McCormick Barstow LLP Secures Reversal of $43 Million Judgment and Decertification of “Exempt” Class of Title Escrow Workers

The Fifth District Court of Appeal in California on May 29, 2026, reversed a $43 million judgment (which had grown to nearly $75 million with the addition of a $14 million attorney fee award and post-judgment interest) in a closely watched wage-and-hour class action. According to the 138-page partially published opinion authored by Justice Rosendo Pena, Jr., the 19-year Cortina odyssey is “even rarer and more beastly” than the 2014 California Supreme Court case at the center of the opinion. Scott M. Reddie, chair of the Appellate Litigation Group of McCormick Barstow LLP, along with O’Melveny attorneys David Marroso, Anton Metlitsky, Adam Karr, and Jenya Godina, were brought in to handle the appeal, and secured the victory.

This is a complete victory for North American Title Company, now known as Lennar Title Company, a subsidiary of homebuilder Lennar Corp., on both substance and process. The Court exhaustively analyzed the law on class certification within the context of the case and impressively dug into a 22,000-page reporter’s transcript and over 10,000 page appendix to truly understand the facts. There are only a handful of appellate decisions in wage-and-hour cases decertifying a class after a full trial. Because of the unusual posture of the case and the breadth and depth of the Court’s analysis, Cortina will likely become one of the guiding legal opinions in this area of law in California.

The matter has been in litigation since 2007. After a 41-day bench trial in 2016, a Fresno Superior Court judge determined that more than 260 people who worked in escrow services in dozens of offices across the State of California all had been wrongly classified as exempt from overtime pay. Then, over North American’s objection, the trial court appointed a referee to take evidence on the amount of overtime hours worked and ordered North American to pay for the entire process, including the referee’s fees, court reporter’s fees, travel costs for witnesses, etc. The referee spent almost three years hearing testimony from more than 200 witnesses, and ultimately determined the testifying plaintiffs were owed restitution totaling more than $21 million, which ultimately grew to almost $75 million with pre and post judgment interest and attorney’s fees. The appellate panel said the judge’s class-wide liability determination was erroneous and its subsequent decision to delegate critical responsibilities to a referee over objection was “unprecedented in our state jurisprudence” and “entirely unauthorized.”

If the opinion stands, the case will be remanded to the lower court for further proceedings. Despite Cortina’s 19-year history, the Court aptly noted: “Unfortunately, the end is nowhere in sight.” 

The case is Cortina v. North Am. Title Co., No. F085389 (Cal. Ct. App. May 29, 2026).