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Molock v. Whole Foods Market Group, Inc.

United States District Court, District of Columbia

June 11, 2018

MICHAEL MOLOCK, et al., Plaintiffs,



         This putative class action arises from a controversy surrounding a profit-sharing plan implemented by Defendant Whole Foods Market Group, Inc. (“WFMG”), known as the “Gainsharing program, ” which awarded bonuses to Whole Foods store employees whose departments came in under budget. Pls.' Second Am. Compl., ECF No. 28, ¶ 15. Plaintiffs, who are current and former employees of WFMG, allege that WFMG abused the Gainsharing program on a nationwide scale by “shifting labor costs” to store departments that were underperforming, thus reducing or negating the bonuses that would have been owed to employees in an over-performing department. Id. ¶ 18. Plaintiffs' claims arise solely under District of Columbia or state law.

         On March 15, 2018, this court granted in part and denied in part Defendant's Motion to Dismiss Plaintiffs' Second Amended Class Action Complaint. See Mem. Op. & Order, ECF No. 34. As relevant to the instant motion, the court rejected Defendant's assertion that the Supreme Court's recent decision in Bristol-Myers Squibb Co. v. Superior Court of California, 137 S.Ct. 1773 (2017), required dismissal of the claims of unnamed putative class members who reside outside of the District of Columbia for lack of personal jurisdiction. In Bristol-Myers Squibb, the Supreme Court held, in the context of a mass tort action, that the Due Process Clause of the Fourteenth Amendment did not permit a California state court to exercise specific jurisdiction over the tort claims of nonresident plaintiffs. See Id. at 1781-82. WFMG now urges this court to certify its March 15, 2018 order for interlocutory appeal under 28 U.S.C. § 1292(b) to allow the D.C. Circuit to weigh in on whether the jurisdictional limits proscribed in Bristol-Myers Squibb extend to unnamed, nonresident members of a putative nationwide class in federal court. See Def.'s Mot. to Certify for Interlocutory Appeal, ECF No. 37; Def.'s Mem. in Supp., ECF No. 37-1 [hereinafter Def.'s Mem.]. Plaintiffs oppose certification. See Pls.' Mem. in Opp'n, ECF No. 38 [hereinafter Pls.' Mem.].

         For the reasons discussed below, the court finds that “[a]n immediate appeal would conserve judicial resources and spare the parties from possibly needless expense if it should turn out that this Court's ruling[ ] [is] reversed.” APCC Servs., Inc. v. Sprint Commc'ns Co., 297 F.Supp.2d 90, 100 (D.D.C. 2003). Accordingly, Defendant's motion to certify is granted.


         Under 28 U.S.C. § 1292(b), the certification of an order for interlocutory appeal is appropriate when “(1) the order involves a controlling question of law; (2) a substantial ground for difference of opinion concerning the ruling exists; and (3) an immediate appeal would materially advance the litigation.” APCC Servs., 297 F.Supp.2d at 95. The party seeking interlocutory review “bears the burden of showing that exceptional circumstances justify a departure from the basic policy of postponing appellate review until after the entry of final judgement.” Virtual Def. & Dev. Int'l Inc. v. Republic of Moldova, 133 F.Supp.2d 9, 22 (D.D.C. 2001) (internal quotation marks omitted). Given the “strong congressional policy against piecemeal reviews, and against obstructing or impeding an ongoing judicial proceeding by interlocutory appeals, ” certification is only appropriate in the court's discretion and upon satisfaction of the elements of section 1292(b). Judicial Watch, Inc. v. Nat'l Energy Policy Dev. Grp., 233 F.Supp.2d 16, 20 (D.D.C. 2002) (quoting United States v. Nixon, 418 U.S. 683, 690 (1974)). The issue WFMG seeks to certify satisfies all three elements.


         As to the first element-whether the order involves a “controlling question of law”-there is no genuine dispute. See 28 U.S.C. § 1292(b). Indeed, Plaintiffs offer no argument to the contrary. See Pls.' Mem. at 5-12. A controlling question of law is “one that would require reversal if decided incorrectly or that could materially affect the course of litigation with resulting savings of the court's or the parties' resources.” Judicial Watch, 233 F.Supp.2d at 19 (quoting In re Vitamins Antitrust Litigation, Civ. A. No. 99-197, 2000 WL 673936, at *2 (D.D.C. Jan. 27, 2000). “The resolution of an issue need not necessarily terminate an action in order to be controlling, but instead may involve a procedural determination that may significantly impact the action.” APCC Servs., 297 F.Supp. 2d. at 96 (internal quotations and citation omitted).

         Here, whether Bristol-Myers Squibb applies to claims of unnamed, nationwide putative class members in a federal court is a threshold jurisdictional question. If this court's decision is correct, the court may exercise specific jurisdiction over the claims of thousands of unnamed, nonresident putative class members. On the other hand, if the court is wrong and it lacks specific jurisdiction over such claims, this court could not entertain a nationwide class action and the most Plaintiffs could seek to certify is a District of Columbia class. The difference in scope of these two scenarios need not be belabored. Quite obviously, a nationwide class action would place far greater demands on this court and Defendant than would a case that goes forward with only a geographically limited class. For that reason, the order from which Defendant seeks interlocutory review involves a “controlling question of law.”


