PORTILLO v. NATIONAL FREIGHT, INC.

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW JERSEY

CAMDEN VICINAGE

JOHN F. PORTILLO et al., individually

and on behalf of all others similarly

situated, Hon. Joseph H. Rodriguez

Plaintiffs, Civil No. 15-7908 (JHR/KMW)

v.

OPINION

NATIONAL FREIGHT, INC. and NFI

INTERACTIVE LOGISTICS, INC.,

Defendants.

This case is before the Court on Plaintiffs’ Motion for Class Certification, filed on

September 3, 2019. [Docket No. 129.] For the reasons expressed herein, the Court will

grant Plaintiffs’ Motion.

I. Background

Defendants NFI Interactive Logistics, Inc. and National Freight, Inc. (collectively,

“NFI”) compose “a leading provider of transportation, logistics and distribution

services” to various clients including, most relevant to this case, Trader Joe’s Markets.

[Docket No. 102, ¶ 19.] NFI transports goods between Trader Joe’s warehouses and

stores up and down the Eastern Seaboard. [Id.] To fulfill its obligations to Trader Joe’s,

NFI uses both its own employees and independent contractors as delivery drivers. [Id.]

Named Plaintiffs in this suit — John F. Portillo, Rafael Suarez, Martin Duran, German

Bencosme, Edin Vargas, Luis A. Hernandez, Josue Paz, and Alvaro Castaneda

(collectively, “Named Plaintiffs”) — worked for NFI as delivery drivers during the

relevant time period (i.e., between June 22, 2019, and the present). [Id.] Each of them

signed an agreement (generally referred to as an “Independent Contractor Agreement”

or “ICA”) with NFI, discussed in more detail below, that classified them as independent

contractors rather than employees. [Docket No. 129-1, at 4.] Plaintiffs believe that “NFI

entered into at least 135 [such] agreements with who performed deliveries full-time to

Trader Joe’s stores on the East Coast on NFI’s behalf.” [Id.] They allege, on behalf of

themselves and others similarly situated, that they were wrongly classified as

independent contractors and “that as a result of that misclassification, NFI illegally

deducted amounts from their compensation in violation of the New Jersey Wage

Payment Law” (“NJWPL”). [Id. at 1.]

Defendants used four different ICAs during the relevant time period.

[Docket No. 148, at 4 n.3.] In 2009, NFI used an agreement called the “Lessor and

Lessee Operating Agreement” (the “2009 LLOA”). [Docket No. 143-3, ¶ 8.] Beginning at

some point in 2010, NFI started using an agreement called the “Independent Contractor

Operating Agreement” (the “2010 ICOA”). [Id., ¶ 9.] In 2017 and 2019, NFI

implemented new versions of the Independent Contractor Operating Agreement (the

“2017 ICOA” and “2019 ICOA,” respectively). [Id. ¶¶ 10-11.] Importantly, the 2009

LLOA contains a New Jersey choice of law provision and no forum selection clause (the

“2009 LLOA Provision”); the 2010 and 2017 Agreements contain a New Jersey choice of

law provision and a New Jersey forum selection clause (the “2010 ICOA Provision” and

“2017 ICOA Provision,” respectively); and the 2019 Agreement contains a Texas choice

of law provision and a Texas forum selection clause (the “2019 ICOA Provision”).

[Docket No. 142, at 5-6.] According to Defendants, as of October 18, 2019, five drivers

had signed the 2019 Agreement. [Id. at 6.]

Other than the choice-of-law clauses, the contents of the various ICAs are

materially the same. They required various things from the drivers, including

background checks, drug and alcohol testing, Defendants’ exclusive use of the drivers’

trucks, utilization of a specific GPS system, acquisition of various forms of insurance,

regular inspections by Defendants, record maintenance, log sheets, toll receipts, and

immediate reporting of all accidents, among various other terms. [See Docket No. 129-1,

at 4-6.] Defendants also utilized various workplace rules and procedures, including

handbooks, codes of conduct, and other written policies that dictated the drivers’

activities. [See id. at 6.] The drivers had to put NFI’s logo on their trucks and were

prohibited from putting another company’s logo on them. [Docket No. 129-1, at 7.] They

were restricted in their ability to work for other companies, both practically (given the

amount of hours they worked) and contractually (Defendants had to give written

consent). [Id.]

In practice, the drivers would report at least once per day to a Trader Joe’s

warehouse in either Nazareth or Hatfield, Pennsylvania, locations where Defendants

have offices and on-site staff. [Id. at 8.] Their deliveries and routes were pre-determined

by Defendants, including the times that they had to be made. [Id. at 8-9.] Defendants

were able to monitor drivers’ progress via the GPS system mentioned above. [Id. at 9.]

Failure to follow the procedures, rules, policies, and schedules set out by Defendants

could result in Defendants’ employees disciplining the drivers. [Id. at 10.]

Finally, Defendants had the authority to make various deductions from the

drivers’ weekly paychecks. [Id. at 11.] Deductions included costs for the GPS device,

damages to goods or property, fuel, insurance, and other things. [Id. at 11-12.] The crux

of Plaintiffs’ case is their allegation that these deductions were taken illegally by

Defendants. [Id. at 1.] This relies on a finding that Plaintiffs were in fact employees, and

not independent contractors, under the NJWPL, which would make such deductions

illegal. [Id.]

