Phillips v. Carpet Direct Corporation et al

Filing 29

ORDER granting in part and denying in part 19 Motion to Dismiss pursuant to Fed. R. Civ. P. 12(b)(6), by Magistrate Judge Michael E. Hegarty on 1/10/2017. The Clerk of the Court is directed to dismiss Defendants Crouch, Jenson, and Kinsey from this action. (slibi, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 16-cv-02438-MEH
LEX PHILLIPS, and
LEX PHILLIPS & ASSOCIATES, INC.,
Plaintiffs,
v.
CARPET DIRECT CORPORATION,
GAYLE CROUCH,
GREG JENSEN,
CHARLES OWENS, and
TODD KINSEY,
Defendants.
______________________________________________________________________________
ORDER ON MOTION TO DISMISS
______________________________________________________________________________
Michael E. Hegarty, United States Magistrate Judge.
Before the Court is Defendants’ Motion to Dismiss pursuant to Fed. R. Civ. P. 12(b)(6) [filed
November 11, 2016; ECF No. 19]. The motion is fully briefed, and the Court finds that oral
argument (not requested by the parties) would not materially assist the Court in its adjudication of
the motion. Based on the record before it, the Court grants in part and denies in part the Defendants’
motion.1
BACKGROUND
Plaintiffs initiated this action on September 29, 2016 asserting this Court’s federal question
jurisdiction based on alleged federal claims and its pendent jurisdiction over the alleged state law

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The parties consented to this Court’s jurisdiction to hear all matters on November 17,
2016. ECF No. 22.

claims. ECF No. 1.
I.

Statement of Facts
The following are pertinent factual allegations (as opposed to legal conclusions, bare

assertions or merely conclusory allegations) made by Plaintiffs in the Complaint, which are taken
as true for analysis under Fed. R. Civ. P. 12(b)(6) pursuant to Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). The Court must limit its review to the four corners of the Complaint, but may also consider
documents attached to the pleading as exhibits, Oxendine v. Kaplan, 241 F.3d 1272, 1275 (10th Cir.
2001), as well as any unattached documents which are referred to in the Complaint and central to
the plaintiff’s claim, so long as the authenticity of such documents is undisputed. Jacobsen v.
Deseret Book Co., 287 F.3d 936, 941 (10th Cir. 2002).
Defendant Carpet Direct Corporation (“CDC”) sells floor coverings including carpet,
hardwood, laminate, tile, and stone to end-user consumers. According to CDC’s business model,
“Brokers” are individuals who, for proper consideration paid to CDC, are permitted to form their
own businesses under the CDC business model and name and are paid commissions by CDC for
sales they complete. These Brokers are required to meet certain sales quotas, and failure to meet
such quotas may result in reduction of commissions. CDC profits from its employment of Brokers
across the country.
Plaintiff Lex Phillips (“Phillips”) was employed by CDC in the summer 1996 as a “Broker.”
At or about that time, Phillips attended a broker meeting with Earl Crouch, owner and founder of
CDC. Crouch convinced Phillips to form a business with CDC by telling him and other attendees
that they would eventually own and have complete control of their own businesses. Based on
Crouch’s statements, Phillips decided to invest his time and resources to become a Broker for CDC,

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and incorporated the Plaintiff business entity, Lex Phillips & Associates, Inc. (“LP&A”) solely for
such purpose.
According to the contract with CDC, the Plaintiffs had exclusive rights to operate as a Broker
in a defined territory in Northern Colorado and Southern Wyoming: the “counties of Larimer,
Boulder[,] and Weld” and “[t]he municipalities of Ft. Collins, Loveland, Windsor, Greeley,
Wellington, and Cheyenne, WY.” Phillips understood from Crouch and other CDC personnel that
his rights to operate in this territory would be exclusive and, from 1996 to 2015, it was exclusive.
As a Broker, Phillips worked hard to establish his business by handling all sales, marketing,
and expenses for CDC within his territory, and by selling products during the day and removing and
disposing of carpet for new customers without compensation at night. He rented a truck large
enough to hold the carpet and pad he picked up and delivered, and at the outset even stored carpet
and pad in his own garage because he could not afford to lease a warehouse and/or forklift necessary
for his jobs. Later, Phillips established a warehouse for CDC in Windsor, Colorado for which CDC
paid 1% of Plaintiffs’ sales volume; however, if warehouse expenses exceeded 1% for any given
period, the difference was deducted from Phillips’ commissions. But, if Plaintiffs’ volume exceeded
warehouse expenses in a given period, it was not credited to later shortfalls.
Defendant Todd Kinsey is a former employee of LP&A and, also, a family friend of
Defendant Charles Owens, CDC Director of Sales and Marketing. In or about 2015, Kinsey
complained to Owens that he was not making enough money working at LP&A. Owens, although
aware that Plaintiffs had exclusive rights to operate there, established a CDC brokerage in Loveland,
Colorado and assigned Kinsey as the Broker. In an effort to conceal this apparent “breach” of
Plaintiffs’ contract, Owens directed Kinsey to transfer sales information onto generic forms listing

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no city or zip code to disguise where sales were made, so Kinsey could be paid brokerage
commissions for product delivered to the LP&A’s Windsor warehouse. When Phillips complained,
Owens promised to reimburse Plaintiffs for 100% of the commissions improperly paid to Kinsey,
but he never did so.
Phillips lodged complaints to Vearl Jones, CDC Assistant Director of Sales and Marketing,
on August 19, 2015, directly to Owens in January 2016, and to Defendant Greg Jenson, CDC
Director of Operations, in May 2016, but they did nothing to remedy the problems.
In addition, CDC represented to its Brokers, including Phillips, and to its customers that the
carpet pad they obtained from CDC was made of “virgin foam,” an industry term denoting the high
quality of the pad. However, while charging a higher price for such “virgin foam,” CDC knew the
carpet pads were made from recycled carpet pads.
CDC imposes several requirements on Brokers including: (1) comply with CDC’s rules,
policies, and procedures or face termination; (2) attend training and meetings upon notice of CDC;
(3) provide services as dictated by CDC’s business model; (4) refrain from assigning Broker duties;
(5) hire employees only with CDC approval; (6) refrain from engaging in any competing
employment; (7) work full time and the days and hours specified by CDC, including Saturdays, up
to 62 hours per week; (8) work on the CDC’s leased premises using equipment owned by CDC; (9)
perform their duties on days of the week directed by CDC; (10) submit bi-weekly written reports
concerning activities of the brokerage and the Broker’s supervision of sales agents; (11) incur
business and travel expenses, some of which were reimbursed by CDC; (12) recognize that all
samples, materials, training materials, brochures, warehouse equipment, and buildings were owned
and/or controlled by CDC; (13) use warehouses and equipment provided by CDC, but not invest in

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any facilities or materials; and (14) acknowledge that their employment could be terminated at any
time and they could quit employment at any time.
Phillips, as a Broker, was paid by CDC as an independent contractor and was not provided
any employment benefits including vacation pay, paid overtime, unemployment when terminated,
workers compensation, social security benefits, or training required by the Department of
Transportation, Occupational Safety & Health Administration and other federal and state agencies.
II.

