Perez v. Kazu Construction LLC et al
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION FOR PARTIAL SUMMARY JUDGMENTM re 43 Motion for Partial Summary Judgment. Signed by JUDGE ALAN C. KAY on 04/17/2017. The Court GRANTS IN PART and DENIES I N PART Defendants' Motion for Summary Judgment. Defendants' Motion as to the statute of limitations issue is GRANTED as to equitable tolling but DENIED as to willfulness. The Defendants' Motion is GRANTED as to Richard Napierala, Frank Aguinaldo, James Dela Cuesta, Jaime Magallanes, Wesley Mericle, and Bruce Petree, and the Secretarys claims as to these CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF).
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
SECRETARY OF LABOR, UNITED STATES )
DEPARTMENT OF LABOR, EDWARD HUGLER )
) Civ. No. 16-00077 ACK-KSC
KAZU CONSTRUCTION, LLC,
a corporation; and VERNON LOWRY,
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION
FOR PARTIAL SUMMARY JUDGMENT
For the reasons set forth below, the Court GRANTS IN
PART AND DENIES IN PART Defendants’ Motion for Partial Summary
Judgment, ECF No. 43.
Defendant Kazu Construction, LLC (“Kazu Construction”)
is a limited liability company whose sole member is Defendant
Vernon Lowry (“Mr. Lowry”).
Defs. Concise Statement of Facts,
ECF No. 44, ¶ 1 (“Defs. CSF”).
From 2012-2014, Kazu
Construction was the contractor for the development of the
Makaha Oceanview Estates (“MOE Project”).
Id.; ECF No. 78 at
At issue in this case are Defendants’ employment and
recordkeeping practices under the Fair Labor Standards Act, 29
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U.S.C. §§ 206, 207, 215(a) (2) and 215(a) (5) (“FLSA”).
¶ 1, ECF No. 1.
The Secretary of Labor (“Secretary”) alleges
that Defendants failed to pay certain employees minimum wage and
overtime compensation by engaging in a practice of banking hours
in excess of 40 hours a week.
Id. ¶¶ 10-11.
Defendants failed to make, keep, and preserve accurate records
of the hours worked by employees.
Id. ¶ 12.
The Department of Labor learned about this allegedly
unlawful scheme after a former Kazu Construction employee,
Dennis Tadio, filed a complaint with the state labor agency on
July 7, 2014 seeking unpaid wages.
1, ECF No. 83 (Tadio complaint).
Opp. at 12; Lee Decl., Ex.
The state agency specialist
then referred Mr. Tadio to the U.S. Department of Labor, Wage
and Hour Division to investigate a possible overtime violation.
Opp. at 13; Tadio Decl. ¶ 7, ECF No. 84; Lee Decl. ¶ 3, ECF No.
The Secretary filed his complaint on February 22,
ECF No. 1.
Defendants filed the instant Motion for
Partial Summary Judgment on November 16, 2016.
(“Motion” or “MSJ”).
ECF No. 43
The Secretary filed his Opposition and
accompanying Concise Statement of Disputed Facts on February 13,
ECF Nos. 77-78 (ECF No. 78, “Opp.”; ECF No. 77, “Pls.
Defendants filed their Reply on February 20, 2017.
No. 88 (“Reply).
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This Court held a hearing on Defendants’ Motion on
April 10, 2017.
Summary judgment is proper where there is no genuine
issue of material fact and the moving party is entitled to
judgment as a matter of law.
Fed. R. Civ. P. 56(a).
Rule of Civil Procedure (“Rule”) 56(a) mandates summary judgment
“against a party who fails to make a showing sufficient to
establish the existence of an element essential to the party’s
case, and on which that party will bear the burden of proof at
Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); see
also Broussard v. Univ. of Cal., at Berkeley, 192 F.3d 1252,
1258 (9th Cir. 1999).
“A party seeking summary judgment bears the initial
burden of informing the court of the basis for its motion and of
identifying those portions of the pleadings and discovery
responses that demonstrate the absence of a genuine issue of
Soremekun v. Thrifty Payless, Inc., 509 F.3d
978, 984 (9th Cir. 2007) (citing Celotex, 477 U.S. at 323); see
also Jespersen v. Harrah’s Operating Co., 392 F.3d 1076, 1079
(9th Cir. 2004).
“When the moving party has carried its burden
under Rule 56[(a)] its opponent must do more than simply show
that there is some metaphysical doubt as to the material facts
[and] come forward with specific facts showing that there is a
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genuine issue for trial.”
Matsushita Elec. Indus. Co., Ltd. v.
Zenith Radio, 475 U.S. 574, 586–87 (1986) (citation and internal
quotation marks omitted); see also Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 247–48 (1986) (stating that a party cannot
“rest upon the mere allegations or denials of his pleading” in
opposing summary judgment).
“An issue is ‘genuine’ only if there is a sufficient
evidentiary basis on which a reasonable fact finder could find
for the nonmoving party, and a dispute is ‘material’ only if it
could affect the outcome of the suit under the governing law.”
In re Barboza, 545 F.3d 702, 707 (9th Cir. 2008) (citing
Anderson, 477 U.S. at 248).
When considering the evidence on a
motion for summary judgment, the court must draw all reasonable
inferences on behalf of the nonmoving party.
Indus. Co., 475 U.S. at 587; see also Posey v. Lake Pend Oreille
Sch. Dist. No. 84, 546 F.3d 1121, 1126 (9th Cir. 2008) (stating
that “the evidence of [the nonmovant] is to be believed, and all
justifiable inferences are to be drawn in his favor”).
Statute of Limitations
The parties first dispute whether the applicable
statute of limitations is two or three years, and regardless,
whether the Secretary is entitled to equitable tolling.
ordinary statute of limitations for an FLSA violation is two
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years; however, “a cause of action arising out of a willful
violation may be commenced within three years after the cause of
29 U.S.C. § 255(a).
“A violation of the FLSA is willful if the employer
‘knew or showed reckless disregard for the matter of whether its
conduct was prohibited by the [FLSA].”
Chao v. A-One Med.
Servs., Inc., 346 F.3d 908, 918 (9th Cir. 2003) (quoting
McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133 (1988))
(alteration in original); Flores v. City of San Gabriel, 824
F.3d 890, 906 (9th Cir. 2016) (“A violation is willful if the
employer knew or showed reckless disregard for the matter of
whether its conduct was prohibited by the [FLSA].”) (internal
quotation and citation omitted) (alteration in original).
The Ninth Circuit has found willfulness where the
employer was “on notice of its FLSA requirements, yet took no
affirmative action to assure compliance with them.”
IBP, Inc., 339 F.3d 894, 909 (9th Cir. 2003).
term can apply where an employer disregarded the very
possibility that it was violating the statute.”
