In Richards v. Eli Lilly, the Seventh Circuit charted new territory for how courts should evaluate requests to send notice in Fair Labor Standards Act (FSLA) collective actions under 29 U.S.C. § 216(b). Departing from the widely used “modest showing” standard, this new framework gives district courts discretion to weigh both sides’ evidence early in the case—before authorizing notice to potential opt-in plaintiffs—while stopping short of the demanding threshold required by the Fifth Circuits. The Court’s opinion also deepens the circuit split on this critical issue under the FLSA.
This post walks through the Richards opinion issued August 5, 2025, and contrasts the Seventh, Fifth and Sixth Circuit approaches with the traditional approach applied by several other courts.
Background: How Courts Have Evaluated FLSA Notice Requests
Section 216(b) of the FLSA allows employees to bring suit on behalf of others who are “similarly situated.” Unlike Rule 23 class actions, however, FLSA cases require each plaintiff to affirmatively opt in. As a result, the ability to send notice to other potential plaintiffs is central to the overall structure and success of these lawsuits.
For decades, courts have largely followed a two-step process, originally developed in Lusardi v. Xerox Corp., where plaintiffs could secure “conditional certification” and court-approved notice by making only a modest factual showing, sometimes based solely on the pleadings, that potential plaintiffs are similarly situated. But in recent years, courts and commentators have questioned whether this lenient standard imposes unfair pressure on defendants and encourages overbroad, underdeveloped collective actions.
That skepticism led the Fifth and Sixth Circuits to move away from Lusardi in Swales v. KLLM Transport Services (2021) and Clark v. A&L Homecare and Training Center, LLC (2023). The Seventh Circuit now joins those courts in abandoning the traditional framework, albeit with a new, middle-ground standard.
The Case: Richards v. Eli Lilly
Monica Richards, a sales employee at Eli Lilly, alleged that she was passed over for promotion in favor of a younger, less qualified colleague. She brought claims under the Age Discrimination in Employment Act (ADEA), which incorporates the FLSA’s collective action procedure. Richards sought to represent a group of similarly situated older employees who claimed to have been disadvantaged by company hiring practices.
The district court followed the traditional Lusardi model, requiring only a minimal showing that the proposed group was similarly situated. The district court granted conditional certification, refusing to consider Eli Lilly’s contrary evidence. Eli Lilly petitioned for interlocutory appeal to the Seventh Circuit on the limited question of the proper legal standard for issuing notice under the collective-action procedure set forth in the FLSA, § 216(b).
The Seventh Circuit’s New Standard
After hearing oral arguments earlier this year, the Seventh Circuit vacated the district court’s ruling and clarified the showing required to send notice to potential opt-in plaintiffs. The Court held that before issuing notice, a district court must determine whether the named plaintiff has presented enough evidence to create a material factual dispute about whether the proposed group is similarly situated.
This is not a merits determination. Plaintiffs do not have to prove their case or establish similarity by a preponderance of the evidence. But district courts in the Seventh Circuit may no longer rubber-stamp notice based solely on allegations or one-sided declarations. Importantly, the decision authorizes district courts to consider employer-submitted evidence at the notice stage and to tailor notice based on the scope of the evidentiary record. The district courts retain discretion to manage the certification and notice process; but must do so under this more balanced evidentiary framework.
How This Compares to Other Circuits
The Richards standard sits between the Fifth Circuit’s more demanding “preponderance of the evidence” rule and the Sixth Circuit’s “strong likelihood” threshold. Here is how the major approaches stack up:
By contrast, the Ninth Circuit has recently concluded that it was bound by circuit precedent and could not depart from the Lusardi two-step approach.[1] It remains to be seen whether the circuit will review that precedent en banc in an appropriate case or whether the Supreme Court will need to address the circuit split.
Conclusion
Richards v. Eli Lilly marks a clear shift in the Seventh Circuit’s approach to FLSA collective actions. The days of automatic notice based on minimal allegations are over. Plaintiffs in the Seventh Circuit must now bring real evidence to the table—and employers have a stronger opportunity to push back early. Questions remain whether other circuits will follow suit, however.
This new standard aligns with the goals of fairness and efficiency, giving district courts the tools they need to manage these cases responsibly. For employers, it creates a meaningful opportunity to stop collective actions before they get off the ground.
[1] Harrington v. Cracker Barrel Old Country Store, Inc. (9th Cir. July 1, 2025).
