SECOND CIRCUIT RULES IN FAVOR OF APPLEBEE’S RESTAURANT WORKERS IN WAGE-AND-HOUR SUIT

In 2010, workers at Applebee’s restaurants located in New York sued franchisee owner, T.L Cannon Corp. (“Cannon”), for alleged violations of the Fair Labor Standards Act and New York Labor Law. Specifically, Plaintiffs claimed that Cannon failed to pay hourly employees an extra hour of pay when working a ten-hour workday pursuant to state regulations and also required managers to subtract pay for rest breaks they did not actually take. Plaintiffs moved for class certification on both claims. The district court, relying upon a misreading of the Supreme Court case, Comcast Corp. v. Behrend, found that since damages were not measurable on a class-wide basis, Plaintiffs motion for class certification must be denied. The district court construed Comcast as holding that the failure to offer a damages model that is susceptible of measurement across the entire class is fatal to the class certification question.

Plaintiffs appealed the lower court’s decision. Yesterday, the United States Court of Appeals for the Second Circuit vacated and remanded the order of the district court. The Second Circuit found that the lower court misinterpreted the Comcast decision when it denied class certification to Plaintiffs solely based on the damages issue and ruled that individualized damages determinations alone cannot preclude class certification. The case will now return to the district court, which will decide whether to certify the class based on the proper standards.

The case is titled Roach v. T.L. Cannon Corp., and the full decision can be read here.

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