In order to rectify their alleged damages, Plaintiffs filed this suit in the Superior

Court of New Jersey Law Division in Camden County on June 19, 2015. [Docket No. 1-

3.] On November 5, 2015, Defendants removed the case to this Court. [Docket No. 1.]

After nearly three years of litigation — including discovery issues and denied motions to

remand, to dismiss, and for summary judgment — Plaintiffs filed the operative

Amended Complaint on August 13, 2018. [Docket No. 102.] The parties then

unsuccessfully attempted to resolve the case via mediation between November 30, 2018,

and April 15, 2019. [See Docket Nos. 104-111.] After further discovery issues, Plaintiffs

filed their Motion for Class Certification on September 3, 2019. [Docket No. 129.]

Defendants filed their response in opposition on October 18, 2019. [Docket No. 142.]

Plaintiffs timely filed their response on November 1, 2019. [Docket No. 148.] Defendants

were permitted to file a sur-reply brief on June 30, 2020. [Docket No. 168.]

II. Jurisdiction

The Court exercises subject matter jurisdiction over this matter pursuant to the

Class Action Fairness Act, 28 U.S.C. § 1453 (“CAFA”). As required by CAFA, the putative

class in this case consists of at least 100 proposed class members, the citizenship of at

least one of which being diverse from that of at least one of the Defendants. [Docket No.

102, ¶ 16.] The CAFA amount-in-controversy requirement is also met, as that figure

exceeds $5,000,000 here. [Id.]

III. Plaintiffs’ Motion for Class Certification

The Court will next address Plaintiffs’ Motion for Class Certification. [Docket No.

129.] For the reasons expressed below, the Motion will be granted.

A. Choice of Law

The first argument that Defendants make in their opposition to Plaintiffs’ Motion

for Class Certification revolves around what law should apply in this case. [See Docket

No. 142, at 11-14.] In their initial brief, Plaintiffs refer exclusively to New Jersey law,

which they argue applies because of an earlier decision made by the late Honorable

Jerome B. Simandle. [See Docket No. 129, at 4 n.4.] Defendants disagree with that

interpretation of that Opinion. [Docket No. 142, at 11-14.] The Court will therefore begin

its discussion with a recounting of the Opinion in question.

It is crucial to note that at the time of the Court’s previous Opinion, NFI had not

yet begun to use the 2019 ICOA (with the Texas choice-of-law clause). However, the

remaining facts upon which the Court relied are equally present today.

The Court utilized New Jersey’s “most significant relationship test,” which

follows Sections 6, 145, and 221 of the Restatement (Second) of Conflict of Laws. [See id.

at 26-27, 31-32.] It concluded that “New Jersey has the most significant relationship to

the parties, the working relationships, and the claims at issue in this case.” [Id. at 38-

39.] The Court noted its mindfulness of four factors in particular. First, the Court held

that “Plaintiffs and Defendants reasonably expected New Jersey law to apply to the bulk

of their disputes and contracted for that outcome.” [Id. at 39.] After all, “Defendants are

the more sophisticated party and the drafters of the contract; they elected to be bound

(with regard to contract claims) by New Jersey law and to bind the drivers to New Jersey

law with regard to such claims, and Plaintiffs also seek to apply New Jersey law.” [Id. at

39.] Since “the reasonable expectations of the parties to a contract is one of the

important factors in a choice-of-law analysis under the Restatement,” the Court found

that this factor cut in favor of applying New Jersey law. [Id.]

Second, the Court noted that “the nature of Plaintiffs’ work was highly mobile

and not based in any other state more significantly so as to grant that state the most

significant interest under the Restatement’s analysis.” [Id.] Even though none of Named

Plaintiffs are New Jersey citizens, [see id. at 5], and their home states “have an interest

in the proper payment of wages to their citizens, it appears to be without question that

Plaintiffs knowingly took on a business opportunity that was inherently of an interstate

nature,” [id. at 39-40].

Third, the Court stated that,

while the center of the relationship between the parties in physical terms

appears to be in Pennsylvania at the warehouse interface, as that is where

the Plaintiffs interacted with Defendants on the most regular basis, that

does not lead to the conclusion that Pennsylvania has the most significant

interest in light of all other factors. This would seem to bind Defendants to

abiding by the wage laws of any state in which it has, effectively, a satellite

office that serves as a home-base to drivers, when Defendants’ operations

are primarily in New Jersey and Plaintiffs and Defendants reasonably

sought to apply New Jersey law to their contractual claims, as discussed

above.

[Id. at 40.]

And fourth, “the Court note[d] that Plaintiffs did perform a significant portion of

their work in New Jersey.” [Id.] It distinguished this case from one in which “Plaintiffs

seek the protection of New Jersey state wage and employment laws for the people who

avowedly never worked in New Jersey.” [Id.]

In sum, those four factors persuaded the Court to rule that “New Jersey has the

most significant interest in these particular circumstances,” meaning that “New Jersey

law applies to Plaintiffs’ claims.” [Id. at 40-41.]

Defendants argue that the previous Opinion only “applies to the Named

Plaintiffs’ claims,” and that Judge Simandle “did not rule, and could not have ruled, on

the putative class’s claims, as those claims were not before him.” [Docket No. 142, at 11.]

Defendants then try to argue that the factual differences between Named Plaintiffs and

putative class members are sufficient to conclude that the choice of law ruling could not

be the same for all putative class members. [Id. at 12.] Specifically, Defendants argue

that five facts could distinguish putative class members from Named Plaintiffs

sufficiently enough to render the Court’s prior Opinion inapplicable to putative class

members. They are: (1) “where putative class members reside;” (2) “the states in which

they incorporated their companies;” (3) whether they signed the 2009 LLOA, which has

no venue selection clause; (4) “the states in which they make or made deliveries;” and

(5) whether they signed the 2019 ICOA, which has Texas — not New Jersey — choice of

law and venue selection provisions. [Id.]