         The court also is satisfied that the second element-that there exist a substantial ground for difference of opinion-is present in this case. “A substantial ground for difference of opinion is often established by a dearth of precedent within the controlling jurisdiction and conflicting decisions in other circuits.” APCC Servs., 297 F.Supp.2d at 97. It is not necessarily enough, however, that there are conflicting decisions in other circuits. Instead, a court “must analyze the strength of the arguments in opposition to the challenged ruling to decide whether the issue is truly one on which there is a substantial ground for dispute.” Id. at 98.

         There is no controlling or persuasive precedent in this jurisdiction, and no circuit authority elsewhere, that addresses Bristol-Myers Squibb's application to nationwide class actions in federal courts. There are only district court cases, and among them there is a near even split on the question. Defendant points to nine cases that it characterizes as having reached a different conclusion than this court did. Def.'s Mem. at 6-7 & n.3; Def.'s Ltr. Br., ECF No. 41, at 1-2; see, e.g., McDonnell v. Nature's Way Prods., LLC, No. 16-C-5011, 2017 WL 4864910, at *4 (N.D. Ill. Oct. 26, 2017) (dismissing nonresident putative class members' claims for lack of a connection to the forum).[1] Plaintiffs, on the other hand, identify nine other cases that have gone the other way and are in agreement with this court. Pls.' Mem. at 7 n.2; see, e.g., Feller v. Transam. Life Ins. Co., No. 2:16-cv-01378, 2017 WL 6496803, at *17 (C.D. Cal. Dec. 11, 2017) (recognizing that “there are important differences between mass tort and class actions for the purposes of personal jurisdiction over defendants” and concluding that Bristol-Myers Squibb's reasoning “does not reach so far as to bar the nonresident unnamed class members”). In light of these numbers, there can be no dispute, as one court has put it, that the question “whether Bristol-Myers extends to class actions is a question that has divided courts across the country.” Chavez v. Church & Dwight Co., No. 17-C-1948, 2018 WL 2238191, at *10 (N.D. Ill. May 16, 2018).[2]

         This court's task is not, however, to “keep score” and determine which side has more decisions in its favor, but instead is to analyze the reasoning in those decisions and the “strength of the arguments in opposition” in order to decide whether there is a substantial ground for dispute. APCC Servs., 295 F.Supp.2d at 98. And here there is. The cases holding that Bristol-Myers Squibb applies to claims of nationwide class members are well-reasoned and do not lack persuasive power. In brief, those courts that have taken an opposing view have highlighted the Supreme Court's holding in Bristol-Myers Squibb that due process requires there be some relationship between the defendant and the plaintiff's claim to the forum state to establish specific jurisdiction. See, e.g., Practice Mgmt. Support Servs., Inc. v. Cirque du Soleil, Inc., No. 14-C-2032, 2018 WL 1255021, at *15-17 (N.D. Ill. Mar. 12, 2018); Greene v. Mizuho Bank, Ltd., 289 F.Supp.3d 870, 873-75 (N.D. Ill. 2017). They also have emphasized the Supreme Court's conclusion that even the presence of similar claims from resident plaintiffs is not enough to satisfy due process. See Id. These jurisdictional limitations, although made in the context of a mass tort action in state court, have obvious parallels to the nationwide class action in federal court. Moreover, some courts have responded to the concern that extending Bristol-Myers Squibb to class actions would gut Rule 23. They have reasoned that Rule 23 cannot grant jurisdiction where the due process clause does not allow it, citing the Supreme Court's statement in Amchem Products, Inc. v. Windsor, 521 U.S. 591, 613 (1997), that “Rule 23's class action requirements must be interpreted in keeping with Article III constraints, and with the Rules Enabling Act, [28 U.S.C. § 2072(b)] which instructs that the federal court rules of procedure shall not abridge, enlarge, or modify any substantive right.” See Practice Mgmt. Support Servs., 2018 WL 1255021, at *16 (alterations and internal quotation marks omitted); see also In re Dental Supplies Antitrust Litigat., No. 16-Civ-696, 2017 WL 4217115, at *9 (E.D.N.Y. Sept. 20, 2017) (“The constitutional requirements of due process do[ ] not wax and wane when the complaint is individual or on behalf of a class. Personal jurisdiction in class actions must comport with due process just the same as any other case.”). These are not insubstantial arguments. And reasonable jurists can, and have, disagreed about them.

         Although this court remains unpersuaded by these contrary interpretations of Bristol-Myers Squibb, it does not find the reasoning employed in those cases to be lacking merit, leading this court to conclude that there is a ‚Äúsubstantial ground for ...

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