ANDREW BEISSEL v. WARREN TRANSPORT INC (2025)

ORDER

This matter is before the Court on plaintiff's motion for conditional certification. (Doc. 47). Defendant filed a resistance. (Doc. 51). Plaintiff filed a reply. (Doc. 56).

For the following reasons, the Court denies plaintiff's motion for conditional certification.

I. FACTUAL BACKGROUND

Defendant is a motor carrier headquartered in Waterloo, Iowa. (Docs. 46, at 2; 51-1, at 2). Defendant agrees to contracts, known as an Independent Contractor Operating Agreement (“ICOA”), with individuals or entities (“drivers”)¹ to provide transportation services. (Doc. 51-1, at 2–3). Under the ICOAs, drivers agree to provide a truck and a qualified driver. (Id., at 3). In exchange, defendant offers loads to drivers and compensates the drivers for each load completed. (Id.). Defendant deducts certain expenses from drivers' compensation, which drivers authorize in the ICOAs. (Id.). When the other party is a business entity, defendant compensates the entity. (Id.). When the other party is an individual, defendant compensates the individual. (Id.). Most drivers operate the truck personally, but some hire other operators to operate the truck on their behalf. (Id.). And some drivers, called fleet operators, provide multiple trucks and operators at once. (Id.). Defendant classifies all these drivers as independent contractors.

Defendant categorizes its drivers into four categories: (1) long haul over-the-road (OTR) van drivers; (2) OTR flatbed/specialized drivers; (3) short haul drivers; and (4) local fleet operators. (Id., at 5). OTR van drivers haul standard trailers between points in different states during trips which usually take more than one day. (Id.). OTR flatbed/specialized drivers haul specialty freight which is primarily oddly shaped freight—this appears to the Court to be “oversized load” type of freight. (Id.). Short haul drivers operate within a 550-mile radius of Waterloo and travel approximately 350 miles on average, often transporting goods between warehouses or between warehouses and retailers. (Id., at 6).² Local fleet operators haul shipments of tractor parts for one of defendant's customers within the city limits of Waterloo. (Id., at 5–6). OTR van drivers make up 53% of defendant's drivers; 20% are OTR flatbed/specialized drivers; 10% are short haul drivers; and 17% are local fleet operators. (Id., at 6).

Drivers obtain their trucks from several sources. About 40% of drivers either own their own truck or lease a truck from a third party before entering into an agreement with defendant. (Id., at 6–7). The remaining 60% of drivers lease a truck from Competitive Equipment Sales, Inc. (“Competitive Equipment”), a “corporate affiliate” of defendant. (Id., at 7). These percentages vary by category of driver. Currently, 63% of OTR van drivers lease through Competitive Equipment; 75% of OTR flatbed/specialized drivers lease through Competitive Equipment; 50% of short haul drivers lease through Competitive Equipment; and 0% of local fleet operators lease through Competitive Equipment. (Id., at 7–8). The drivers' leases with Competitive Equipment include an option to purchase the truck for a stipulated value at the end of the lease. (Id., at 7). Under the terms of the lease with Competitive Equipment, drivers authorize defendant to deduct a portion of the drivers' weekly compensation and forward it to Competitive Equipment to satisfy the drivers' lease payment obligation to Competitive Equipment. (Id.).

Plaintiff states that defendant requires new drivers to attend a five-day orientation before they begin work. (Doc. 47, at 11). It appears, however, that the length of the orientation and some of the training at the orientation differs depending on the driver and the category of driver. (Doc. 51-1, at 8). Orientation can take anywhere from three to five days, according to defendant. (Id.). For example, the OTR flatbed/specialized drivers typically complete additional specialized training at orientation, and drivers sometimes require additional training on safety or use of electronic logging devices. (Id.).

