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COA upholds dismissal of proposed class

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Potential plaintiffs who want to join a class action suit seeking redress under the state's Wage Claims Statute must first submit a claim to the Indiana Department of Labor, the Indiana Court of Appeals upheld today.

The ruling comes seven months after another appellate panel ruled in Lemon v. Wishard Health Services, 902 N.E.2d, 297 (Ind. Ct. App. 2009), that anyone who wants to file a lawsuit in court or join a class action suit under the Wage Claims Statute has to first submit their claim to the DOL. In upholding that decision, the Court of Appeals affirmed the dismissal of the proposed class of plaintiffs who haven't sought review and referral from the DOL in Maureen Reel, Thomas Dullen, and Ned Milby, on Behalf of Themselves and All Others Similarly Situated v. Clarian Health Partners Inc., No. 49A02-0901-CV-112.

Maureen Reel, Thomas Dullen, and Ned Milby filed their complaints under the Wage Claims Statute against Clarian Health Partners on behalf of themselves and all others who were paid their paid time off (PTO) wages on or after July 11, 2003. Their suit claimed Clarian paid out the PTO after the pay date for the pay period in which they were involuntarily separated, which would violate the Wage Claims Statute.

Clarian was initially granted summary judgment on the claims, but the appellate court reversed with respect to Reel, Dullen, and Milby. Those three had initially submitted their claim to the DOL.

The trial court did grant summary judgment to Clarian in a separate ruling in regards to the class claims. The named plaintiffs argued on appeal that despite the ruling in Lemon, in which transfer was pending at the time they filed their brief, but was denied by the time Clarian filed its brief, the members of the proposed class action weren't required to file their wage claims with the DOL in order to join the suit.

Under the Wage Claims Statute, the wage claims must first be submitted to the DOL, which may then refer the claims to the attorney general, who may initiate civil actions or refer the claim to an attorney. To become the "designee" of the attorney general, the claimant must first obtain a letter of referral before filing suit, wrote Judge Nancy Vaidik.

The Court of Appeals also affirmed the trial court didn't abuse its discretion in sequencing the discovery to avoid extensive and costly discovery until it ruled on the motion to dismiss.

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