With respect to Defendants’ first and second points, none of Named Plaintiffs

resided in New Jersey at the time of Judge Simandle’s ruling, nor had any incorporated

their trucking companies in New Jersey. [See Docket No. 94, at 5.] Of the eight named

Plaintiffs, five were Rhode Island residents and three were Pennsylvania residents.1 [Id.]

Meanwhile, three Named Plaintiffs had their own trucking companies and each of them

was incorporated in Rhode Island. [Id.] Yet the Court found that none of the states of

1 One of the three Pennsylvania residents also lived in Rhode Island for a portion of the

relevant time period. [Docket No. 94, at 5.]

residence or of incorporation had a more significant interest than New Jersey due to the

other factors involved. [Id. at 38-39.] Therefore, the questions of where the putative

class members reside or where their companies are incorporated would not change the

outcome of this issue: either they are not residents of or incorporated in New Jersey, in

which case they are just like the eight Named Plaintiffs whose claims are governed by

New Jersey law, or they are residents of or incorporated in New Jersey, in which case

the Court’s choice of law analysis would point even more clearly to New Jersey law

applying. Therefore, this argument by Defendants is unavailing.

Similarly, Defendants’ third argument, that the lack of a venue selection clause in

the 2009 LLOA matters, is meritless. After all, five of the eight Named Plaintiffs had

signed the 2009 LLOA, and the Court still found that New Jersey law should apply. [Id.

at 4-5.] Obviously, then, the fact that some putative class members also signed the 2009

LLOA does nothing to undermine the ruling that New Jersey law should apply.

Defendants’ fourth factual argument revolves around whether putative class

members made deliveries in New Jersey. In the previous Opinion, the Court held that

the fact that Named Plaintiffs did perform some work in New Jersey cut in favor of New

Jersey law applying. [Docket No. 94, at 40.] The Court came to this conclusion in spite

of the fact that Named Plaintiffs “all reported to work for Defendants in Pennsylvania

and had their primary face-to-face interactions with Defendants through Defendants’

Pennsylvania place of business and Pennsylvania-based employees.” [Id. at 30.] It even

held that “the physical relationship between the parties was centered in Pennsylvania,”

where Named Plaintiffs began and finished each of their deliveries, among other

activities. [Id. at 32.] Nevertheless, the Court found that Named Plaintiffs performed “a

significant portion of their work in New Jersey.” [Id. at 40.] The Court noted that

Named Plaintiffs “carried out deliveries in . . . New Jersey” and were sometimes

required to communicate with NFI employees in New Jersey. [See id. at 7, 29.]

Defendants allege that its “data shows 28 Contractors who performed no work in

New Jersey.” [Docket No. 142, at 13.] Plaintiffs counter that “[a] closer review of NFI’s

data reveals that 7 of those driers are not class members in any event because they were

not full-time drivers for NFI, and many others almost certainly drove in New Jersey to

perform their deliveries.” [Docket No. 148, at 6.] Even accepting Defendants’ assertions,

this Court finds that, all else being equal, a lack of deliveries having been made in New

Jersey does not so distinguish the circumstances surrounding a putative class member

from those surrounding Named Plaintiffs so as to alter Judge Simandle’s prior analysis.

The much more significant ties to New Jersey — most importantly the choice-of-law

clause in combination with Plaintiffs’ willful decision to engage with a New Jersey

business and be bound by New Jersey law, but also the still-present fact that drivers

would sometimes have to communicate with Defendants’ employees in New Jersey, —

were much more significant in the Court’s decision. Although the lack of deliveries to

New Jersey would render this decision an even closer one than it was before, that fact

alone would not tip the scales in favor of another state. Therefore, this Court holds that,

based on its prior decision, the mere lack of deliveries to New Jersey would not mean

that a state other than New Jersey has “the most significant interest in these particular

circumstances.”

That brings the Court to Defendants’ fifth and final choice-of-law argument: the

2019 ICOA, which has Texas choice of law provisions and which at least five putative

class members have signed. As noted above, a large part of the Court’s prior decision

stemmed from the dual nature of the parties’ relationships: “the contractual relationship

is centered in New Jersey and the physical interface of work performance is in

Pennsylvania.” [Docket No. 94, at 30.] The Court also listed as the principal reason for

deciding the “close question” that New Jersey law applied:

Defendants are the more sophisticated party and the drafters of the

contract; they elected to be bound (with regard to contract claims) by New

Jersey law and to bind the drivers to New Jersey law with regard to such

claims, and Plaintiffs also seek to apply New Jersey law. This is the

unusual case where Plaintiffs seek to bind the drafters of the contract to

the choice-of-aw stated therein. While the Court, as discussed above, does

not find that the scope of that provision encompasses the Plaintiffs’ claims

literally and directly, the Court does note that giving effect to the

reasonable expectations of the parties to a contract is one of the important

factors in a choice-of-law analysis under the Restatement. Here, it appears

fair to presume that Plaintiffs and Defendants reasonably expected New

Jersey law to apply to the bulk of their disputes and contracted for that

outcome.

[Id. at 39.]

