Nucci v. Rite Aid Corporation

Background

Kristal Nucci, Ana Goswick, and Kelly Shaw brought a proposed class action against Rite Aid Corporation and Thrifty Payless, Inc. They alleged that Rite Aid required non-exempt employees in California stores to purchase their own work clothing without reimbursement. The complaint asserted claims involving business-expense reimbursement, uniforms, minimum wages, wage statements, waiting-time penalties, restitution under California’s Unfair Competition Law, public injunctive relief, and California’s Private Attorneys General Act.

Rite Aid’s written dress standards required employees to wear navy-blue tops and khaki bottoms, described as “Team Colors.” The policy also said Rite Aid would provide blue vests as an alternative for employees unable to meet the color requirement. The plaintiffs argued that the vest alternative was not meaningfully available. They relied on a survey showing that at least 337 of 471 responding California stores had no blue vests, along with an expert report based on a survey of 49 employees. Rite Aid disputed the surveys’ reliability and submitted evidence that some managers allowed variations from the written dress standards.

The proposed class included approximately 26,232 non-exempt employees, excluding pharmacists, pharmacy interns, and asset protection agents, who worked in any Rite Aid store in California from March 13, 2015 through the trial date.

Motion to Strike

Rite Aid moved to strike the report of Dr. Jeffery S. Peterson and the underlying survey under Federal Rule of Evidence 702 and the standards governing expert evidence. Rite Aid argued that the survey was unreliable, had too few responses, was not properly randomized, and was affected by nonresponses and possible bias.

The court denied the motion to strike. First, it found that Rite Aid had not followed a local rule requiring evidentiary and procedural objections to be included in the relevant brief. The court also considered the arguments on their merits and concluded that the alleged flaws generally affected the survey’s weight—the importance the factfinder should give the evidence—rather than its admissibility. The court found that the survey had been conducted according to accepted principles and that Rite Aid had not shown that Dr. Peterson’s report should be excluded.

Class Certification Standard

Class certification is the decision to allow claims involving many people to proceed together through named representatives. Under Rule 23(a), the plaintiffs had to show numerosity, commonality, typicality, and adequate representation. Under Rule 23(b)(3), they also had to show that common questions predominated over individual ones and that a class action was superior to other methods of resolving the dispute.

The court emphasized that certification required an evidentiary showing, but that the certification stage was not a full trial on the merits. The court could consider merits-related questions only to the extent they were relevant to the Rule 23 requirements.

Rule 23 Requirements

The court found numerosity because the proposed class contained approximately 26,000 members, and Rite Aid did not dispute that requirement.

The court found commonality because common evidence could address two central questions: whether Rite Aid required employees to purchase clothing as a condition of employment and whether the Team Colors clothing qualified as a uniform under California law. For the claims under California Labor Code section 2802 and Wage Order No. 7-2001, the court identified three relevant issues: whether the clothing was required by the employer, whether it had a distinctive design or color, and whether it was usual and generally usable in the occupation.

The court found that Rite Aid’s written policies, the blue-vest survey, and Dr. Peterson’s survey provided evidence of a common policy or practice. The court concluded that the variations described by Rite Aid’s managers—such as occasionally allowing different colors, jeans, or other clothing—were minor variations that did not defeat commonality.

The court also found predominance. It concluded that the common questions went directly to liability because resolving them could determine whether the clothing was required, distinctive, and not generally usable in the occupation. The court rejected Rite Aid’s arguments that individual managers’ enforcement choices, individual wages, damages calculations, or the absence of a formal trial plan defeated predominance. It explained that Rule 23 did not require a trial plan at the certification stage and that the need for individual damages calculations did not necessarily prevent class treatment.

The court found typicality because the named plaintiffs alleged that they were subjected to the same Team Colors policy and were required to wear and purchase navy-blue tops and khaki bottoms. The court found adequacy because the plaintiffs and their counsel had no serious, irreconcilable conflict with the class and because Rite Aid offered no evidence that Goswick or class counsel had violated ethical rules through solicitation.

Finally, the court found superiority. It reasoned that individual damages were likely not large enough to make separate lawsuits efficient, that it was unaware of other related actions against Rite Aid, that California was an appropriate forum for California-law claims involving California employees, and that the case could be managed using common evidence.

Disposition

The court denied Defendants’ motion to strike and granted Plaintiffs’ motion for class certification. It certified this Rule 23(b)(3) class: all non-exempt employees, excluding pharmacists, pharmacy interns, and asset protection agents, working in any Rite Aid store in California at any time from March 13, 2015 through the trial date. The opinion decided whether the case could proceed as a class action; it did not decide the ultimate liability of Rite Aid or the amount of any recovery.