Procedural History
Based on these allegations, Plaintiffs assert violations of the Fair Labor Standards Act

(“FLSA”), unjust enrichment, breach of contract, and tortious interference against the Defendants.
Complaint, ECF No. 1-1. Plaintiffs seek injunctive relief under the FLSA and recovery for
“compensatory damages,” “liquidated damages for violations of the FLSA,” and “punitive damages
to be determined at trial.” Id. at 9.
In response to the Complaint, Defendants filed the present motion to dismiss on November
11, 2016, arguing that Plaintiffs’ allegations fail to state plausible claims for relief pursuant to Fed.
R. Civ. P. 12(b)(6). Specifically, Defendants contend that LP&A is not a proper plaintiff in this
case; the FLSA claim is barred by the applicable statute of limitations; Plaintiffs fail to state FLSA
claims against the individuals Defendants; Plaintiffs’ unjust enrichment claim is precluded by the
existence of a contract and is barred by the statute of limitations; Plaintiffs fail to state an unjust
enrichment claim against the individual Defendants; Plaintiffs fail to state breach of contract and
tortious interference claims because the subject contract term does not exist; and Plaintiffs’
allegations against the individual Defendants are not sufficient to state tortious interference.
Plaintiffs counter that although LP&A was not a party to any contracts, it was the recipient

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of most at-issue payments in this case; Defendants’ case law concerning the FLSA statute of
limitations is inapplicable; Plaintiffs’ FLSA claims are properly stated against the individual
Defendants; factual disputes concerning the existence of a contract preclude dismissal of Plaintiffs’
unjust enrichment claim; Plaintiffs’ allegations regarding “exclusivity rights” are sufficient to
demonstrate a contract term for purposes of the breach of contract and tortious interference claims;
and the allegations are sufficient to demonstrate “motivation” for the tortious interference claims.
Defendants reply that Plaintiffs are incorrect in interpreting case law concerning FLSA
statute of limitations; their allegations of individual liability do not survive the standard set by the
Supreme Court in Twombly; neither the statute nor case law support LP&A as an FLSA plaintiff;
Plaintiffs’ affirmation of his contracts with CDC foreclose recovery under a theory of unjust
enrichment against the entity, and Plaintiffs have abandoned the claim against the individual
Defendants; an ongoing injury does not toll limitations for unjust enrichment; and Plaintiffs have
failed to adequately plead an “exclusivity” contract term.
LEGAL STANDARDS
“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted
as true, to ‘state a claim to relief that is plausible on its face.’” Iqbal, 556 U.S. at 678 (quoting Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Plausibility, in the context of a motion to
dismiss, means that the plaintiff pled facts which allow “the court to draw the reasonable inference
that the defendant is liable for the misconduct alleged.” Id. Twombly requires a two prong analysis.
First, a court must identify “the allegations in the complaint that are not entitled to the assumption
of truth,” that is, those allegations which are legal conclusions, bare assertions, or merely
conclusory. Id. at 678-80. Second, the Court must consider the factual allegations “to determine

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if they plausibly suggest an entitlement to relief.” Id. at 681. If the allegations state a plausible
claim for relief, such claim survives the motion to dismiss. Id. at 680.
Plausibility refers “to the scope of the allegations in a complaint: if they are so general that
they encompass a wide swath of conduct, much of it innocent, then the plaintiffs ‘have not nudged
their claims across the line from conceivable to plausible.’” Khalik v. United Air Lines, 671 F.3d
1188, 1191 (10th Cir. 2012) (quoting Robbins v. Okla., 519 F.3d 1242, 1247 (10th Cir. 2008)). “The
nature and specificity of the allegations required to state a plausible claim will vary based on
context.” Kansas Penn Gaming, LLC v. Collins, 656 F.3d 1210, 1215 (10th Cir. 2011). Thus, while
the Rule 12(b)(6) standard does not require that a plaintiff establish a prima facie case in a
complaint, the elements of each alleged cause of action may help to determine whether the plaintiff
has set forth a plausible claim. Khalik, 671 F.3d at 1191.
The adequacy of pleadings is governed by Federal Civil Procedure Rule 8(a)(2), which
requires that a complaint contain “a short and plain statement of the claim showing that the pleader
is entitled to relief.” Fed. R. Civ. P. 8(a)(2). This rule “requires more than labels and conclusions,
and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must
be enough to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555 (internal
citations omitted). Determining whether the allegations in a complaint are “plausible” is a
“context-specific task that requires the reviewing court to draw on its judicial experience and
common sense.” Iqbal, 556 U.S. at 679. If the “well pleaded facts do not permit the court to infer
more than the mere possibility of misconduct,” the complaint should be dismissed for failing to
“show[ ] that the pleader is entitled to relief” as required by Rule 8(a)(2). Id.

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ANALYSIS
Defendants’ motion challenges all claims made by the Plaintiffs against them; accordingly,
the Court will analyze the motion by addressing each claim in turn.
I.

Count I - FLSA Violations
For this count, Defendants contend LP&A is not a proper plaintiff; the FLSA claims are

barred by the applicable statute of limitations; and, Plaintiffs fail to state FLSA claims against
Crouch, Jenson, and Owens.
A.

Is the Entity Plaintiff a Proper FLSA Plaintiff?