Id. at 908-09
(finding willfulness where the employer “could easily have
inquired into the meaning of the relevant FLSA terms and the
type of steps necessary to comply therewith” but instead
“attempt[ed] to evade compliance, or to minimize the actions
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necessary to achieve compliance therewith.”) (internal citation
and quotation omitted).
Defendants seem to imply that willfulness only arises
“when an employer knows that its current position had previously
been invalidated or questioned in a prior legal proceeding.”
MSJ at 10.
However, while this is one way in which willfulness
may be shown, the Court agrees with the Secretary that courts
have found willfulness in variety of circumstances.
14 & n.41.
See Opp. at
A district court in Oregon found willfulness where
experienced business people required employees to split their
time between two companies in order to evade FLSA overtime
requirements, of which they were aware.
Perez v. Oak Grove
Cinemas, Inc., 68 F. Supp. 3d 1234, 1245 (D. Or. 2014).
district court in Nevada also found willfulness where the
defendant allegedly paid workers on a per job basis, regardless
of the hours worked, and that workers were not paid for training
time, among other issues.
Cholette v. Installpro, Inc., No.
2:10-CV-02153-KJD, 2012 WL 2190844, at *2 (D. Nev. June 13,
Because the pay structure disregarded the hours worked,
the court found that the defendant was reckless in risking a
violation of FLSA minimum wage and overtime requirements.
In addition, several courts have found willfulness
where the employers failed to make any real effort to keep
records of the employee’s hours.
See, e.g., Thornton v. Crazy
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Horse, Inc., No. 3:06-CV-00251-TMB, 2012 WL 2175753, at *11 (D.
Alaska June 14, 2012) (“Record keeping was atrocious, management
never seemed to make any sincere effort to determine when
dancers were coming and going or working or not working.”); Xuan
v. Joo Yeon Corp., No. 1:12-CV-00032, 2015 WL 8483300, at *5 (D.
N. Mar. I. Dec. 9, 2015) (despite employer’s belief he was
following the law, his failure to track employee’s hours was
willful because he “proceed[ed] as if the risk did not exist at
Here, Mr. Lowry has declared that he “stated in the
presence of employees that [he] did not want employees working
overtime” and that it “has never been [his] understanding or
intent that Kazu employees were working overtime.”
¶ 7, ECF No. 44-5.
However, this is insufficient to merit
In the first place, as a matter of law the
regulations dictate that:
[i]n all such cases it is the duty of the
management to exercise its control and see
that the work is not performed if it does
not want it to be performed. It cannot sit
back and accept the benefits without
compensating for them. The mere
promulgation of a rule against such work is
not enough. Management has the power to
enforce the rule and must make every effort
to do so.
29 C.F.R. § 785.13.
Thus, merely stating that Mr. Lowry did not
want or intend for employees to work overtime is insufficient to
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relieve Defendants of their burden to pay any overtime worked.
If Defendants were or should have been aware that overtime might
be accruing, they needed to “make every effort” to prevent it
from being performed.
See Forrester v. Roth’s I.G.A. Foodliner,
Inc., 646 F.2d 413, 414 (9th Cir. 1981) (“[A]n employer who
knows or should have known that an employee is or was working
overtime must comply with the provisions of § 207” and may not
“stand idly by...even if the employee does not make a claim for
the overtime compensation.”).
And while an employee’s failure
to notify the employer regarding overtime worked or deliberately
preventing the employer from having such knowledge may impede an
FLSA overtime claim, there does not seem to be any evidence of
such issues here.
See id. (“[W]here an employer has no
knowledge that an employee is engaging in overtime work and that
employee fails to notify the employer or deliberately prevents
the employer from acquiring knowledge of the overtime work, the
employer’s failure to pay for the overtime is not a violation of
In addition, the Secretary has submitted evidence
creating a genuine dispute of material fact regarding
There is evidence that Defendants were
aware of their obligation to document and pay overtime.
Caparas Decl., Ex. B, ECF No. 80 (investigation statement by Mr.
Lowry that “[i]f an employee works overtime then overtime is
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Employees are then paid overtime.”); Santos Decl.,
Ex. B, ECF No. 79-2 (Desiree Lowry1 Dep., 99:3-15, 197:5-198:9)
(describing how new employees are told that they will be paid at
time-and-a-half for overtime, and that the FLSA requires payment
for hours worked on a weekly basis and does not allow averaging
of hours over greater periods of time).
Defendants also do not
appear to dispute their awareness of FLSA requirements.
More importantly, the Secretary has shown evidence
sufficient for a reasonable jury to find that Defendants knew or
were reckless with respect to their duties to track and pay
overtime to Kazu Construction’s employees.
The declarations of
several employees suggest that Mr. Lowry knew that his employees
were or likely would be working overtime and advised them that
overtime hours would be banked rather than paid.
Cummings Decl. ¶ 5, ECF No. 85 (“Mr. Vernon Lowry told me that
we would be working 70 hours per week, we would get paid for 40
hours of work and the extra hours we would bank.”); Napierala
Decl. ¶¶ 4, 5, 7, ECF No. 81 (Napierala reported to Mr. Lowry
how long everyone worked, which was typically around 70 hours
per week, and Mr. Lowry told them hours worked in excess of 40
would be banked); Tadio Decl. ¶ 3, ECF No. 84 (“[Mr. Lowry] told
Desiree Lowry is the wife of Defendant Vernon Lowry. She is
the Director of Operations for Kazu Construction. D. Lowry Dep.
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me that the extra hours we worked were being ‘banked’ for our
later use when needed, and that was the reason our paychecks did
not include compensation for them.”).
The sole source for the time cards that Desiree Lowry
created and then submitted for payment was the work logs that
Mr. Lowry created.
D. Lowry Dep. at 153:6-154:8 (in creating
time cards, “I relied on the work log [Mr. Lowry sent]... if the
work log is incorrect, then the time card would be incorrect.”).
Employees did not enter their own time or keep time cards.
Tadio Decl. ¶ 2, ECF No. 84 (“I did not sign-in or enter hours
into a timesheet”); K. Hendricksen interview statement, Caparas
Decl., Ex. F, ECF No. 80 (Mr. Lowry tracked hours and
Hendricksen never signed a time sheet).
Rather, Mr. Lowry was
aware of and kept records of the hours that his employees were
Napierala Decl. ¶ 5, ECF No. 81 (stating that he
reported to Mr. Lowry each day how long the employees worked,
and “Mr. Lowry kept the records of the hours that I worked on
The time cards eventually submitted were
inaccurate and included time for hours not worked.
Dep. at 173:1-4, 175:10-25 (admitting that time cards for
Napierala, Tadio, and Cummings show hours not in fact worked;
time cards were used to track hours charged to different jobs).
