Isabel Diaz v. Jaguar Restaurant Group, LLC

Filing 920101213

Opinion

[P U B L IS H ]

IN THE UNITED STATES COURT OF APPEALS F O R THE ELEVENTH CIRCUIT FILED _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ U.S. COURT OF APPEALS N o . 09-16046 ________________________ D . C. Docket No. 08-22317-CV-EGT IS A B E L DIAZ, p lain tiff and all others similarly situated under 2 9 U.S.C. 216(b), Plaintiff-Appellant, versus JAGUAR RESTAURANT GROUP, LLC, E D U A R D O DURAZO, JA G M A R MANAGEMENT GROUP, LLC, Defendants-Appellees, JA G M A R BRANDS, LLC, D e f e n d a n t.
ELEVENTH CIRCUIT DECEMBER 13, 2010 JOHN LEY CLERK

________________________ A p p eal from the United States District Court fo r the Southern District of Florida _________________________ (D ecem b er 13, 2010)

Before CARNES, FAY and SILER,* Circuit Judges. P E R CURIAM: Isab el Diaz ("Diaz") filed a lawsuit against Jaguar Restaurant Group, LLC, Jag m ar Management Group, LLC, Jagmar Brands, LLC 1, and Eduardo Durazo (co llectiv ely, "Jaguar"), her former employer, for unpaid overtime wages under the F air Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201­216. During trial, the d istrict court allowed Jaguar to amend its Answer pursuant to Federal Rule of Civil P ro ced u re 15(b) to include the administrative exemption as an affirmative defense as it found that Diaz had injected the issue through her testimony at trial. The jury retu rn ed a verdict finding that Diaz had worked more than 40 hours per week for w h ich she was not compensated, but also finding that she was exempt from the req u irem en ts of the FLSA as she was an administrative employee. Subsequently, D iaz filed this appeal challenging the district court's decision to allow Jaguar to am en d its Answer during trial. We reverse the district court's decision allowing Jag u ar to amend its Answer, and remand this case to the district court for a trial on d am ag es. _____________________
* Honorable Eugene E. Siler, Jr., United States Circuit Judge for the Sixth Circuit, sitting by designation. Jagmar Brands, LLC is no longer a party in this case as it was stipulated during trial that it would be voluntarily dismissed with prejudice from this matter. 2
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I. BACKGROUND Isab el Diaz worked as a bookkeeper for Jaguar from December 2004 to M arch 2008. During her employment, Diaz performed numerous administrative task s in addition to her bookkeeping duties. For example, she managed the cash reg ister, distributed tips, opened bank accounts, maintained menus, processed new em p lo yees into the system, ran errands, managed liquor orders, and occasionally o p en ed the restaurant. Although Diaz often worked long hours, Jaguar did not co m p en sate Diaz for work performed in excess of 40 hours per week. O n August 20, 2008, Diaz filed this lawsuit against Jaguar under the FLSA to recover unpaid overtime wages. In its Answer, Jaguar raised five affirmative d efen ses, including the defense that Diaz was an independent contractor. Jaguar, h o w ev er, did not raise the administrative exemption as an affirmative defense. Subsequently, the parties conducted discovery and, on December 23, 2008, Diaz w as deposed. Following discovery, on February 17, 2009, Jaguar filed its Motion fo r Summary Judgment, which was denied. On October 1, 2009, the parties filed a Joint Pretrial Stipulation. In the Joint P retrial Stipulation, Jaguar raised the administrative exemption for the first time. In one line of the Joint Pretrial Stipulation, Jaguar stated that whether Diaz was "em p lo yed in an administrative or professional capacity" was an issue of fact

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which required proof at trial. In a footnote in the Joint Pretrial Stipulation, Diaz o b jected to Jaguar's insertion of this issue, stating that this defense was never raised by Jaguar and was thus waived. Then, on October 5, 2009, the district court co n d u cted a pretrial conference, during which Jaguar did not raise the ad m in istrativ e exemption issue, and the district court did not address the issue in its Omnibus Order Following Pretrial Conference. The day before trial, on O cto b er 19, 2009, the parties filed their proposed Joint Jury Instructions and Jaguar in clu d ed one instruction on the administrative exemption, to which Diaz objected. Despite the objections filed by Diaz, Jaguar did not file a motion to amend its A n sw er to include the administrative exemption as an affirmative defense at any tim e prior to trial. O n October 20, 2009, trial commenced. At the close Jaguar's case, Jaguar filed a Motion to Amend Answer to Conform to the Evidence in order to include th e administrative exemption as an affirmative defense. Diaz objected to the am en d m en t, arguing that Jaguar waived the defense by not raising it earlier and th at Diaz had not introduced any new evidence through her testimony. The district co u rt granted Jaguar's motion over Diaz's objection, allowing Jaguar to amend its A n sw er and allowing the jury instructions and verdict form to be altered acco rd in g ly. Subsequently, the jury returned a verdict finding that Diaz worked