The Court notes at the outset that neither the Defendants nor the Plaintiffs cite to any case
law determining whether an entity may constitute an “employee” under the applicable FLSA
provisions. After its own investigation, the Court found no case on point and only one unpublished
opinion “assum[ing], for the sake of argument, that a corporate entity [could] be properly classified
as an employee [under the FLSA], at least to the extent the entity is an alter ego of an individual”
for that court’s adjudication of a motion to decertify an FLSA collective action. See Saravia v.
Dynamex, Inc., No. C 14-05003 WHA, 2016 WL 5946850, at *2 (N.D. Cal. Sept. 30, 2016). Having
engaged in no analysis nor consideration of the issue, though, the court’s opinion in Saravia is not
persuasive here.
Accordingly, to determine whether an entity is a proper FLSA plaintiff, “[w]e [must] begin
with the plain language of the FLSA.” Johns v. Stewart, 57 F.3d 1544, 1557 (10th Cir. 1995). The
FLSA provides that, “Any employer who violates the provisions of section 206 or section 207 of this
title shall be liable to the employee or employees affected in the amount of their unpaid minimum
wages, or their unpaid overtime compensation, as the case may be, and in an additional equal

8

amount as liquidated damages.” 29 U.S.C. § 216(b). Under the FLSA, an “employee” is “any
individual employed by an employer.” Johns, 57 F.3d at 1557 (citing 29 U.S.C. § 203(e)(1)).
“Employ” is defined as to “suffer or permit to work.” Id. (citing § 203(g)). Thus, an employee is
an “individual” who an employer suffers or permits to work. Id.; see also Matrai v. DirecTV, LLC,
168 F. Supp. 3d 1347, 1352 (D. Kan. 2016) (citing Nationwide Mut. Ins. Co. v. Darden, 503 U.S.
318, 326 (1992) (quoting 29 U.S.C. § 203(g))). Courts have interpreted the definition of employee
broadly to effectuate the “broad remedial purposes” of the FLSA. Johns, 57 F.3d at 1557 (citing
Dole v. Snell, 875 F.2d 802, 804 (10th Cir. 1989)). “The Supreme Court has noted, however, that
although the FLSA’s definition of ‘employee’ is quite broad, ‘it does have its limits.’” Id. (quoting
Tony & Susan Alamo Found. v. Sec’y of Labor, 471 U.S. 290, 295 (1985)).
An “employer” subject to the FLSA, on the other hand, is defined as “any person acting
directly or indirectly in the interest of an employer in relation to an employee . . . .” 29 U.S.C. §
203(d). A “person” under the FLSA is defined as “an individual, partnership, association,
corporation, business trust, legal representative, or any organized group of persons.” 29 U.S.C. §
203(a). Thus, while an FLSA “employee” is limited in its definition to “an individual,” an FLSA
“employer” is recognized as either an individual or an entity. Considering this distinction, the Court
must conclude that Congress intended that only individuals, and not entities, be permitted to bring
claims for violations of the FLSA minimum wage (29 U.S.C. § 206) and overtime (29 U.S.C. § 207)
provisions. See Robbins v. Chronister, 402 F.3d 1047, 1050 (10th Cir. 2005) (“the function of the
courts ... [i]s to construe ... [statutory] language so as to give effect to the intent of Congress.”)
(quoting United States v. Am. Trucking Ass’ns, 310 U.S. 534, 542 (1940)); Fish v. Kobac, 840 F.3d
710, 740 (10th Cir. 2016) (“When Congress knows how to achieve a specific statutory effect, its

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failure to do so evinces an intent not to do so.”). In fact, the Court agrees with Defendants who
contend that an entity reasonably cannot be “suffered” or “permitted to work” as required under the
FLSA. See 29 U.S.C. § 203(g).
Accordingly, the Court will grant Defendants’ motion to dismiss Plaintiff LP&A’s FLSA
claims against them.
B.

Are Phillips’ FLSA Claims Time-Barred?

“The FLSA generally imposes a two-year statute of limitations unless the defendant’s
violations are shown to be willful, in which case a three-year period applies.” Mumby v. Pure
Energy Servs. (USA), Inc., 636 F.3d 1266, 1270 (10th Cir. 2011) (citing 29 U.S.C. § 255(a)). To fall
under the three-year limitation, the plaintiff must show that “the employer either knew or showed
reckless disregard for the matter of whether its conduct violated the statute.” Id. (quoting
McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133 (1988)).
Defendants argue that, whether a two- or three-year limitation applies, Phillips’ FLSA claim
is time-barred. They contend that Phillips’ employment with CDC began as an “independent
contractor” in 1996 and, even as late as 2007, Phillips first executed a written agreement with CDC
which repeatedly referred to Phillips as an “independent contractor.”

Thus, Phillips’ mis-

classification claim accrued upon a “single act” that “should trigger [Phillips’] awareness of and
duty to assert his rights,” which, arguably, was shortly after he was employed and certainly no later
than 2007. In addition, Defendants assert, “there is no continuing violation [here] because Phillips’
FLSA claim arises out of the singular act of CDC allegedly misclassifying him as an independent
contractor.” Mot. 5.
Phillips counters that he is not asserting a continuing violation theory, which would allow

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recovery on the basis of an ongoing illegal practice initiated prior to the limitations period, but
rather, an “each paycheck” theory which is supported by the law and, thus, his claims against
Defendants are not time-barred. Phillips asserts that “the law is quite clear that when an employee
is improperly classified as ‘exempt’ a new cause of action accrues each time they [sic] are issued
a paycheck that does not pay the appropriate amount.” Resp. 2. Phillips argues that Defendants’
case law is distinguishable because it involved the execution of “waivers” of any right to receive
overtime under the FLSA and whether such execution constituted a single, discrete act from which
the FLSA claims accrued. Here, Phillips contends, rather than “one ongoing violation,” he has
suffered “a series of repeated violations of an identical nature.” Id. at 5.
Defendants reply that the FLSA waivers addressed in their supporting Fifth Circuit case are
much like the agreements Phillips executed in this case and, thus, unlike cases in which employees
have no knowledge of any singular act of “misclassification,” the continuing violation or “each
paycheck” theory does not apply here.
The parties have cited to, and the Court has found, no Tenth Circuit opinions addressing
when a claim for overtime pay under the FLSA accrues.2 Certain opinions by district courts within
the Circuit have found such claim accrues “at the end of each regular workday” (Bayles v. Am. Med.
Resp. of Colo., Inc., 937 F. Supp. 1477, 1489 (D. Colo. 1996)); “at each regular payday immediately

