Aug 27 A Chicago federal judge on Wednesday said
Groupon Inc sales representatives cannot pursue a
class-action lawsuit over the Internet commerce company's
failure to pay for overtime before and after its 2011 initial
U.S. District Judge Edmond Chang said the roughly 1,500
representatives' claims, job duties and alleged injuries were
too disparate to justify letting them sue as a group over
allegations that Groupon violated Illinois' minimum wage law.
Chang noted that Groupon did eventually adopt more uniform
management policies, and that these could "serve as markers" for
the plaintiffs to pursue a smaller class action.
He gave the plaintiffs until Sept. 23 to propose a narrower
class, or else pursue their claims on an individual basis.
More than 100 Groupon sales representatives are pursuing
related claims under the federal Fair Labor Standards Act.
Douglas Werman, a partner at Werman Salas representing the
plaintiffs, said: "We're disappointed in the court's decision,
and believe it is factually and legally flawed. We are currently
evaluating our options."
Groupon spokesman Bill Roberts said the Chicago-based
company is pleased with the decision.
Class actions can enable plaintiffs to pursue larger
recoveries at lower cost than if they sued individually.
A 2011 U.S. Supreme Court decision involving Wal-Mart Stores
Inc, which Chang cited, made it harder for many
plaintiffs to pursue such cases.
According to Wednesday's decision, the Groupon lawsuit
sought class certification covering the periods Aug. 19, 2008 to
March 19, 2011, and Aug. 23, 2011 to the present, when Groupon
paid no overtime.
The lawsuit also sought certification for the interim
five-month period when Groupon paid overtime, but allegedly less
than it was supposed to pay.
Known for its "daily deals," Groupon has under Chief
Executive Eric Lefkofsky been trying to evolve into an
e-commerce retailer better able to compete with rivals such as
Groupon went public at $20 per share on Nov. 4, 2011, but
have not traded that high since February 2012. The shares on
Wednesday closed up 7 cents at $6.53 on the Nasdaq.
The case is Dailey et al v. Groupon Inc, U.S. District
Court, Northern District of Illinois, No. 11-05685.
(Reporting by Jonathan Stempel in New York; Editing by David