In short, the Court’s previous decision relied heavily on the fact that the 2009

LLOA, the 2010 ICOA, and the 2017 ICOA all had New Jersey choice-of-law clauses. The

2019 ICOA, conversely, has a Texas choice-of-law clause. This fact drastically changes

the Court’s previous analysis. This Court holds that the lack of a New Jersey choice-of-

law clause in the 2019 ICOA would change the outcome of the Court’s previous decision.

As noted above, the predominant piece of evidence that affirmatively pointed to the

“close” ruling that New Jersey had the most significant relationship was the New Jersey

choice-of-law clause. [See id.] Without that consideration, the relevant Restatement

factors (that is, the Section 6, 145, and 221 factors) would no longer point to New Jersey

as the state with the most significant relationship. Instead, the parties’ physical

relationship, which predominantly existed in Pennsylvania, would be the most

fundamental factor in determining which state “has the most significant relationship to

the parties, the working relationships, and the claims at issue.” [See id. at 38-39.]

Plaintiffs themselves seem to concede this point. [See Docket No. 148, at 4-5.]

Their only arguments with respect to the five individuals who signed the 2019 ICOA are

(1) “they may not even be in the class” due to the other class requirements; (2) they

might have worked under one or more of the previous contracts that did have a New

Jersey choice-of-law clause, in which case they are still eligible class members; and (3)

in any event, Defendants only identify five such people, meaning that there are still at

least 130 others who would qualify as class members. [See id.] They make no argument

that New Jersey law should apply to those five individuals and instead argue that

Pennsylvania law should apply either to the entire class or to a subclass. [See id. at 6

n.4.] Neither of these options are viable here. First of all, the Court cannot apply

Pennsylvania law to the entire class when, as shown above, the Court already ruled that

New Jersey law applied to the majority of the class. Second of all, a subclass requires

numerosity, just like any other class. Marcus v. BMW of N. Am., LLC, 687 F.3d 583, 595

(3d Cir. 2012). As will be made clearer below, a proposed class of five members would

not satisfy the numerosity requirement. Because the choice-of-law question is not

contested with respect to the drivers who signed the 2019 ICOA, the Court will refrain

from giving an in-depth analysis of what state has the most significant relationship to

the circumstances surrounding the drivers who signed the 2019 ICOA. For the purposes

of this Motion, it suffices to say that New Jersey law would not apply to those drivers.

In conclusion, with respect to Defendants’ arguments that the Court’s previous

Opinion about choice of law does not apply to anybody beyond Named Plaintiffs, the

Court now holds that its previous Opinion does apply to the putative class members,

except for those who only signed the 2019 ICOA.

B. Rule 23 Requirements

The Court will next discuss the requirements of Federal Rule of Civil Procedure

23, which governs class certification. Per that rule, a putative class must satisfy each of

Rule 23(a)’s four requirements as well as one of Rule 23(b)’s three requirements. See

FED. R. CIV. P. 23(b) (stating that “[a] class action may be maintained if Rule 23(a) is

satisfied and if” one of Rule 23(b)’s three requirements is met). Rule 23(a)’s four

requirements are (1) numerosity, (2) commonality, (3) typicality, and (4) adequacy. See,

e.g., In re Cmty. Bank of N. Va., 622 F.3d 275, 291 (3d Cir. 2010).

Furthermore, Rule 23(b)(3), the subsection under which Plaintiffs seek class

certification in this case, provides two additional requirements: predominance and

superiority. See, e.g., id. As a final requirement, the class must also be clearly defined

and objectively ascertainable. See Byrd v. BMW of N. Am., LLC, 687 F.3d 583, 591 (3d

Cir. 2012).

A plaintiff has the burden of proving each of the above requirements by a

preponderance of the evidence. In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305,

307 (3d Cir. 2008). The court “must make whatever factual and legal inquiries are

necessary and must consider all relevant evidence and arguments presented by the

parties.” Id. The court must engage in a “rigorous” and individualized analysis of the

above requirements before certifying a class. See id. (“Class certification is proper only

‘if the trial court is satisfied, after a rigorous analysis, that the prerequisites’ of Rule 23

are met.” (quoting Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 161 (1982))); Byrd v.

Aaron’s, 784 F.3d 154, 172 (3d Cir. 2015) (“Precise analysis of relevant Rule 23

requirements will always be necessary.”).

In this case, Plaintiffs seek to certify the following class:

All individuals who: (1) entered into an independent contractor agreement

with NFI, either personally or through a corporate entity; and (2) drove a

vehicle on a full-time basis to perform deliveries of goods to Trader Joe’s

stores anywhere on the East Coast on behalf of NFI at any time since June

22, 2009.

[Docket No. 129-1, at 1.]2 With that proposed class in mind, the Court will now address

each relevant Rule 23 requirement.

1. Numerosity

Numerosity requires that “the class . . . be ‘so numerous that joinder of all

members is impracticable.’” Id. (quoting FED. R. CIV. P. 23(a)(1)). In the Third Circuit, a

court will presume that numerosity is met if “the potential number of plaintiffs exceeds

40.” Stewart v. Abraham, 275 F.3d 220, 226-27 (3d Cir. 2001). Here, the proposed class

consists of more than 40 individuals. [See Docket No. 148, at 8.] Therefore, the

numerosity requirement is met.

2. Commonality

Commonality requires that “questions of law or fact common to the class” exist.