Defendant has the ability to monitor drivers via GPS tracking. Defendant states that it does not generally monitor drivers except from time to time to provide shipping updates to customers. (Id., at 13–14). Under the ICOA, drivers are required to submit certain paperwork to defendant in connection with each load the driver carries. (Doc. 47-1, at 3, 14). Drivers are generally able to choose their own routes when delivering a load, with one exception in Laredo, Texas, which defendant states is for security and regulatory compliance purposes. (Id., at 3; Doc. 51-1, at 14). Route types and choices sometimes vary by driver category, though. For example, some drivers haul dedicated lanes (i.e., a specific trip using the same route each time) for specific customers, and sometimes routes for OTR flatbed/specialized drivers are largely mandated by state regulations. (Doc. 51-1, at 14).

The way defendant offers loads to drivers is largely the same for OTR van, OTR flatbed/specialized, and short haul drivers. Defendant offers the closest driver a load, and if the driver declines, defendant offers the load to the next closest driver. (Id., at 9). For OTR flatbed/specialized drivers, defendant separates the drivers into categories based upon level of experience when deciding who to offer a load because of the specialized nature of the freight. (Id., at 11). Local fleet operators do not receive load offers because they only haul loads for a specific customer in Waterloo. (Id., at 9). That is, local fleet operators are not dispatched by defendant. (Id., at 6).

Plaintiff was an OTR van driver with defendant from December 2021 until October 2023. (Doc. 47-1, at 2). Plaintiff was one of the drivers who leased a tractor under an equipment lease with Competitive Equipment. (Doc. 51-1, at 16). Plaintiff states that defendant inspected his vehicle twice per year while he was a driver with defendant. (Doc. 47-1, at 3). Plaintiff also states that he was required to obtain defendant's approval before making any repairs to his trailer. (Id.). According to plaintiff, under the ICOA, drivers were required to carry specific insurance, including “public liability and property damage coverage,” and were required to “submit proof of coverage to” defendant. (Doc. 47, at 11). Plaintiff also states that defendant “requires drivers to [use] company-issued fuel cards and specific fueling locations” in his brief. (Id., at 12). The pages to which plaintiff cites in support of this claim do not necessarily support it except for the fact that there is a fuel/cash card program. (See Doc. 47-1, at 8, 26–27). Defendant states that it makes a fuel card available to drivers which allows drivers to purchase fuel at a discounted price from certain stations, but that drivers are not required to use the fuel card. (Doc. 51-1, at 14). Plaintiff further states that he “was not permitted to make deliveries for any company other than” defendant. (Doc. 47-1, at 3).

Defendant pays drivers based on a set percentage of each load they deliver. The rate is generally 65% of the gross revenue for the load. (Id., at 13). Local fleet operators, however, receive about 70% of the gross revenue for their loads. (Doc. 51-1, at 5–6). It appears all drivers are also paid 100% of any fuel surcharge defendant bills to the customer—although, it is unclear whether short haul drivers receive this payment. (Id.). OTR van drivers and OTR flatbed/specialized drivers also agree in their ICOAs to a “fuel mileage reimbursement agreement” which operates as a formula that “results in the linehaul percentage varying up or down based on the linehaul rate charged to the customer.” (Id., at 6). It is unclear whether local fleet operators' ICOAs include a fuel mileage reimbursement agreement. Short haul drivers do not sign fuel mileage reimbursement agreements. (Id.).

Under the ICOAs, drivers are responsible for certain expenses. Plaintiff states that these include “all costs and expenses related to operating [his] vehicle, including maintenance and repairs, fuel, oil, tires, and lubricants, as well as all taxes, fees, and tolls associated with vehicle operation.” (Doc. 47-1, at 3). Plaintiff also states that defendant made deductions from his compensation, “including escrow, truck payments, fuel costs, insurance premiums, and various administrative fees and charges” which often totaled thousands of dollars per week. (Id.).

As a result of the deductions and expenses plaintiff paid, he claims that “there were several weeks during which [his] pay fell below minimum wage.” (Id.). Plaintiff includes an example week in December 2022 in which he claims he drove 788 miles, worked more than forty hours, and received $0.00 in net pay after deductions. (Id.). Defendant disagrees with plaintiff's factual claim on this front. (Doc. 51, at 24).

