Cruz Mejia et al v. Brothers Petroleum, LLC et al

Filing 161

ORDER AND REASONS denying 128 Motion to lift the limited stay.. Signed by Chief Judge Sarah S. Vance on 12/11/14. (jjs)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
DANIA GISSELL CRUZ MEJIA, et. al.,

CIVIL ACTION

Plaintiffs,
NO: 12-2842
VERSUS
BROTHERS PETROLEUM, LLC, et al.,

SECTION: R(3)

Defendants.

ORDER AND REASONS
Before the Court is plaintiffs' motion to lift the limited
stay

the

Court1

imposed

on

September

3,

2014,

which

stayed

discovery owed by Imad Hamdan regarding undocumented employees.2
The Court DENIES plaintiffs' motion, because defendant Hamdan's
Fifth Amendment rights will be jeopardized if the Court lifts the
limited stay.

I.

Background
This is a "collective action" seeking damages for alleged

violations of the overtime and minimum wage provisions of the Fair
Labor Standard Act ("FLSA"). 29 U.S.C. §§ 206 and 207. Defendants
employed plaintiffs at various Brothers Food Mart convenience

1

This matter was previously before Judge Helen Berrigan.
After issuing the order imposing the limited stay, Judge Berrigan
recused herself and the case was reassigned to this Section. See
R. Doc. 114.
2

R. Doc. 107.

stores throughout Louisiana and allegedly failed to compensate
plaintiffs adequately during the period from November 28, 2009 to
the present.3
On July 16, 2014, Judge Berrigan conditionally certified the
collective action and defined the class as "[a]ll current and
former non-exempt, hourly employees who have been employed by
Brothers Petroleum, LLC d/b/a Brothers Food Mart or Brothers Food
Mart in the State of Louisiana during the time period of November
28, 2009 through the present."4

Judge Berrigan ordered defendants

to produce a list of "all potential opt-in plaintiffs' names, last
known

mailing

addresses,

and

email

addresses."5

Defendants

produced a partial list of employees but omitted the names and
contact

information

defendants.6

of

undocumented

workers

employed

by

Defendants then moved the Court to stay the civil

proceeding due to the United States Attorney's Office's criminal
investigation

of

defendant

undocumented workers.7

Imad

Hamdan's

alleged

hiring

of

Defendants argued that allowing discovery

to proceed concerning undocumented employees would force Mr. Hamdan

3

R. Doc. 113.

4

R. Doc. 79 at 3.

5

Id. at 8.

6

At the time the Court imposed the limited stay, only
Brothers Petroleum, LLC and Imad Hamdan, the sole owner of
Brothers Petroleum, were defendants in this action.
7

R. Doc. 88.
2

to chose between his right against self-incrimination and defending
against the allegations raised in this civil proceeding.

On

September 3, 2014, Judge Berrigan denied defendants' motion to stay
the

proceeding

in

its

entirety

but

issued

a

limited

stay.

Specifically, the Court found that a temporary and limited stay of
the outstanding discovery was appropriate until "the parameters of
any criminal investigation [are] determined."8

Accordingly, the

Court ordered that "[n]o discovery as to undocumented workers may
proceed for a period of two (2) months from the date of this order,
at which time the Court will consider appropriate motions including
a motion to reopen and/or another motion to stay, if appropriate."9
After Judge Berrigan imposed the limited stay, plaintiffs
filed

their

Second

Amended

defendants to the action.10

Complaint

and

added

forty-four

These additional defendants are not

covered by the Court's September 3, 2014 order imposing the limited
stay.

Plaintiffs now move the Court to lift the limited stay that

applies to Hamdan and Brother Petroleum, LLC.

Plaintiffs contend

that a continued stay is unwarranted because two months have passed
and defendants have not demonstrated any meaningful developments in
the criminal investigation.11 Apparently all defendants, including

8

R. Doc. 107 at 5.

9

Id. at 6 (emphasis in original).

10

R. Doc. 113.

11

R. Doc. 128-1 at 2.
3

newly added defendants, oppose the motion arguing that Hamdan and
two

other

defendants

were

recently

served

with

Grand

Jury

subpoenas.12 This ruling applies only to the parties covered by the
original stay.

II.

