Nevada et al. v. U.S. Department of Labor and Alvarez

A class action lawsuit was brought by Chipotle employees in New Jersey alleging that they are owed overtime under the U.S. Department of Labor regulations that were enjoined in November by a judge in the U.S. District Court for the Eastern District of Texas. In addition to defending itself in New Jersey, Chipotle filed a motion asking the Judge in the Texas case to find the workers’ counsel in contempt of his Court Order. The RLC, as part of its work on overtime issues, agreed to assist Chipotle, as a finding against Chipotle could have repercussions for the entire industry and could jeopardize our win in the Texas case.

Resolution

On March 19, 2018, the judge in Texas held the workers’ attorneys in contempt because they “recklessly disregarded a duty owed to the court” when they brought the class action case against Chipotle Mexican Grill Inc. in New Jersey that sought to enforce the enjoined U.S. Department of Labor overtime regulations. The judge in Texas granted a Stay pending the workers’ attorneys appeal.

On July 13, 2018, the Law Center filed an amicus brief in support of the contempt finding. The Law Center presented the national perspective of the damage and confusion that workers’ counsel created by filing its lawsuit against Chipotle alleging the Stay Order in Texas was not valid for private sector employers and highlighting the impact for the industry if plaintiff’s attorneys around the country could have gone on ignoring the Texas court’s rulings in the overtime case. The Law Center further argued that if the District Court lacks the power to enforce its ruling through contempt, then, future injunctions invalidating regulations will have no practical force or effect.