July 28 (Bloomberg) -- FedEx Corp. must face more state class-action lawsuits by contract drivers who claim they deserve benefits because the company treats them as full-time workers by mandating their clothing, hours and prices, a judge said.

U.S. District Judge Robert Miller in South Bend, Indiana, yesterday granted drivers’ request to sue as groups on behalf of workers in Arizona, Georgia, Ohio, Utah, Louisiana, Nevada, North Carolina and Oregon. In the same ruling, Miller denied similar requests by drivers in Colorado, Connecticut and Vermont as well as claims that some of the lawsuits should cover all such FedEx drivers in the U.S.

Judges have certified 28 such cases as class actions while rejecting 14, said Lynn Faris, the lead attorney for the drivers.

“If we succeed in these, as we expect to, FedEx will have the vast majority of its largest markets directly affected by adverse rulings regarding its current illegally skewed playing field to deal with,” Faris said in an e-mail.

Miller previously certified one state case as a national class action, in which an estimated 14,000 current and 13,000 former drivers in the ground-delivery unit can sue as a group under federal law. The drivers seek about $1 billion in damages for back pay, truck purchases, overtime and costs they incurred as contractors.

‘American Right’

FedEx, based in Memphis, Tennessee, says its contract driver model is legal and was approved for tax purposes by the U.S. Internal Revenue Service in 1994. The agency is reviewing years 2002 and 2004 through 2006 to see if the company has classified the workers properly for tax purposes.

“As we’ve said all along, we believe the lawsuits that are part of the MDL litigation are without merit and part of a broad-based assault on independent contractors who have chosen to own and operate their own businesses,” Maury Lane, a FedEx spokesman, said in an e-mail, referring to the so-called multidistrict litigation.

Miller said in his ruling that he will turn his attention to requests by both sides to decide the cases without trials. While class certification isn’t a ruling on the merits of a case, it provides leverage for plaintiffs, making it easier to finance litigation and negotiate a settlement.

Overtime Ruling

Yesterday, FedEx workers who sought class-action status in an overtime compensation lawsuit lost their bid to sue as a group. The U.S. Court of Appeals in Atlanta found that a federal trial court in Florida didn’t abuse its discretion in denying workers class status in that case.

The track record for FedEx is mixed in similar cases at issue in the Indiana federal court. A Seattle jury in March ruled for FedEx in an overtime-pay class-action lawsuit which claimed the company called the drivers entrepreneurs and controlled them as if they were employees.

The California Supreme Court upheld a trial court award after finding a group of contractors were treated as employees in 2007. FedEx agreed to pay $26.8 million to settle the decade- long case with 203 drivers, the company said in December. Drivers split $14.5 million and the remaining money went to lawyers and court costs.

FedEx fell $1.06, or 1.6 percent, to $65.53 in New York Stock Exchange composite trading at 1 p.m.

The Indiana case is In re FedEx Ground Package System Inc. Employment Practices Litigation, 3:05-md-00527, U.S. District Court, Northern District of Indiana (South Bend).

To contact the reporter on this story: Laurence Viele Davidson in Atlanta at lviele@bloomberg.net

Last Updated: July 28, 2009 13:27 EDT