2

The Court notes the Tenth Circuit has held that 29 U.S.C. § 255 “was intended as a
limitation on the remedy available, not on the right to bring the action, and must be pleaded as
an affirmative defense.” Hodgson v. Humphries, 454 F.2d 1279, 1283–84 (10th Cir.1972)
(emphasis added); see also Donovan v. M&M Wrecker Serv., Inc., 733 F.2d 83, 85 (10th Cir.
1984). However, the Supreme Court in McLaughlin v. Richland Shoe Co., 486 U.S. 128, 129
(1988) determined that “the statute of limitations applicable to civil actions to enforce the Fair
Labor Standards Act (FLSA) ... provides that such actions must be commenced within two years
‘except that a cause of action arising out of a willful violation may be commenced within three
years after the cause of action accrued.’” Id. (quoting 29 U.S.C. § 255(a)) (emphasis added).
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following the work period during which the services were rendered for which the wage or overtime
compensation is claimed” (Arnold v. Schlumberger Tech. Corp., No. 10cv346 MCA, 2010 WL
9007208, at *7 (D.N.M. Oct. 29, 2010) (collecting cases) and Allison v. Frito-Lay, Inc., No. 914193-C, 1992 WL 123799, at *3 (D. Kan. Mar. 27, 1992) (same)); and “each time the employer
issues a paycheck in violation of the FLSA” (Topp v. Lone Tree Athletic Club, Inc., No. 13-cv01645-WYD-KLM, 2014 WL 3509201, at *8 (D. Colo. July 14, 2014)). Notably, in none of these
cases did the plaintiff employee(s) execute an employment agreement with the employer.
Phillips relies primarily on four cases to support his argument that an FLSA overtime claim
accrues each time an employee is issued a paycheck containing insufficient or no overtime pay for
work performed. One of these cases—Knight v. Columbus, 19 F.3d 579 (11th Cir. 1994)—addresses
the applicability of the FLSA statute of limitations under two theories and, in so doing, analyzes
Defendants’ primary case, Alldread v. City of Grenada, 988 F.2d 1425 (5th Cir. 1993), in such a way
as to lead this Court to conclude Phillips’ claims are not time-barred.
In Alldread, the plaintiff firefighters alleged that the defendant city coerced them into signing
waivers of overtime pay in the implementation of a new pay system that occurred four years before
they filed the lawsuit seeking recovery for overtime pay. Id. at 1429. The Fifth Circuit
characterized the issue as “whether the reduction in pay was a single act of discrimination under the
FLSA, hence barred by its three year statute of limitations, or whether the reduction effected in each
subsequent paycheck constitutes a violation of the Act, thus making the complaint timely, at least
in part.” Id. at 1430 (quoting Hendrix v. Yazoo City, 911 F.2d 1102 (5th Cir. 1990)). In determining
the alleged coercion and implementation of the new pay system was the former (i.e., claim was timebarred), the court cited the Supreme Court’s opinion in Lorance v. AT & T Techs., Inc., 490 U.S.

12

900, 912 n.5 (1989), which explained:
With a facially neutral system the discriminatory act occurs only at the time of
adoption, for each application is nondiscriminatory.... But a facially discriminatory
system ... by definition discriminates each time it is applied.
Alldread, 988 F.2d at 1431. Thus, the court concluded, “the district court properly construed the
FLSA agreements or waivers as an integral part of the City’s pay policy and concluded that the
policy was facially valid.” Id. at 1431-32.
Defendants rely on Alldread to argue that Phillips’ allegations also involve statements of
“coercion” and that the independent contractor agreements Phillips executed are similar to the FLSA
waiver agreements. This Court is not persuaded. In Knight v. Columbus, the Eleventh Circuit was
asked to determine whether the FLSA statute of limitations barred the plaintiff firefighters’ overtime
claims under a “misclassification” theory and under a “retaliation” theory. 19 F.3d at 580. The
Knight court found the Alldread opinion was distinguishable from the misclassification claims of
the Knight plaintiffs because,
the claims of the officer plaintiffs in the present case are not [based on a single FLSA
violation]; they do not require reference to any action taken by the City outside the
limitations period. It is true that the City’s original adoption of the pay policy
occurred more than three years ago, but the officer plaintiffs need not prove the
adoption of that pay policy to recover. If they are truly not exempt employees, the
officer plaintiffs only need to prove that they have worked unpaid overtime hours
during the statute of limitations period.
Knight, 19 F.3d at 583. Similarly, the opinion in Anderson v. City of Bristol, 6 F.3d 1168 (6th Cir.
1993) was distinguishable where
the Anderson plaintiffs’ sole complaint was that the city had recalculated their wage
rates so as to eliminate the future impact of overtime pay. Id. at 1169. The wage
recalculation had occurred five years before the plaintiffs filed suit, id., and “[t]he
only continuing effect [was] a reduced pay rate that absorbed any overtime increase
that would have occurred without the wage reduction.” Id. at 1176. Each actual
paycheck included payment for overtime worked, but because the plaintiffs’ base pay
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had been reduced, their take-home pay remained unchanged. The court reasoned that
any unlawful action by the city occurred outside the statute of limitations.
Knight, 19 F.3d at 582. Finally, in Knight itself, the court found that the retaliation claims were
time-barred because “[f]or the non-officer plaintiffs to prevail, they must establish that the City
violated the FLSA when it failed to give them a pay raise in July 1987, which was more than three
years before the commencement of this action in October 1990.” Id. at 584.
From Knight, Anderson, and Alldread, the Court discerns that if the challenged action by the
defendant employer is facially valid and must be proved (i.e., FLSA waivers, wage recalculation,
pay raise denial) for a plaintiff to recover, such action constitutes a single, discrete act from which
an FLSA claim accrues; however, if the action is facially discriminatory (i.e., misclassification as
an exempt employee or an independent contractor3), but need not be proved for a plaintiff to recover
under the FLSA, the “continuing violation” or “each paycheck” theory applies. In this case, as was
true for the officer plaintiffs in Knight, Phillips need not prove that Defendants misclassified him
as an independent contractor to recover overtime pay under the FLSA, but only that he is properly
classified as a nonexempt employee of CDC. See Knight, 19 F.3d at 583; see also Gustafson v. Bell
Atl. Corp., 171 F. Supp. 2d 311, 322 (S.D.N.Y. 2001) (applying the “each paycheck” theory to a
statute of limitations defense to claim for misclassification as an independent contractor) (citing
Pollis v. New Sch. for Soc. Research, 132 F.3d 115, 118 (2d Cir. 1997)).
Accordingly, Phillips, to the extent he succeeds in proving his FLSA claim, may recover for

3

Although the Court recognizes a distinction between an employee classified as “exempt”
at the employer’s discretion and an individual classified as an independent contractor with his or
her consent, the Court finds such distinction minimal for purposes of this analysis where, under
both scenarios, the individual typically accepts employment with (apparently) full knowledge of
the employer’s classification.
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any overtime worked but not paid on or after September 29, 2014 or, if Phillips proves Defendants’
conduct was willful, for overtime worked but not paid on or after September 29, 2013. Defendants’
motion to dismiss in this regard is denied.
C.

