California appeals court denies class action status in U.S. Bank National Association lawsuit

By Chandra Lye | Feb 15, 2018

SAN FRANCISCO – A California Court of Appeal denied a class action certification in a lawsuit against the U.S. Bank National Association on Jan. 17.

SAN FRANCISCO – A California Court of Appeal denied a class action certification in a lawsuit against the U.S. Bank National Association on Jan. 17.

The complaint was brought forward by two previous employees, Samuel Duran and Matt Fitzsimmons. The plaintiffs were disputing wages for their positions with the organization.

“This case is a wage and hour class action challenging whether defendant U.S. Bank National Association (Bank) had properly classified its business banking officers (BBOs) as exempt employees under the outside salesperson exemption,” the appeals court decision stated. “This exemption applies to employees who spend more than 50 percent of their workday engaged in sales activities outside their employer’s place of business.”

The plaintiffs claimed the bank classified them incorrectly. They said that they spent most of their time inside the bank office rather than outside, which is what the bank claimed.

A trial court had previously denied the class action status as well, in May 2016.

“In spite of the voluminous evidence submitted by both parties, the court found '[t]he only new material of any importance lies in the disputes between Krosnick and Hildreth.' The court determined the certification issue based on its resolution of those disputes,” according to the court's decision.

Part of the issue that came up at the trial were survey results that the plaintiffs presented to try and prove their case.

“As statistical evidence, they proposed using representative testimony with sample sizes ranging from 15 to 50 BBOs, having associated respective margins of error ranging from 11 percent to 5.53 percent,” the appeals court decision stated.

“The bank also included a declaration prepared by its expert, Andrew Hildreth, which criticized the 2015 survey and its methodology. In brief, Hildreth concluded the survey suffered from self-selection bias, as well as serious measurement and estimation errors.”

In February 2015 the trial court denied the bank’s application to halt the survey and prevent the plaintiff from communicating with other potential class members.

“The court found plaintiffs had a right to conduct the survey in order to support their opposition to the bank’s motion.”

In June of that year, the plaintiffs were ordered to provide the Bank with the identities of those involved in the survey.

“The court also ordered plaintiffs to produce the identities of those respondents to an earlier Krosnick survey (2008 survey) who had also responded to the 2015 survey, together with the 2008 survey responses of those respondents.”

Regardless, the trial court found that the 2015 survey information had no value.

“The court determined plaintiffs could not rely on the survey instrument in establishing a prima facie case,” the appeals court decision stated.

Based largely on Hildreth’s analysis, the court found there were errors with the survey results, which defeated the class action certification claim.

“In its order, the court concluded plaintiffs had failed to carry their burden of showing that common questions predominated,” the appeals decision read.

“The court concluded that, apart from shoring up plaintiffs’ trial plan, their statistical evidence 'continues to fall short of the kind of showing of uniformity that the Duran (v. U.S. Bank National Assn.) court found necessary.'”

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