In 2009, Genesis HealthCare was sued in the U.S. District Court for the Eastern District of Pennsylvania by a former employee, Laura Symczyk. Ms. Symczyk worked as a nurse at a Genesis facility for a period of 7 months and alleged that she had, on many occasions, worked through her meal break but was not paid due to the automatic deduction in the Genesis timekeeping system (the "Kronos clock"). Ms. Symczyk sought to represent herself and a class of potentially thousands of other employees in this case.
In response to her claims, Genesis proffered an "Offer of Judgment" under Federal Rule of Civil Procedure 68, which provides that a defendant who makes an offer of everything the plaintiff could hope to recover can then seek dismissal of the case. The Rule's rationale is that, if the defendant makes such an offer, there is no longer a live "case or controversy" required for federal jurisdiction under the U S Constitution, and the federal courts no longer have jurisdiction. In this case, Genesis offered Ms. Symczyk $ 7500 plus attorneys' fees-- an amount she admitted was more than she could ever possibly recover in the lawsuit. No other person opted-in to the case.
After Genesis made the offer, the district court dismissed the case pursuant to Rule 68. The plaintiff appealed, making the policy argument that defendants could just "pick off" potential lead plaintiffs in an attempt to avoid class actions. The U.S. Court of Appeals for the Third Circuit agreed with Ms. Symczyk and, without giving material consideration to the jurisdictional and Constitutional arguments, reversed. Genesis then petitioned for certiorari with the U.S. Supreme Court, and NFIB Legal Center--recognizing the nationwide importance of the issue--filed in support of the employer to urge the court to take the case.
Now the Supreme Court has agreed to hear the case and the NFIB Legal Center has once more filed in support of the employer. The case has significant implications for employers, especially those in the health care industry where the mission requires continual patient coverage. Wage and hour class actions have become epidemic as plaintiffs' lawyers see an opportunity for recovery with every hourly employee at a particular business.
Status: Pending - U.S. Supreme Court.