Leon v. M.I. Quality Lawn Maintenance, Inc. et al
Filing
225
ORDER Denying 197 Plaintiffs' Renewed Motion for Judgment as a Matter of Law. Signed by Magistrate Judge Andrea M. Simonton on 2/20/2013. (mmn)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
EDEL LEON, et al.,
Plaintiffs,
v.
CASE NO. 10-20506-CIV-SIMONTON
M.I. QUALITY LAWN
MAINTENANCE, INC., et al.,
Defendants.
/
LUIS SOLORZANO,
Plaintiff,
v.
CASE NO. 10-20975-CIV-SIMONTON
M.I. QUALITY LAWN
MAINTENANCE, INC., et al.,
Defendants.
/
ORDER DENYING MOTION FOR RENEWED JUDGMENT AS A MATTER OF LAW
This matter is before the Court on Plaintiffs’ Renewed Motion for Judgment as a
Matter of Law (DE # 197).1 Defendants have filed a Response (DE # 211), and Plaintiffs
have filed a Reply (DE # 214). Pursuant to the consent of the parties, the Honorable
Patricia A. Seitz, United States District Judge, has referred this case to the undersigned
United States Magistrate Judge for all further proceedings (DE # 63). After a review of
the record as a whole, and for the reasons stated below, Plaintiffs’ Renewed Motion is
denied.
1
The Renewed Motion is DE # 146 in Luis Solorzano v. M.I. Quality Lawn Maintenance,
Inc., et al., No. 10-20975-CIV-SIMONTON, but references to docket entries in this Order
are to those found in Edel Leon, et al. v. M.I. Quality Lawn Maintenance, Inc., et al., No.
10-20506-CIV-SIMONTON, unless otherwise indicated.
I.
BACKGROUND
On July 17, 2012, after a jury trial regarding alleged violations of the Fair Labor
Standards Act, 29 U.S.C. §§ 201 to 219 (the “FLSA”), the jury returned verdicts in favor of
Plaintiff Javier Gonzalez with respect to his retaliation claim, and in favor of Plaintiff Luis
Solorzano with respect to his overtime wage claim (DE ## 189, 192). The jury found,
however, that the two corporate Defendants, M.I. Quality Lawn Maintenance, Inc. (“M.I.
Quality”) and Mitchell’s Lawn Maintenance Corp. (“Mitchell’s Lawn”), were not joint
employers of these Plaintiffs.2 At the close of Plaintiffs’ case, Plaintiffs moved for
judgment as a matter of law with regard to Defendants’ joint employment of Plaintiffs.3
The motion was denied with leave to renew at the close of trial. Following the conclusion
of the jury trial, Plaintiffs filed their Renewed Motion.
II.
PARTIES’ POSITIONS
In their Renewed Motion, the Plaintiffs recount facts from the trial they believe
establish that the two corporations at issue are joint employers of Plaintiffs Javier
Gonzalez and Luis Solorzano (DE # 197 at 1-4). In reviewing the facts, Plaintiffs assert
that they demonstrate that employees of M.I. Quality “controlled the means and manner
of the work” performed by the Plaintiffs because Plaintiffs’ work was supervised by M.I.
Quality employees (DE # 197 at 4). Specifically, Plaintiffs contend that Jose Ernesto
Mendoza and Mitchell Igelko supervised Plaintiffs’ work, and these supervisors were M.I.
Quality employees. Plaintiffs argue that these facts demonstrate the control over
Plaintiffs by the employers and the employers’ supervision of Plaintiffs (DE # 197 at 6), as
2
In contrast, with respect to Plaintiff Edel Leon’s claims of FLSA violations, the jury
found that he was jointly employed by the corporate Defendants (DE # 188).
3
Although not explicitly stated by Plaintiffs in their Renewed Motion, the undersigned
assumes, given the evidence at trial and the parties’ arguments with regard to the
Renewed Motion, that Plaintiffs’ employment with Mitchell’s Lawn is not in question;
instead, the question of joint employment is with regard to whether M.I. Quality may also
be considered an employer of these Plaintiffs.
