Challenge to Nevada Minimum Wage Law Defeated

Being subjected to lawsuits is not considered an “injury in fact”

By Scott R. Eldridge Apr 20, 2016
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The U.S. District Court for the District of Nevada recently dismissed a lawsuit against Nevada officials challenging the state’s minimum wage law and its implementing regulations.

A group of plaintiffs in the hospitality and restaurant business alleged that the law was unconstitutional and pre-empted by the Employee Retirement Income Security Act (ERISA). Under Nevada law, employers that provide health benefits to workers may pay a lower minimum wage, and “health benefits … shall consist of making insurance available to the employee for the employee and the employee’s dependents at a total cost to the employee for premiums of not more than 10 percent of the employee’s gross taxable income from the employer.” 

The court dismissed the lawsuit, concluding that the plaintiffs lacked standing because they had not suffered an “injury in fact.”  Although the plaintiffs argued that the minimum wage law harmed them because they had been sued for allegedly violating it, none of those lawsuits reached a judgment against them and the suits remain pending.

According to the court, it is possible that the plaintiffs could prevail in those other lawsuits and, thus, the alleged harm to the plaintiffs was not “certainly impending” to qualify as an “injury in fact” necessary to maintain the lawsuit.

The court also rejected the plaintiffs’ argument that the state’s labor commissioner had enforced the minimum wage law and regulations in a manner that violated federal and Nevada law due to failure to allege specific facts to support its conclusory allegation.

Landry’s Inc. v. Sandoval, No. 2:15-cv-1160 (D. Nev. Mar. 31, 2016).

Professional Pointer: Nevada’s minimum wage law remains enforceable; however, because the court provided the plaintiffs an opportunity to file an amended complaint “that demonstrates [their] standing to sue,” Nevada employers should continue to monitor this case.

Scott R. Eldridge is an attorney with the law firm Miller, Canfield, Paddock and Stone PLC in Lansing, Mich.

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