Cases & Deals

CITGO obtains affirmation by Fifth Circuit dismissing all 26 plaintiffs in wage-hour action and awarding costs to CITGO

Clients CITGO Petroleum Corporation

On November 12, 2013, the Fifth Circuit Court of Appeals affirmed a final judgment obtained by Jones Day on behalf of client CITGO Petroleum Corporation in a lawsuit by 26 current and former console supervisors. Plaintiffs challenged their classification as exempt from the overtime pay requirements of the Fair Labor Standards Act.

During discovery, Jones Day attorneys determined that 23 Plaintiffs were destroying critical evidence with respect to their work duties and were failing to participate in discovery. Two evidentiary hearings demonstrated these Plaintiffs failed to preserve and produce work notes and/or emails sent and received during work hours, as required by court order. The district court dismissed the 23 Plaintiffs as sanctions for their failure to comply with two discovery orders. The court also granted summary judgment to CITGO on the claims of three other Plaintiffs because they were unable to prove their damages. These Plaintiffs had also been sanctioned for failing to comply with an order to permit discovery on their damages.

The Fifth Circuit upheld the dismissal of all 26 plaintiffs, finding the district court properly exercised its discretion under Rule 37 after making extensive evidentiary findings.

In addition, on a question of first impression, the Fifth Circuit reversed and rendered in favor of CITGO with respect to costs incurred at the district court level. The court rejected the consideration of the prevailing party's wealth as a factor in the reduction of costs, held that the plaintiffs were not indigent, and awarded costs to CITGO.

The Jones Day team that successfully represented CITGO was led by Stan Weiner of the Firm's Cleveland Office and Alex Pyke of the Firm's Houston Office.

Steve Moore, et al. v. CITGO Refining & Chemicals Company, L.P., Civil Action No. 2:11-cv-22 (S.D. Tex. Oct. 16, 2012), Appeal Nos. 12-41175, 12-41292 (5th Cir. Nov. 13, 2013)