2
well as an agreement between the employers to share employees’ services (DE # 214 at
3). In addition, Plaintiffs set forth the role of Mitchell Igelko to establish a joint
employment relationship. They state that he hired these Plaintiffs and discharged Javier
Gonzalez. He also, they continue, determined the amount and method of wage
payments. Plaintiffs further argue that each Defendant corporation acted directly or
indirectly in the interest of the other as evidenced by their respective roles – M.I. Quality
obtained contracts for work, and Mitchell’s Lawn performed the work (DE # 214 at 3).
Thus, Plaintiffs conclude, one entity could not function without the other (DE # 214 at 5).
Finally, Plaintiffs state that the payroll for Plaintiffs was prepared by Mitchell Igelko and
other staff who were M.I. Quality employees (DE # 197 at 6).
In Response, Defendants contend that sufficient evidence was set forth at trial to
support the jury’s findings, namely, that Mitchell’s Lawn hired and supervised Plaintiffs,
and that Mitchell’s Lawn owns the facility where Plaintiffs worked and the equipment
used by them (DE # 211 at 2, 5). Thus, Defendants conclude, the jury’s verdict in this
regard should stand (DE 211 at 3). With regard to Mr. Mendoza, Defendants contend that
Mr. Mendoza was not clear as to which entity employed him (DE # 211 at 5-6). As for
payroll, Defendants argue that, while Mr. Igelko determined the Plaintiffs’ pay rate and
method, M.I. Quality had no function other than to acquire lawn maintenance contracts
and provide employee health benefits. While an M.I. Quality employee (Kelly Phillips)
prepared the payroll, Defendants continue, Mr. Igelko signed payroll checks that were
drawn from the Mitchell’s Lawn bank account (DE # 211 at 6).
III.
LEGAL STANDARDS
Under Federal Rule of Civil Procedure 50(b), if a court does not grant a motion for
judgment as a matter of law pursuant to Fed. R. Civ. P. 50(a), a movant may renew the
motion “if there is no legally sufficient evidentiary basis for a reasonable jury to find for
the non-moving party.” Optimum Techs., Inc. v. Henkel Consumer Adhesives, Inc., 496
3
F.3d 1231, 1251-52 (11th Cir. 2007) (citation omitted). Federal Rule of Civil Procedure
50(a) provides
If a party has been fully heard on an issue during a jury trial and the court
finds that a reasonable jury would not have a legally sufficient evidentiary
basis to find for the party on that issue, the court may…grant a motion for
judgment as a matter of law....
In considering judgment as a matter of law, the Court reviews “all of the evidence in the
light most favorable to, and with all reasonable inferences drawn in favor of, the
nonmoving party.” Mendoza v. Borden, Inc., 195 F.3d 1238, 1244 (11th Cir. 1999) (citation
omitted). The existence of a genuine issue of material fact precludes judgment, but a
“mere scintilla of evidence” does not create a jury question. Id. Denial is appropriate
only if “reasonable and fair-minded persons in the exercise of impartial judgment might
reach different conclusions.” If “reasonable people could not arrive at a contrary
verdict,” then a motion is properly granted. Id. The court’s determination is “squarely
and narrowly focused on the sufficiency of evidence.” Optimum Techs., Inc., 496 F.3d at
1251-52 (citation omitted). With this standard in mind, and considering that Plaintiffs
bear the burden of proof, the undersigned turns to the standard for determining joint
employment under the FLSA.
The FLSA defines an employer as “any person acting directly or indirectly in the
interest of an employer in relation to an employee.” 29 U.S.C. § 203(d). The Code of
Federal Regulations provides further guidance for determining joint employment. It
states in relevant part
A single individual may stand in the relation of an employee to two or more
employers at the same time under the [FLSA]…. A determination of
whether the employment by the employers is to be considered joint
employment or separate and distinct employment for purposes of the
[FLSA] depends upon all the facts in the particular case.
