Lola v. Skadden, Arps, Slate, Meagher & Flom LLP
620 F. App'x 37 (2015)
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Rule of Law:
An attorney performing document review is not necessarily "engaged in the practice of law" under the Fair Labor Standards Act's professional exemption if the work is so mechanical and devoid of independent legal judgment that it does not require a lawyer's professional skills. The definition of "practice of law" for this purpose is determined by the law of the state with the greatest interest in the litigation.
Facts:
- David Lola, an attorney licensed in California, was hired by Tower Legal Staffing to work for the law firm Skadden, Arps, Slate, Meagher & Flom LLP.
- Beginning in April 2012, Lola worked for 15 months in North Carolina on a document review project for a litigation pending in Ohio.
- Lola's assigned tasks consisted of reviewing documents for pre-determined search terms, coding those documents into pre-determined categories, and redacting information based on specific protocols provided by Skadden.
- He alleged that his work was closely supervised by Skadden attorneys and did not require him to exercise any legal judgment.
- Lola worked approximately 45 to 55 hours per week.
- He was paid a flat rate of $25 per hour for all hours worked, including those over 40 per week, and did not receive overtime pay.
Procedural Posture:
- David Lola filed a putative collective action against Skadden and Tower Legal Staffing in the U.S. District Court for the Southern District of New York.
- Lola claimed violations of the Fair Labor Standards Act's (FLSA) overtime provision.
- The defendants filed a motion to dismiss the complaint for failure to state a claim, arguing Lola was an exempt professional engaged in the practice of law.
- The district court granted the motion to dismiss, finding that Lola's document review constituted the practice of law under North Carolina law.
- Lola, as appellant, appealed the district court's dismissal to the U.S. Court of Appeals for the Second Circuit.
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Issue:
Does a licensed attorney performing document review that allegedly requires no independent legal judgment qualify as being 'engaged in the practice of law' and is therefore exempt from the Fair Labor Standards Act's overtime pay requirements?
Opinions:
Majority - Pooler, Circuit Judge
No, a licensed attorney performing document review that requires no independent legal judgment is not 'engaged in the practice of law' and is therefore not exempt from the FLSA's overtime provisions. The court determined that the definition of 'practice of law' under the FLSA is a matter of state, not federal, law. Applying choice-of-law principles, the court found that North Carolina, where Lola lived and worked, had the greatest interest in the litigation. Under North Carolina law, the exercise of at least a modicum of independent legal judgment is an essential element of the practice of law. Because Lola's complaint alleged that his document review tasks were so mechanical and constrained by rigid protocols that he exercised no legal judgment whatsoever, he stated a plausible claim that he was not practicing law. The court reasoned that if the tasks could be performed by a machine, they could not be considered the practice of law.
Analysis:
This decision significantly impacted the legal staffing industry and the classification of contract attorneys. It established that merely holding a law license and performing tasks labeled 'document review' does not automatically exempt an attorney from federal overtime protections. The court's focus on the actual substance of the work—whether it involves professional legal judgment—over the employee's title or qualifications created a more fact-intensive inquiry for determining exemption status. This ruling opened the door for numerous similar lawsuits by contract attorneys who perform routine, algorithmic review, forcing employers to re-evaluate their pay practices for such roles.
