Texas Supreme Court Turns Back Employee Class Action

Posted 12:04 PM by Michael Fox

Without hearing oral argument, the Texas Supreme Court today overturned a class certification that had been affirmed by the Corpus Christi Court of Appeals. Snyder Communications, LP v. Magana (Tex. 6/25/04). The trial court had certified a class consisting of:

All persons employed in the United States with Defendant Snyder Communications, L.P., on or after April 3, 1997 in the capacity of a sales associate (also known as a field representative position) and employed to sell the AT&T Long Distance Residential Program who submitted one or more LOAs to Defendant which Defendant did not pay.

The allegations were that Snyder had committed both fraud and breach of contract in paying (or from the plaintiffs' perspective, more aptly put, failing to pay) commissions for sales of long distance services.

Although anyone interrupted at dinner by a phone solicitor might have trouble deciding where sympathy should lie between the phone solicitor who called, or the company who hired legions of callers, fortunately that was not the basis for the court's decision. Instead the Court held that since there were as many as 5 reasons why a particular sale (LOA) could be rejected, each individual LOA would have to be considered. Under those circumstances, it was an abuse of discretion for the lower courts to find that common issues of law and fact predominated as required by the class certification rules. Although not all employee class actions will fall into this category, clearly many issues that could arise in an employment law case will.

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