Has Phillips Properly Sued the Individual Defendants Under the FLSA?

Defendants argue that Phillips’ allegations concerning the individual Defendants are
conclusory and, thus, insufficient to state a claim for liability under the FLSA.
The Honorable Christine M. Arguello recently issued a decision analyzing whether a
plaintiff’s allegations were sufficient to state an FLSA claim of individual liability. Lopez v. Next
Generation Constr. & Envtl., LLC, No. 16-cv-00076-CMA, 2016 WL 6600243 (D. Colo. Nov. 8,
2016). This Court gratefully adopts Judge Arguello’s statement of the law in this area:
In FLSA cases, personal liability has often been imposed on individual officers in a
corporation without conducting a traditional veil-piercing analysis. See, e.g.,
Saavedra v. Lowe’s Home Ctrs., Inc., 748 F. Supp. 2d 1273, 1284 (D.N.M. 2010);
Digiore v. State of Ill., 962 F. Supp. 1064, 1080 (N.D. Ill. 1997); Donovan v. Agnew,
712 F.2d 1509, 1511–12 (1st Cir. 1983); Donovan v. Sabine Irrigation Co., Inc., 695
F.2d 190, 194–95 (5th Cir.), cert. denied, 463 U.S. 1207 (1983); Marchak v.
Observer Publ’ns, Inc., 493 F. Supp. 278, 282 (D.R.I. 1980); Brennan v. Whatley,
432 F. Supp. 465, 469 (E.D. Tex. 1977); Hodgson v. Royal Crown Bottling Co., 324
F. Supp. 342, 347 (D. Miss. 1970), aff’d, 465 F.2d 473 (5th Cir. 1972); Schultz v.
Chalk–Fitzgerald Constr. Co., 309 F. Supp. 1255 (D. Mass. 1970).
Such liability has instead been imposed on the ground that the particular individual
falls within the FLSA’s definition of “employer” and thus shares statutory
obligations with the corporation itself. See, e.g. Saavedra, 748 F. Supp. 2d at 1284
(“A person must be an ‘employer’ within the meaning of the . . . FLSA to be held
individually liable under [the] statute.”); Digiore, 962 F. Supp. at 1080 (the FLSA
contemplates individual liability under term “employer”); Donovan, 712 F.2d at
1511 (imposing liability for FLSA violations upon an individual shareholder as an
“employer” within the meaning of FLSA Section 3(d), 29 U.S.C. § 203(d)).
This occurs because an “employer” under the FLSA is defined to “include[ ] any
person acting directly or indirectly in the interest of an employer in relation to an
employee.” 29 U.S.C. § 203(d). “Person” includes “an individual,” and “employ”
includes to “suffer or permit to work.” Id. Courts construe these provisions
15

expansively, Robertson v. Bd. of Cty. Comm’rs of Cty. of Morgan, 78 F. Supp. 2d
1142, 1150 (D. Colo. 1999), and an employee may have several simultaneous
employers, id.; Falk v. Brennan, 414 U.S. 190, 195 (1973).
The Tenth Circuit has considered numerous factors when determining whether an
individual is an “employer” under the FLSA, including whether the alleged employer
has the power to hire and fire employees, supervises and controls employee work
schedules or conditions of employment, determines the rate and method of payment,
and maintains employment records. Hodgson v. Okada, 472 F.2d 965, 968–69 (10th
Cir. 1973); Mitchell v. Hertzke, 234 F.2d 183, 189–90 (10th Cir. 1956); see also
Robertson, 78 F. Supp. 2d at 1150–51; Herman v. RSR Sec. Servs., Ltd., 172 F.3d
132, 139 (2d Cir. 1999) (“[T]he overarching concern is whether the alleged employer
possessed the power to control the workers in question, ... with an eye to the
‘economic reality’ presented by the facts of each case.”); Baker v. Flint Eng'g &
Const. Co., 137 F.3d 1436, 1439 (10th Cir. 1998) (applying these factors to assess
the employer-employee relationship). Courts have also looked at the level of
operational control the individual has over the company, including whether the
individual is “involved in the day-to-day operation or ha[s] some direct responsibility
for the supervision of the employee.” Koellhoffer v. Plotke–Giordani, 858 F. Supp.
2d 1181, 1189–90 (D. Colo. 2012) (quoting Alvarez Perez v. Sanford–Orlando
Kennel Club, Inc., 515 F.3d 1150, 1160 (11th Cir. 2008)).
Lopez, 2016 WL 6600243 at *3-*4.
In this case, Phillips’ only argument in response to Defendants’ contention that his
allegations are conclusory and insufficient is that he has “not yet had the opportunity to engage in
any discovery.” Resp. 9. The Court is not convinced; a challenge pursuant to Fed. R. Civ. P.
12(b)(6) is made directly in response to an operative pleading and, thus, typically occurs before the
start of discovery. Certainly, the Supreme Court had this in mind when interpreting Rules 8 and
12(b). See Twombly, 550 U.S. at 555; Iqbal, 556 U.S. at 679.
Here, Phillips brings his FLSA claims against CDC, as well as the individual Defendants
Crouch, Jenson, and Owens. With respect to Gayle Crouch, Phillips alleges she “is one of the
owners and Directors of the Board for Defendant [CDC]. ... She has directed or, at [the] very least,
approved and ratified many of Defendant CDC’s activities and policies, FLSA violations, and

16

fraudulent and unlawful activities that have given rise to the claims enumerated in the instant case.”
Compl. ¶ 6. Phillips describes Greg Jenson with the same language. Id. ¶ 7. Phillips uses the same
language to describe Charles Owens except, rather than an “owner and director,” Mr. Owens is
characterized as a “managerial level employee of Defendant CDC.” Id. ¶ 8. Later, in the “factual
background” section of the pleading, Phillips refers to Owens as “CDC’s Director of Sales and
Marketing.” Id. ¶ 54. However, the factual allegations reference none of the individual Defendants
concerning overtime pay. Under Count I, Phillips refers repeatedly to CDC but, with respect to
Crouch, Jenson, and Owens, he states only “[t]he individual defendants, and each of them, are
employers as that term is described in the [FLSA] and, therefore, are individually liable for the
losses suffered by the Plaintiff.” Id. ¶ 83.
The Court concludes Phillips’ allegations are conclusory and insufficient to state a claim for
individual liability under the FLSA. Essentially, the allegations reveal only the individual
Defendants’ titles at CDC and from such titles, Phillips asks the Defendants and the Court to assume
they constitute “employers” under the FLSA. The Court declines to do so and finds that Phillips has
failed to state plausible FLSA claims against Defendants Crouch, Jenson, and Owens. Defendants’
motion to dismiss will be granted in this regard.
II.