Plaintiff states that he had conversations with “at least two other drivers” at defendant's office who “also had significant deductions taken out of their pay by [defendant], and there were weeks in which these deductions resulted in them receiving no pay.” (Doc. 47-1, at 3).

On July 10, 2024, plaintiff filed this action in Iowa state court. (Doc. 1, at 1). Plaintiff generally alleged in his complaint that defendant misclassified plaintiff as an independent contractor and in some weeks plaintiff was paid below minimum wage. (Doc. 2). In the original complaint, plaintiff brought claims under Iowa state law and sought to certify a class action on behalf of himself and all others similarly situated. (Id., at 4–7). Defendant then removed the case to this Court. (Doc. 1). Plaintiff later filed an amended complaint with largely the same factual allegations. (Doc. 46). In his amended complaint, plaintiff added a claim under the federal Fair Labor Standards Act (“FLSA”), Title 29, United States Code, Section 216(b). (Doc. 46, at 8). Plaintiff seeks to bring the FLSA claim as a collective action. (Id., at 6).

II. LEGAL STANDARD

Under Title 29, United States Code, Section 216(b), an employee may maintain an action against an employer for violation of the FLSA “for and in behalf of himself or themselves and other employees similarly situated.” But such similarly situated other employees must give “consent in writing to become such a party and such consent [must be] filed in the court in which such action is brought.” Id. Thus, individuals other than the named plaintiff must affirmatively “opt in” to become part of the collective action.

“[C]onditional certification of a collective class is firmly within the Court's discretion.” Peck v. Mercy Health, No. 4:21-CV-834 RLW, 2023 WL 1795421, at *2 (E.D. Mo. Feb. 7, 2023).

Traditionally, this Court, as well as most courts in the Eighth Circuit and elsewhere, has “employed a two-step approach to determine whether it is appropriate to certify a collective action under the FLSA.” Cervantes v. CRST Int'l, Inc., No. 20-CV-75-CJW-KEM, 2021 WL 7185079, at *2 (N.D. Iowa Jan. 25, 2021). This Court explained the traditional two-step process in Cervantes:

“The two-step approach ‘distinguishes between conditional class certification, generally made at the ‘notice stage,’ and a final class certification determination made after discovery is largely complete.[’]” [Salazar v. Agriprocessors, Inc., No. 07-CV-1006-LRR, 2008 WL 782803, at *4 (N.D. Iowa Mar. 17, 2008)] (quoting Dietrich v. Liberty Square, L.L.C., 230 F.R.D. 574, 577 (N.D. Iowa 2005)).

The first step is conditional certification, wherein a plaintiff moves to conditionally certify the action early in the case for purposes of providing notice to similarly situated persons. [Id.] This lenient standard requires that a plaintiff “merely provide some factual basis from which the court can determine if similarly situated potential plaintiffs exist.” Bouaphakeo v. Tyson Foods, Inc., 564 F. Supp. 2d 870, 892 (N.D. Iowa 2008). To meet this standard, plaintiffs must make “a modest factual showing sufficient to demonstrate that they and potential plaintiffs were victims of a common policy or plan that violated the law.” Salazar, 2008 WL 782803, at *4 (quoting Dietrich, 230 F.R.D. at 577). A plaintiff need not show that the potential plaintiffs are actually similarly situated at this stage. Bertroche v. Mercy Physician Assocs., Inc., No. 18-CV-59-CJW, 2018 WL 4107909, at *2 (N.D. Iowa Aug. 29, 2018). Under the FLSA, “[t]he sole consequence of conditional certification is the sending of court-approved written notice to employees, who in turn become parties to a collective action only by filing written consent with the court.” Genesis Healthcare Corp. v. Symczyk, 569 U.S. 66, 75 (2013) (citations omitted). Thus, under the first step, district courts merely provide notice of the opportunity to join potential plaintiffs “in a manner that is orderly, sensible, and not otherwise contrary to statutory commands or the provisions of the Federal Rules of Civil Procedure.” Hoffman-La Roche Inc. v. Sperling, 493 U.S. 165, 170 (1989).