Id. (quoting FED. R. CIV. P. 23(a)(2)). Because this action is brought under Rule 23(b)(3),

the Rule 23(a)(2) “commonality requirement ‘is subsumed by the predominance

requirement’” of Rule 23(b)(3). Danvers Motor Co. v. Ford Motor Co., 543 F.3d 141, 148

(3d Cir. 2008) (quoting Geoorgine v. Amchem Prods., Inc., 83 F.3d 610, 626 (3d Cir.

1996)). Therefore, this requirement will be discussed below with the predominance

requirement.

2 The Court notes its inherent authority to redefine a proposed class in order to maintain

a class action. See FED. R. CIV. P. 23(c)(1); Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 185

(1974) (“[A]s Rule 23(c)(1) clearly indicates, the courts retain both the power and the

duty to realign classes during the conduct of an action when appropriate.”).

3. Typicality

Typicality requires that “the claims or defenses of the representative parties are

typical of the claims or defenses of the class.” FED. R. CIV. P. 23(a)(3); see also In re

Cmty. Bank, 622 F.3d at 291. The Third Circuit has held that a court’s typicality analysis

must address

three distinct, though related, concerns: (1) the claims of the class

representative must be generally the same as those of the class in terms of

both (a) the legal theory advanced and (b) the factual circumstances

underlying that theory; (2) the class representative must not be subject to

a defense that is both inapplicable to many members of the class and likely

to become a major focus of the litigation; and (3) the interests and

incentives of the representative must be sufficiently aligned with those of

the class.

In re Schering Plough Corp. ERISA Litig., 590 F.3d 585, 599 (3d Cir. 2009).

Defendants’ typicality challenge is limited to the first above factor. [See Docket

No. 142, at 19-20.] They claim that Defendants’ claims rely on “disparate liability

theories” based on some of Named Plaintiffs’ depositions. [See id.] But as Plaintiffs

point out, Defendants’ argument seems to do little more than cherry pick statements

made by Named Plaintiffs while ignoring the claims actually set forth in Plaintiffs’

Amended Complaint. [See Docket No. 148, at 12-13; Docket No. 102 (Amended

Complaint).] Defendants’ attempt to misconstrue Plaintiffs’ claims will not be

entertained by the Court. Instead, the Court agrees with Plaintiffs that typicality is met

here, since “Plaintiffs and members of the proposed class were all classified as

independent contractors, all signed the same [contracts], worked subject to the same

controls, worked exclusively for NFI on a full-time basis, were subject to the same types

of deductions, and were required to purchase their own worker’s compensation

insurance.” [Docket No. 129-1, at 20.] The factual and legal issues of Named Plaintiffs’

claims are typical of those of the rest of the class; the typicality requirement is satisfied.

4. Adequacy

Adequacy requires that “the named plaintiffs . . . ‘fairly and adequately protect

the interests of the class.’” In re Cmty. Bank, 622 F.3d at 291 (quoting FED. R. CIV. P.

23(a)(4)). This requires analysis of two factors: “(1) whether counsel is qualified,

experienced, and able to conduct the litigation; and (2) whether any conflicts of interest

exist between the named parties and the class they seek to represent.” Carrow v. FedEx

Ground Package Sys., Inc., Civil No. 16-3026 (RBK/JS), 2019 WL 7184548, at *9 (D.N.J.

Dec. 26, 2019) (citing In re Prudential Ins. Co. Am. Sales Practice Litig. Agent Actions,

148 F.3d 283, 312 (3d Cir. 1998). Defendants do not address these factors, but instead

argue that adequacy is not satisfied here because “a plaintiff cannot adequately

represent ‘people who possess different claims.’” [Docket No. 142, at 19 (quoting Harris

v. Marsh, 100 F.R.D. 315, 325 (E.D.N.C. 1983).] However, as noted above, the claims are

typical of the whole class, so Defendants’ adequacy argument fails. Moreover, counsel

are indisputably “qualified, experienced, and able to conduct the litigation,” [see Docket

No. 129-1, at 22 (recounting counsel’s qualifications)], and there is no conflict, [see id. at

21]. Therefore, the adequacy requirement is met.

5. Predominance

Predominance means “that the questions of law or fact common to class

members predominate over any questions affecting only individual members.” See FED.

R. CIV. P. 23(b)(3). This does require some soothsaying from the Court, as it “must

formulate some prediction as to how specific issues will play out in order to determine

whether common or individual issues will predominate.” In re Hydrogen Peroxide

Antitrust Litig., 552 F.3d 305, 311 (3d Cir. 2009) (quoting In re New Motor Vehicles

Can. Exp. Antitrust Litig., 522 F.3d 6, 20 (1st Cir. 2008)). “If proof of the essential

elements of the cause of action requires individual treatment, then class certification is

unsuitable.” Id. (quoting Newton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 259

F.3d 154, 172 (3d Cir. 2001)). A court, thus, must “examine the elements of plaintiffs’

claim ‘through the prism’ of Rule 23.” Id. (quoting Newton, 259 F.3d at 172).

In this case, the central question for predominance is whether the class members

were misclassified as independent contractors instead of employees. [See Docket No.

129-1, at 13-20; Docket No. 142, at 22-28.]3 New Jersey courts use the so-called “ABC

test” to determine whether an individual is an employee or an independent contractor

for NJWPL claims. Hargrove v. Sleepy’s, LLC, 106 A.3d 449, 465 (2015) (“Sleepy’s I”).

