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Door Shuts On Duane Reade's Decertification Bid In OT Suit

Law360—Suevon Lee

A New York federal judge Thursday stood firm by his class certification ruling on behalf of Duane Reade Inc. assistant store managers who claim they were shorted of overtime pay, denying the pharmacy chain's bid for decertification at discovery's end.

No new evidence has come to light that convinces him a predominant common question does not exist as to whether the assistant store managers were misclassified as "exempt" workers from New York's overtime requirements, U.S. District Judge K. Paul Oetken wrote in his 20-page ruling denying decertification.

The judge had certified a class of at least 750 assistant store managers under New York labor law in March 2013, only partially decertifying that class on the damages issue five months afterwards. The judge in January 2012 also conditionally certified a collection action under the Fair Labor Standards Act, with more than 250 plaintiffs having opted in since.

With discovery in the 2011 action completed, the Walgreens Co. subsidiary argued, unsuccessfully, that there were "fundamental differences" evident among the individual class members' store management duties that demanded the class be decertified.

"Duane Reade's second bite at the apple [fares] no better than its first," Judge Oetken said. "The [assistant store managers] at Duane Reade remain similarly situated, such that there are common questions as to whether they were misclassified as exempt. While there are individualized issues in this case — it has already been decertified as to damages — they are overwhelmed by the plaintiffs' common questions."

Based on "rigorous review of the deposition testimony" and the pharmacy chain's own corporate practices, the judge said the common question still predominates. He lent little weight to Duane Reade's new submissions of employee self-evaluations indicating varying levels of managerial duties and a U.S. Department of Labor audit of one store in which the assistant manager purportedly had as much management responsibility as the store manager.

The judge wrote, "a review of the record since the 2013 decision has reinforced the court's prior conclusion as to the similarity of class members. By the same token, this review of the record reinforces the court's conclusion that the common questions overwhelm individualized differences as to class members."

Adam Klein, an attorney with Outten & Golden LLP who is representing the plaintiffs, appeared satisfied with Thursday's denial of decertification.

"We are delighted with the decision and look forward to proving our case at trial for the collective and class," Klein told Law360 on Thursday.

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In February 2015, the Second Circuit affirmed the class certification decision.

The plaintiffs are represented by Adam T. Klein, Justin Mitchell Swartz, Lewis M. Steel, Michael Joseph Scimone, Molly Anne Brooks, Paul W. Mollica, Rachel Megan Bien and Sally Jasmine Abrahamson of Outten & Golden LLP, Dana Lauren Gottlieb and Jeffrey Michael Gottlieb of Gottlieb & Associates and Seth Richard Lesser and Rachel Aghassi of Klafter Olsen & Lesser LLP.

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The case is Mani Jacob et al. v. Duane Reade Inc. et al., case number 1:11-cv-00160, in the U.S. District Court for the Southern District of New York.