The second step—final certification—occurs at the close of discovery. Frazier v. PJ Iowa, L.C., 337 F. Supp. 3d 848, 861–62 (S.D. Iowa 2018). The second stage is a fact-intensive inquiry which requires the Court to consider factors such as “(1) the extent and consequence of disparate factual and employment settings of the individual plaintiffs; (2) the various defenses available to defendant which appear to be individual to each plaintiff; and (3) fairness and procedural considerations.” West v. Border Foods, Inc., Civil No. 05-2525 (DWF/RLE), 2006 WL 1892527, at *3 (D. Minn. June 10, 2006). Importantly, a defendant may also later move to decertify an action. Young v. Cerner Corp., 503 F. Supp. 2d 1226, 1229 (W.D. Mo. 2007).

Cervantes, 2021 WL 7185079, at *2.

Traditionally, then, this case is at the first stage of the two-step process. This first step, as noted above, only requires plaintiff to “provide some factual basis from which the court can determine if similarly situated potential plaintiffs exist.” Bouaphakeo, 564 F. Supp. 2d at 892. And, as noted above, plaintiff “need not show that the potential plaintiffs are actually similarly situated at this stage.” Cervantes, 2021 WL 7185079, at *2. This is a “lenient standard.” Id.

But defendant argues the Court should adopt a different standard here. Recently, the fifth and sixth circuit courts of appeals have held that district courts should apply a more demanding standard than they traditionally have at this initial stage. The Fifth Circuit, in Swales v. KLLM Transport Services, L.L.C., 985 F.3d 430, 434 (5th Cir. 2021), specifically rejected the traditional “two-step certification rubric.” Instead, the court instructed that “a district court must rigorously scrutinize the realm of ‘similarly situated’ workers, and must do so from the outset of the case, not after a lenient, step-one ‘conditional certification.’ ” Id. The main holding in Swales is that courts must be more demanding, and less lenient, at an early stage in determining whether potential opt in plaintiffs are “similarly situated.” See id. at 439–43.

A few years later, the Sixth Circuit landed somewhere in between the traditional approach and the Swales approach. In Clark v. A&L Homecare & Training Center, LLC, 68 F.4th 1003, 1009–11 (6th Cir. 2023), the court rejected the traditional standards—especially the lenient standard at step one—but did not go as far as the Swales court in what is required at step one. The Clark court read Swales to require, at the early notice stage, “that the district court must find by a preponderance of the evidence that those [potential opt in] employees are similarly situated to the original plaintiffs.” Id. at 1010. But the Clark court pointed out that, as a practical matter, it would be quite difficult for a district court to “conclusively make ‘similarly situated’ determinations as to employees who are in no way present in the case.” Id. Because the district court will not yet have heard from the other potential opt ins at the early stage, the Clark court reasoned, the court cannot know all of the facts yet at that stage. But the court also rejected the “modest showing” or “lenient standard” requirement. Instead, the Clark court concluded that “for a district court to facilitate notice of an FLSA suit to other employees, the plaintiffs must show a ‘strong likelihood’ that those employees are similarly situated to the plaintiffs themselves.” Id. at 1011. This, the court said, is “a showing greater than the one necessary to create a genuine issue of fact, but less than the one necessary to show a preponderance.” Id. Thus, under the Sixth Circuit's rule, plaintiffs need not show that the other potential opt ins are similarly situated by a preponderance of the evidence at the notice stage, but instead plaintiffs must show by the slightly lesser standard of a “strong likelihood” that the potential opt ins are similarly situated to plaintiffs. See id.

Here, defendant argues the Court should adopt a higher evidentiary standard in line with the Swales and/or Clark court(s), largely resting its argument on the reasoning in the cases. (Doc. 51, at 14–15). Defendant argues the higher standard is particularly appropriate in this case because plaintiff has not offered admissible evidence that the potential opt in plaintiffs are similarly situated to plaintiff and to each other, and because plaintiff has not identified any other individuals who would join the case if invited. (Id., at 15).

