Montize et al v. Pittman Properties et al

Filing 210

MEMORANDUM OPINION AND ORDER denying 194 Motion for Summary Judgment. Signed by Honorable Robert T. Dawson on May 12, 2011. (cnn)

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
EL DORADO DIVISION
ARCELIA MUNIZ, EVENCIO GARCIA, and
AGUSTIN GARCIA GONZALEZ
v.

PLAINTIFFS

No. 1:07-CV-1073

PITTMAN PROPERTIES LIMITED PARTNERSHIP #1;
D&M PITTMAN, INC.; DAWOOD AYDANI; and
MICKEY H. PITTMAN

DEFENDANTS

and
PITTMAN NURSERY CORP.

CROSS-PLAINTIFF

v.
PITTMAN PROPERTIES LIMITED PARTNERSHIP #1;
D&M PITTMAN, INC.; DAWOOD AYDANI;
MICKEY H. PITTMAN; LYNN AYDANI;
and LAWANDA JONES

CROSS-DEFENDANTS

MEMORANDUM OPINION AND ORDER
Currently before the Court are Defendants’ Motion for Summary
Judgment filed by D&M Pittman, Inc., Pittman Properties Limited
Partnership #1, and Mickey H. Pittman (Doc. 194)1; Defendants’
Brief in Support (Doc. 195); Defendants’ Statement of Material and
Undisputed Facts in Support (Doc. 196); Plaintiffs’ Response (Doc.
199); Plaintiffs’ Brief in Support (Doc. 200); Defendant Pittman
Nursery Corp.’s Response and Brief in Opposition (Doc. 201);

1

Defendant Dawood Aydani, who is pro se as of the date of
this Order, did not join in this Motion for Summary Judgment, nor
did he file any response. Mr. Aydani was notified by mail of the
status hearing scheduled for May 20, 2011. Should Mr. Aydani fail
to appear at the hearing, the Court will schedule a subsequent
hearing at which his appearance will be required and secured, if
needed.

Defendant Pittman Nursery Corp.’s Response to Plaintiffs’ Statement
of

Undisputed

Facts

(Doc.

202);

and

Defendants’

Reply

to

Plaintiffs’ Response (Doc. 205).
For the reasons explained herein, Defendants’ Motion for
Summary Judgment (Doc. 194) is DENIED.

Discovery completion and

trial dates will be set at the Status Conference on May 20, 2011.
I. Background
Plaintiffs are Mexican nationals who worked from 2004-2007 as
temporary farm workers in Magnolia, Arkansas. Plaintiffs’ employer
in Arkansas during this time was Pittman Nursery Corp. (“PNC”), a
commercial horticultural business that sponsored the Plaintiffs’
H-2A non-immigrant visas for seasonal farming work.

Plaintiffs

filed their original Complaint on August 23, 2007 (Doc. 1), amended
their Complaint on December 16, 2008 (Doc. 43), and then amended it
again on May 18, 2010 (Doc. 132).
Amended

Complaint

is

that

The crux of Plaintiffs’ Second

Defendant

Dawood

Aydani,

a

senior

employee and officer of PNC in charge of recruiting and supervising
PNC’s migrant labor force, extorted cash from the wages of the
individual Plaintiffs and a class of migrant farm workers similarly
situated.

Defendant

Aydani’s

alleged

“kickback

scheme,”

as

Plaintiffs refer to it, involved him demanding up to $1000 in cash
from each worker in exchange for allowing the workers to keep their
jobs at PNC and secure future employment there in the coming
season. (Doc. 132, p. 4)

2

PNC is part of a larger family-owned and family-operated
horticultural business made up of four people: Defendant Mickey H.
Pittman and her three adult children, Donna Pittman King, David
Pittman, and Dixie Pittman.
The Defendants are all part of the Pittman family business.
The evidence reflects that the four members of the Pittman family
are the sole owners of the Defendant companies and had a close,
dependent relationship with each another and with Defendant Dawood
Aydani,

the

supervisor

accused

of

abusing,

extorting money from Plaintiff farm workers.

threatening,

and

For her part, the

mother, Mickey H. Pittman, is the sole shareholder of D&M Pittman,
Inc. (“D&M”), an Arkansas corporation that is the general partner
of Pittman Properties Limited Partnership #1 (“PP1") and Pittman
Properties

Limited

#2 (“PP2"2).