Under the ABC test, an individual who performs a service is presumed to be an

employee unless the employer proves that:

(A) Such individual has been and will continue to be free from control or

direction over the performance of such service, both under his

contract of service and in fact; and

(B) Such service is either outside the usual course of business for which

such service is performed, or that such service is performed outside of

3 Defendants make three other arguments as well. First, they reassert the choice-of-law

argument. [Docket No. 142, at 21.] For the reasons outlined above, that argument fails.

Second, they argue that Plaintiffs’ “evidence of illegal deductions is individualized.” [Id.

at 28 (alterations omitted).] Third, they argue that “evidence of damages is

individualized.” [Id. (alterations omitted).] However, as Plaintiffs indicate in their reply

brief, these arguments are meritless. [Docket No. 148, at 19-20.] These issues can

plainly be decided on common evidence, including spreadsheets already provided in

discovery. See Carr v. Flower Foods, Inc., Civil Action No. 15-6391, Civil Action No. 16-

2581, 2019 WL 2027299, at *17 (E.D. Pa. May 7, 2019) (“[B]ecause the same categories

of deductions were routinely made by Defendants and subjected to the same treatment

in the standard written agreements between the parties, the validity of those deductions

will hinge on common questions of law.”). Moreover, the Third Circuit has held that

“obstacles to calculating damages may not preclude class certification” provided that the

class can show “the fact of damages . . . on a common basis.” Harnish v. Widener Univ.

Sch. of Law, 833 F.3d 298, 306 (3d Cir. 2016). Plaintiffs have met that burden here.

all the places of business of the enterprise for which such service is

performed; and

(C) Such individual is customarily engaged in an independently

established trade, occupation, profession or business.

N.J. STAT. ANN. § 43:21-19(i)(6)(A)-(C).

“In cases concerning the alleged misclassification of delivery drivers in other

jurisdictions using ABC tests, federal courts have repeatedly found common evidence

sufficient to satisfy all three prongs of the test.” Carrow, 2019 WL 7184548, at *10 (citing

various cases). The Court will address each in turn.

i. Prong A

As stated above, Prong A requires Defendants to show the drivers were free, in

contract and in fact, from Defendants’ control. N.J. STAT. ANN. § 43:21-19(i)(6)(A).

Defendants claim that common evidence cannot answer either of these inquiries.

[Docket No. 142, at 22-26.] Defendants argue that the drivers “signed materially

different agreements depending on when they provided services to NFI,” pointing to a

handful of minor changes made over the course of the various agreements. [Id. at 4-5,

22.] In response, Plaintiffs counter that there are “ample terms showing NFI’s control

included in each of the contract iterations.” [Docket No. 148, at 17.] They expand in a

footnote:

For example, terms requiring the drivers to provide their trucks to NFI

exclusively for NFI’s use, requiring the drivers to maintain GPS and

communication systems approved by NFI, requiring the drivers to

regularly submit their trucks for inspection, requiring the drivers to

maintain logs and numerous other records and submit them to NFI,

requiring the drivers to report all accidents or other issues to NFI

immediately, prohibiting the drivers from assigning or subcontracting

their obligations, maintaining insurance mandated by NFI, and providing

NFI the ability to terminate the driver for any reason at NFI’s discretion.

[Id. at 17 n.29.] Based on that evidence, the Court holds that common evidence can

determine whether the drivers were contractually free from Defendants’ control.

The Court also finds that common evidence can answer whether the drivers were

factually free from Defendants’ control. Plaintiffs point out that Defendants “required all

of its delivery drivers to follow numerous policies, . . . issued instructions to all of its

drivers through letters and weekly newsletters, and [Defendants’] managers and

supervisors routinely used the Qualcomm [communication] system to provide

instructions to its drivers while they performed their work.” [Docket No. 129-1, at 18-

19.] Defendants also tracked the drivers’ locations with GPS devices, and automatically

reported the drivers as off duty under certain circumstances. [Id.] Defendants argue that

the application of these policies “varied in practice” and therefore require an

individualized inquiry. [Docket No. 142, at 24-25.] It also claims some of the policies

referenced by Plaintiffs were only in place to satisfy safety protocols and Department of

Transportation requirements. [Id.] This is beside the point at this stage of the case. See

Williams v. Jani-King of Philadelphia Inc., 837 F.3d 314, 322 (3d Cir. 2012) (“[T]he class

certification stage is not the place for a decision on the merits.”). Moreover, “evidence of

common practices can establish common answers to control as a matter of fact.”

Carrow, 2019 WL 7184548, at *10 (quoting DaSilva v. Border Transfer of MA, Inc., 296

F. Supp. 3d 389, 401 (D. Mass. 2017)). Plaintiffs have shown such evidence in their

Motion, so the question of control as a matter of fact can be resolved by common

evidence. Therefore, the Court holds that Prong A can be resolved through common

evidence.

ii. Prong B

As the Honorable Robert B. Kugler noted in a recent opinion on this issue,

“[t]here is no real dispute that Prong B turns on common evidence, because the

questions it raises — about the nature of the service provided, the usual course of

business of the employer, and whether the service was performed at the employer’s

place of business — are fairly abstract, and do not vary by individual.” Id. This Court

finds that the Carrow court’s analysis is equally applicable here, and that Prong B can be

resolved on common evidence. Defendants concede that the first part of Prong B —

whether the drivers performed services outside the usual course of Defendants’ business

— can be resolved on common evidence. [See Docket No. 142, at 26-27.] Instead, they

argue that the drivers performed services “outside of all the places of business of”

Defendants. [Id. at 26.] Defendants argue that this turns on “whether the amount of

time a Contractor spent — and the work, if any, he performed — at Trader Joe’s

warehouses in Nazareth or Hatfield, Pennsylvania, establishes that he worked ‘inside’

NFI’s places of business.” [Id.] This, Defendants argue, cannot be answered by common

evidence. [Id. at 26-27.]