Plaintiff argues that “there is no reason the Court should depart from the well-established two-step collective approach and order discovery.” (Doc. 56, at 4). Plaintiff points out that the Court will have the opportunity to reconsider whether the collective should survive and its scope at the close of discovery, at the second stage of the process, under the traditional approach. (Id.). Plaintiff argues further that other courts have continued to follow the traditional two-step approach, and specifically district courts in the Eighth Circuit have roundly rejected the Fifth and Sixth Circuits' new approaches. (Id., at 5).

Finally, both parties recognize that this Court has previously declined to follow Swales in an order which was filed after Swales was decided but before Clark was decided. (Docs. 51, at 15 n.4; 56, at 2) (both quoting Cervantes, 2021 WL 7185079, at *3).

The Court will stick with the traditional two-step approach for several reasons. First, the traditional approach is apparently the unanimous practice of the district courts in the Eighth Circuit, including after Swales and Clark were decided. See, e.g., Peck, 2023 WL 1795421, at *3 (“[T]his Court is unaware of a single case from within the Eighth Circuit that applies the Swales standard. ․ In fact, a review of the case law reveals nearly universal negative treatment of Swales by other district courts in this Circuit.”); Sullivan v. Dent Wizard Int'l, LLC, No. 4:25-cv-00097-AGF, 2025 WL 1489243, at *3–4 (E.D. Mo. May 22, 2025) (applying the traditional two-step approach and declining to apply a heightened standard similar to Swales or Clark). This Court has similarly rejected Swales previously. See Cervantes, 2021 WL 7185079, at *3.

The other reason the Court will stick with the traditional approach involves the timing and consequences of the first stage of the process. Notably, “the sole consequence of conditional certification under Section 216 is the sending of court-approved written notice to employees who in turn become parties to a collective action only by filing written consent with the court.” Tyson Foods, Inc. v. Bouaphakeo, 577 U.S. 442, 449 (2016) (cleaned up). And this is not the final decision as to the existence or scope of the collective. A defendant still has the opportunity to challenge the existence and scope of a collective through a motion to decertify at a later time. Additionally, the early timing of the motion for conditional certification means the parties may not generally be in possession of many of the relevant facts, especially the facts relating to the other members of the collective. A deep dive into the facts at this early stage will necessarily be flawed, especially about facts known by the other potential members of the collective. Thus, the Court will analyze the present motion under the traditional two-step approach.

III. ANALYSIS

For the Court to grant plaintiff's motion for conditional certification of a collective, plaintiff must “provide some factual basis from which the court can determine if similarly situated potential plaintiffs exist.” Bouaphakeo, 564 F. Supp. 2d at 892 (internal quotations omitted). Plaintiff must “come forward with a factual basis, a colorable basis, or substantial allegations, that the existing plaintiff and putative plaintiffs were together the victims of a single decision, policy or plan.” Id. at 893 (cleaned up). Also, “a plaintiff's supporting evidence should include evidence that other similarly situated individuals desire to opt in to the litigation because others' interest in joining the litigation is relevant to whether or not to put a defendant employer to the expense and effort of notice to a conditionally certified class of claimants.” Rivera v. Stryten Energy, LLC, No. 21-CV-2056 CJW-MAR, 2022 WL 22915989, at *4 (N.D. Iowa July 28, 2022) (cleaned up). “This Court has consistently looked to see whether the plaintiff proffered evidence that other putative members of the collective desire to opt in.” Id. (citing Behr v. AADG, Inc., 136 F. Supp. 3d 1012, 1017 (N.D. Iowa 2015); Bouaphakeo, 564 F. Supp. 2d at 896).

Defendant argues plaintiff “has not identified anyone who wants to join the case.” (Doc. 51, at 17). Defendant points out that the closest plaintiff gets to “even acknowledging the existence of other potential plaintiffs is to assert that ‘at least two other drivers' told him they were paid nothing during certain unspecified weeks as a result of unidentified deductions.” (Id.). This, defendant argues, is insufficient.

