Roland v. Annett Holdings, Inc.
| Decision Date | 20 March 2020 |
| Docket Number | No. 18-1092,18-1092 |
| Citation | 940 N.W.2d 752 |
| Parties | Anthony ROLAND, Appellee, v. ANNETT HOLDINGS, INC., Appellant. |
| Court | Iowa Supreme Court |
Sasha L. Monthei of TMC Transportation, Des Moines, for appellant.
Matthew R. Denning, Christopher D. Spaulding, and Nicholas L. Shaull of Spaulding, Berg & Schmidt, P.L.C, Des Moines, and Donald G. Beattie and Nile Hicks of Beattie Law Firm, Des Moines, for appellee.
In this appeal, we must determine whether the district court abused its discretion by certifying a class action of employees with pending workers’ compensation claims. A trucking company operating nationally required its long-distance drivers to sign a "Memorandum of Understanding" (MOU) providing for short-term light duty and treatment in Des Moines after sustaining a work-related injury. An Alabama employee injured in Indiana successfully challenged the MOU, winning a ruling from the Iowa Workers’ Compensation Commission, affirmed by the district court and court of appeals, that determined the MOU as applied to him violated Iowa Code sections 85.18 and 85.27(4) (2017). The ruling allowed him to continue treatment in Alabama.
The driver then filed this civil action on behalf of himself and over forty other "similarly situated" employees who signed the MOU. The representative plaintiff driver alleges bad-faith claims and seeks actual damages including emotional distress as well as punitive damages. The employer, arguing the drivers’ claims had to be resolved by the agency, filed a motion to dismiss the civil action for lack of subject matter jurisdiction. The district court denied the motion to dismiss and certified this case as a class action. The employer appealed, and we transferred the case to the court of appeals, which affirmed the class-certification ruling. We granted the employer’s application for further review.
For the reasons explained below, we hold the district court abused its discretion by certifying this case as a class action. In our view, the commonality requirement is lacking, individual issues predominate over common ones, and workers’ compensation claims must be resolved by the workers’ compensation commission before judicial review. Accordingly, we vacate the decision of the court of appeals and reverse the class-certification ruling.
Annett Holdings, Inc.1 is a flatbed trucking company that transports freight across the United States. It is based in Des Moines, Iowa, and has satellite offices in North Carolina and Missouri. On October 24, 2013, Anthony Roland, a resident of Oxford, Alabama, started working for Annett Holdings as an over-the-road truck driver. Many of Annett Holdings employees, like Roland, reside outside of Iowa. As a condition of employment with Annett Holdings, all of its drivers, including Roland, were required to sign their employer’s MOU. The MOU outlined work requirements following a work-related injury.
Under the MOU, drivers who sustain a work-related injury must temporarily relocate from their home state to Des Moines for modified work duty.
Because drivers agree to be away from home as an essential function and an agreed upon term of their employment with Annett Holdings, injured workers are expected to temporarily relocate and perform their modified duty work in Des Moines, Iowa, irrespective of your state of residence. The temporary relocation will include staying away from your home for up to two weeks at a time. By accepting employment with the Company, you acknowledge there is nothing you are aware of which would prevent you from temporarily relocating to Des Moines, Iowa[,] for up to two weeks at a time to perform modified duty work assignments in the event you suffer a work injury.2
The MOU further states that Annett Holdings will pay for all travel expenses and lodging associated with the modified work duty. Drivers could return home every two weeks at the employer’s expense. The MOU provides, "If ongoing medical care is required by the medical condition of the injured worker, Annett Holdings will coordinate the modified duty work schedule with medical appointments to ensure the least amount of disruption between the two." Should the worker refuse the modified work duty, the MOU provides that Annett Holdings will suspend workers’ compensation benefits as permitted under Iowa Code section 85.33(3). Roland signed the MOU two days before he began his employment.
A. Roland’s Injury and Treatment. On March 4, 2014, Roland sustained a work-related injury to his elbow. Roland received his initial treatment in Indianapolis, Indiana, where the injury occurred, and he was later assigned to modified work duty in Des Moines pursuant to the MOU. After receiving treatment for his injury in Des Moines, Roland grew dissatisfied with his care. He requested to be seen by Dr. John Payne, an orthopedic surgeon in Anniston, Alabama. Annett Holdings approved the request, and Dr. Payne recommended surgery for Roland’s elbow, which he performed in Alabama on May 9. Annett Holdings authorized physical therapy for Roland in Anniston for three weeks following the surgery. During his recuperation in Alabama, Roland received physical therapy in the same office building as Dr. Payne, approximately three miles from Roland’s home in Oxford. After surgery in Alabama, and pursuant to the MOU, Roland was released to return to modified work duty in Des Moines on May 20. Annett Holdings arranged for Roland to receive physical therapy in Des Moines.