Finally, there is evidence that employees worked more hours than
were recorded on their pay stubs.
See Napierala Decl. ¶¶ 4-5,
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ECF No. 81 (Mr. Lowry recorded time worked, and paystubs only
showed 40 hours per week despite typically working 10 hours per
day and around 70 hours per week); Tadio Decl. ¶¶ 3-5, ECF No.
84 (similar); Cummings Decl. ¶¶ 3-6, ECF No. 85 (similar).
In sum, viewed in the most favorable light, the
Secretary’s evidence shows that, even though Defendants were
aware of the FLSA’s overtime requirements, they paid employees
according to time records that were inaccurate and undercounted
the amount of hours their employees worked.
The Court finds
that there is a genuine dispute of material fact as to
Defendants’ willfulness and whether the three-year statute of
Accordingly, the Court DENIES Defendants’
Motion on this basis.
B. Claims Prior to February 22, 2013
Defendants also argue that the Secretary is barred
from seeking claims prior to February 22, 2013 as employees did
not work any overtime prior to that date, and as any claims
prior to that date would be barred by the three-year statute of
Motion at 11-12.
The Secretary asserts that there
are disputed facts as to whether there were overtime violations
prior to February 22, 2013 and argues that he may be entitled to
Opp. at 18-19.
Defendants dispute whether
equitable tolling is available in an FLSA action, and even if
so, that the Secretary is entitled to it.
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Reply at 2-9.
The Court first turns to whether the Secretary has
sufficiently controverted Defendants’ assertion that claims
prior to February 22, 2013 are time-barred because employees did
not work overtime.
The Secretary asserts that even in 2012,
most of Defendants’ employees worked up to 70 hours per week,
six to seven days a week, relying primarily on the declarations
of Richard Napierala, Preston Cummings, and Dennis Tadio.
CSF ¶ 12.
However, the declarations of Mr. Cummings and Mr.
Tadio do not speak to the relevant time period here, because
they began work at Kazu Construction in March and February of
See Cummings Decl. ¶ 1, ECF No. 85; Tadio
Decl. ¶ 1, ECF No. 84.
Nevertheless, Mr. Napierala began
working at Kazu Construction in September 2012, and he stated
that only 2-4 workers were employed in 2012, and that they
usually worked 7 days a week for more than 8 hours a day.
generally Napierala Decl., ECF No. 81; see also Kramer Decl. ¶
5, ECF No. 82 (noting that certain employees appeared to work
continuously six to seven days a week).
This evidence is
sufficient to establish a dispute of fact as to whether
employees worked overtime prior to February 22, 2013.
However, even if employees did work overtime prior to
February 22, 2013, the Secretary’s claims prior to that date
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would be time-barred absent equitable tolling.2
In the Ninth
Circuit, the FLSA limitations period is subject to the doctrine
of equitable tolling.
See Partlow v. Jewish Orphans' Home of S.
Cal., Inc., 645 F.2d 757, 760 (9th Cir.1981), overruled on other
grounds by Hoffmann–La Roche, Inc. v. Sperling, 493 U.S. 165
(1989); see also Barba v. Seung Heun Lee, No. CV 09-1115, 2009
WL 8747368, at *28 (D. Ariz. Nov. 4, 2009) (“The FLSA
limitations period is subject to the doctrine of equitable
tolling.”); Kellgren v. Petco Animal Supplies, Inc., No. 13-CV644, 2014 WL 2558688, at *4 (S.D. Cal. June 6, 2014) (“The
Contrary to Defendants’ assertion, the possibility that the
three-year statute of limitations may apply does not prevent the
possible application of equitable tolling. See Reply at 8-9.
Defendants’ citation to a case from the Court of Federal Claims
is not persuasive, particularly in light of the more recent
recognition by that jurisdiction that “the weight of authority
favors equitable tolling of FLSA claims.” Christofferson v.
United States, 64 Fed. Cl. 316, 326 (Fed. Cl. 2005) (rejecting
argument that equitable tolling was not permissible as Congress
had provided for a three-year statute of limitations for willful
violations); see also Moreno v. United States, 82 Fed. Cl. 387,
401-02 (Fed. Cl. 2008) (discussing the split in Federal Circuit
caselaw regarding the availability of equitable tolling). The
Court also notes that numerous district courts in this circuit
have allowed plaintiffs to assert both willfulness and equitable
tolling arguments. See, e.g., Dualan v. Jacob Transp. Servs.,
LLC, 172 F. Supp. 3d 1138 (D. Nev. 2016) (finding sufficient
showing of both willfulness and equitable tolling at conditional
class certification stage); Chastain v. Cam, No. 3:13-CV-01802SI, 2014 WL 3734368, at *8 (D. Or. July 28, 2014) (concluding
that both equitable tolling and the three-year statute of
limitations could apply); Morgovsky v. AdBrite, Inc., No. C 1005143 SBA, 2012 WL 1595105, at *7 (N.D. Cal. May 4, 2012)
(allowing amendment of complaint to allege facts supporting both
willfulness and equitable tolling).
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statute of limitations for FLSA claims is subject to equitable
“Equitable tolling applies when the plaintiff is
prevented from asserting a claim by wrongful conduct on the part
of the defendant, or when extraordinary circumstances beyond the
plaintiff’s control made it impossible to file a claim on time.”
Stoll v. Runyon, 165 F.3d 1238, 1242 (9th Cir. 1999).
litigant seeking equitable tolling bears the burden of
establishing [the] elements.”
Pace v. DiGuglielmo, 544 U.S.
408, 418 (2005); see also Kwai Fun Wong v. Beebe, 732 F.3d 1030,
1052 (9th Cir. 2013).
Although the Secretary argues that Defendants have
failed to rebut his equitable tolling theory, see Opp. at 18-19,
it is not entirely apparent from the parties’ papers what the
theory of equitable tolling actually is.
The Secretary’s brief
states that he informed Defendants’ counsel that he would be
pursuing equitable tolling, Opp. at 18 n.56, and appears to
argue that he is entitled to pursue equitable tolling on the
basis that there is a dispute of fact regarding whether
employees worked overtime prior to February 22, 2013, Opp. at
If this is in fact the Secretary’s theory, it misses
Equitable tolling focuses on the plaintiff’s
diligence or the defendant’s wrongful conduct in preventing the
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plaintiff from timely asserting his claim.
See Stoll, 165 F.3d
at 1242; Kwai Fun Wong, 732 F.3d at 1052 (the party seeking
equitable tolling must establish “(1) that he has been pursuing
his rights diligently, and (2) that some extraordinary
circumstance stood in his way”).
Here, the Secretary does not
appear to have made an argument or provided evidence in support
of either equitable factor.