29 C.F.R. § 791.2(a). In addition, 29 C.F.R. § 791.2(b) provides
Where the employee performs work [that] simultaneously benefits two or
more employers, or works for two or more employers at different times
4
during the workweek, a joint employment relationship generally will be
considered to exist in situations such as: (1) Where there is an
arrangement between the employers to share the employee’s services, as,
for example, to interchange employees; or (2) Where one employer is
acting directly or indirectly in the interest of the other employer (or
employers) in relation to the employee; or (3) Where the employers are not
completely disassociated with respect to the employment of a particular
employee and may be deemed to share control of the employee, directly or
indirectly, by reason of the fact that one employer controls, is controlled
by, or is under common control with the other employer.
The Eleventh Circuit has developed a list of factors applicable to an analysis of
joint employment. See Layton v. DHL Express (USA), Inc., 686 F.3d 1172, 1176-77 (11th
Cir. 2012), citing Aimable v. Long & Scott Farms, 20 F.3d 434 (11th Cir. 1994). The eight
Aimable factors include:
(1) The nature and degree of control of the workers; (2) The degree of
supervision, direct or indirect, of the work; (3) The power to determine the
pay rates or the methods of payment of the workers; (4) The right, directly
or indirectly, to hire, fire, or modify the employment conditions of the
workers; (5) Preparation of payroll and the payment of wages…(6)
[O]wnership of the facilities where work occurred[;]…(7) [P]erformance of a
specialty job integral to the business[; …and (8): I]nvestment in equipment
and facilities.
Layton, 686 F.3d at 1176. The Court in Layton also identified several “principles” to
guide their analysis under the eight-factor test. First, each relationship between an
employee and a given employer should be considered separately in determining
economic dependence. Second, no one factor determines the relationship; instead, it
“depends on the economic reality of all the circumstances.” Id. at 1177. Third, the
factors are not intrinsically helpful but, instead, are valuable as tools to the extent they
shed light on an employee’s alleged economic dependence on a given employer, which
is a fact-specific inquiry. Id. Fourth, the analysis to determine joint employment is not a
“mathematical formula,” with each factor to be decided in one employer’s favor. Instead,
the factors must be viewed “qualitatively to assess the evidence of economic
dependence, which may point to both [employers].” Id. at 1178. Finally, the analysis
should focus on economic dependency instead of common law employment concepts.
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Id. With these legal standards as a framework, the undersigned turns to the facts of this
case.
IV.
ANALYSIS
As stated in greater detail below, Plaintiffs fail to meet the standard for judgment
as a matter of law with regard to joint employment. In short, the evidence in front of the
jury provided a legally sufficient basis for their findings, and, thus, judgment in favor of
joint employment as a matter of law is not appropriate. The undersigned emphasizes
that, as the legal standards set forth above make clear, the consideration before the
Court is not whether the undersigned would have reached a different conclusion as to
joint employment, based on the evidence. Instead, pursuant to Fed. R. Civ. P. 50, the
question is much narrower. Under this narrower review, the undersigned finds no
reason as a matter of law to disturb the jury’s findings because “reasonable and fairminded persons in the exercise of impartial judgment might reach different conclusions.”
Mendoza, 195 F.3d at 1244.
At the outset, the undersigned notes that the joint employment distinction was not
lost on the jurors, as demonstrated by their verdicts; while they determined that the
Defendant entities were not joint employers with regard to Plaintiffs Gonzalez and
Solorzano, the jury found joint employment with regard to Plaintiff Edel Leon. Thus, as
fact finders who weighed the economic circumstances of the respective Plaintiffs’
employment as a whole, the jurors decided that the factors weighed against a finding of
joint employment for these Plaintiffs. Accordingly, the verdicts demonstrate that the
jurors distinguished among each employee’s relationship with the respective
Defendants.