As part of his aftercare, Roland had to continue physical therapy for his elbow, and Dr. Payne told him to take extreme care to avoid swelling. Dr. Payne prescribed a cooling machine to use for twenty-one days to prevent swelling in Roland’s arm. However, Roland was not permitted to travel by air with the machine and had to travel by car for each trip between Alabama and Iowa. The machine ran on electricity. When he discussed this problem with Annett Holdings, he was told to substitute ice for the cooling machine while driving.
During Roland’s time in Des Moines, all but one of his therapy sessions occurred at the Baymont Hotel, where he stayed when assigned to light duty in Des Moines. Annett Holdings authorized Roland to receive physical therapy in Anniston for the weeks of June 9 and June 16 when he returned for post-op care with Dr. Payne. According to Roland, the therapy he received in Alabama was significantly better than what he received in Des Moines.
B. Roland’s Workers’ Compensation Claim. On June 5, Roland petitioned the Iowa Workers’ Compensation Commissioner seeking alternative medical care in Alabama. On June 17, while Roland was in Alabama for his follow-up appointment, the parties participated in a telephonic hearing with deputy workers’ compensation commissioner Erin Pals. The next day, Deputy Pals granted Roland’s petition for alternative care and concluded that the MOU deprived Roland of reasonable medical care. She found that the modification of the prescribed cooling machine to ice was unreasonable and interfered with his authorized treatment, that the Baymont Hotel therapeutic sessions did not amount to reasonable care, and that changing his treatment to Des Moines interfered with Dr. Payne’s recommendations. Based on Roland’s testimony, she determined "the therapy in Alabama is more effective and superior to the therapy in Des Moines."
Further, Deputy Pals found the MOU violated Iowa Code section 85.18 by attempting to avoid or eliminate the "reasonable" and "not unduly inconvenient" requirements from section 85.27. Deputy Pals cited the 897-mile trip between Alabama and Iowa for treatment as unreasonable; found the treatment in Iowa interrupted his visitation with his daughter, thereby creating an undue inconvenience; determined the Anniston therapy was superior; and concluded that the therapy offered in Des Moines did not provide reasonable care. For those reasons, Deputy Pals determined that the treatment offered was not reasonably suited to treat Roland’s injuries without undue inconvenience and ordered a transfer of Roland’s care to Dr. Payne in Anniston, Alabama.
Annett Holdings filed a petition for judicial review and persisted in requiring Roland to travel to Des Moines for modified work duty and medical care. On December 12, the district court affirmed Deputy Pals’ decision. The court of appeals affirmed the district court’s ruling on February 10, 2016.
C. Roland’s Petition and Motion for Class Certification. Six days later, Roland filed this civil action against Annett Holdings on behalf of himself and others similarly situated. Roland sought to certify a class of out-of-state Annett Holdings drivers who were required to sign the MOU and abide by its terms or else risk suspension or termination of their benefits. The petition alleged deprivation of statutory rights and other losses, including loss of time traveling to and from the employee’s home and Iowa; mental distress associated with the deprivation of the statutory rights; and unnecessary travel, sometimes contrary to the recommendation of the employee’s physician. On April 15, Roland amended his petition to include the allegation that Annett Holdings acted in bad faith because it did not suspend its modified work program following rulings by the agency, district court, and court of appeals. Roland sought compensatory and punitive damages.
D. Annett Holdings’ Resistance to Class Certification. Annett Holdings argued that the drivers’ claims involved too many individualized issues for class adjudication and that there is no private cause of action under Iowa Code section 85.18. Relying on Wal-Mart Stores, Inc. v. Dukes , 564 U.S. 338, 131 S. Ct. 2541, 180 L.Ed.2d 374 (2011), Annett Holdings argued that violation of the same provision of law cannot support class certification when the class members suffered different injuries.
Annett Holdings asserted the MOU is not per se illegal, noting that the court of appeals decision...
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