Discussion
When a defendant in a civil case is facing criminal charges,

a district court may, in its discretion, stay the civil action.
United States v. Kordel, 397 U.S. 1, 12 (1970); see also In re Ramu
Corp., 903 F.2d 312, 318 (5th Cir. 1990) ("The stay of a pending
matter is ordinarily within the trial court's wide discretion to
control the course of litigation, which includes authority to
control the scope and pace of discovery.").

The Fifth Circuit has

instructed that, in ruling on requests for stays of the civil side
of parallel civil/criminal proceedings, "judicial discretion and
procedural

flexibility

should

be

utilized

to

harmonize

the

conflicting rules and to prevent the rules and policies applicable
to one suit from doing violence to those pertaining to the other."
United States v. Gieger Transfer Serv., Inc., 174 F.R.D. 382, 385
(S.D. Miss. 1997) (citing Campbell v. Eastland, 307 F.2d 478, 487
(5th Cir. 1962)).
When determining whether a stay is warranted, courts consider:
(1) the extent of overlap between the criminal case and the civil
12

R. Doc. 135 at 4-5.
4

case; (2) the status of the criminal case, including whether the
defendant has been indicted; (3) the interests of the plaintiff in
proceeding expeditiously, weighed against the prejudice to the
plaintiff caused by the delay; (4) the interests of and the burden
on the defendant; (5) the interests of the courts; and (6) the
public interest.

Alcala v. Texas Webb Cty., 625 F. Supp.2d 391,

399 (S.D. Tex. 2009) (collecting district court cases in the Fifth
Circuit applying this test).

Although district courts have wide

discretion to determine whether a stay is warranted, "[e]ven
discretionary stays . . . will be reversed when they are immoderate
or of an indefinite duration."

In re Ramu Corp., 903 F.2d at 318

(internal citations omitted).
A.

Extent to Which Issues in the Civil and Criminal Cases
Overlap

The most important factor in determining whether to grant a
stay is the similarity in the issues in the civil and criminal
actions.

Dominguez v. Hartford Fin. Servs. Grp., Inc., 530 F.

Supp. 2d 902, 906-07 (S.D. Tex. 2008).

Overlapping issues in

parallel civil and criminal proceedings militate in favor of a
stay.

See United States v. ATP Oil & Gas Corp., CIV. A. No. 13-

0262, 2013 WL 6184991, at *3 (E.D. La. Nov. 26, 2013).

In

determining whether issues in civil and criminal cases are related,
courts impose a "common-sense, fact-bound analysis."
903 F.2d at 319.

5

In re Ramu,

Here, the Court is unable to determine with certainty the
extent

to

which

the

civil

case

overlaps

with

the

criminal

investigation because none of the defendants has been indicted.
See SEC v. AmeriFirst Funding, Inc., CIV. A. No. 3:07-1188, 2008 WL
866065, at *3 (N.D. Tex. Mar. 17, 2008) ("Because no indictment has
as yet been handed up against [defendant], the court cannot
determine with certainty the degree of overlap between this [civil]
action and the criminal investigation."). The few indications that
the Court does have, however, suggest that the criminal charges, if
they are forthcoming, will be directed at defendant Hamdan's
alleged practice of hiring undocumented workers.13 The scope of the
criminal proceeding thus will likely be limited to undocumented
employees. The civil proceeding, on the other hand, relates to all
of the defendants' current and former non-exempt, hourly employees,
including undocumented employees, as the FLSA applies to citizens
and undocumented workers alike.14 Although the undocumented workers
status as such is not an issue in the civil case, the information
sought

by

plaintiffs

in

this

proceeding--names

and

contact

information of undocumented workers employed by defendants--is the

13

Defendants attached as exhibits to their opposition
subpoenas addressed to defendants Imad Hamdan, Brothers
Petroleum, LLC, and Ziad Mousa requiring production on October
31, 2014 of "all accounting records of every Brothers location,
to include any handwritten payroll and/or accounting records."
R. Doc. 135-2.
14

R. Doc. 113 at 1.
6

apparent crux of the criminal investigation.

Accordingly, the

Court finds that the overlap between the civil case and the
criminal investigation weighs in favor of continuing the limited
stay.
B.