The Court agrees with Defendants’ assertion that the
Secretary does not appear to have been diligent.
Reply at 3-4.
It is undisputed that the Department of Labor first issued a
back wage calculation extending back to 2012 in October 2014,
and that the Secretary was unsuccessful in getting Defendants to
sign a tolling agreement in February 2015.
Reply at 3-4.
Although the Secretary seems to have been aware of the claims
and statute of limitations issues at that time, he waited
approximately one year to file the complaint.
See Compl., ECF
The Secretary fails to explain this delay or his
diligent pursuit of these claims, when the Department of Labor
appears to have been well aware of the statute of limitations
and the alleged overtime violations at least as early as
Nor has the Secretary explained how Defendants
wrongfully prevented him from discovering the alleged violations
and timely filing a complaint.
Even if Defendants’ record
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keeping practices prevented the Department of Labor from
discovering the alleged overtime issues as they occurred, the
Secretary had the opportunity to investigate the overtime issues
in late 2014 and early 2015.
Had the Secretary filed his
complaint at that time, he would have been able to pursue
virtually all of the damages he now claims, assuming he can
prove a willful violation as discussed supra.
In addition, Defendants also question whether the
equitable tolling inquiry should focus on the conduct of the
Department of Labor or of the individual employees.
Equitable tolling focuses on the litigant.
Reply at 2-
See Kwai Fun
Wong, 732 F.3d at 1052 (discussing the showings the “litigant”
must make); see also Chao v. Va. DOT, 291 F.3d 276, 283 (4th
Cir. 2002) (rejecting Secretary’s argument that she had been
diligent because the individual employees had diligently pursued
private claims, as equitable tolling focuses on the plaintiff).
Here, the litigant is the Secretary of Labor, not the individual
The complaint clearly identifies the Secretary of
Labor as the plaintiff and distinguishes the employees to whom
the Defendants allegedly owe wage and overtime compensation.
See generally Compl.
Moreover, even if the circumstances of the individual
employees were relevant, the Secretary still bears the burden of
providing evidence showing how the employees’ circumstances
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entitle him to equitable tolling in suing on their behalf.
However, the Secretary has not provided facts sufficient to meet
that burden, as he merely states that the tolling “is essential
to fully compensate workers and to ensure that bad actors, such
as Defendants, do not benefit from their efforts to evade the
Opp. at 19.
This conclusory statement does not evidence
how the employees have been diligent or explain how the
Defendants’ allegedly wrongful conduct prevented the employees
from discovering their rights in time.3
In addition, the evidence Defendants have submitted shows that
employees were aware they were entitled to overtime and that
their hours were being banked and failed to raise claims. See
Reply at 4-8. Even if the employees were not aware that the
informal banking system was illegal, they have not shown that
they were “excusably ignorant” of the FLSA limitations period.
See Stallcop v. Kaiser Foundation Hosps., 820 F.2d 1044, 1050
(9th Cir. 1987) (“Equitable tolling requires that [the plaintiff
be] excusably ignorant of the limitations period.”); see also
Barba, 2009 WL 8747368, at *29 (rejecting equitable tolling
where employees did not provide evidence that underpayment was
concealed and finding claims accrued on each payday). This is
particularly true where the Department of Labor investigated and
produced back wage violation calculations in October 2014 and
February 2015, Defs. CSF ¶ 13, and there is no evidence that the
employees have taken any steps to protect their rights since
then. The Secretary additionally asserted at the hearing that
Defendants affirmatively misled employees into believing that
the informal banking system was legal. However, while
Defendants allegedly engaged in an illegal banking system, there
does not appear to be evidence supporting that Defendants
additionally represented the legality of such practice to their
employees. See Morales v. Laborer’s Union Local 304, No. C 1102278 WHA, 2012 WL 70578, at *5 (N.D. Cal. Jan. 9, 2012)
(allowing equitable tolling pursuant to a fraudulent concealment
theory where the defendant proclaimed the legality of its
conduct and expressly relied on its claimed expertise in
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The Court thus finds that even though there is a
dispute of fact regarding whether employees worked overtime
prior to February 22, 2013, the Secretary has not provided a
basis on which a reasonable factfinder could conclude he is
entitled to equitable tolling.
Accordingly, the Court finds
that claims prior to February 22, 2013 are time-barred and
GRANTS partial summary judgment to Defendants on this issue.
Claims Regarding Particular Employees
A. Whether Claims on Behalf of Richard Napierala Must Be
Dismissed for Failure to Name Him in the Complaint.
Defendants next move to dismiss claims for back wages
and liquidated damages on behalf of Richard Napierala because he
was not named as a claimant.
MSJ at 12-14.
counters that he was not required to name Mr. Napierala as a
“claimant” in the complaint.
Opp. at 20 n.62.
complaint, the Secretary seeks back wages and liquidated damages
pursuant to 29 U.S.C. §§ 216(c) and 217.
Compl. ¶ 12.
216(c) authorizes the Secretary to seek unpaid minimum wages,
unpaid overtime compensation, and liquidated damages on behalf
29 U.S.C. § 216(c).
Section 217 provides
jurisdiction for federal courts to restrain the withholding of
minimum wages or overtime compensation due to employees, but
employment law to mislead plaintiffs into believing their rights
were not violated by the practice at issue).
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does not allow for the recovery of liquidated damages.
As the Ninth Circuit has recognized, “[t]he authority
of the Secretary to seek back wages under § 17 of the FLSA
without specifically naming employees in the complaint is wellestablished.”
Donovan v. Crisostomo, 689 F.2d 869, 875 (9th
Cir. 1982) (citing Donovan v. Univ. of Tex., 643 F.2d 1201 (5th
Cir. 1981) and EEOC v. Gilbarco, Inc., 615 F.2d 985 (4th Cir.
There is thus no question that the Secretary may pursue
§ 17 claims on behalf of Mr. Napierala without naming him in the
Defendants’ Motion is thus denied to the extent it
seeks to bar recovery under § 217.
However, in order to recover under § 216, employees
must be named in the complaint.
See Ford v. Troyer, 156 F.3d
181 (5th Cir. 1998) (unpublished) (“Section 216 allows the
Secretary to recover back wages and liquidated damages on behalf
of employees specifically named in the complaint.”); EEOC v.
Sperry-Univac Corp., No. C 81-0276J, 1982 WL 649, at *5 (D. Utah
Nov. 29, 1982) (“[O]nly if the EEOC seeks liquidated damages
pursuant to 29 U.S.C. § 216(c) need it name the aggrieved
persons as plaintiffs in order to recover on their behalf.”).
The Ninth Circuit has held that an action for a claim under §
216(c) commences for statute of limitations purposes on the date
that the claimant was identified in the complaint.
