Judge Denies Summary Judgment, Litigation Continues in American Family Case
On Wednesday, Judge Donald C. Nugent of the United States District Court for the Northern District of Ohio rejected American Family’s second attempt to prevent a proposed class action from proceeding. Wexler Wallace, along with co-counsel, represents current and former agents employed by American Family who allege they were denied benefits under the Employment Retirement Income Security Act. The complaint alleges that the agents were misclassified as independent contractors by American Family when the Company treated them as employees – a misclassification that the complaint alleges not only cost plaintiffs’ retirement and health benefits, but also unjustly enriched the company.
Judge Nugent declined to grant summary judgment to American Family on its argument that the named Plaintiffs’ claims were time-barred. The Court explicitly rejected American Family’s argument that the claims asserted by the Plaintiffs accrued upon execution of the Agency Agreement. The Court also denied American Family’s request for summary judgment on its affirmative defense that Plaintiffs had failed to exhaust their administrative remedies, holding, “Defendants have provided no evidence or reason to convince the Court that any attempt by these agents to pursue a claim for benefits under ERISA administrative procedures would have been any thing other than futile.” The Court then considered American Family’s motion for summary judgment on whether agents are employees or independent contractors, considering many of the factors that relate to American Family’s right to control its agents. The Court concluded that the ultimate answer to the question of which way the scale tips requires a fact-intensive analysis better left for trial, and denied American Family’s motion.
This is the second win for plaintiffs provided by Judge Nugent in this case. He also denied America Family’s motion to dismiss in its entirety in August 2013.