Written by The Business Journal Staff
While the firm is known for assisting plaintiffs in wrongful termination, sexual harassment, and other employment-related cases, including class-action suits, Artenian said it’s uncommon for a class-action suit to be certified, let alone make it to trial, as parties typically reach a settlement agreement.
The case is the second of its kind the firm has won in the last 13 months — a rarity, according to attorney Larry Artenian, who served as lead counsel during the Wal-Mart case.
“Recently, for whatever reason, big corporate defendants have decided its not a good idea to settle, so although these cases rarely go to trial, we’ve had two go to trial in the last 12 to 13 months,” Artenian said. “Prior to that, I’ve been to seminars the last five or six years about class actions and we haven’t even found a judge who has had two wage-and-hour class-action cases go to trial in their career.”
The first case, Cortina v North American Title Co., went to trial in Fresno County Superior Court in 2015. In this case, the firm represented about 700 escrow officers employed by North American Title Co. Half the employees were classified as exempt from overtime when plaintiffs argued they should have been eligible, while another portion of the group were classified as eligible but were allegedly not paid for their overtime. Judge Jeff Hamilton ultimately ruled in favor of the first group, while he found the second group of plaintiffs too varied to make a ruling for them as a whole in a class action.
Artenian said the court has yet to release a dollar figure with its verdict for the first group in the North American Title Co. case, but one of the firm’s expert witnesses has made a ballpark estimate between $20 and $30 million, making it the largest case the firm had won up until the Wal-Mart trial, which was held in November.
The firm has been working on the Wal-Mart case since 2008, so getting the case to trial was a major feat.
“Wal-Mart is the biggest private employer in the United States,” Artenian said. “I think they are No. 1 or No. 2 on the Fortune 500, so when you sue them, which you can predict — but we’ve certainly learned — they have endless resources at their disposal. So, we’ve been up against two huge law firms: Gibson, Dunn and Crutcher, and Scopelitis, Garvin, Light, Hanson and Feary. On our side, we had this little group of people here in Fresno and then one attorney, Stan Saltzman, from an office in Southern California, Marlin and Saltzman.”
By the time the trial started on Halloween at a U.S. District Court in San Francisco, the presiding judge had commented that it was the oldest case on her docket.
The case involved approximately 840 truck drivers over an 11-year period. The drivers argued they had not been paid for various tasks performed as part of their job duties. While Artenian said it wasn’t a true minimum wage case, it was handled as such, as the law states if you were paid zero for something, then what you are entitled to if you win a lawsuit is minimum wage.
“The $54 million figure was calculated at whatever the minimum wage was at the time people did the work, and it was a complicated calculation for experts since they had to go into company records and look at what period of time each individual worked, and the minimum wage rate changed several times over the 11 years,” Artenian said.
Though the $54 million verdict is monumental in and of itself, statutory penalties could be added to the amount, bringing the judgment up to as much as $140 million.
In all, Artenian said his firm filed paperwork Dec. 14 asking the court to assess three statutory penalties and damages.
The first, and most likely to be added to the sum, according to Artenian, is a penalty for intentional failure to pay minimum wage. The jury, Artenian said, found that Wal-Mart did intentionally fail to pay the truck drivers. With the finding, the court can impose a $100 penalty for the first pay period of intentional failure to pay and $250 for each subsequent violation (or pay period). The jury calculated over 103,000 pay periods that Wal-Mart was in violation, which would work out to an additional $25 million in penalties against Wal-Mart.
The second item the firm has asked for on behalf of the drivers is liquidated damages. Liquidated damages are difficult to assess, Artenian said, because you can’t quantify the experiences and things in life an individual had to miss out on due to not receiving the proper pay back when it was owed.
Assessing the impact for more than 800 people is even more difficult, but the liquidated damages provision under the California statute states the court can assess them at an amount equal to the amount of the minimum wage damages. In essence, the court could double the amount of the judgment, giving another $54 million to the plaintiffs.
The firm also asked the court to consider adding damages dealing with unfair business practices and competition for the first year, 2004-2005, of the case. The value of those damages is just under $6 million.
Over the next few weeks, Artenian said Wal-Mart’s lawyers will have time to file briefs and opposition to these damages, and sometime toward the end of January 2017, there will be a hearing where the court will decide whether damages can be added and how much. After that phase, another statute states Wal-Mart has to pay the prevailing attorneys’ fees.
“Unlike a lot of class-action suits where a company did false advertising and everyone affected gets $5, there are drivers in this group who stand to get $100,000 or more,” Artenian said. “If it were to come out to $140 million, with 800 and some odd people, that averages to $175,000 to $180,000 a person potentially. Of course, I don’t want to be inaccurate because all we have right now is $54 million, but that is the best-case scenario…I would be shocked if the court does not add something.”
After the final amount is tallied, Artenian expects a lengthy appeals process and there is a possibility of settlement prior to coming before an appellate court.
With an end in sight, however, Artenian said the case is certainly something he hasn’t seen before: “We haven’t investigated it or anything, but it’s the biggest verdict by a Fresno law firm we’ve ever heard of.”
“We have been creeping up toward this as our class actions have gotten bigger and bigger,” Artenian said. “The one we just finished last year in Fresno County, if that does come out to $20-$30 million, that would be the biggest one we’ve ever had. We’ve settled a bunch between $10-$16 million and some of those cases have been potentially as big as the one last year, but we hadn’t seen anything in the range of this Wal-Mart case at all.
“What does it mean for us? I don’t know. We have a bunch of class-action cases we’re handling now and more on behalf of truck drivers, but these cases take a really long time. Five years is not unusual and this Wal-Mart case has been eight. You don’t get paid anything while you’re working and you spent a lot of your own money on expert witnesses and more. You have to have a certain stomach for it…you have to believe there is a lot of merit to the case. That is one reason I believe we’ve been successful.”
While Artenian served as lead counsel in the Wal-Mart case, the firm’s attorneys Dan Kopfman, Butch Wagner, Angela Martinez, Andy Jones and Russ Myrick, along with Stan Saltzman of Marlin and Saltzman, also worked diligently on the case. In the North American Title Company case, Wagner, Jones, Kopfman and Artenian served as the lead firm, but had assistance from two other local firms: Wanger, Jones and Helsley, and Cornwell and Sample.