Valentino U.S.A. has nabbed a meaningful victory in a lawsuit accusing it of “willfully and knowingly underpaying a large portion of its employees, by failing to pay them overtime wages” in violation of federal and state labor laws. In a new decision, a New York federal court denied a pool of former Valentino employees’ bid for class certification in the wage and hour lawsuit they are waging against the American arm of the Italian fashion brand. The court ruled that the plaintiffs failed to put forth sufficient evidence of a uniform policy affecting all class members, denying the motion for class certification but allowing individual claims to proceed.
A Bit of Background: Zion Brereton, Andreya Crawford, James Choi, and Rogelio Benitez (the “plaintiffs”) filed suit against Valentino U.S.A., Inc. in the U.S. District Court for the Southern District of New York in December 2019, alleging that the company has engaged in systemic violations of the Fair Labor Standards Act and New York Labor Law, including the misclassification of employees as “exempt” or as “independent contractors” to avoid paying overtime wages.
In addition to seeking monetary damages, the plaintiffs asked the court to certify their proposed class action and enable them to represent two classes of individuals: (1) Full-Time Employee Class: Non-executive employees earning under $100,000 annually who were allegedly denied overtime; and (2) Freelancer Class: Freelancers misclassified as independent contractors and paid a day-rate between December 13, 2013, and December 16, 2015.
A Win for Valentino
On February 20, SDNY Judge Jessica Clarke ruled that the plaintiffs failed to satisfy several requirements for class certification of their lawsuit against Valentino, namely, numerosity, commonality, typicality, and predominance. At a high level, the court found that …
> Numerosity: The plaintiffs did not provide sufficient evidence to demonstrate the number of potential class members. For the Full-Time Employee Class, the plaintiffs pointed to a Salary Review Report showing compensation changes for 286 employees but provided no information on job roles, pay rates, or locations.
> Commonality and Typicality: There were significant differences among the plaintiffs in terms of job roles, duties, and employment circumstances. For example, while Crawford and Brereton were freelancers, Choi and Benitez were full-time employees with different responsibilities, with such disparities necessitating individualized legal inquiries.
> Predominance: Individual issues related to job duties, compensation structures, and eligibility for overtime outweigh any common legal or factual questions. This complexity requires fact-specific assessments for each class member, rendering class-wide adjudication impractical.
> Insufficient Evidence of Uniform Policies: The plaintiffs argued that Valentino’s company-wide policies on overtime and independent contractor classification applied uniformly to all class members. However, the court found the evidence insufficient, citing that “comp days” and other incentives were inconsistently implemented. Moreover, the reclassification of employees in 2019 did not establish a common policy linking the alleged labor violations to all potential class members.
Morrison Cohen partner and co-chair of the firm’s Luxury Brands and Employment practices Keith Markel, who represents Valentino in the case, says: “This decision is a significant victory for Valentino in a long-standing wage and hour case that has wrongfully accused the Company of misclassifying past employees. It’s a true testament to Valentino that it has not wavered in its steadfast defense to these alleged claims.”
Implications for Valentino & the Fashion Industry
The plaintiffs may still pursue their claims against Valentino in individual lawsuits, but the denial of class certification significantly reduces the potential scope of liability for Valentino. The ruling underscores the challenges plaintiffs can face in certifying classes under wage and hour laws, particularly in industries with varied job roles and complex employment structures. At the same time, as wage and hour litigation continues to be a hot-button issue in the fashion industry, this case highlights the importance of robust employment classifications and compensation policies.
The case is Benitez v. Valentino U.S.A., Inc., 1:19-cv-11463 (SDNY).
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