Partnership

David

and

Dixie

Pittman have been president and vice-president, respectively, of
D&M.

PP1 is an Arkansas limited partnership that owns land and

manages real estate for the benefit of the family business.
Mickey, David, and Dixie Pittman own and operate PP1.
Dixie, and Donna Pittman own and operate PP2.

David,

Donna is the sole

shareholder of PNC, which is the arm of the family business that
hires, pays, and oversees workers in planting and raising trees and
shrubs for sale to customers.

PNC houses its migrant workers on

lands owned by PP2, while PNC’s farming operation takes place on

2

PP2 is not a party to this action.
3

land owned by PP1.

There is deposition testimony that Mickey

Pittman trusts and loves Mr. Aydani like a son (Doc. 194-1), and
that after Donna Pittman fired Mr. Aydani on behalf of PNC for the
alleged misconduct that is the subject of this lawsuit, Mr. Aydani
was immediately re-hired by other Pittman family members acting
through D&M and PP1.
Since the onset of litigation, the parties entered into a
restraining order which directed Mr. Aydani to have no contact
directly or indirectly with any named Plaintiff or potential class
member (Doc. 21); yet two motions for contempt of that restraining
order were filed by Plaintiffs and PNC against Aydani and the other
Defendants (Docs. 23 and 92) which appear to stem from Aydani’s
continuing employment or, at minimum, personal involvement with the
individuals or businesses connected to the Pittman family business.
Though the Court never ordered contempt sanctions against Aydani
and the other Defendants for alleged contacts with PNC’s Mexican
migrant workers, it is clear that Aydani’s continued employment and
personal association with certain members of the Pittman family
have kept Mr. Aydani squarely in the middle of this litigation and
the ensuing family drama.
Plaintiffs allege a family-wide conspiracy to share in the
ill-gotten gains borne of Mr. Aydani’s threats and extortion.
Though Plaintiffs admit that they are uncertain how the conspiracy
to extort money was structured among the Pittman family and within

4

the family business, they request that a jury be allowed to hear
the evidence and make its own judgments.

Plaintiffs were able to

work out a settlement of their individual and class claims against
PNC only, which was approved by the Court on January 18, 2011
(Docs. 188-189).3
Following PNC’s settlement with Plaintiffs, Cross-Plaintiff
PNC went on the offensive against the other Defendants, claiming
that PNC was also a victim of Aydani and the other Defendants’
collusion.

Accordingly, PNC amended its Answer on April 25, 2011

(Doc. 206), and asserted cross-claims against Defendants Dawood
Aydani, his wife Lynn Aydani, D&M, PP1, Mickey Pittman, and Lawanda
Jones, PNC’s bookkeeper, for violations of the RICO Act, RICO
conspiracy, breach of fiduciary duty, fraud, negligence, tortious
interference with business expectancy, and common law conspiracy.4
PNC also asserted a cross-claim for conversion against Mr. and Mrs.
Aydani, D&M, PP1, and Mickey Pittman for destruction of PNC’s farm
watering system,

appliances,

cabinetry,

sprinkler

system,

and

swimming pool in the nursery farm house, as well as theft of

3

The Court has removed PNC from the caption of the case as
a “Defendant” and lists PNC as a “Cross-Plaintiff” only, pursuant
to PNC’s settlement of all its claims with Plaintiffs.
4

PNC’s cross-claims are not the subject of this Motion
for Summary Judgment.
5

certain trees, shrubs, and seeds.5

Finally, PNC asserted joint and

several liability against D&M, PP1, and Mickey Pittman through a
corporate veil-piercing theory of liability.

Defendants PP1, D&M,

Mickey Pittman, and Lawanda Jones moved on May 9, 2011, to Strike
PNC’s Second Amended Cross-Claims and Dismiss Cross-Claims (Docs.
208-209).