Count II - Unjust Enrichment
Defendants argue that Plaintiffs’ unjust enrichment claim is (1) barred by the existence of

a written contract; (2) time-barred; and (3) vague and insufficient to survive the Iqbal/Twombly
requirements for plausible allegations against the individual Defendants.

A.

Barred by Written Contract

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Defendants contend the broker/independent contractor agreements govern the same subject
matter as that alleged to support Plaintiffs’ unjust enrichment claims and, as such, Plaintiffs’ claim
cannot stand. Defendants assert that because Plaintiffs have not rescinded the agreements and, in
fact, rely on such agreements for the breach of contract and tortious interference claims, the written
agreements preclude any claim for unjust enrichment. Plaintiffs counter that “[t]here is a significant
factual dispute as to the validity of the Plaintiffs’ contracts, given the circumstances in which they
were entered.” Resp. 11.
To state a claim for unjust enrichment, Plaintiffs must allege that: (1) at plaintiff’s expense,
(2) defendant received a benefit, (3) under circumstances that would make it unjust for defendant
to retain the benefit without paying. See Robinson v. Colo. State Lottery Div., 179 P.3d 998, 1007
(Colo. 2008) (en banc).
Unjust enrichment is a form of quasi-contract or a contract implied in law. As such,
it is an equitable remedy and does not depend on any contract, oral or written. The
theory does not require any promise or privity between the parties. Rather, it is a
judicially created remedy designed to avoid benefit to one to the unfair detriment of
another.
Hottinger Excavating & Ready Mix, LLC v. R.E. Crawford Constr., LLC, 175 F. Supp. 3d 1269,
1278 (D. Colo. 2016) (quoting Salzman v. Bachrach, 996 P.2d 1263, 1265 (Colo. 2000) (en banc)
(internal citations omitted)).
“[I]n general, a party cannot recover for unjust enrichment by asserting a quasi-contract
when an express contract covers the same subject matter because the express contract precludes any
implied-in-law contract.” Interbank Invs., LLC. v. Eagle River Water & Sanitation Dist., 77 P.3d
814, 816 (Colo. App. 2003). However, a plaintiff that is party to an express contract may
nonetheless bring an unjust enrichment claim when it “will have no right under an enforceable

18

contract.” Id.; see also Dudding v. Norton Frickey & Assocs., 11 P.3d 441, 447–48 (Colo. 2000)
(en banc). Thus, while a plaintiff may not recover damages under an unjust enrichment claim that
are identical to those available under its other claims, “it is well-established that a plaintiff may seek
alternative theories of recovery, even when only one of those theories could actually bear fruit at
trial.” Bd. of Cty. Comm’rs of La Plata Cty. v. Brown Grp. Retail, Inc., 598 F. Supp 2d 1185, 1192
(D. Colo. 2009) (citations omitted).
Thus, Defendants are correct (and Plaintiffs do not dispute) that Plaintiffs may not recover
under Count II if the broker/independent contractor agreements are deemed enforceable. However,
the Court finds that, if Phillips4 is found to be an employee of CDC under the FLSA, rather than an
independent contractor, the enforceability of the agreements may be in question. Thus, since it is
possible that a determination during the litigation might render the agreements invalid, the Court
will construe the unjust enrichment claim as an “alternative” to the Plaintiffs’ breach of contract and
tortious interference claims. Bd. of Cty. Comm’rs of La Plata Cty., 598 F. Supp 2d at 1192. The
motion to dismiss will be denied in this regard.
B.

Statute of Limitations

Defendants assert that Plaintiffs knew or should have known of their injury(ies) under this
claim well before the three-year statute of limitations. Plaintiffs counter that “the unjust enrichment
injury was still happening at the time they filed the complaint.” Resp. 10.
“[B]ecause unjust enrichment is a form of relief in quasi-contract or contract implied in law,
the time within which to assert such a claim ordinarily is assessed under the three-year statute of
limitations for contract actions.” Sterenbuch v. Goss, 266 P.3d 428, 437 (Colo. App. 2011) (citing

4

It is undisputed that Phillips was a party to the agreements, not LP&A.
19

Colo. Rev. Stat. § 13–80–101(1)(a) and Salzman v. Bachrach, 996 P.2d 1263, 1265 (Colo. 2000)).
A claim of unjust enrichment accrues “when a person discovers, or through the exercise of
reasonable diligence should discover, that all elements of the claim are present.” Id. (quoting
Hannon Law Firm, LLC v. Melat, Pressman & Higbie, LLP, 293 P.3d 55, 58 (Colo. App. 2011)).
Here, the Plaintiffs’ allegations taken as true reveal that Phillips believed, from the time he
began a working relationship with Defendants in 1996, that the company he formed under the “CDC
business model” would eventually become his own business. Compl. ¶¶ 24, 25. It was not until
2015 that Phillips learned CDC placed another “broker” in what he considered his sales territory.
Compl. ¶¶ 55, 56, 61, 63. The Court finds a reasonable jury could conclude from these facts that
Phillips first learned in 2015 that CDC interpreted the business relationship differently than he did
in that CDC had the control over and ability to diminish Plaintiffs’ sales generation and income. As
such, Plaintiffs’ allegations plausibly state that Phillips first learned in 2015 of circumstances under
which it may be unjust for CDC to retain the benefits of Phillips’ investments into LP&A, which
Phillips believed would be his own. See Compl. ¶ 89 (“A financial benefit was conferred on
Defendant CDC by Plaintiff by reason of his capital investments into the Carpet Direct organization
through acquisition of equipment on the organization’s behalf, payment of rent for space for the
organization, and acceptance of less remuneration because of his false belief that he was building
equity in a company.”).
Because Plaintiffs’ allegations, taken as true, demonstrate that Phillips’ knowledge of the
facts essential to the cause of action occurred in 2015, the Court will deny the motion to dismiss.

