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Kuzich v. Homestreet Bank

United States District Court, D. Arizona

August 15, 2018

Katherine Kuzich, Plaintiff,
Homestreet Bank, et al., Defendants.



         Pending before the Court is Plaintiff Katherine Kuzich's Motion for Conditional FLSA Collective Action Certification and Notice. (Doc. 40). For the following reasons, the Motion is granted in part and denied in part.


         Defendant HomeStreet Bank provides various consumer and commercial bank services, including residential lending. As part of its operation, HomeStreet Bank employs four different levels of Loan Processors[1] with varying degrees of responsibility to assist with the processing of loan documents. HomeStreet Bank classifies Loan Processors as non-exempt, hourly employees who are eligible for overtime pay under the Fair Labor Standards Act (“FLSA”).

         Plaintiff Katherine Kuzich worked as a Loan Processor III for HomeStreet Bank at their Scottsdale, Arizona location. (Doc. 40-3 ¶ 2). Ms. Kuzich signed a declaration alleging that HomeStreet management encouraged her to process and close mortgage loans outside of normal working hours and to not report these additional hours. (Doc. 40-3 ¶¶ 10-11). Thus, HomeStreet Bank never paid Ms. Kuzich overtime for this additional work. (Doc. 40-3 ¶ 10). Based on her observations at work, Ms. Kuzich understood that other HomeStreet Processors had similar obligations after normal working hours and were not being paid for all of the overtime hours worked. (Doc. 40-3 ¶¶ 6, 12-13). At least six other employees who worked as a Processor III for HomeStreet in Arizona and California signed a nearly identical declaration, where they all declared, “I regularly worked ‘off the clock' and HomeStreet did not pay me for this work, ” and “[m]y manager discouraged me from reporting all of my overtime hours.” (Docs. 40-4 through 40-9 at ¶ 9).

         On August 29, 2017, Ms. Kuzich filed a putative collective action complaint claiming relief under FLSA. (Doc. 1). She subsequently requested this Court to certify a conditional collective action under 29 U.S.C. § 216(b). (Doc. 40). Ms. Kuzich seeks to conditionally certify a class of Processors I, II, and III and Loan Processors I, II, and III who worked in HomeStreet Bank's Single Family Lending Division in the last three years.


         I. Legal Standard

         An employee may bring an FLSA collective action on behalf of herself and other employees who are “similarly situated.” 29 U.S.C. § 216(b). However, neither the statute nor the Ninth Circuit defines the phrase “similarly situated.” To determine whether employees are similarly situated under FLSA, District courts within the Ninth Circuit generally follow a two-step approach. Colson v. Avnet, Inc., 687 F.Supp.2d 914, 925 (D. Ariz. 2010). At the first step, courts conditionally certify a collective action if the plaintiff presents substantial allegations, supported by declarations or discovery, “that the putative class members were together the victims of a single decision, policy, or plan.” Id. (citing Thiessen v. Gen. Elec. Capital Corp., 267 F.3d 1095, 1103 (10th Cir. 2001)) (other citations omitted); Talavera v. Sun-Maid Growers of Cal., 2016 WL 1073253, at *3 (E.D. Cal. Mar. 18, 2016). If the plaintiff meets this burden, the potential members of the collective action are notified and presented the opportunity to opt-into the lawsuit. Colson, 687 F.Supp.2d at 925. At the second step, which takes place after notification and discovery, defendants may move to decertify the class, and the Court revisits the question of whether the class members are similarly situated. Id. The second step applies a much stricter standard than the initial notification step. Id.

         Because plaintiffs bring motions for conditional certification prior to significant opportunities for discovery, and because potential members to the collective action must opt-in, plaintiff's burden for conditional certification is light. Prentice v. Fund for Public Interest Research, Inc., 2007 WL 2729187, at *2 (N.D. Cal. Sept. 18, 2007). This fairly lenient standard in the Ninth Circuit typically results in conditional certification. Shaia v. Harvest Mgmt. Sub LLC, 306 F.R.D. 268, 272 (N.D. Cal. 2015). “All that need be shown by the plaintiff is that some identifiable factual or legal nexus binds together the various claims of the class members in a way that hearing the claims together promotes judicial efficiency and comports with the broad remedial policies underlying the FLSA.” Wertheim v. State of Arizona, 1993 WL 603552, at *1 (D. Ariz. Sept. 30, 1993). Plaintiffs may not, however, rely on mere allegations, but must provide some factual basis that potential plaintiffs are similarly situated. See Shaia, 306 F.R.D. at 272; Velasquez v. HSBC Fin. Corp., 266 F.R.D. 424, 427 (N.D. Cal. 2010). Further, at this initial notification stage, “the Court is concerned only with whether a definable group of similarly situated plaintiffs exists.” Warren v. Twin Islands, LLC, 2012 WL 346681 at *2 (D. Idaho Feb. 2, 2012). Thus, in determining whether to conditionally certify a proposed class for notification purposes only, courts do not review the underlying merits of the action. Colson, 687 F.Supp.2d at 926.

         II. Analysis

         A. Whether Proposed Class is Similarly Situated

         1. Overtime Compensation Claim

Defendant HomeStreet Bank argues that identical, perfunctory declarations cannot establish that a proposed class is similarly situated. (Doc. 42 at 8-12). The District of Arizona has previously denied certification of a FLSA class action when the supporting declarations were nearly identical, vague, conclusory, silent where one would expect important detail, and contradictory to allegations in the complaint. Delnoce v. Globaltranz Enterprises, Inc., 2017 WL 4769529 at *5 (D. Ariz. Sept. 25, 2017). However, a finding that submitted declarations are “rather ‘cookie-cutter' . . . alone is not a basis upon which to deny” a FLSA class action. Baughman v. Roadrunner Communications LLC, 2012 WL 12937133 at *3 (D. Ariz. Sept. 27, 2012) (citing Bollinger v. Residential Capital, LLC, 761 F.Supp.2d 1114, 1120 (W.D. Wash. 2011) (“But at this stage, under a lenient standard, the use of similarly worded or even ‘cookie cutter' declarations is not fatal to a motion to certify an FLSA collective action.”)). Therefore, at this stage in the ...

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