Federal Judge certifies collective action against Geico

Posted on: October 10th, 2013 by Steve Larson
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Blog Wage and HourA Maryland federal judge on Wednesday conditionally certified as a collective action a suit accusing Geico General Insurance Company of misclassifying its insurance investigators as administrative employees to avoid paying them overtime. 

U.S. District Judge Roger Titus certified a class made up of an unspecified number of investigators nationwide who have worked for Geico during the past three years — except for those who already won a nearly identical class action against the company before the same judge last November.

Judge Titus also authorized notices of the latest suit to be sent to would-be class members enabling them to opt in, despite Geico’s contention that such an order would effectively result in a follow-up notice going out to potential class members who decided against participating in the earlier companion case, Calderon v. Geico General Insurance Co.

“The motion for collective action notice in this case is plainly intended to round up additional plaintiffs, by sending a second round of notices to investigators who did not join the Calderon lawsuit as a result of the first round,” Geico said. “Thus, it directly conflicts with the purposes of collective action notice, which are to avoid duplicative litigation and set early deadlines for participation.”

Former Geico insurance investigator John “Tony” Vetter Sr. brought the suit in February, alleging the company misclassified him and other investigators as administrative employees under the Fair Labor Standards Act and denied them overtime pay .

Vetter, of Florida, who worked for the company from October 2009 to August 2012, accused the company of willfully and in bad faith continuing to withhold overtime compensation from the workers even after the court ruled in Calderon — another class action by Geico insurance investigators over the same issue — that those employees were eligible for time-and-a-half.

“Defendants have been, or should have been, on notice that the primary duties of plaintiff Vetter and the collective class do not allow for defendants to classify them as exempt from the requirements of the FLSA,” the suit said.

In Calderon, Judge Titus granted a partial summary judgment motion against Geico in late November, after the company failed to convince him that the administrative exemption to the FLSA applied to the workers because their duties allegedly involved the use of discretion and independent judgment.

That class of 49 current and former insurance investigators likewise were seeking overtime they said had wrongly been denied. Geico appealed Judge Titus’s ruling in the case to the Fourth Circuit earlier this month.

Vetter and the six other plaintiffs who have opted in to his suit moved the court to certify the class July 11, saying that even if Geico contested the amount of overtime they each put in, all of the plaintiffs were in similar situations because they had similar job duties, all “routinely” worked more than 40 hours per week, yet they were paid a fixed annual salary and denied overtime under the the same allegedly unlawful companywide policy.

The motion also pointed out how the court, faced with an identical set of facts in Calderon, had certified that case as both an FLSA collective action and a class action under Federal Rule of Civil Procedure 23.

Geico said the notices would be redundant and unlawfully “stir up litigation,” but that argument failed to sway the court, which on Wednesday ordered Geico to hand over the contact information for investigators that would fall within the class so notices of the suit could be distributed to them.

The case is Vetter v. Geico General Insurance Company et al., case No. 8:13-cv-00642before the U.S. District Court for the District of Maryland.