Baricuatro et al v. Industrial Personnel and Management Services, Inc. et al

Filing 218

ORDER and REASONS granting in part and denying in part Plaintiffs' 136 Motion to Proceed as a Collective Action and Facilitate Notice Under 29 U.S.C. 216(b). IT IS FURTHER ORDERED that the plaintiffs and defendants Grand Isle, D&R, and DNR submit within seven (7) days a joint proposed notice plan, as described within document. Signed by Judge Kurt D. Engelhardt on 11/9/2012. (cab) Modified on 11/9/2012 to edit document type (cab).

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

ISIDRO BARICUATRO, ET AL

CIVIL ACTION

VERSUS

NO. 11-2777

INDUSTRIAL PERSONNEL AND
MANAGEMENT SERVICES, INC., ET AL

SECTION “N” (2)

ORDER AND REASONS
Before the Court is the “Plaintiffs’ Motion to Proceed as a Collective Action and
Facilitate Notice under 19 U.S.C. § 216(b)” (Rec. Doc. 136). The defendants have filed
opposition memoranda. See Rec. Docs. 186, 188; see also Rec. Docs. 189 and 208 (adopting
opposition memoranda filed by co-defendants). Plaintiffs have filed reply memoranda. See Rec.
Docs. 204, 206.
I. BACKGROUND:
The plaintiffs are Filipino workers (including welders and pipe fitters) who allege that
they were fraudulently recruited in the Philippines, given E-2 or B-1/OCS visas, and then
brought to Louisiana, where they were exploited in the oil and gas industry and housed in
deplorable conditions. The plaintiffs allege that the defendants: (1) subjected them to forced
labor in violation of the Trafficking Victims Protection Act of 2003 (18 U.S.C. §§ 1589-90); (2)
violated the Racketeer Influenced and Corrupt Organization Act (“RICO”) (18 U.S.C. §§ 196168); (3) violated the plaintiffs’ civil rights (42 U.S.C. § 1981); (4) violated the Fair Labor
Standards Act (“FLSA”) (19 U.S.C. §§ 203(m), 206 & 207); (5) violated the Klu Klux Klan Act

of 1871 (42 U.S.C. § 1985) and the Thirteenth Amendment; (6) committed the torts of fraud,
negligent misrepresentation, false imprisonment, and intentional and negligent infliction of
emotional distress under Louisiana law; and (7) breached contracts and/or covenants of good
faith and fair dealing. See Rec. Doc. 172. The plaintiffs also assert these claims on behalf of
others similarly situated, as a putative class action under FRCP 23 and a putative collective
action under the FLSA. At issue in the instant motion is whether to conditionally certify the
matter to proceed as a collective action pursuant to the FLSA, 29 U.S.C. § 216(b) and issue
court-approved notice.
II. LAW AND ANALYSIS:
A. Standard for Conditional § 216(b) Certification and Court-Approved Notice:
“The FLSA affords workers the right to sue collectively on behalf of themselves and
others ‘similarly situated’ for violations of the Act’s minimum wage provisions and overtime
protections. 29 U.S.C. § 216(b).” Lima v. International Catastrophe Solutions, Inc., 493 F.
Supp. 2d 793, 797 (E.D. La. 2007) (Fallon, J.). FLSA collective actions differ from Rule 23
class actions in that they require potential class members to affirmatively “opt-in” to the action,
rather than including the potential member automatically and then permitting them to expressly
opt out. “District courts are provided with discretionary power to implement the collective
action procedure through the sending of notice to potential plaintiffs.” Id.
In determining whether a group of “similarly situated” employees exists such that notice
should be given, courts in this District follow the two-stage Lusardi1 approach, which was
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Lusardi v. Xerox Corp., 118 F.R.D. 351 (D.N.J. 1987).
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detailed in Mooney v. Aramco Services, Co., 54 F.3d 1207, 1213-14 (5th Cir.1995), overruled on
other grounds by Desert Palace, Inc. v. Costa, 539 U.S. 90 (2003):2
Under Lusardi, the trial court approaches the “similarly situated” inquiry via a
two-step analysis. The first determination is made at the so-called “notice stage.”
At the notice stage, the district court makes a decision–- usually based only on the
pleadings and any affidavits which have been submitted– whether notice of the
action should be given to potential class members.
Because the court has minimal evidence, this determination is made using a fairly
lenient standard,8 and typically results in “conditional certification” of a
representative class. If the district court “conditionally certifies” the class, putative
class members are given notice and the opportunity to “opt-in.” The action proceeds
as a representative action throughout discovery.
The second determination is typically precipitated by a motion for “decertification”
by the defendant usually filed after discovery is largely complete and the matter is
ready for trial. At this stage, the court has much more information on which to base
its decision, and makes a factual determination on the similarly situated question.
If the claimants are similarly situated, the district court allows the representative
action to proceed to trial. If the claimants are not similarly situated, the district court
decertifies the class, and the opt-in plaintiffs are dismissed without prejudice. The
class representatives– i.e. the original plaintiffs– proceed to trial on their individual
claims. ...
At the notice stage, “courts appear to require nothing more than substantial
allegations that the putative class members were together the victims of a
single decision, policy, or plan ....”
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Mooney, 54 F.3d at 1213-14 & n.8.