In response, Plaintiffs cite a recent New Jersey Superior Court, Appellate

Division case in which that court held that, because the business of a company that

transports goods for its customers is “at no fixed place, . . . the places of defendants’

business enterprise not only included its facility, but also extended to the various

locations the truck drivers . . . were required to travel to perform services on defendants’

behalf.” Morales v. V.M. Trucking, LLC, Docket No. A-2898-16T4, 2019 WL 2932649, at

*6 (N.J. Super. App. Div. July 9, 2019). In light of that decision, Defendants’ argument

cannot be successful: their “places of business” include both their own factories as well

as the Trader Joe’s locations that the drivers delivered to. Therefore, Prong B can be

resolved on common evidence.

iii. Prong C

Finally, Prong C requires that Defendants prove the drivers were “customarily

engaged in an independently established trade, occupation, profession or business.” N.J.

STAT. ANN. § 43:21-19(i)(6)(C). As Judge Kugler wrote in Carrow, “[t]he thrust of prong

C is determining whether the ‘individual has a profession that will plainly persist despite

the termination of the challenged relationship.’” Carrow, 2019 WL 7184548, at *10

(quoting Hargrove, 106 A.3d at 459). Additionally, the New Jersey Superior Court,

Appellate Division, has held that Prong C requires that “[t]he employee must be engaged

in such independently established activity at the time of rendering the service involved.”

Phila. Newspapers, Inc. v. Bd. of Review, 937 A.2d 318, 327 (N.J. Super. Ct. App. Div.

2007) (quoting Gilchrist v. Div. of Empl. Sec., 137 A.2d 29, 35 (N.J. Super. Ct. App. Div.

1957)).

In this case, Plaintiffs argue that they were precluded from operating as truly

independent businesses. [Docket No. 129-1, at 17-18.] They point out that the drivers

worked full-time for Defendants, they did not work for anybody else, they were

prohibited from placing another business’s merchandise on their trucks, they drove

trucks with Defendants’ logo and DOT number, and they pulled trailers owned by

Defendants. [Id.] Defendants point out that some drivers worked for other companies

“immediately after they stopped driving for NFI.” [Docket No. 142, at 26-27.] However,

Defendants do not argue that any drivers were able to work for another company while

they worked for Defendants. The common evidence indicates that they were precluded

from doing so, in spite of Defendants’ protestations. As such, Prong C can also be

decided on common evidence.

In conclusion, each prong of New Jersey’s ABC test can be decided based on

common evidence in this case. Therefore, the predominance (and, resultingly,

commonality) requirement is satisfied here.

6. Superiority

Superiority means “that a class action is superior to other available methods for

fairly and efficiently adjudicating the controversy.” See FED. R. CIV. P. 23(b)(3). Rule

23(b)(3) further lists four “pertinent” factors to consider when determining if

superiority is satisfied:

(A) the class members’ interests in individually controlling the

prosecution or defense of separate actions;

(B) the extent and nature of any litigation concerning the controversy

already begun by or against class members;

(C) the desirability or undesirability of concentrating the litigation of the

claims in the particular forum; and

(D) the likely difficulties in managing a class action.

FED. R. CIV. P. 23(b)(3)(A)-(D).

Defendants argue that these factors cut against a finding of superiority for a

variety of reasons. [Docket No. 142, at 29-30.] They argue that the class would

“disregard[] class members’ interests in individually controlling the prosecution of their

claims” and “deprive[] them of the ability to seek what they in fact want.” [Id.]

Defendants also reassert their claim that New Jersey law would not apply to all putative

class members, and that the resulting conflict between applicable laws would “render a

class action unmanageable,” which is not true given the Court’s rulings in this Opinion.

[Id. at 30.]

Plaintiffs, of course, argue the opposite. They note that this case involves class

members who “shared similar roles and responsibilities, . . . were all governed by a

uniform corporate . . . policy, and . . . are all alleging that the [policy] was illegal,” factors

which cut in favor of a class action. Rivet v. Office Depot, Inc., 207 F. Supp. 3d 417, 432

(D.N.J. 2016). Moreover, the damages here stand to be relatively small for many

individuals, who might otherwise be unable to pursue their claims individually. See id.

(favoring class certification where members “will have little incentive to pursue their

claims on an individual basis”). Finally, Plaintiffs point to a risk inherent to legal claims

for workers in the employment context: retaliation. [Docket No. 129-1, at 28.] Class

actions can help avoid the chilling effect that individual litigation might have on

employees, thereby making it a superior option.

The Court agrees with Plaintiffs on the question of superiority. Despite

Defendants’ arguments, “no class member’s interests in independently prosecuting his

or her claim would be frustrated by certifying the class at issue here;” the Court has not

been made aware of any other lawsuits brought by potential class members, nor have

the class members “exhibited [any] interest in controlling the prosecution of this action

in this forum or elsewhere.” See Stair ex rel. Smith v. Thomas & Cook, 254 F.R.D. 191,

201 (D.N.J. 2008). Moreover, it is desirable to concentrate this litigation in this forum,

especially considering that it has already been concentrated here for nearly five years.