C.

Individual Defendants

20

Defendants contend the “Complaint is unclear whether Phillips is asserting unjust enrichment
against CDC only or also against the individual Defendants” and argue “Phillips does not assert any
facts supporting the conclusion that the individual Defendants were unjustly enriched.” Mot. 8.
Plaintiffs do not address this argument. The Court disagrees with the former, but agrees with the
latter and finds that the Complaint specifically alleges Count II “as to Defendant CDC” and fails to
assert facts necessary to allege a plausible unjust enrichment claim against the individual
Defendants. Accordingly, Count II is alleged solely against Defendant CDC, and the motion to
dismiss will be denied as moot in this regard.
III.

Count III - Breach of Contract5
Defendants argue Plaintiffs’ breach of contract claim fails because the subject agreement

does not contain the “exclusivity” clause on which Plaintiffs rely for the claim. Plaintiffs counter
that, when a contract is silent as to a material term, the parties’ “course of dealing” may guide the
court in supplying an omitted term. Defendants reply that the parties’ course of dealing may not
override a document’s plain meaning.
The Tenth Circuit has recently interpreted and set forth a statement of Colorado law
concerning the interpretation of contracts:
Under Colorado law, contracts “should be interpreted consistently with the
well-established principles of contractual interpretation.” Allstate Ins. Co. v. Huizar,
52 P.3d 816, 819 (Colo. 2002). Courts “must examine [contractual] terms and
attempt to determine the intent of the parties.” East Ridge of Fort Collins, LLC v.
Larimer & Weld Irrigation Co., 109 P.3d 969, 973 (Colo. 2005). What courts are
after is the parties’ mutual intent. Pepcol Mfg. Co. v. Denver Union Corp., 687 P.2d
1310, 1313 (Colo. 1984). Absent an indication the parties chose to deviate from plain
meaning, “the instrument’s language must be examined and construed in harmony

5

The argument analyzed in this section also involves Plaintiffs’ tortious interference
claim and will be resolved as to both.
21

with the plain and generally accepted meaning of the words used.” East Ridge, 109
P.3d at 974. In other words, common usage prevails, and “strained constructions
should be avoided.” Allstate, 52 P.3d at 819.
***
When a contractual provision unambiguously resolves the parties’ dispute, the
interpreting court’s task is over. “It is axiomatic that in the absence of an ambiguity
a written contract cannot be varied by extrinsic evidence.” Pepcol, 687 P.2d at 1314.
When, on the other hand, “an ambiguity has been determined to exist, the meaning
of its terms is generally an issue of fact to be determined in the same manner as other
factual issues.” East Ridge, 109 P.3d at 974. Extrinsic evidence, for example,
becomes admissible to determine the meaning of a contractual provision at issue.
“This extrinsic evidence may include any pertinent circumstances attendant upon the
transaction, including the conduct of the parties under the agreement.” Pepcol, 687
P.2d at 1314. Courts in Colorado “have found the conduct of the parties before the
controversy arose to be a reliable test of their interpretation of the agreement.” East
Ridge, 109 P.3d at 975.
Determining whether “a written contract is ambiguous is a question of law.” Id. It is
not enough that the parties disagree about the meaning. Id. “Rather, a contract is
ambiguous [only] if it is fairly susceptible to more than one interpretation.” Id.
(quotation omitted). In guiding this determination, however, Colorado law no longer
restricts the interpreting court to the four corners of the contract. Id. Where
appropriate, “extrinsic evidence may be conditionally admitted to determine whether
the contract is ambiguous.” Id. This evidence, though, must be stricken if the court,
after considering the evidence, has determined no ambiguity exists. Pepcol, 687 P.2d
at 1314 n. 3.
Level 3 Commc’ns, LLC v. Liebert Corp., 535 F.3d 1146, 1154-55 (10th Cir. 2008); see also
Brammer-Hoelter v. Twin Peaks Charter Acad., 492 F.3d 1192, 1211 (10th Cir. 2007) (“if the
relevant contract provision is unambiguous, the course of dealing may not override the document’s
plain meaning.”).
Here, a copy of the CDC Broker/Independent Contractor Agreement in force at the time of
the alleged breach is found at ECF Nos. 2-3, 3-1, and 4-1 (“Agreement”). The copy provided to the
Court is not signed, but there is no dispute between the parties that the February 18, 2014 Agreement
was in force. It is also undisputed that the Agreement refers to the Broker’s “Sales Territory”
22

(defined as “the counties of Larimer, Boulder, and Weld” and “[t]he municipalities of Fort Collins,
Loveland, Windsor, Greeley, Wellington, and Cheyenne, WY”) in several provisions, but no
provision of the Agreement expressly states that the Broker has “exclusive rights” to sell in the Sales
Territory. However, the Court agrees with Plaintiffs that the Agreement is ambiguous, or “fairly
susceptible to more than one interpretation,” in that certain provisions the Agreement may be
reasonably interpreted as conferring “exclusive rights” on Phillips concerning the Sales Territory.
For example, in the Recitals, the parties stipulate that CDC “wishes to engage” Phillips, and
Phillips “is willing,” “to sell and manage the distribution of flooring on Carpet Direct’s behalf in the
Sales Territory.” This provision is also found in ¶ 2.1 of the Agreement. In addition, the following
provisions suggest the “exclusivity” of Phillips’ right to sell in the Sales Territory:
-

Broker agrees to provide guidance and coordinate the marketing and sales of
the Sales Reps in order to maximize the sales of Flooring by Carpet Direct
in the Sales Territory (¶ 2.2);

-

Broker agrees to manage Carpet Direct’s offices and warehouse facilities in
the Sales Territory, including the ordering, receipt and distribution of all
Flooring (¶ 2.3 (emphasis added));

-

Broker further agrees to ensure that all Sales Reps within his/her Sales
Territory use only the banks specified by Carpet Direct for the deposit of the
amounts that any Sales Rep in the Sales Territory receives from the sale of
Flooring (¶ 2.5 (emphasis added));