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See, e.g., Lima, 493 F.R.D. at 798 (Fallon, J.); Lang v. DIRECTV, Inc., 2011 WL
6934607 *7 (E.D. La. 2011) (Brown, J., following Vance, J.); Lackey v. SDT Waste & Debris
Serv., LLC, 2011 WL 6329909 *2 (E.D. La. 2011) (Milazzo, J.); Smith v. Offshore Specialty
Fabricators, Inc., 2009 WL 2046159 *2 (E.D. La. 2009) (Barbier, J.); Fernandes Da Silva v.
M2/Royal Constr. of La., LLC, 2009 WL 3565949 *3 (E.D. La. 2009) (Lemmon, J.); Melson v.
Directech Southwest, Inc., 2008 WL 2598988 *3 (E.D. La. 2008) (Feldman, J.); Williams v.
Bally’s Louisiana, Inc., 2006 WL 1285904 *2 (E.D. La. 2006) (Africk, J.).
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“At the notice stage, the plaintiff bears the burden of making a preliminary factual
showing that at least a few similarly situated individuals exist.” Lima, 493 F.R.D. at 798. “The
plaintiff may satisfy his or her burden through submission of evidence in the form of pleadings,
affidavits and other supporting documentation.” Id. “A plaintiff need only demonstrate a
reasonable basis for the allegation that a class of similarly situated persons may exist.” Id.
(quotations and citations omitted).
B. The Plaintiffs’ Showing and the Defendants’ Objections as to Certification:
Here, the plaintiffs assert the following FLSA claims on behalf of themselves and other
similarly situated employees:
(1) “Defendants Grand Isle and DNR (f/k/a D&R) violated 29 U.S.C. § 203(m) by
deducting excessive and unreasonable costs for living expenses and for tools and
equipment from Plaintiffs’ wages. ... For example, Grand Isle, and DNR (f/k/a D&R)
often deducted up to $2,000 to $3,500 per month from Plaintiffs’ wages for living
expenses, even though this exorbitant amount far exceeded the actual cost, or even
the fair market value, of such expenses [and] also charged Plaintiffs for the cost of
work-related tools and equipment, even though these Defendants ultimately retained,
and clearly benefitted from, these work-related tools and equipment.” See 2nd
Amended Compl. (Rec. Doc. 172) at ¶¶ 97-98, 101-104, 111-115, 247.
(2) “Defendants Grand Isle and DNR (f/k/a D&R) violated 29 U.S.C. § 206 by
deducting costs for living expenses and for tools and equipment from Plaintiffs’
wages so as to cause Plaintiffs’ wages to at times fall below the federally mandated
minimum wage rate. See id. at ¶¶ 111-115, 248.
(3) “Defendants Grand Isle and DNR (f/k/a D&R) violated 29 U.S.C. § 207 by
failing to compensate Plaintiffs for all hours worked, and by knowingly failing to
compensate Plaintiffs at a rate of one and one-half times their regular hourly wage
for hours worked in excess of 40 hours per week in violation of 29 U.S.C. §
207(a)(1). Defendants Grand Isle and DNR (f/k/a D&R), for example, did not
compensate Plaintiffs for travel time (i.e., the time they were required to spend
traveling to and from Defendants’ job sites each day) even though Plaintiffs were
required to perform certain work tasks before this travel time [and] did not
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compensate Plaintiffs for any time spent donning, doffing, and cleaning required
protective equipment and tools. See id. at ¶¶ 111-115, 249.

