Nevada v. U.S. Dep't of Labor
This case concerns a motion for contempt filed by Chipotle Mexican Grill, Inc. and Chipotle Services, LLC against Carmen Alvarez and her attorneys. Chipotle alleged that Alvarez and her legal counsel violated a nationwide preliminary injunction issued by the Eastern District of Texas on November 22, 2016, which enjoined the Department of Labor from implementing and enforcing a revised overtime regulation (the "Final Rule"). Despite the injunction, Alvarez and her lawyers filed a lawsuit in New Jersey against Chipotle, seeking overtime wages based on the very Final Rule that was enjoined. The Court found that it had jurisdiction over the non-party respondents due to actual notice of the injunction. It determined that Alvarez and her lawyers were in privity with the Department of Labor, whose interests were adequately represented in the original injunction proceeding, and thus were bound by the nationwide injunction. The Court further clarified that the injunction was unambiguous and prohibited any enforcement of the Final Rule, not just by the Department of Labor. Good faith was not a defense to contempt. Consequently, the Court granted Chipotle's motion for contempt, ordering respondents to withdraw their allegations related to the Final Rule and affirming the injunction's broad applicability. Chipotle was also awarded attorneys' fees and expenses for prosecuting the contempt motion.