Next, the undersigned turns to the eight factors of Aimable “squarely and
narrowly focused on the sufficiency of evidence.” Optimum Techs., Inc., 496 F.3d at
1251-52 (citation omitted). First, the undersigned considers together (as the parties
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have) the first two Aimable factors to determine whether the jury had a “legally sufficient
evidentiary basis to find” as it has. Fed. R. Civ. P. 50(a). These two factors concern the
nature of the respective employers’ control and supervision of the Plaintiffs’ work.
Layton, 686 F.3d at 1176. Plaintiffs state that Mitchell Igelko supervised Plaintiffs work
and also directed the work of Jose Ernesto Mendoza, an alleged M.I. Quality employee,
who also supervised Plaintiffs’ work (DE # 197 at 3-4). This satisfies the first two factors,
Plaintiffs conclude, as well as the shared control provision of 29 C.F.R. § 791.2(b)(3).
Defendants agree that Mitchell Igelko supervised Plaintiffs, but that he did so in his
capacity as the principal of Mitchell’s Lawn (DE # 211 at 5) – a conclusion Plaintiffs
appear to implicitly challenge although they do not refute the legal sufficiency of the
evidence underlying Defendants’ claim. Defendants also note that the evidence is mixed
with regard to Mr. Mendoza’s true employer (DE # 211 at 5-6) – a claim regarding the
sufficiency of evidence that Plaintiffs do not refute in their Reply.
Thus, while Plaintiffs challenge the weight of the evidence and the conclusions
reached in light of it, Plaintiffs do not refute the legal sufficiency of the evidence to
support a conclusion that Mr. Igelko supervised Plaintiffs in his capacity with Mitchell’s
Lawn. Moreover, while Plaintiffs consistently argue that Mr. Mendoza is an M.I. Quality
employee, they do not dispute the fact that the inconsistent testimony of Mr. Mendoza
regarding his employer precludes judgment as a matter of law regarding joint
employment. Thus, Plaintiffs appear with the first two factors to take issue with
conclusions resulting from the evidence – not the sufficiency of the evidence, itself.
Such a disagreement, however, is beyond the scope of a Rule 50 motion. Therefore,
considering the evidence in the light most favorable to Defendants, the undersigned
concludes that “reasonable and fair-minded persons in the exercise of impartial
judgment might reach different conclusions” as to whether Plaintiffs were solely
7
employed by Mitchell’s Lawn, given this evidence before the jury. See Mendoza, 195 F.3d
at 1244.
The third and fifth factors concern pay. Specifically, the third factor addresses the
power to determine pay rates and method of payment, and the fifth factor concerns
payroll preparation and wage payments. Layton, 686 F.3d at 1176. Plaintiffs argue that
the evidence shows that Mitchell Igelko determined Plaintiffs’ pay rates and signed the
paychecks, or paid cash, as he deemed appropriate. Plaintiffs further assert that payroll
was prepared by office staff who were M.I. Quality employees (DE # 197 at 3, 6).
Defendants acknowledge that Mr. Igelko determined Plaintiffs’ pay rate and method of
payment. Defendants also acknowledge that an M.I. Quality employee, Kelly Phillips,
prepared payroll. Defendants assert, however, that wages were paid by Mitchell’s Lawn
because the related funds were drawn from a Mitchell’s Lawn bank account (DE # 211 at
6) – a claim Plaintiffs do not refute in their Reply.
Thus, in a light most favorable to Defendants, the jury had before it evidence that,
while an M.I. Quality employee may have prepared payroll in an administrative sense, the
key decisions were made by Mitchell Igelko, the principal of Mitchell’s Lawn, who paid
Plaintiffs from Mitchell’s Lawn funds. Incidentally, M.I. Quality’s role in preparing the
payroll would not necessitate as a matter of law a finding that M.I. Quality must be
considered a joint employer of Plaintiffs. See, e.g., Beck v. Boce Group, L.C., 391 F.
