Cruz-Alvarez & Stamps Todd: Inadequate Counsel Justified Class Decertification, Second Circuit Rules

Decertification of a class is rare. Rarer still is decertification because class counsel no longer adequately represented the class. But a district court sua sponte decertifying a class on that basis is unheard of. Yet the Eastern District of New York did just that, and the Second Circuit affirmed the decertification in its recent Jin v. Shanghai Original, Inc., et al. opinion.

The case began when the named plaintiff filed a putative class action on behalf of himself and other non-managerial employees at a New York restaurant based on alleged violations of their rights under the New York Labor Law and Fair Labor Standards Act. Finding the proposed class satisfied Rule 23(a) and Rule 23(b)(3), the district court certified the class, noting “[t]he crux of the plaintiffs’ claims is susceptible to classwide proof: did the [Defendants] have a policy or practice of paying employees flat rates regardless of minimum wage, overtime, and spread-of-hour requirements?” At the same time, the district court appointed John Troy and Troy Law, PLLC as class counsel based on their “extensive experience litigating employment law cases in this district, including class actions” and their actions taken in the case through the discovery process to that point.