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California Litigation Update: Q&A with Matthew Righetti

By ALM Staff | Law Journal Newsletters |
November 08, 2004

California has a major influence on many business trends in the United States, and franchising law is no exception. Two recent court decisions in the state could have a significant effect on how franchises classify their employees for overtime purposes. Additionally, a citizen referendum that is on the November ballot could change how franchises (and all private businesses) are exposed to lawsuits. In this Q&A, Matthew Righetti, a partner in Righetti Wynne, based in San Francisco, talks about the potential impact of these developments in the context of the general business environment in the state. Righetti represented the plaintiffs in Sav-On Drugstores v. Superior Court, which is discussed below.

FBLA: In August 2004, the California Supreme Court issued a decision in Sav-On Drugstores v. Superior Court. What's your assessment of the impact of this decision on overtime class action lawsuits in California?

Righetti: This case provides much welcomed guidance for the trial courts in these cases. The Supreme Court confirmed that where an employer has categorically classified a readily identifiable group of employees as “exempt” from the overtime laws, then the trial court's decision to certify the class action should not be disturbed. The court rejected Sav-On's argument that employers should be allowed to defend overtime claims individual-by-individual after making a class-wide exemption classification. If the employer makes a decision that affects a class of workers, then the employer should be prepared to defend the decision on a class-wide basis.

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