PNC has yet to respond to these Motions to Strike and to

Dismiss, and the Court will reserve judgment on these motions until
responses are filed.
The Motion for Summary Judgment now before the Court (Doc.
194) concerns only the remaining causes of action brought by
Plaintiffs:

claims under 18 U.S.C. § 1962 et seq., the Racketeer

Influenced and Corrupt Organizations Act (“RICO”), for extorting
Plaintiff’s wages and converting them to Defendants’ own use; the
common law tort of conversion; violations of the Arkansas Minimum
Wage Act pursuant to Ark. Code Ann. § 11-4-210; and negligent
supervision of Mr. Aydani.6
II.

Standard of Review
In determining whether summary judgment is appropriate, the

moving party bears the burden of establishing both the absence of
5

Among other allegations, PNC also claims that Mr. Aydani
“concealed in the ground so-far unidentified chattels (probably
cash and possibly belonging to PNC), which he then dug up and
removed upon his departure related to this lawsuit.” (Doc. 206,
¶ 192).
6

Plaintiffs’ FLSA claims were dismissed on July 6, 2010
(Doc. 151).
6

a genuine issue of material fact and that it is entitled to
judgment as a matter of law. See Fed. R. Civ. P. 56(c); Matsushita
Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106
S. Ct. 1348, 89 L. Ed. 2d 538 (1986); Nat’l. Bank of Commerce of El
Dorado, Ark. v. Dow Chem. Co., 165 F.3d 602 (8th Cir. 1999).

The

Court must review the facts in a light most favorable to the party
opposing a motion for summary judgment and give that party the
benefit of any inferences that logically can be drawn from those
facts. Canada v. Union Elec. Co., 135 F.3d 1211,

1212-13 (8th Cir.

1998) (citing Buller v. Buechler, 706 F.2d 844, 846 (8th Cir.
1983).

In order for there to be a genuine issue of material fact,

the non-moving party must produce evidence “such that a reasonable
jury could return a verdict for the nonmoving party.” Allison v.
Flexway Trucking, Inc., 28 F.3d 64, 66 (8th Cir. 1994) (quoting
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248(1986)).
III. Discussion
A.

RICO
The evidence before the Court shows that the Pittman family

business

is

an

intertwined

structure

of

corporations

and

partnerships, in which a few family members oversee and share in
the investments and profits that benefit them all.

Reviewing the

facts in a light most favorable to the Plaintiffs, as is required,
the

issue

of

extortionist,

the
acted

case

is

alone

whether
or

in
7

Mr.

Aydani,

collusion

with

the
the

alleged
other

Defendants.
Separating Mr. Aydani from the other Defendants is difficult,
as Mr. Aydani has had a close familial and business relationship
with the members of the Pittman family for a number of years and
has held fiduciary positions of trust and responsibility in the
family business as a whole.

Mr. Aydani admittedly was directly

employed by PNC in recruiting, managing, and paying the Mexican
temporary laborers on whom the business is dependent; however, it
is

impossible

Defendants

are

at

this

each

point

so

to

distinct

say

that

in

their

PNC

and

the

business

other

purposes,

operations, and assets that they could not have openly or tacitly
been a part of Mr. Aydani’s alleged kickback scheme. Indeed, there
is evidence that Defendant Mickey Pittman shared in the profits,
specifically cash profits, made by PNC, and D&M and PP1 managed
property and received rents from PNC for land use.

Mrs. Mickey

Pittman, D&M, and PP1 therefore were dependent on the profitability
of PNC’s business operations, and assets flowed among all the
Defendants.
The Pittman nursery business is a family business, and the
officers and shareholders of the varying business entities are the
same four individuals, Mickey, Donna, David, and Dixie Pittman.
Consequently, Defendants’ insistence that Mr. Aydani was “employed
by

PNC”

when

engaged

in

the

alleged

extortion

amounts

to

a

distinction without a difference (Doc. 194, ¶ 4). Defendants argue

8

that “[n]either Mrs. [Mickey Pittman] Ketchum nor anyone on behalf
of PP1 or D&M was present when Aydani allegedly asked Plaintiffs
for money or when Plaintiffs paid him.” (Doc. 195, p. 5)

But this

assertion does not negate the possibility of there being both an
“enterprise” and a “conspiracy” to illegally extort money, as must
be proven under the RICO statute to show a violation. 18 U.S.C. §
1962 (c) and (d).
The

fact

that

Defendants

deny

knowledge

of

the

alleged

kickback scheme itself and insist that all the assets they shared
in the family business are not tainted by the scheme is not
dispositive on summary judgment.