Supp. 2d 1183, 1191 (S.D. Fla. 2005) (in granting summary judgment against joint
employment, and considering this Aimable factor, noting that although second company
paid wages to employees, the company appeared to only serve an administrative
function and pass through payments from plaintiffs’ employer, thus, demonstrating only
minimal evidence of the second company’s joint employment). Therefore, in the
undersigned’s review that is “squarely and narrowly focused on the sufficiency of
evidence,” the undersigned finds that reasonable minds could differ as to the
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conclusions reached from this evidence, as there was sufficient evidence for the jury to
reach the conclusion that Mitchell’s Lawn controlled Plaintiffs’ pay. See Optimum
Techs., Inc., 496 F.3d at 1251-52 (citation omitted); Mendoza, 195 F.3d at 1244.
The fourth factor addresses the right to hire, fire or modify the conditions of
employees’ work. Layton, 686 F.3d at 1176. The Defendants do not dispute that this
power lay with Mitchell Igelko (DE ## 197 at 6; 211 at 6), and the parties do not further
address this factor. Presumably, while they may agree that Mitchell Igelko held this
power, they would disagree as to in which capacity Mitchell Igelko exercised this
authority with respect to Plaintiffs. At any rate, Plaintiffs fail to develop any further
argument with regard to this factor.
The sixth factor relates to ownership of the facilities where Plaintiffs’ work
occurred. Layton, 686 F.3d at 1176. Plaintiffs simply note that both corporations
operated out of the same facility (DE # 197 at 3). Defendants declare that the undisputed
fact is that all the equipment and facilities were owned by Mitchell’s Lawn (DE # 211 at 6).
Plaintiffs do not refuted this contention. Thus, the available evidence demonstrated that
Plaintiffs worked out of a facility owned by Mitchell’s Lawn only, with equipment owned
by Mitchell’s Lawn only. Given this record, the undersigned finds legally sufficient
evidence for the jury to have reached its conclusion. See Fed. R. Civ. P. 50(b).
The parties have not raised or addressed any further arguments that relate to the
remaining factors.
Beyond the eight Aimable factors, Plaintiffs emphasize that Defendants satisfy the
guidelines for joint employment set forth in 29 C.F.R. § 791.2. Specifically, Plaintiffs
argue in their Renewed Motion that evidence of Mr. Igelko and Mr. Mendoza supervising
Plaintiffs’ work supports a conclusion under 29 C.F.R. § 791.2(b)(3) that the entities were
joint employers. Defendants did not respond to this argument. In their Reply, Plaintiffs
raise additional arguments to support joint employment with regard to 29 C.F.R. § 791.2,
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including, among others, an agreement among the employers to share the work of
employees and the interdependent relationship of the corporate Defendants.
There are several problems with Plaintiffs’ claims as they relate to the cited
federal regulation. First, a procedural issue presents itself because Plaintiffs raised one
specific argument in their Renewed Motion, and the others were raised in their Reply,
precluding Defendants’ response to the additional arguments. Moreover, the import of
the one argument raised in the Renewed Motion is unclear; Plaintiffs argue that the
supervision of Plaintiffs’ work satisfied 29 C.F.R. § 791.2(b)(3), but that provision appears
to address the supervision by one employer of another employer, or the common control
of employers. At any rate, even assuming that Plaintiffs appropriately set forth viable
regulatory arguments, they must be considered in context. The Court acknowledges the
authority of the regulation but must consider it in the context of the controlling Eleventh
Circuit legal standards cited above.
