Chanel Beats Proposed Class Action Bid Filed by "Underpaid" Employees

Chanel has scored a major victory in a lawsuit filed against it by a group of employees at its Beverly Hills store. According to the proposed class action suit filed in December 2015 by shipping department employees Cristian Luna, Anthony Hernandez and Javier Delgado, Chanel failed to pay them and others overtime compensation and minimum wage for overtime hours worked in violation of both federal and state law. As of this past week, a California federal judge rejected the group’s bid for certification of a nationwide class in the suit, thereby cutting the number of potential plaintiffs by at least a few hundred.

U.S. District Judge Gary Klausner refused to certify the proposed class action lawsuit, and as a result, has prevented “similarly situated” employees in other Chanel stores from joining in the case at hand against the Paris-based design house. In order for a proposed class action lawsuit – one that gathers many individual claims together into a single lawsuit – to be certified, the named plaintiffs must show that all of the potential class members have claims that raise common legal and factual issues, making it most efficient to deal with all of the claims together. In short: all of the plaintiffs must be “similarly-situated.”

This is where the named plaintiffs in the case at hand failed to meet their burden. Per Klausner’s decision last week, Luna, Hernandez and Delgado failed to present evidence of wage violations at Chanel stores besides their own, and as a result, if other Chanel employees have been forced to work overtime without adequate compensation and/or without breaks, they will have to file individual lawsuits of their own.

Judge Klausner’s decision comes on the heels of assertions from Chanel’s counsel that the evidence the plaintiffs provided (and the fact that they were forced to work overtime in the first place) does not amount to anything more than proof that they’re incapable of fulfilling their job duties. Moreover, Chanel asserted that nationwide class certification is improper as the cases at hand are too individualized and the individual plaintiffs’ claims are not backed up by similar claims from employees at other stores.