Plaintiff argues he should not be required to show that any potential opt-in plaintiffs are interested in opting in. (Doc. 56, at 9–10). Plaintiff cites cases which fundamentally disagree with the reasoning in Rivera. (Id.). The cases plaintiff cites generally reason that requiring a plaintiff to produce evidence that other potential members of the collective desire to opt in imposes an unfair burden on the plaintiff and undermines the remedial goals of the FLSA. (Id., at 10) (citing, e.g., Heckler v. DK Funding, LLC, 502 F. Supp. 2d 777, 780 (N.D. Ill. 2007)).

Although both arguments here have merit, this Court has been clear in requiring that plaintiffs show at least some evidence at this stage that other potential members of the collective desire to opt in. This Court rejected essentially the same argument plaintiff makes here in Rivera. See 2022 WL 22915989, at *4–5. The Court incorporates its reasoning stated in Rivera here and rejects plaintiff's argument for the same reasons. See id.

Plaintiff, then, is required to show at this stage “evidence that at least one of the putative class members desires to join the lawsuit.” Id. at *4 (quoting Judkins v. Southerncare, Inc., 4:12-cv-00293, 2013 WL 12099652, at *3 (S.D. Iowa June 24, 2013)). That is, “a named plaintiff must do more than show the mere existence of other similarly situated persons.” Judkins, 2013 WL 12099652, at *3 (cleaned up).

Here, plaintiff has not carried this burden. Plaintiff has submitted no evidence showing that anybody else desires to join the collective. As defendant points out, the only evidence plaintiff submits which could possibly relate to this issue is plaintiff's assertion that he had a conversation with two other drivers where the other drivers said that they “had significant deductions taken out of their pay by [defendant] and there were weeks in which these deductions resulted in them receiving no pay.” (Doc. 47-1, at 3). This is not enough. Nothing about what appears to have been passing conversations suggest that these two other drivers believed these incidents violated the FLSA or any other law, or that they wished to join a lawsuit asserting as much.

In fact, this Court has rejected a stronger argument than plaintiff's here. In Rivera, the Court rejected the “plaintiff's argument that his ‘declaration merely stating that other similarly situated employees wish to opt in’ is enough to show the required interest.” 2022 WL 22915989, at *5. Here, plaintiff does not even say there are other similarly situated employees who wish to opt in. Plaintiff simply states that there are similarly situated employees. Plaintiff would not only need to state that there are others who wish to opt in, but would also need to put forward some evidence—more than speculation—to carry his burden here. Plaintiff has not done so. Thus, the Court will deny plaintiff's motion to conditionally certify a collective. (Doc. 47).

Although the Court will not complete the rest of the analysis, it notes that it would consider, if there was evidence of other drivers who desired to be in the collective, plaintiff's arguments as to OTR van drivers, OTR flatbed/specialized drivers, and short haul drivers. Given the evidence in front of the Court at this point, local fleet operators, however, would very likely not be included in any potential collective. Even at this early stage, these drivers' situations are materially different enough from drivers in the other categories that they cannot be similarly situated. Local fleet operators carry much shorter loads than the other drivers—generally only within Waterloo city limits. Additionally, these drivers only carry loads for one of defendant's customers, and they are dispatched by defendant's customer, not by defendant. The analysis of the major issues in this case will necessarily be different for these drivers as compared with the other three categories of drivers. At base, local fleet operators have a different day-to-day job and their relationship with defendant is necessarily different when compared with the other three categories of drivers. Thus, even at this early stage, the Court can and would eliminate local fleet operators from the conditional collective if the Court would have completed the “similarly situated” analysis.

IV. CONCLUSION

For these reasons, the Court denies plaintiff's motion for conditional certification. (Doc. 47).

IT IS SO ORDERED this 10th day of June, 2025.

FOOTNOTES

1.   One of the ultimate issues in this case is whether these drivers are independent contractors or employees. The Court will use the neutral term “drivers” instead of contractors or employees.

2.   It is not entirely clear whether this 350-mile average is per day, per delivery, or something else.

C.J. Williams, Chief Judge United States District Court Northern District of Iowa