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689 F.2d at 875; Solis v. Wash. Dep’t of Soc. & Health Servs.,
Case No. C08-6579, 2016 WL 879166, at *6 (W.D. Wash. Mar. 8,
2016) (“[C]laims under section 216(c) are limited to two years
from the date of identifying the particular employee.”).
Here, there is no question that Mr. Napierala was not
identified in the complaint filed on February 22, 2016.
Compl., Ex. A.4
However, in the Amended Exhibit A filed on
February 13, 2017, the Secretary added Richard Napierala’s name
to the list.
ECF No. 86.
Assuming that listing Mr. Napierala
in the exhibit qualifies for purposes of § 216, the applicable
statute of limitations on his claims would be calculated based
on that date.
In their Reply, Defendants appear to assert that
listing employees in Exhibit A does not satisfy the naming
requirement of § 216 because it does not designate any of the
employees as “individual claimants” or “party plaintiffs.”
Reply at 10.
However, courts do not require the employees on
whose behalf the Secretary seeks to recover to be named as
In EEOC v. Hernando Bank, the Fifth Circuit found
that naming three employees in the prayer for relief was
724 F.2d 1188, 1193 (5th Cir. 1984).
And in Reich
v. Great Lakes Collection Bureau, Inc., the district court found
Exhibit A does list Stanley Napierala, but not Richard
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that identifying individuals by way of an exhibit to the
complaint was sufficient to name the employees involved under §
176 F.R.D. 81, 84 (W.D.N.Y. 1997).
Similarly in U.S.
EEOC v. Elrod, the district court found that the agency had
sufficiently identified employees for purposes of § 216(c) by
listing them in appendices.
No. 84 C 10886, 1986 WL 10374, at
*3-4 (N.D. Ill. Sept. 12, 1986).
And in Donovan, the Ninth
Circuit concluded that naming employees in a pre-trial order was
sufficient to commence § 216(c) claims because the order bound
689 F.2d at 875.
Defendants are correct in noting that the Secretary
says that the individuals identified in Exhibit A here “are not
Reply at 10; Opp. at 20 n.62.
the Court is inclined to disagree with Defendants’ conclusion
that “the DOL admits that its complaint Exhibit A does not
satisfy the naming requirement of 29 U.S.C. § 216(c).”
The Secretary clearly raised claims under § 216(c) seeking
back wages and liquidated damages in his complaint and attached
an exhibit identifying specific employees on whose behalf he was
seeking those damages – which he was not required to do for the
§ 217 claims.
See Compl. & Prayer for Relief (b).
the Secretary amended that exhibit to update the list of
- 21 -
employees5 and confirmed at the hearing that he is still pursuing
claims under both §§ 216 and 217.
Given that identifying
employees in an exhibit or appendix to the complaint has been
found sufficient for § 216(c) claims, the Court finds that the
Secretary has sufficiently identified Mr. Napierala and other
Kazu Construction employees for purposes of claims under §
216(c) and rejects Defendant’s contention that the Secretary
admitted he has not sufficiently identified the employees by
stating in passing in a footnote that they were “not individual
Accordingly, the Court DENIES Defendants’ Motion on
the basis that the Secretary is not entitled to pursue recovery
under § 216(c) on behalf of Mr. Napierala (or any other person
listed in Exhibit A).
However, as Mr. Napierala was not
identified until February 13, 2017 claims on his behalf did not
commence until that date.
For those employees who were named in
the original Exhibit A, claims on their behalf commenced on
February 22, 2016 for statute of limitations purposes.
Elrod, 1986 WL 10374, at *3-4 (distinguishing between the date §
To the extent that updating this exhibit constitutes an
amendment to the Secretary’s pleading, the Court notes that
leave to amend pleadings should be freely given and that there
is no undue prejudice from allowing such amendment here.
The Secretary also clarified at the hearing that his use of the
term “individual claimant” was to indicate that the employees
were not plaintiffs, but rather affected employees on whose
behalf the Secretary was seeking damages.
- 22 -
216(c) actions commenced for employees named in appendix to the
original complaint versus those named in the appendix to the
B. Whether Mr. Napierala and Mr. Aguinaldo Qualify As
Defendants argue in the alternative that Mr. Napierala
and Mr. Aguinaldo are not owed any back wages because they
qualify as exempt employees who are not entitled to overtime.
MSJ at 14-19.
Under 29 U.S.C. § 213, the FLSA’s minimum wage
and overtime provisions do not apply to “any employee employed
in a bona fide executive administrative, or professional
29 U.S.C. § 213(a)(1).
According to the
regulations, an employee employed in a bona fide executive
capacity is any employee who is: (1) “[c]ompensated on a salary
basis at a rate of not less than $455 per week”; (2) “[w]hose
primary duty is management of the enterprise in which the
employee is employed or of a customarily recognized department
or subdivision thereof”; (3) “[w]ho customarily and regularly
directs the work of two or more other employees”; and (4) “[w]ho
has the authority to hire or fire other employees or whose
suggestions and recommendations as to the hiring, firing,
promotion or any other change of status or of other employees
are given particular weight.”
29 C.F.R. § 541.100(a).
- 23 -
“An employer who claims an exemption from the FLSA
bears the burden of demonstrating that the exemption applies.”
Klem v. Cty. of Santa Clara, 208 F.3d 1085, 1089 (9th Cir.
The FLSA is intended to provide for the recovery of
unpaid minimum wages and unpaid overtime compensation, and the
Ninth Circuit has counseled that courts should be “mindful of
the directive that [the statute] is to be liberally construed to
apply the furthest reaches consistent with Congressional
Biggs v. Wilson, 1 F.3d 1537, 1539 (9th Cir. 1993).
Thus, in order to ensure that employees are broadly protected
consistent with Congress’s direction, exemptions employers may
claim from complying with the FLSA’s requirements “are to be
narrowly construed...against employers and are to be withheld
except as to persons plainly and unmistakably within their terms
See Klem, 208 F.3d at 1089 (quoting Auer v.
Robbins, 519 U.S. 452, 462 (1997)) (alteration in original).
The only element of the exemption that appears to be
in dispute is the salary-basis.
Defendants have submitted
evidence, which the Secretary does not appear to contest,
regarding the other elements.
The duty of management includes,
but is not limited to, “interviewing, selecting, and training
employees; setting and adjusting their rates of pay and hours of
work; directing the work of employees...determining the
techniques to be used; [and] apportioning the work among
- 24 -
29 C.F.R. § 541.102.
Here, Defendant has
submitted evidence showing that both Mr. Napierala and Mr.
Aguinaldo hired and fired employees, regularly trained and
monitored employees, and regularly directed and gave assignments
to other employees.
