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McCann v. The Sullivan University System, Inc.

Supreme Court of Kentucky

August 24, 2017

MARY E. MCCANN (INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED) APPELLANT
v.
THE SULLIVAN UNIVERSITY SYSTEM, INC., D/B/A SULLIVAN UNIVERSITY COLLEGE OF PHARMACY, ET AL APPELLEE

         ON REVIEW FROM COURT OF APPEALS CASE NO. 2014-CA-000392 JEFFERSON CIRCUIT COURT NO. 10-CI-001130

          COUNSEL FOR APPELLANT: Theodore W. Walton Garry Richard Adams, Jr.

          COUNSEL FOR APPELLEES, THE SULLIVAN UNIVERSITY SYSTEM, INC., D/B/A/ SULLIVAN UNIVERSITY COLLEGE OF PHARMACY, SULLIVAN COLLEGE OF TECHNOLOGY AND DESIGN, SULLIVAN UNIVERSITY GLOBAL E-LEARNING, DALE CARNEGIA KENTUCKIANA, INTERNATIONAL CENTER FOR DISPUTE RESOLUTION LEADERSHIP, SULLIVAN UNIVERSITY, LOUISVILLE TECHNICAL INSTITUTE, THE NATIONAL CENTER FOR HOSPITALITY STUDIES, INSTITUTE FOR PARALEGAL STUDIES, SPENCERIAN COLLEGE AND INTERIOR DESIGN INSTITUTE: Grover C. Potts, Jr. Michelle Deann Wyrick Rania Marie Basha Emily Christine Lamb

          COUNSEL FOR APPELLEES, THE KENTUCKY CHAMBER OF COMMERCE ("CHAMBER"), AND THE KENTUCKY SOCIETY FOR HUMAN RESOURCES MANAGEMENT ("KYSHRM"): Jeffrey Alan Savarise John Choate Roach Timothy James Weatherholt

          COUNSEL FOR APPELLEE, JEFFERSON COUNTY TEACHERS ASSOCIATION (JCTA): Thomas J. Schulz

          COUNSEL FOR APPELLEE, KENTUCKY EQUAL JUSTICE CENTER (“KEJC”) AND JOBS WITH JUSTICE: John Christopher Sanders McKenzie Cantrell

          COUNSEL FOR APPELLEES, KENTUCKY JUSTICE ASSOCIATION, KENTUCKY CHAPTER OF AMERICAN FEDERATION OF LABOR AND CONGRESS ODF INDUSTRIAL ORGANIZATIONS, KENTUCKY STATE BUILDING AND CONSTRUCTION TRADE COUNCIL, RIVER CITY FRATERNAL ORDER OF POLICE LODGE 614, INC., TEAMSTERS LOCAL 783, INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND.AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, AND UNITED STEEL, PAPER AND FORESTRY, RUBBER, MANUFACTURING, ENERGY, ALLIED INDUSTRIAL AND ALLIED INDUSTRIAL AND SERVICE WORKERS INTERNATIONAL UNION: Kevin Crosby Burke Irwin H. Cutler, Jr. David Lindsay Leightty Jamie Kristin Neal

          COUNSEL FOR APPELLEE, UPS CERTIFIED CLASS Andrew J. Home Michael Douglas Grabhorn

          OPINION

          WRIGHT JUSTICE.

         Mary McCann filed a CR 23 motion to certify a class action in Jefferson Circuit Court. The trial court denied that motion as a matter of law and McCann appealed. The Court of Appeals affirmed the trial court's judgment and held KRS 337.385 does not authorize class actions. McCann then moved this Court for discretionary review, and we granted her motion. On appeal, McCann argues that the Court of Appeals erred by reading KRS 337.385 to prohibit class actions. We agree. Therefore, we reverse the judgment of the Court of Appeals and remand this case to Jefferson Circuit Court for proceedings consistent with this opinion.

         I. BACKGROUND

         The Sullivan University System, Inc., hired Mary McCann as an admissions officer in March 2006 at its Fort Knox Campus. In May 2007, Sullivan transferred McCann to its Spencerian College campus in Louisville. In April 2008, Sullivan terminated McCann's employment.

         Following her termination, McCann filed an action in Jefferson Circuit Court. Sullivan removed McCann's action to federal court after the United States Department of Labor filed a complaint against Sullivan under the federal Fair Labor Standards Act. Sullivan disputed the Department of Labor's allegations, but as part of that settlement, agreed to treat its admissions officers as non-exempt employees, to pay overtime wages, and to pay back wages to certain admissions officers. By agreed order, the federal district court dismissed McCann's federal Fair Labor Standards Act claims against Sullivan and remanded the. remaining state law claims to Jefferson Circuit Court.

         When McCann moved to certify a class, the Jefferson Circuit Court . denied the motion on purely legal grounds. In its order denying class certification, the trial court relied upon dicta in an unpublished Court of Appeals' opinion, Toyota Motor Mfg., Kentucky, Inc. v. Kelley, 2012-CA-001508-ME, 2013 WL 6046079, at *9 (Ky. App. Nov. 15, 2013). The Court of Appeals in Kelley did not reach the merits of whether a class action is available for claims brought under KRS 337.385. Yet, the panel opined that if it were to reach that question, it would conclude ...


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