Stephanie Heredia v. Eddie Bauer LLC

Background

Stephanie Heredia brought a wage-and-hour class action against Eddie Bauer LLC. She alleged that Eddie Bauer required hourly retail employees to undergo inspections of their bags or other personal belongings when leaving its stores, including for breaks and at the end of shifts, and that employees were not paid for time spent on those inspections. Heredia worked as a sales associate at Eddie Bauer’s Gilroy, California store from November 2013 to March 2016.

The court had previously certified a class consisting of all current and former non-exempt Eddie Bauer retail-store employees employed in California from September 28, 2012, through the present. The written inspection policy applied to retail employees carrying bags or containers that could conceal merchandise, but the policy did not say whether inspections should occur before or after employees clocked out.

Motions and developed record

The court considered three principal motions: Eddie Bauer’s motion for summary judgment against the certified class, Eddie Bauer’s motion to decertify the class, and Heredia’s motion to modify the class definition. After class certification, the parties developed additional evidence about how inspections occurred in practice. An Eddie Bauer expert’s study observed exits at seven California stores. Of 137 fully observed exits, 80.3 percent were on the clock and 19.7 percent were off the clock. A stipulated sample of employee depositions led the expert to conclude that 54.2 percent of exit inspections occurred on the clock.

The evidence also varied by employee and store. Some employees testified that inspections generally or always occurred while they were clocked in, while others testified that inspections occurred off the clock. The court noted that Heredia did not dispute the expert’s analysis and conceded that the class, as originally certified, could not proceed on the current record. She instead sought to shorten the class period to end on December 31, 2016.

Decertification

The court granted Eddie Bauer’s motion for decertification. Under Federal Rule of Civil Procedure 23, a certified class must satisfy requirements including common questions that predominate over individual issues. The court explained that its earlier certification had relied on the premise that employees were subject to a uniform security-inspection policy. The later evidence no longer supported that premise.

The court found that the written policy was silent about whether inspections had to occur on or off the clock and that employees’ actual experiences varied. Because some employees were inspected on the clock and others off the clock, the court concluded that the class was not ascertainable—that is, it could not be identified using objective criteria without individualized inquiries. The court also found that determining whether employees experienced uncompensated inspection time would require asking about each employee’s circumstances. It concluded that the case would require numerous individual factual determinations rather than a common answer for the class.

The court further relied on conflicting evidence about inspection practices across the class period. It rejected Heredia’s comparisons to other bag-check cases because those cases involved written policies requiring off-the-clock inspections or evidence that most or all employees experienced such inspections. The court stated that the current record instead showed that most Eddie Bauer inspections occurred on the clock.

Other rulings related to decertification

The court terminated as moot Heredia’s motion to strike evidence submitted with Eddie Bauer’s reply because the court had not considered or relied on that evidence. The court granted Heredia’s request for judicial notice of two publicly available court documents.

Because the class was decertified, the court terminated Eddie Bauer’s motion for summary judgment against the certified class as moot. The court did not decide Eddie Bauer’s arguments about whether the alleged off-the-clock time was compensable under California law.

Motion to modify the class definition

The court denied Heredia’s motion to modify the class definition. Heredia proposed ending the class period on December 31, 2016, based on an allegation that Eddie Bauer changed its inspection practices around the beginning of 2017. The court did not decide whether that alleged change actually occurred. Instead, it held that even the proposed pre-2017 class had the same basic problem: inspection practices were not uniform.

The court observed that some employees who worked before 2017 reported on-the-clock inspections or no inspections, while others reported off-the-clock inspections. It concluded that the differences were too significant to allow the narrowed class to proceed. The court also agreed that modifying the class so close to trial would prejudice Eddie Bauer because the company had conducted discovery and filed its summary-judgment motion based on the broader certified class. The court therefore denied the requested modification.

Disposition

The court granted Eddie Bauer’s motion for decertification; terminated Eddie Bauer’s motion for summary judgment against the certified class as moot; denied Heredia’s motion to modify the class definition; terminated Heredia’s motion to strike reply evidence as moot; and granted Heredia’s request for judicial notice.