Finally, the parties do not note any substantial difficulties in managing this class action,

and in fact for many reasons set out above, there are many reasons that a class action

would be more manageable than other options, especially because of the reliance on

common evidence here. See Carrow, 2019 WL 7184548, at *12. Therefore, the

superiority requirement is also met here.

7. Ascertainability

Ascertainability requires that “(1) the class is ‘defined with reference to objective

criteria’; and (2) there is ‘a reliable and administratively feasibly mechanism for

determining whether putative class members fall within the class definition.’” Byrd v.

Aaron’s Inc., 784 F.3d 154, 163 (3d Cir. 2015) (quoting Hayes v. Wal-Mart Stores, Inc.,

725 F.3d 349, 355 (3d Cir. 2013)). It “consists of nothing more than these two inquiries[

a]nd it does not mean that a plaintiff must be able to identify all class members at class

certification — instead, a plaintiff need only show that ‘class members can be

identified.’” Id. (quoting Carrera v. Bayer Corp., 727 F.3d 300, 308 n.2 (3d Cir. 2013)).

In this case, the class definition is plainly based only on objective criteria.

Defendants argue that “full-time basis” cannot be an objective criterion because

Plaintiffs “attempt[] to define it.” [Docket No. 142, at 14.] This argument is illogical. A

criterion needing to be defined has no bearing on whether it is objective or subjective. In

this instance, the full-time criterion is clearly objective, as it is demonstrable by evidence

that does not rely, for instance, on “class members’ state of mind.” See City Select Auto

Sales v. BMW Bank of N. Am. Inc., 867 F.3d 434, 439 n.3 (3d Cir. 2017). Defendants

other arguments about this first ascertainability effectively attempt to force Plaintiffs to

identify all class members individually, which they are not required to do at this stage.

Therefore, the Court finds that the criteria of the class is objective, and the first

ascertainability requirement is met.

Defendants also argue that the second requirement is not met. It relies on two

cases in making this argument: Hargrove v. Sleepy’s, LLC, No. 10-01138 (PGS), 2018

WL 1092457 (D.N.J. Feb. 28, 2018) (“Sleepy’s II”), and a previous iteration of the

above-discussed Carrow case. [Docket No. 142, at 16-17.] The Carrow case upon which

their argument relies no longer supports their theory, as Judge Kugler has since issued

an opinion, discussed above, that grants class certification in a case similar to this one.

See Carrow, 2019 WL 7184548. Meanwhile, Sleepy’s II is distinguishable from this case,

as Plaintiffs point out. In that case, the court denied class certification in part because of

a lack of clear records to show what putative class members suffered allegedly improper

wage deductions. See Sleepy’s II, 2018 WL 1092457, at *7-8. Specifically, in that case,

the plaintiffs attempted to cross-reference multiple sets of incomplete data taken from

different time periods to show ascertainability. See id. at *3. Conversely, in this case,

“NFI produced spreadsheets that listed each contractor, the individuals who drove for

each contractor in addition to the contractor himself (i.e., secondary drivers), and the

number of deliveries completed by each individual.” [Docket No. 148, at 9.] There is no

lack of sufficient data here as there was in Sleepy’s II. See also Carrow, 2019 WL

7184548, at *12 (distinguishing that case from Sleepy’s II based on similar data as is

present in this case). In this case, the data is complete and covers the entirety of the

class period. Moreover, to the extent that Defendants have not yet disclosed the needed

data with respect to certain potential class members, they admit that they can easily do

so once the class has been certified. [See Docket No. 149-3, at 33-34.]

Defendants also point out that, like in Sleepy’s II, they “often contracted with —

and thus paid — business entities rather than individuals,” and those entities went on to

pay their individual drivers. [Docket No. 142, at 16.] Defendants claim that “Named

Plaintiffs offer no mechanism for identifying individual people who experienced

deductions from their wages.” [Id. at 17.] But, as Plaintiffs point out, the proposed class

would only consist of those individuals who “(1) entered into an independent contractor

agreement with NFI, either personally or through a corporate entity; and (2) drove a

vehicle on a full-time basis.” In other words, “Plaintiffs only seek to include as class

members the contractors who actually drove for themselves,” not sub-contractors whose

relationship with NFI reflects the more tenuous connection Defendants warn of. Courts

have found such a class to be ascertainable. See, e.g., Carrow, 2019 WL 7184548, at *12;

Carr v. Flower Foods, Inc., Civil Action No. 15-6391, Civil Action No. 16-2581, 2019 WL

2027299, at *10 (E.D. Pa. May 7, 2019).

Therefore, the Court finds that the class is clearly defined and ascertainable here.

Moreover, all of the relevant Rule 23 requirements are met, so the Court will grant class

certification.

IV. Conclusion

For the reasons expressed above, the Court will grant Plaintiffs’ Motion for Class

Certification, though it will slightly alter Plaintiffs’ proposed class in light of the findings

of this Opinion. The following class is certified under Rule 23(b)(3):

1. All individuals who: (1) entered into, either personally or through a

corporate entity, an independent contractor agreement with NFI that had

a New Jersey choice-of-law clause; and (2) drove a vehicle on a full-time

basis to perform deliveries of goods to Trader Joe’s stores anywhere on the

East Coast on behalf of NFI at any time since June 22, 2009.

2. “Full-time basis” means having delivered at least 80% of the loads assigned to the

contractor.

An accompanying Order shall issue.

June 30, 2020 s/Joseph H. Rodriguez

Date JOSEPH H. RODRIGUEZ

United States District Judge