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more than 40 hours per week for which she was not compensated, but that she was ex em p t from the requirements of the FLSA as an administrative employee. Diaz tim ely filed this appeal alleging that the district court committed reversible error by allo w in g Jaguar to amend its Answer during trial. II. STANDARD OF REVIEW "T h e Federal Rules of Civil Procedure are designed to avoid surprise and th u s to facilitate a proper ruling on the merits of each case." Combee v. Shell Oil C o ., 615 F.2d 698, 701 (5th Cir. 1980).2 Pursuant to that philosophy, Federal Rule o f Civil Procedure 15(b) "permits amendments to the pleadings even after ju d g m en t if the issues involved are tried by the express or implied consent of the p arties." Id. "Allowing an amendment to the pleadings at the close of trial to co n fo rm to the evidence presented is within the trial court's discretion." Borden, In c. v. Fla. E. Coast Ry. Co., 772 F.2d 750, 758 (11th Cir. 1985). Thus, we review th e district court's decision to grant Jaguar leave to amend its Answer for abuse of d iscretio n . See Combee, 615 F.2d at 701. III. DISCUSSION Jag u ar failed to plead the administrative exemption as an affirmative defense in its Answer. In the fourteen months between the filing of its Answer and the
In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), we adopted as binding precedent all decisions of the former Fifth Circuit handed down before October 1, 1981. 5
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commencement of trial, Jaguar never moved to amend its Answer to include the ad m in istrativ e exemption. Jaguar also did not raise the issue of the administrative exemption during discovery. The only time Jaguar raised the issue prior to trial w as by inserting it in one line of the Joint Pretrial Stipulation and in the proposed Jo in t Jury Instructions, to which Diaz objected. Jaguar did not raise the issue d u rin g the pretrial conference and the district court did not include the issue in its O m n ib u s Order Following Pretrial Conference. If ever there were a classic case of w aiv er, this is it! See Latimer v. Roaring Toyz, Inc., 601 F.3d 1224, 1239 (11th C ir. 2010) ("Failure to plead an affirmative defense generally results in a waiver of th at defense."). Jaguar repeatedly waived the administrative exemption defense by failin g to plead the defense in its Answer and by failing to move to amend its A n sw er before trial. Ideally, cases should be tried on their merits. Accordingly, even if Jaguar failed to plead the administrative exemption defense, the district court could allow Jag u ar to amend its Answer during trial if the issue was tried by the parties' ex p ress or implied consent, or included in a pretrial order. See Fed. R. Civ. P. 1 5 (b ); see Steger v. Gen. Elec. Co., 318 F.3d 1066, 1077 (11th Cir. 2003) ("[I]ssu es not raised in the pleadings may be treated as if they were properly raised w h en they are `tried by express or implied consent of the parties,' Federal Rule of

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Civil Procedure 15(b), or are included in a pretrial order."). In this case, the issue w as not included in the district court's Omnibus Order Following Pretrial C o n feren ce. Further, it is clear that the administrative exemption issue was not tried by the parties' express consent as Diaz opposed the insertion of the issue in th e Joint Pretrial Stipulation, proposed Joint Jury Instructions, and at trial. See R. V o l. 5: 160­65. The district court, however, found that the issue was tried by im p lied consent as it believed Diaz introduced the issue of the administrative ex em p tio n through her testimony at trial. Thus, the district court allowed the a m e n d m e n t. The district court erred in finding that the administrative exemption issue w as tried by implied consent and in thereby allowing Jaguar to amend its Answer. That issue was not tried by implied consent as Diaz's testimony was relevant to an o th er defense in this case: Jaguar's independent contractor defense. "The in tro d u ctio n of evidence arguably relevant to pleaded issues cannot serve to give a p arty fair notice that new issues are entering the case." Wesco Mfg., Inc. v. T ro p ica l Attractions of Palm Beach, Inc., 833 F.2d 1484, 1487 (11th Cir. 1987); see Jimenez v. Tuna Vessel Granada, 652 F.2d 415, 421 (5th Cir. 1981) (stating th at implied consent cannot be found when "evidence is introduced that is relevant to an issue already in the case and there is no indication that the party who

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introduced the evidence was seeking to raise a new issue"). Diaz's testimony was relev an t to counter Jaguar's independent contractor defense, and she clearly was n o t seeking to raise the administrative exemption as a new issue. Further, we can n o t conclude that her testimony was "much more strongly relevant" to the ad m in istrativ e exemption than to the independent contractor defense, which could b e construed as notice of a new issue. See United States f/u/b/o Seminole Sheet M eta l Co. v. SCI, Inc., 828 F.2d 671, 677 (11th Cir. 1987). Thus, her testimony can n o t be considered implied consent to try the administrative exemption. IV. CONCLUSION F o r the foregoing reasons, we reverse the district court's decision to allow Jag u ar to amend its Answer during trial and remand for the district court to co n d u ct a trial on damages. R E V E R S E D and REMANDED.

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