See Defs. CSF ¶¶ 3-4, 8, 10.
has not disputed these facts.
See Pls. CSF at 2 n.2 (explicitly
not disputing those particular paragraphs, among others, of
Defendants’ Statement of Facts).
This same evidence also
demonstrates that Mr. Napierala and Mr. Aguinaldo meet the other
two elements of the exemption regarding the hiring and firing of
employees and regularly directing the work of at least two other
Turning to the last element of the exemption,
[a]n employee will be considered to be paid
on a ‘salary basis’ within the meaning of
the regulations if the employee regularly
receives each pay period on a weekly, or
less frequent basis, a predetermined amount
constituting all or part of the employee’s
compensation, which is not subject to
reduction because of variations in the
quality or quantity of the work performed.
29 C.F.R. § 541.602(a).
In determining whether an employee is
salaried, “[t]he question is not whether an employer has the
subjective intention that its employees be exempt from the
FLSA’s overtime provisions.
Rather, it is whether the employer
has evinced the objective intention to pay its employees on a
- 25 -
salaried basis as defined in the Secretary’s regulations.”
Klem, 208 F.3d at 1091.
Courts including the Ninth Circuit have held that a
payroll accounting system that calculates pay on an hourly basis
does not necessarily indicate that employees are not salaried.
In McGuire v. City of Portland, the Ninth Circuit affirmed the
district court’s grant of summary judgment that employees were
exempt even where City’s payroll accounting system tracked time,
including absences and hours worked beyond the standard shift,
on an hourly basis.
159 F.3d 460, 464 (9th Cir. 1998).
doing so, the court rejected the City’s argument that this
demonstrated that the employees were not salaried, because it
found that the employees had the option of working either 40 or
53 hours per week, but were paid the same amount regardless of
which schedule they chose.
Although the hourly rates
differed, the City’s practice was to start with the weekly
salary figure, and then work backwards from the schedule to
arrive at an hourly rate.
Similarly, although leave was
tracked on an hourly basis, the salary was not ordinarily
subject to reduction for absences from work.
Likewise, in Palazzolo-Robinson v. Sharis Management
Corp., the court relied on McGuire to conclude that “a payroll
accounting system which calculates an exempt employees [sic] pay
on an hourly basis does not indicate that the employee was not
- 26 -
salaried and, thus, is subject to the FLSA’s minimum wage or
overtime wage requirements.”
68 F. Supp. 2d 1186, 1192 (W.D.
There, the payroll accounting system calculated
her salary on an hour-by-hour basis, but the court found that
this did not indicate the employee was not salaried, especially
where she acknowledged that she had been told that she would be
paid a predetermined amount.
Id.; see also, e.g., Wright v.
Aargo Sec. Servs, Inc., No. 99 CIV. 9115 (CSH), 2001 WL 91705,
at *7 (S.D.N.Y. Feb. 2, 2001) (“The label an employer or a time
record furnishes an employee for internal purposes is not
determinative of the employee’s status under the FLSA.”) (citing
McGuire and Palazzolo).
Cf. Brunnozi v. Cable Commc’ns, Inc., -
--F.3d ----, 2017 WL 1055588, at *3 (9th Cir. Mar. 21, 2017) (in
determining what constitutes an employee’s regular rate of pay,
the court must evaluate “what happens under the contract” and
cannot rely on a declaration by the parties or “contract
However, courts have rejected attempts to mask hourly
pay structures as salary guarantees.
In Brock v. Claridge Hotel
and Casino, the Third Circuit affirmed the district court’s
conclusions that the employee’s wages were actually calculated
on an hourly basis.
846 F.2d 180, 184 (3d Cir. 1988).
court rejected the employer’s argument that the additional
compensation the employee was claiming was a bonus to
- 27 -
incentivize better performance, finding that the bonus varied
with the number of hours worked, which encouraged the employee
to work more hours, not to perform better.
Id. at 185; see also
Hodgson v. Cactus Craft of Ariz., 481 F.2d 464, 466 (9th Cir.
1973) (affirming as not clearly erroneous trial court’s findings
that employees were paid on an hourly basis, despite employer’s
claims that they were salaried).
Here, Defendants assert that both Mr. Napierala and
Mr. Aguinaldo were paid a predetermined weekly amount in excess
of the statutory minimum, and thus were salaried employees.
Defs. CSF ¶¶ 9, 11.
As to Mr. Aguinaldo, both he and Mr. Lowry
submitted declarations evidencing that they understood that Mr.
Aguinaldo would receive guaranteed pay that was not subject to
Aguinaldo Decl. ¶ 3, ECF No. 44-1 (“I understood
that my pay was guaranteed and would not be subject to
reduction.”); Lowry Decl. ¶ 10, ECF No. 44-5 (“Kazu provided
Aguinaldo with a predetermined weekly pay, which was not subject
to reduction based upon the quantity or quality of his work.”).
As to Mr. Napierala, Defendants rely only on Mr. Lowry’s
declaration stating that Mr. Napierala received a predetermined
weekly pay not subject to reduction.7
Lowry Decl. ¶ 11, ECF No.
Defendants also state that the Department of Labor investigator
“expressly represented to Kazu that Napierala was exempt and
that the DOL was not seeking any back wages for him.” Motion at
- 28 -
44-5 (“Kazu provided Napierala with a predetermined weekly pay,
which was not subject to reduction based upon the quality or
quantity of his work.”).
In attempting to dispute these facts, the Secretary
relies on paragraphs 5, 6, 9, and 11 of his Statement of
See Opp. at 20 n.63.
falls into three categories.
This evidence roughly
First, the Secretary points to the
Payroll Register for Kazu Construction, which designates the pay
type for Mr. and Mrs. Lowry as “Salary” and for Mr. Napierala
and Mr. Aguinaldo as “Regular.”
See Santos Decl., Ex. F, ECF
No. 79-6; see also Caparas Decl., Ex. A, ECF No. 80 (designating
Mr. and Mrs. Lowry as “salary” and Mr. Napierala and Mr.
Aguinaldo as receiving an hourly rate of $45/hour and $40/hour,
8 (citing Yeh Decl. ¶ 2, ECF No. 44-13). In the first place,
Mr. Caparas has declared that he “did not represent that [his]
findings constituted the Secretary’s final determinations on
what charges to bring.” Caparas Decl. ¶ 5, ECF No. 80. In
addition, Defendants do not rely on this fact to argue that the
Secretary has waived or is equitably estopped from asserting a
claim for back wages on behalf of Mr. Napierala. Especially in
view of the Supreme Court’s recognition that its “decisions
interpreting the FLSA have frequently emphasized the nonwaivable
nature of an individual employee’s right to a minimum wage and
to overtime pay under the Act,” Barrentine v. Ark.-Best Freight
Sys., Inc., 450 U.S. 728, 740 (1981), this Court will not rely
on the investigator’s apparent representation here, even
assuming Defendants’ characterization of the representation is
accurate. See also Ruiz v. Fernandez, 949 F. Supp. 2d 1055,
1063 (E.D. Wash. 2013), order clarified, No. CV-11-3088, 2013 WL
12167930 (E.D. Wash. June 24, 2013) (noting that collateral
estoppel could not bar claims even where the Department of Labor
investigator found no violation because the Department did not
act in an adjudicatory capacity during the investigation).