There exists a genuine issue of

material fact on this point, and a jury should decide the veracity
of Plaintiffs’ and Defendants’ competing claims. There is evidence
that

Defendant

Mickey

Pittman

split

quantities

of

cash

with

Defendant Aydani on a regular basis during the relevant time period
and transported cash from the nursery to Pittman family business
offices (Docs. 194-1, 194-4, 194-6, 194-7). There is also evidence
that Mickey Pittman and D&M are one in the same, and that D&M is
also the managing partner for PP1 (Doc. 194-4).

There is evidence

that PP1 receives payments from PNC through rent, among other means
(Doc. 200-1).
It is clear that the individual Plaintiffs, Mexican migrant
workers with little knowledge of English or the laws of this
country, do not have a working understanding of the Pittman family

9

business, including the identity and structure of D&M and PP1, the
entities that share assets with PNC (Doc. 194-1).

Even so,

Plaintiffs have established that there is a genuine issue of
material fact as to whether Plaintiffs’ money, allegedly obtained
through unlawful threats and extortion, was ultimately shared,
knowingly or unknowingly, by the Defendants.
Plaintiffs have presented evidence that money, employment, and
business

responsibilities

apparently

flowed

freely

among

Mr.

Aydani, PNC, D&M, PP1, and the members of the Pittman family, and
it is therefore evident that a genuine issue of material fact
remains regarding the existence of a conspiracy and a violation of
the RICO statute.
B.

Conversion and Arkansas Minimum Wage Claims
Defendant Dawood Aydani has not yet been deposed in this case.

Considering that his alleged acts and omissions constitute the
basis for this lawsuit, summary judgment is improper at this stage
in the litigation for this reason alone. Nonetheless, based on the
evidence presented thus far by the parties, summary judgment of
Plaintiffs’ tort claim for conversion of their wages is denied due
to the existence of a number of genuine issues of material fact.
First, there exists a genuine issue of material fact as to
whether Mr. Aydani threatened and extorted cash from Mexican
migrant workers employed by PNC, which if proven would affect
Plaintiffs’ minimum wage under Arkansas law for the relevant time

10

period. Next, there is a genuine issue of material fact concerning
Mr. Aydani’s personal and business relationship with some members
of the Pittman family, and the trust and responsibility invested in
Mr. Aydani in the running of the family business.

According to the

facts presented, cash from the nursery business was shared freely
among Mr. Aydani, Mrs. Aydani, Mrs. Mickey Pittman, other members
of the Pittman family, and the corporate and partnership entities
tasked with managing business assets.

Finally, there is a genuine

issue of material fact regarding whether officers and employees of
the Defendant companies made attempts to conceal the evidence of
cash splitting from other family members, either by logging the
splits in secret, hiding the evidence of splits using technology,
or destroying evidence of the transactions. (Docs. 194-2, 194-3,
201-6)

The

source

or

sources

of

the

cash

splits

are

also

vigorously disputed by the parties and, being material to the
claims made by the Plaintiffs, bar summary judgment.
C.

Negligent Supervision
Because there exist genuine issues of material fact regarding

whether or not Defendants, including Defendant Aydani, colluded in
extorting cash from Plaintiffs, and because of the fluidity of
control, management, and authority over the family business exerted
by the Defendant companies and individuals, the Court finds that a
genuine issue of material fact exists regarding the employment
relationship between Mr. Aydani and PNC, D&M, PP1, and Mickey
11

Pittman. For these reasons, and for those explained above, summary
judgment is inappropriate at this time for Plaintiffs’ negligent
supervision claim.
IV.

Conclusion
Defendants’ Motion for Summary Judgment (Doc. 194) is DENIED.

Discovery completion and trial dates will be set at the Status
Conference on May 20, 2011.

IT IS SO ORDERED this 12th day of May 2011.

/s/ Robert T. Dawson
Robert T. Dawson
United States District

12

Judge