The District of Columbia district court added to the growing collection of orders opining on whether and to what extent the Supreme Court’s decision in Bristol-Myers Squibb applies to class actions. This case involved a putative class of employees suing Whole Foods in an attempt to recover wages pursuant to the upscale grocer’s “Gainsharing” bonus program. The program seeks to incentivize departments in individual stores to perform under budget by distributing budget surpluses to department employees. The lawsuit alleges Whole Foods improperly “shifted” budget surpluses to underperforming departments so it could withhold Gainsharing wages owed to employees.
On a motion to dismiss, Whole Foods challenged the court’s exercise of personal jurisdiction based on Bristol-Myers, where the Supreme Court held that a California state court could not exercise jurisdiction over non-resident plaintiffs’ claims in a mass tort action.
First, the District of Columbia district court held that Bristol-Myers barred it from hearing claims by two specific putative class representatives — a Maryland resident who worked at a Virginia store, and an Oklahoma resident who worked at an Oklahoma store — because those plaintiffs failed to allege any claims-related connection to D.C. In contrast, the other named plaintiffs’ claims arose from conduct within the forum because they either lived in D.C. or worked at Whole Foods in the District. The court followed recent D.C. Circuit precedent to hold that the Fifth Amendment imposes the same restrictions on specific jurisdiction in federal courts as Bristol-Myers held the Fourteenth Amendment imposes on jurisdiction in state courts (a question the Supreme Court had left unanswered) and dismissed those two class representatives.
Second, however, the court held that Bristol-Myers does not require the dismissal of non-resident putative class members’ claims for lack of personal jurisdiction because, even though those individuals may not have a claims-related connection to the forum, Bristol-Myers’s jurisdictional holding “does not apply to class actions.”
The line between the court’s dual holdings is nuanced; on one hand it applied Bristol-Myers’s jurisdictional principles but on the other it distinguished Bristol-Myers as inapplicable in class actions. The former is explained by the parallel between the two named class representatives in Molock and the non-resident plaintiffs in the mass action at issue in Bristol-Myers. Class action or not, the Maryland and Oklahoma class representatives were named plaintiffs in a lawsuit over which the court must have personal jurisdiction. The latter is explained by the fact that Bristol-Myers’ jurisdictional holdings regarding non-resident plaintiffs who were real parties in interest in a mass action are not procedurally equivalent to the posture of unnamed putative class members in class actions. Class actions, unlike mass torts, function as representative suits with class representatives representing the interests of similarly situated individuals (who may later become unnamed plaintiffs pending certification) and putative class actions must satisfy added due process requirements via certification.