Press Release
01/14/09 -
Vedder Price Wins Summary Judgment in FLSA Class Action Case for Novartis
On January 12, 2009, Judge Paul A. Crotty of the US District Court for the Southern District of New York, granted Defendant Novartis Pharmaceutical Corporation's Motion for Summary Judgment in a consolidated national class action lawsuit in which the plaintiffs claimed to be entitled to overtime pay under the federal Fair Labor Standards Act and corresponding state wage and hour laws. The case is styled In Re Novartis Wage and Hour Litigation, No. 06-MD-1794 (PAC).
NPC argued that the plaintiffs were not entitled to overtime pay because they fell within the "outside sales" and "administrative" exemptions to both the federal and state overtime requirements. Both parties moved for summary judgment and the Court heard oral arguments in late 2008. In a 33 page Opinion and Order, Judge Crotty held that the NPC sales reps were exempt under both exemptions, as well as under California law.
Construing the outside sales exemption, Judge Crotty explained that while it is to be ready narrowly, "recognizing the realities of the pharmaceutical industry is not incompatible with engaging in a narrow reading. To the contrary, it produces results that reflect the exemptions terms and spirit." Similarly, after acknowledging that pharma sales reps are constrained by federal regulations, the reps do exercise ample discretion and make independent judgments within the confines of the regulations. Dismissing the plaintiffs' claims that they are mere "robots" or "automatons", Judge Crotty wrote: "It defies logic to accept that ... Reps are expected to do nothing but chant slogans and mouth platitudes."
Vedder Price attorneys Richard Schnadig, Charles Wolf, Thomas Abram, Aaron Gelb, Joseph Mulherin and Elizabeth Hall were involved in various aspects of this litigation.
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