Aaron Senne v. Kansas City Royals Baseball
934 F.3d 918 (2019)
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Rule of Law:
In a wage-and-hour class action brought in a California federal court, California's choice-of-law rules generally require applying the law of the state where the work was performed. Plaintiffs may use representative evidence to establish predominance for class certification where employers failed to keep adequate time records.
Facts:
- Minor league baseball players sign a standard, seven-year Uniform Player Contract (UPC) with one of the thirty Major League Baseball (MLB) franchise teams.
- The UPC obligates players to perform services year-round but states they are only paid a fixed monthly salary during the "championship season," which runs from April through September.
- Each year beginning in March, players are required to participate in mandatory spring training in either Arizona or Florida, for which virtually all are unpaid.
- Following spring training, some players are assigned to minor league affiliates, such as teams in the California League which plays games exclusively within California.
- Players not assigned to an affiliate team remain in Arizona or Florida for "extended spring training," for which most are unpaid.
- After the championship season, some players participate in "instructional leagues" in Arizona or Florida, also without pay.
- During the paid championship season, players allege they routinely work overtime hours for which they are not compensated, as they are paid a fixed salary regardless of hours worked.
- The defendant MLB teams did not keep records of the total hours worked by the minor league players.
Procedural Posture:
- Forty-five minor league players sued MLB, its Commissioner, and numerous MLB franchises in the U.S. District Court for the Northern District of California for federal and state wage-and-hour violations.
- The district court initially certified a Fair Labor Standards Act (FLSA) collective action.
- Defendants moved to decertify the FLSA collective, while Plaintiffs moved to certify state law classes under Federal Rule of Civil Procedure 23.
- The district court granted defendants' motion to decertify the FLSA collective and denied plaintiffs' motion for class certification, citing choice-of-law issues and overwhelming individualized inquiries.
- Plaintiffs moved for reconsideration, narrowing their proposed classes to an Arizona class, a Florida class, a California class, and a reworked FLSA collective.
- On reconsideration, the district court certified the California class and the FLSA collective but denied certification for the Arizona and Florida classes, again based on choice-of-law concerns.
- Plaintiffs appealed the denial of certification for the Arizona and Florida classes, and Defendants cross-appealed the certification of the California class and the FLSA collective to the U.S. Court of Appeals for the Ninth Circuit.
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Issue:
Do choice-of-law considerations defeat the predominance requirement for certifying state-law wage-and-hour classes of non-resident minor league baseball players who work for out-of-state teams, where the work is performed entirely within a single state?
Opinions:
Majority - Paez, J.
No. Choice-of-law considerations do not defeat predominance because, under California's governmental interest test, the law of the state where the work is performed should apply to the wage claims. The court determined that each state ordinarily has the predominant interest in regulating conduct that occurs within its borders. Applying this principle, the wage and hour laws of California, Arizona, and Florida should govern the work performed within those respective states, regardless of the players' or teams' states of residence. This approach avoids an 'administrative nightmare' and aligns with the principles of federalism discussed in Sullivan v. Oracle Corp. Furthermore, the court held that plaintiffs could satisfy the predominance requirement by using representative evidence, as permitted by Tyson Foods, Inc. v. Bouaphakeo, to fill the evidentiary gap created by the defendants' failure to keep proper time records. The combination of uniform pay policies, team schedules, expert surveys, and the 'continuous workday' rule allows for common proof of liability, making class treatment appropriate.
Dissenting - Ikuta, J.
Yes. Choice-of-law considerations defeat predominance because the majority's simplistic 'law of the place of work' rule contradicts California's complex, multi-factor governmental interest analysis. The majority's approach is a revival of the outdated and rejected 'law of the place of the wrong' doctrine. A proper application of California's choice-of-law test requires a careful, individualized analysis of the interests of all affected jurisdictions, including the players' home states, the teams' home states, and New York (designated in the players' contracts). Many of these states have asserted an interest in applying their own wage laws extraterritorially, creating true conflicts that the majority ignores. The sheer number of jurisdictions and player-specific facts makes a class-wide resolution impossible, meaning individual issues overwhelm common ones, thus precluding class certification.
Analysis:
This decision establishes a strong, though contested, presumption in the Ninth Circuit that the law of the situs of work governs wage-and-hour claims in class actions filed under California's choice-of-law regime. This simplifies the certification process for multi-state class actions by minimizing complex, individualized choice-of-law inquiries that often defeat predominance. The opinion also reinforces the significance of Tyson Foods, affirming that plaintiffs can rely on statistical and representative evidence to establish class-wide liability when an employer's failure to keep records makes individual proof impossible. The sharp dissent, however, highlights that this bright-line rule may conflict with the nuanced, multi-factor 'governmental interest' analysis required by California law, setting the stage for future challenges in this area.