-

Carpet Direct agrees to pay Broker a commission equal to fifteen percent
(15%) of the gross amount of sales of Flooring . . . procured for Carpet Direct
in the Sales Territory through Broker’s individual efforts (¶ 4 (emphasis
added));

-

Carpet Direct also agrees to pay Broker a commission equal to five percent
(5%) of the gross amount of sales of Flooring . . . procured for Carpet Direct
in the Sales Territory by any sales agent under the Broker’s supervision (id.);

-

. . . the Broker is responsible and shall pay for all warehouse costs in excess
of 1.0% of the Sales Volume of the Brokerage. “Sales Volume of the
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Brokerage” is defined as all sales (within the calendar month for which the
expenses occurred) of the Broker and his/her Sales Reps within the Sales
Territory less sales taxes (¶ 8.2).
Moreover, the Agreement’s “Covenant Not to Compete” requires that Phillips refrain from engaging
in any “direct sales” of flooring in the Sales Territory for a period of 18 months after termination
of the Agreement (¶ 15.2). The Court concludes that a reading of these provisions and the
Agreement as a whole reveals an ambiguity as to whether Phillips had the exclusive right to sell
CDC Flooring in the Sales Territory. As such, the issue becomes one for a fact finder to decide. See
Level 3 Commc’ns, 535 F.3d at 1155. Therefore, the Court will deny the motion to dismiss
Plaintiffs’ breach of contract and tortious interference claims on this argument.
IV.

Count IV - Tortious Interference with Business Contract
Defendants contend that Plaintiffs have failed to allege facts sufficient to establish the

necessary motivation of Defendant Owens to interfere, and Plaintiffs’ allegations against Defendant
Kinsey amount to legal business competition.
A.

Owens

First, the Court disagrees that the allegations fail to establish Owens’ “necessary” motivation
to “harm” the Plaintiffs. Plaintiffs assert that Kinsey, Owens’ long-time family friend, complained
to Owens (CDC Director of Sales and Marketing) that he was not making enough money as
Plaintiffs’ Sales Rep. Compl. ¶¶ 54-55. In response, Owens established a brokerage for Kinsey in
Loveland, Colorado – Plaintiffs’ defined Sales Territory – and Kinsey’s warehouse was located only
minutes away from Plaintiffs’. Id. The Court finds that these allegations state a plausible claim that
Owens was motivated by a personal desire to interfere in Plaintiffs’ contract with CDC. The Court
will deny the motion to dismiss Plaintiffs’ tortious interference claim against Owens.

24

B.

Kinsey

However, the Court agrees that Plaintiffs’ tortious inference claim cannot stand against
Kinsey. “[T]o prove tortious interference with contract, a plaintiff must show: (1) a contract existed;
(2) the defendant had knowledge of the contract; (3) the defendant interfered and induced the other
party to breach the contract; and (4) the plaintiff was injured as a result. Nobody in Particular
Presents, Inc. v. Clear Channel Commc’ns, Inc., 311 F. Supp. 2d 1048, 1115 (D. Colo. 2004) (citing
Westfield Dev. Co. v. Rifle Inv. Ass’n., 786 P.2d 1112, 1117 (Colo. 1990) (en banc)). Most
importantly, the interference must be intentional and improper. Id. (citing Amoco Oil Co. v. Ervin,
908 P.2d 493, 501 (Colo. 1996) (en banc)).
As Defendants argue, “[i]nterference with a contract is not improper when it involves a
matter of competition between the parties.” Id. In this case, the allegations, taken as true,
demonstrate Kinsey was a Sales Rep for the Plaintiffs, for whom Owens assigned a brokerage in the
contracted Sales Territory. Under Colorado law, “a defendant who intentionally causes a third
person to breach a contract with the plaintiff does not engage in improper conduct if: (1) it concerns
a matter of competition between the defendant and plaintiff; (2) the defendant does not employ
wrongful means; (3) the action does not amount to an unlawful restraint of trade; and (4) the
defendant’s purpose is, at least in part, to advance its own interest. Id. (citing Ervin, 908 P.2d at
501). “‘Wrongful means’ include physical violence, fraud, civil suits, and criminal prosecutions.
Id. at 1115-16 (citing Ervin, 908 P.2d at 502).
Thus, Plaintiffs must show that Kinsey plausibly interfered with the contract and that he
engaged in improper conduct. Here, the allegations do not plausibly state how Kinsey, a “Sales
Rep,” had the ability to interfere with the Agreement between Phillips and CDC. In addition,

25

Kinsey’s conduct indisputably concerns a matter of competition between Plaintiffs and Kinsey, he
is not alleged to have engaged in physical violence, fraud, civil suits, or criminal prosecutions, the
brokerage, as alleged, does not amount to an unlawful restraint of trade, and the allegations
demonstrate Kinsey’s purpose is to advance his own interest (i.e., make more money).
Accordingly, the Court must conclude that Plaintiffs fail to state a plausible claim for tortious
interference against Defendant Kinsey, and the motion to dismiss will be granted as to this claim.
CONCLUSION
In sum, the Court concludes that Plaintiffs’ factual allegations are plausible to state an FLSA
claim on behalf of Phillips against CDC, but all other FLSA claims are dismissed. In addition,
Plaintiffs state plausible claims of unjust enrichment and breach of contract against Defendant CDC.
Finally, Plaintiffs state a plausible claim for tortious interference against Owens, but not against
Kinsey.
Accordingly, this Court grants in part and denies in part Defendants’ Motion to Dismiss
pursuant to Fed. R. Civ. P. 12(b)(6) [filed November 11, 2016; ECF No. 19] as follows:
1.

Plaintiffs’ FLSA claim (Count I) is dismissed as to the individual Defendants;

2.

The FLSA claim brought by Plaintiff LP&A is dismissed, but the claim brought by Phillips
will proceed against Defendant CDC;

3.

Plaintiffs’ unjust enrichment (Count II) and breach of contract (Count III) claims against
Defendant CDC will proceed as alternative theories of relief; and

4.

Plaintiffs’ tortious interference claim (Count IV) is dismissed against Defendant Kinsey, but
will proceed against Defendant Owens.

In light of this order, the Clerk of the Court is directed to dismiss Defendants Crouch, Jenson, and

26

Kinsey from this action.
Dated at Denver, Colorado, this 10th day of January, 2017.
BY THE COURT:

Michael E. Hegarty
United States Magistrate Judge

27