First Circuit Creates Split Regarding Federal Court Jurisdiction Over FLSA Multistate Class Actions – Litigation, Mediation and Arbitration

On January 13, 2022, at Waters vs. Day & Zimmermann NPS, Inc.the Court of Appeals for the First Circuit has become the third federal appeals court to rule on the application of the United States Supreme Court’s decision in the case Bristol-Myers Squibb Co. v. California Superior Court Fair Labor Standards Act (FLSA) Class Actions. Unlike the Sixth Circuit Court of Appeals and the Eighth Circuit Court of Appeals, however, the First Circuit found that a federal court had personal jurisdiction over claims brought by nonresident opt-in plaintiffs. The First Circuit’s decision thus creates a split between the federal appeals courts and raises the prospect that the Supreme Court will ultimately have to decide the issue.


The named plaintiff, John Waters, was a former mechanical supervisor for the defendant, Day & Zimmermann, Inc., which provides services to power plants. He filed a lawsuit in the United States District Court for the District of Massachusetts, alleging that Day & Zimmermann violated FLSA overtime wage requirements. Subsequently, more than 100 people submitted opt-in consent forms seeking to participate in the litigation. Day & Zimmermann moved to dismiss the claims of opt-ins it did not employ in Massachusetts, arguing that the court had no general or specific personal jurisdiction over the claims of those individuals pursuant to the ruling. of the Supreme Court in Bristol-Myers Squibb v. California Superior Court.

In that case, as noted by the First Circuit, the Supreme Court held that “in view of the Fourteenth Amendment, state courts cannot entertain a mass action of state law – an aggregation individual actions – if it includes out-of-state plaintiffs unrelated to the state of the forum.” Based on this decision, the Sixth Circuit (in Canaday v. The Anthem Companies, Inc.) and the eighth circuit (in Vallone vs. CJS Solutions Group, LLC) ruled last year that federal courts do not have personal jurisdiction over FLSA class actions brought by persons who do not reside in the forum state.

The analysis of the first circuit

The first circuit determined that the Bristol Myers Squibb The decision did not control the personal jurisdiction analysis for FLSA claims because it involved state law claims of nonresidents in state court, unlike federal law claims under the FLSA. in federal court. Specifically, he explained that the Bristol Myers Squibb decision “rest[ed] on the Fourteenth Amendment’s Constitutional Limits on State Courts Exercising Jurisdiction over Claims Under State Law” and therefore did not control whether a federal court could exercise jurisdiction over federal claims asserted by non-state plaintiffs. residents.

The appeals court then analyzed whether Rule 4 of the Federal Rules of Civil Procedure limited the jurisdiction of the district courts by incorporating the Fourteenth Amendment. In Canadian, the Sixth Circuit found that Rule 4(k) incorporated the limits on personal jurisdiction imposed by the Due Process Clause of the Fourteenth Amendment. The First Circuit rejected this conclusion, stating that the plain language of Rule 4(k) is simply about the meaning of quotes and does not “bind[] the power of a federal court to act once a subpoena has been properly served and personal jurisdiction has been established.

although service of a subpoena under state or federal law is necessary to establish jurisdiction over a defendant in the first instance, the constitutional limitations of the Fifth Amendment limit the court’s authority after service has been effected at least in federal law actions.

Finally, the First Circuit looked at the congressional intent behind the FLSA and found that the US Congress intended to provide for broad participation in class actions under the statute. The court therefore concluded that jurisdictional limitations on FLSA class actions (such as those imposed by the Sixth Circuit and the Eighth Circuit) would undermine Congress’s purpose in enacting the FLSA to make the class action process widely accessible to employees. Thus, the First Circuit denied the employer’s motion to deny the nonresident applicants’ membership applications and allowed those applications to proceed.

A member of the three-judge panel that considered the appeal disagreed with the majority opinion, not because he disagreed with the interpretation of Rule 4(k) on the merits by the majority, but rather because, in his opinion, there was “no reason . . . to decide [the] issue at this time.” Noting that the majority’s reading of Rule 4(k) was both novel, in that no other court “(including ours) has[d] never read” the rule as the majority did, and controversial in that it directly conflicted with the way two other federal appeals courts and most commentators had read the rule, the dissenting judge said. observe that the federal courts of the First Circuit will now be required “to change the way they have done things in many cases, and in all cases which involve claims of state law” in order to reflect the reading idiosyncratic rule 4(k) of the majority. According to the dissenting judge, his colleagues in the majority could have avoided the result by simply dismissing the appeal, letting the case continue in the district court and then deciding on the matter at a later stage of the proceedings, if a decision ultimately proved necessary and had not been overruled by subsequent developments in the case.

Key points to remember

Employers with operations in First Circuit jurisdiction may see an increase in multistate FLSA class actions filed in circuit district courts. First Circuit jurisdiction includes the U.S. District Courts of Maine, Massachusetts, New Hampshire, Puerto Rico, and Rhode Island. Meanwhile, plaintiffs will likely avoid pursuing such lawsuits in the Sixth Circuit and Eighth Circuit due to the opposing positions in Canadian and Valley. Sixth Circuit jurisdiction includes the federal courts of Kentucky, Michigan, Ohio, and Tennessee; the Eighth Circuit has jurisdiction over the federal courts of Arkansas, Iowa, Minnesota, Missouri, Nebraska, North Dakota, and South Dakota.

The First Circuit’s decision creates a split at the appellate level on an issue that has significant implications for employers and workers. When such a split in authority occurs, the chances of the Supreme Court accepting the matter for review to resolve the split increase dramatically. The likelihood of Supreme Court review is heightened here when the issue being split has far-reaching implications for the size and scope of lawsuits under a statute that is a frequent source of litigation.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

Thelma J. Longworth