The above issues aside, other complications still arise. First, Plaintiffs do not
directly address the predicate language of this provision. In particular, the provision
begins, “Where the employee performs work [that] simultaneously benefits two or more
employers, or works for two or more employers at different times during the
workweek,….” Plaintiffs provide no argument as to the sufficiency of the evidence set
forth to either establish that the Plaintiffs’ work simultaneously was benefiting both
employers, or that Plaintiffs were working for different corporate Defendants at different
times in the workweek. Finally, even if the predicate language were satisfied, 29 U.S.C. §
791.2(b) does not require a finding of joint employment. By its own terms, it states in
pertinent part “…a joint employment relationship generally will be considered to exist in
situations such as….” The plain language of the regulation is more akin to a guideline
than a required finding of a court. Thus, even if the conditions of either Plaintiff’s
10
employment satisfied the parameters of this regulation, the Court is not required as a
matter of law to find joint employment.
Finally, Plaintiffs assert in their Reply that the purported economic dependency of
Mitchell’s Lawn on M.I. Quality necessitates a finding of joint employment. Plaintiffs
argue that the interdependence of the corporate Defendants, as evidenced by the fact
that M.I. Quality obtained the lawn maintenance contracts that Mitchell’s Lawn
subsequently performed, requires such a finding. Because Plaintiffs developed this
argument in their Reply, Defendants have not addressed it. Nonetheless, even assuming
Defendants acknowledge the relationship between the corporate Defendants, the
conclusion does not follow as a matter of law that the Plaintiffs were economically
dependent on M.I. Quality and, thus, under their joint employment. Even courts that
specifically consider as a factor whether a plaintiff’s employer (in this case, Mitchell’s
Lawn) has more than one “client” than the putative joint employer (in this case, M.I.
Quality), find that a single client does not as a matter of law result in a finding of joint
employment. As the Second Circuit noted in Zheng v. Liberty Apparel Co. Inc., 355 F.3d
61, 72 (2d Cir. 2003), this factor sheds light on the relationship between the employers
but is not necessarily determinative of that relationship.
Although neither shared premises nor the absence of a broad client base is
anything close to a perfect proxy for joint employment (because they are
both perfectly consistent with a legitimate subcontracting relationship), the
factfinder can use these readily verifiable facts as a starting point in
uncovering the economic realities of a business relationship.
Id.
Other courts note that the finding of a single client supports but does not require a
finding of joint employment. See, e.g., Lepkowski v. Telatron Marketing Group, Inc., 766
F. Supp. 2d 572, 581 (W.D. Pa. 2011) (stating that the “absence of a broad client base
favors a finding of joint employment”). Thus, at best, Plaintiffs have identified a factor
that may weigh in favor of a finding of joint employment but have not established that
11
they are entitled to judgment as a matter of law based upon the relationship of the
corporate Defendants.
In sum, while a consideration of the Aimable factors is helpful for assessing joint
employment, they are mere “tools” to the ultimate determination of “the degree of
dependence of alleged employees on the business to which they are connected….”
Layton, 686 F.3d at 1177. The analysis considers the economic reality upon reviewing
the totality of the circumstances. In light of the Rule 50 standard, the inquiry, thus, is
whether the jury had a legally sufficient basis for finding that these Plaintiffs were
dependent economically on Mitchell’s Lawn only. As set forth above, after a review of
the totality of the circumstances, the undersigned finds that, although the evidence
supporting joint employment was very strong, there is a “sufficient evidentiary basis for
a reasonable jury to find for the non-moving party” with regard to the question of joint
employment. Optimum Techs., Inc., 496 F.3d at 1251-52. Thus, the jury’s determination
that Plaintiffs failed to meet their burden of proof will not be overturned.
V.
CONCLUSION
Therefore, for the reasons stated above, it is hereby
ORDERED AND ADJUDGED that Plaintiffs’ Renewed Motion for Judgment as a
Matter of Law (DE # 197 in Leon; DE # 146 in Solorzano) is DENIED.
DONE AND ORDERED in chambers at Miami, Florida, on February 20, 2013.
__________________________________
ANDREA M. SIMONTON
UNITED STATES MAGISTRATE JUDGE
Copies furnished to:
All counsel of record
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