The plaintiffs have also submitted the declarations of twelve plaintiffs, each of whom attests to
specific facts supporting each of the FLSA allegations above. See 136-3 (Exhibits A through L).
Moreover, the declarants have averred that, based on their observations – including observations
of co-workers’ pay-stubs, their co-workers were treated in the same way.3
Given the plaintiffs’ submissions and their light burden at the notice stage, the Court
finds that the plaintiffs have demonstrated a reasonable basis for their assertion that similarly
situated persons exist who may have similar FLSA claims against certain of the defendants.
However, the Court finds merit in two of the defendants’ objections, which warrant narrowing
the plaintiffs’ proposed definition of the collective.
First, the Court agrees with the defendants that the plaintiffs have failed to put forth any
evidence or detailed allegations that would support a reasonable inference that similarly situated
persons are or were employed by the defendants outside Louisiana. Thus, the collective will be
limited to Louisiana. Second, the plaintiffs have failed to make even a slight showing indicating
that there exists a class of similarly-situated potential opt-ins with FLSA claims against any of
the following defendants: (1) Industrial Personnel and Management Services, Inc. (“IPAMS”);
(2) Nilfil Peralta (“Peralta”); (3) Thunder Enterprises, Inc. (“Thunder”); (4) Mark Pregeant, Jr.
(“Pregeant”); (4) Randolf Malagapo (“Malagapo”); (5) Danilo Dayao (“Dayao”); (6) V

3

See, e.g., Decl. of Alberto Arcilla (Rec. Doc. 136-3), Exh. A at ¶ 22.
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Manpower Philippines, Inc., formerly known as V People Manpower Philippines, Inc. (“V
People”); and (7) Pacific Ocean Manning, Inc. (“POMI”).
Whether to keep employees of defendant DNR Offshore and Crewing Services, Inc.
(“DNR”) within the class definition is a closer call. In each of the twelve declarations, the
declarant avers that he worked for Grand Isle Shipyard, Inc. (“Grand Isle”) and D&R
(presumably D&R Resources, LLC (“D&R”)) in Galliano, Louisiana and/or Lafitte, Louisiana.
See 136-3 (Exhibits A through L). None of the declarants mentions DNR. However, the
plaintiffs assert in their Complaint that “Grand Isle and DNR (f/k/a D&R)” participated in the
actions underlying each of the plaintiffs’ FLSA claims. See 2nd Amended Compl. (Rec. Doc.
172) at ¶¶ 247-249. They further allege that D&R recently changed its name to DNR. Id. at ¶
57. Although DNR claims in its opposition that it is not the successor to D&R, discovery has not
yet been conducted. See Rec. Doc. 186 at 15 and Exhibit 8. Given the lenient standard for
certification at this stage, the Court finds that the plaintiffs’ allegations have established a
sufficient basis for conditional certification of a class that includes current and former employees
DNR, as well as those of Grand Isle and D&R. If it becomes evident through discovery that no
claims lie against DNR, then it may bring a motion for de-certification at the appropriate time.4

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If DNR has evidence (beyond a self-serving affidavit) that it is not related to D&R,
then it would be in the interest of all parties that DNR disclose such evidence to plaintiffs’
counsel forthwith so that they may make an informed decision regarding whether to proceed
with the collective action against DNR, so as to avoid unnecessary complication and/or
confusion.
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Accordingly, the Court conditionally certifies the following collective of similarly
situated persons: “All individuals who are currently employed or formerly have been employed
by Grand Isle Shipyard, Inc., D&R Resources, LLC, or DNR Offshore and Crewing Services,
Inc. in the State of Louisiana, under E-2 and/or B-1/OCS visas, since November 8, 2008.”
Many of the defendants’ remaining objections to certification have been resolved by this
narrowing of the class definition. To the extent they have not been resolved, the Court finds that
they go to the merits and are not an appropriate basis for denying certification at this stage. If
they are borne out through discovery, then they may form the basis of a later motion for decertification.
C. Issues Relating to Notice:
Because the Court has altered the definition of the collective proposed by the plaintiffs,
the proposed notice plan must be modified, including all proposed notices and consent-to-sue
forms. Therefore, the defendants’ objections to the proposed notice plan are denied without
prejudice. The Court expects counsel to work closely together in preparing a joint proposed
notice plan, including details of when and where the notices shall be posted and/or broadcast.
An objection to an opponent’s proposal will not be well received unless it is supported by the
overwhelming weight of authority and concerns a matter of substantial prejudice. The proposed
plan should also address the issue of whether notices written solely in English will be
meaningful in light of allegations in the Second Amended Complaint that certain plaintiffs are
unable to read English proficiently. See Rec. Doc. 172 ¶86.

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III. CONCLUSION:
Accordingly, for the foregoing reasons;
IT IS ORDERED that the “Plaintiffs’ Motion to Proceed as a Collective Action and
Facilitate Notice under 19 U.S.C. § 216(b)” (Rec. Doc. 136) is hereby GRANTED IN PART
and DENIED IN PART, as set forth herein.
IT IS FURTHER ORDERED that the plaintiffs and defendants Grand Isle, D&R, and
DNR submit within seven (7) days a joint proposed notice plan, as described herein.
New Orleans, Louisiana, this 9th day of November, 2012.

____________________________________
KURT D. ENGELHARDT
UNITED STATES DISTRICT JUDGE

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