- 29 -
In addition, Mr. and Mrs. Lowry asserted in an
investigation statement that “[w]e have 2 salaried employees,
Vernon and Desiree Lowry.
Everyone else is paid hourly.”
Caparas Decl., Ex. B, ECF No. 80.
Finally, the Secretary also
relies on Mr. Lowry’s deposition stating Mr. Napierala’s rate
was $40 per hour.
V. Lowry Dep. at 161:5-17.
The Secretary also argues that the promise of
“guaranteed pay” was a fiction because it was made to all of
Opp. at 21-22 (relying on Mr.
Napierala’s declaration that “[a]ll of the workers were told”
that “we would get paid for 40 hours of work,” Napierala Decl. ¶
7, ECF No. 81).8
Defendants dispute the relevance of how the
other employees were paid.
Reply at 16-17.
The Secretary additionally asserted for the first time at the
hearing that the salary promise made to Mr. Napierala was only
for the first 40 hours of work and did not encompass the extra
hours actually worked. The Secretary then attempted to infer
that Mr. Napierala expected to be able to cash out or receive a
bonus for any extra hours not used through the banking system at
the end of the project, though Mr. Napierala’s declaration does
not explicitly state this expectation. Defendants argue that
this issue is not properly before the Court. The regulations
make clear that an exemption is not lost if an exempt employee
paid on a salary basis also receives additional compensation for
hours worked beyond the normal workweek and that such additional
compensation may be paid on any basis, including bonus,
straight-time hourly, or paid time off. 29 C.F.R. § 541.604(a);
see also Opinion Letter, 1965 DOLWH LEXIS 171 (Sept. 22, 1965).
Thus, even if this issue were before the Court, Mr. Napierala’s
entitlement to or expectation of additional compensation does
not affect that Mr. Napierala was objectively paid on a salaried
basis and therefore qualifies as an exempt employee, as
- 30 -
Defendants’ assertion that the focus of the salary
basis test is on the putative exempt employee, not on how the
other employees are paid, appears to be correct.
See 29 C.F.R.
The salary-basis test contrasts with other parts of
the exemption analysis, such as the definition of a “primary
duty” which explicitly accounts for “the relationship between
the employee’s salary and the wages paid to other employees for
the kind of nonexempt work performed by the employee,” among
other specified factors.
See id. § 541.700.
Rather the focus
of the salary-basis regulation appears to be the circumstances
in which deductions will not defeat the exemption.
C.F.R. § 541.602.
Under the regulations, “[a]n actual practice of making
improper deductions demonstrates that the employer did not
intend to pay employees on a salary basis.”
29 C.F.R. §
However, in the absence of actual deductions, there
must be “a clear and particularized policy — one which
effectively communicates that deductions will be made in
Auer, 519 U.S. at 452.
payroll records for Mr. Napierala and Mr. Aguinaldo show that
discussed infra. See Anani v. CVS RX Servs., Inc., 788 F. Supp.
2d 55, 65 (E.D.N.Y. 2011) aff'd, 730 F.3d 146 (2d Cir.
2013)(employee’s subjective and unsupported belief that he was
an hourly employee held insufficient where there was no
objective evidence that he would have received less than the
guaranteed rate if he had worked fewer hours).
- 31 -
they were paid the same amount every week, and that no
deductions were made.
See Napierala Decl., Ex. 1, ECF No. 81;
Santos Decl., Ex. E, ECF No. 79-5.
This stands in contrast to
other employees who did not receive consistent pay each week.
See D. Lowry Decl. ¶ 88-1, ECF No. 88-1 (identifying instances
of employees being paid for less than 40 hours per week).
even though there is evidence that the allegedly hourly
employees were subject to deductions for time not worked, there
is no evidence showing a significant likelihood that Mr.
Napierala or Mr. Aguinaldo’s salary was subject to such
See McGuire, 159 F.3d at 463 (holding that there
must objectively be a “significant likelihood that penalties
inconsistent with salaried status would be made”).
Nor has the Secretary provided evidence of a
particularized policy which would clearly and effectively
communicate to Mr. Napierala or Mr. Aguinaldo that they could be
subject to deductions.9
Indeed the evidence points to the
Mr. and Mrs. Lowry stated that Mr. Napierala and Mr.
Aguinaldo were paid at a guaranteed rate for 40 hours per week.
Telling all employees as a group that excess hours would be
banked rather than paid does not “clearly and effectively
communicate” to Mr. Napierala and Mr. Aguinaldo in particular
that this policy also applied to them. And while the alleged
practice of banking overtime hours may present possible FLSA
violations as to hourly employees, it does not assist the Court
in determining in the first place whether Mr. Napierala and Mr.
Aguinaldo’s pay was subject to deductions.
- 32 -
V. Lowry Dep. at 161:16-21 (Napierala given a guaranteed rate
for 40 hours); 199:18-200:1 (Napierala and Aguinaldo were paid
for 40 hours at their guaranteed rates); D. Lowry Dep. at
174:23-175:3 (Napierala paid set rate for 40 hours).
And in his
deposition, Mr. Lowry drew a distinction between Mr. Aguinaldo
and Mr. Napierala and other employees whose pay was sometimes
docked when they did not work 8 hours.
V. Lowry Dep. 199:18-
The Secretary is thus left with the labels that
Defendants have used to describe the pay status of various
employees, see, e.g., Caparas Decl., Ex. A, ECF No. 80
(providing an hourly rate for Mr. Napierala and Mr. Aguinaldo
but labeling Mr. and Mrs. Lowry as salaried); Santos Decl., Ex.
The labels Defendants used are simply not
Just as a defendant’s subjective belief that its
employees are exempt is insufficient in light of evidence
showing compensation varied, see Klem, 208 F.3d at 1093, so too
are the descriptions of Mr. Napierala and Mr. Aguinaldo as
hourly employees insufficient where the Secretary has pointed to
no evidence supporting that there was a significant likelihood
their pay could be reduced.
