11 | 17 | 2006 Posted By Sheppard Mullin

New Trend in Wage and Hour Lawsuits Targets Pharmaceutical Industry

In the past year, a new trend has emerged in wage and hour class action litigation that targets pharmaceutical and health products companies.  Several class actions have been filed in courts nationwide alleging that pharmaceutical and health products firms violated federal and state wage and hour laws by misclassifying sales representatives as exempt and denying them overtime pay, as well as meal and rest periods.

Earlier this year, Novartis Corp. was hit with three different lawsuits in New York, New Jersey and California that seek a total of $375 million.  The lawsuits, brought under both the Fair Labor Standards Act and state laws, seek unpaid overtime wages, liquidated damages, compensatory damages, punitive damages, civil penalties, prejudgment interest, injunctive relief, and attorneys' fees and costs.  The lawsuits are seeking to certify both state and nationwide classes.

A similar class action was filed against Eli Lilly & Co. this week by a former sales representative alleging that the company unlawfully classified its sales representatives as exempt and failed to pay overtime.  The suit seeks twice the damages resulting from the unpaid overtime plus attorneys' fees.  It is also seeking certification of two classes, one for the country as a whole and one for Eli Lilly's New York employees.

If approved, the federal classes would be open to thousands of sales representatives who have worked at Novartis and Eli Lilly & Co. up to three years prior to the filing of the complaints in each respective suit.