Hyams v. CVS Health Corporation

Background

Defendants CVS Health Corporation, CVS Pharmacy, Inc., Garfield Beach CVS, LLC, and CVS asked the court to stay, or temporarily pause, this case while the U.S. District Court for the Central District of California considered final approval of a settlement in the related action Chalian et al. v. CVS Pharmacy, Inc. et al. The plaintiffs were Ryan Hyams and Regine Duhon. They opposed the stay and asked the court to proceed with hearings on their pending motions for class certification and partial summary judgment.

The defendants argued that the settlement could affect more than 20,000 potential class members and numerous potential employees with claims in this case. The plaintiffs acknowledged some overlap between the cases. The opinion also described orders from the Chalian court concerning communications by Hyams plaintiffs’ counsel with Chalian settlement-class members. That court found statements by the counsel misleading or inaccurate, invalidated opt-out forms solicited through the Hyams website, and ordered a corrective notice with a December 4, 2020 opt-out deadline.

Court’s analysis

The court applied the factors used to decide whether a stay is appropriate: possible harm from the stay, hardship or unfairness from requiring a party to proceed, and whether a stay would promote the orderly administration of justice. It concluded that the Chalian settlement decision could affect this case and that proceeding before the December 4 final-approval hearing could inefficiently use the parties’ and courts’ resources. The court emphasized that the stay would be temporary and limited in duration because the related hearing was scheduled only two days after the hearings previously scheduled in this case.

The court rejected the plaintiffs’ arguments that witnesses’ memories might fade or that potential class-member declarants might become unreachable. It also rejected arguments about harm to nonparties or the public, noting that those arguments largely depended on the alleged unfairness of a settlement whose fairness was being evaluated by the Chalian court.

Rulings

Judge Haywood S. Gilliam, Jr. GRANTED defendants’ motion to stay. The court VACATED the hearing set for December 2, 2020 and DIRECTED the parties to file a notice within 48 hours after the Chalian court granted or denied the final-approval motion. In a footnote, the court also GRANTED defendants’ request for judicial notice of court records from the Chalian proceeding.