See Anani v. CVS RX Servs., Inc.,
788 F. Supp. 2d 55, 65 (E.D.N.Y. 2011), aff'd, 730 F.3d 146 (2d
Cir. 2013) (finding no genuine issue of fact as to the salarybasis test where “the payment records reflect[ed] a calculation
- 33 -
method that [was] not inconsistent with a salary basis of
payment, and because there [was] no evidence that the Plaintiff
was or would have been subject to improper deductions”); Aargo
Sec. Servs., 2001 WL 91705, at *9 (finding no dispute regarding
salary-basis where the employee’s pay had never been reduced and
there was no evidence supporting a significant likelihood it
would have been reduced had the occasion arisen).
Accordingly, the Court finds that there is sufficient
evidence for a reasonable jury to conclude that Mr. Napierala
and Mr. Aguinaldo are salaried employees, and that the Secretary
has not put forward evidence creating a genuine dispute of fact
on this issue.
The Court therefore GRANTS Defendants’ Motion as
to Mr. Napierala and Mr. Aguinaldo and DISMISSES claims the
Secretary has brought on their behalf.
C. Whether Mr. Aguinaldo is Owed Back Wages
Defendants have argued in the alternative that even if
Mr. Aguinaldo was not an exempt employee, he is still not
entitled to back wages because he did not work overtime.
The Court does not need to reach this issue since it
has concluded that Mr. Aguinaldo is exempt; but if it were to do
so, the Secretary has provided evidence that creates a dispute
of material fact as to this issue.
Opp. at 23-24; Pls. CSF ¶
Specifically, other employees have provided evidence that
Mr. Aguinaldo worked six to seven days a week for 10 hours a
- 34 -
See Napierala Decl. ¶¶ 5-6, ECF No. 81 (Napierala worked
with Aguinaldo, among others, and the schedule of working 10
hours a day 6-7 days a week was the same for everyone); Cummings
Decl. ¶ 3, ECF No. 85 (Cummings worked with Aguinaldo, among
others, and the schedule of working 10 hours a day was the same
for everyone); Tadio Decl. ¶ 5, ECF No. 84 (Tadio worked with
Aguinaldo, among others, 7 days per week and recalled seeing
Aguinaldo work at least as many hours as Tadio did).
true, this evidence establishes a dispute of fact as to how many
hours Mr. Aguinaldo worked and whether he ever worked overtime.
However, in light of the Court’s findings that Mr. Aguinaldo is
exempt, this issue is moot.10
D. Kahikapu Hendricksen
Defendants have moved for summary judgment as to back
wages owed to Kahikapu Hendricksen on the basis that he did not
work overtime because he regularly came to work late and did not
Motion at 21; Hendricksen Decl. ¶ 3, ECF No. 44-
However, the Secretary has provided evidence that creates a
dispute of material fact as to this issue.
CSF ¶ 21.
Opp. at 23-24; Pls.
Most importantly, according to an interview statement
from August 25, 2014, Mr. Hendricksen stated that he worked 10
Although Defendants have argued in the alternative that Mr.
Aguinaldo did not work overtime, the Court notes that Defendants
do not appear to make the same alternative argument as to Mr.
Napierala and that such issue would be moot regardless.
- 35 -
hours a day, seven days a week and that his paycheck did not
show the overtime he had worked; instead those hours had been
Caparas Decl., Ex. F, ECF No. 80.
The declarations of
other employees provide additional evidence that Mr. Hendricksen
worked six to seven days a week for 10 hours a day.
Napierala Decl. ¶¶ 5-6, ECF No. 81 (Napierala worked with
Hendricksen, among others, and the schedule of working 10 hours
a day 6-7 days a week was the same for everyone); Cummings Decl.
¶ 3, ECF No. 85 (Cummings worked with Hendricksen, among others,
and the schedule of working 10 hours a day was the same for
Taken as true, this evidence establishes a dispute
of fact as to how many hours Mr. Hendricksen worked and whether
he ever worked overtime.
Defendants’ Motion is accordingly
DENIED as to Mr. Hendricksen.
E. James Teixeira
Defendants have moved for summary judgment as to back
wages owed to James Teixeira on the basis that he did not work
overtime because he missed work on some days and did not work on
weekends, except when he had missed work during the week.
Motion at 24-25; Teixeira Decl. ¶ 3, ECF No. 44-12.
the Secretary has provided evidence that creates a dispute of
material fact as to this issue.
Opp. at 24-26; Pls. CSF ¶ 25.
Specifically, other employees have provided evidence that Mr.
Teixeira worked six to seven days a week for 10 hours a day.
- 36 -
See Napierala Decl. ¶¶ 5-6. ECF No. 81 (Napierala worked with
Teixeira, among others, and the schedule of working 10 hours a
day 6-7 days a week was the same for everyone); Cummings Decl. ¶
3, ECF No. 85 (Cummings worked with Teixeira, among others, and
the schedule of working 10 hours a day was the same for
Taken as true, this evidence establishes a dispute
of fact as to how many hours Mr. Teixeira worked and whether he
ever worked overtime.
Defendants’ Motion is accordingly DENIED
as to Mr. Teixeira.
F. James Dela Cuesta, Jaime Magallanes, Wesley Mericle,
and Bruce Petree
Finally, the Secretary originally sought back wages on
behalf of James Dela Cuesta, Jaime Magallanes, Wesley Mericle,
and Bruce Petree.
Compl., Ex. A.
Defendants asserted that
these four employees were not owed back wages.
Motion at 20-24.
The Secretary has now withdrawn his claims for overtime as to
these employees, as he does not dispute that they did not work
See Opp. at 7 n.2; Pls. CSF at 2 n.2 (not disputing
the paragraphs of Defendants’ CSF asserting that these four
employees did not work overtime).
Motion is GRANTED as to Mr. Dela Cuesta, Mr. Magallanes, Mr.
Mericle, and Mr. Petree.
Claims on behalf of these four
employees are DISMISSED WITH PREJUDICE.
- 37 -
For the foregoing reasons, the Court GRANTS IN PART
and DENIES IN PART Defendants’ Motion for Summary Judgment.
Defendants’ Motion as to the statute of limitations issue is
GRANTED as to equitable tolling but DENIED as to willfulness.
The Defendants’ Motion is GRANTED as to Richard Napierala, Frank
Aguinaldo, James Dela Cuesta, Jaime Magallanes, Wesley Mericle,
and Bruce Petree, and the Secretary’s claims as to these
employees are DISMISSED WITH PREJUDICE.
Defendants’ Motion is
DENIED as to Kahikapu Hendricksen and James Teixeira.
IT IS SO ORDERED.
Honolulu, Hawaii, April 17, 2017.
Alan C. Kay
Sr. United States District Judge
Hugler v. Kazu Construction, et al., Civ. No. 16-00077 ACK-KSC, Order
Granting in Part and Denying in Part Defendants’ Motion for Partial Summary
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