Status of the Criminal Proceeding and Defendants'
Burden

The second factor, the status of the criminal case, "is
largely linked with the fourth factor, the potential burden on
Defendant in not granting the stay." LeBouef v. Global X-Ray, CIV.
A. No. 07-5755, 2008 WL 239752, at *2 (E.D. La. Jan. 29, 2008).
When a criminal indictment has been issued, there is greater risk
of

self-incrimination,

and

"a

court

should

strongly

consider

staying the civil proceeding until the related criminal proceedings
are resolved."

Whitney Nat'l Bank v. Air Ambulance ex rel. B. & C

Mgmt., CIV. A. No. 04-2220, 2007 WL 1468417, at *3 (S.D. Tex. May
19, 2007).

Although this factor weighs most heavily in favor of a

stay when an indictment has been issued, that an indictment has not
been issued does not necessarily mean that a stay of discovery is
unwarranted.

S.E.C. v. Offill, CIV. A. No. 3:07-1643, 2008 WL

958072, at *3 (N.D. Tex. Apr. 9, 2008).

See also Brumfield v.

Shelton, 727 F. Supp. 282, 284 (E.D. La. 1989) (finding preindictment stay appropriate when a "criminal investigation . . .
parallels the ongoing civil action").
Here, although Hamdan has not been indicted, defendants have
provided evidence demonstrating that a criminal investigation into
7

Hamdan's hiring practices is underway.15
plaintiffs

would

have

Hamdan

disclose

Moreover, given that
the

names

and

contact

information of any undocumented employees, the Court finds that
Hamdan "would be burdened by civil discovery on the same issues"
that are the subject of the criminal investigation.
Bank, 2007 WL 1468417, at *3.

Whitney Nat'l

Indeed, absent a stay, Hamdan would

be forced to chose between his civil discovery obligations and his
Fifth Amendment privilege against self-incrimination.

See Doe v.

Morris, CIV. A. No. 11-1532, 2012 WL 359315, at *2 (E.D. La. Feb.
2, 2012).

Thus, while the pre-indictment status of the criminal

investigation does not counsel in favor of a complete stay, the
Court finds that the second and fourth factors weigh in favor of
continuing the limited stay.

See Waste Mgmt. of Louisiana, LLC v.

River Birch, Inc., CIV. A. No. 11-2405, 2012 WL 520660, at *4 (E.D.
La. Feb. 15, 2012) (finding pre-indictment stay appropriate because
"the criminal investigation is extremely active, and this weighs in
favor of a stay").
C.

Plaintiffs' Interest

Typically, courts require a plaintiff who opposes a stay to
demonstrate undue burden from a stay. See Whitney Nat'l Bank, 2007
WL 1468417, at *3 (citing In re Adelphia Commc'ns Sec. Litig., No.
02-1781, 2003 WL 22358819, at *4 (E.D. Pa. May 13, 2003)).

Here,

plaintiffs argue that undocumented workers will be prejudiced if
15

See supra note 12.
8

the Court continues the limited stay. First, plaintiffs argue that
because the statute of limitations on FLSA claims runs until
potential plaintiffs opt into the action, potential undocumented
plaintiffs may lose their rights to participate in this action if
the limited stay remains in effect.16 Second, plaintiffs argue that
contact information for undocumented workers quickly becomes stale
so that a prolonged stay will decrease the number of plaintiffs who
receive notice.17
As to the first argument, defendants have signed a stipulation
agreeing to toll the statute of limitations with regard to the
claims

of

undocumented

Accordingly,

workers

plaintiffs'

first

until

the

argument

stay
is

lifted.18

is

without

merit.

Plaintiffs' second argument--that potential plaintiffs may be less
likely to receive notice of this action if the limited stay is
continued--is belied by the fact that plaintiffs' proposed class
period runs from November 28, 2009 until the present.

Over five

years has already elapsed since the beginning of the proposed class
period, and the Court is not convinced that extending the limited
stay

of

discovery

will

materially

alter

the

likelihood

that

potential undocumented opt-in plaintiffs will receive notice of

16

R. Doc. 182-1 at 9.

17

R. Doc. 139-2 at 5.

18

R. Doc. 130.
9

this

action.

Accordingly,

the

Court

finds

that

plaintiffs'

interest in lifting the stay is de minimis.
D.

Interests of Court and Public

The

Court

has

an

interest

in

conducting litigation expeditiously.

judicial

economy

and

in

Alcala, 625 F. Supp.2d at

407. In addition, the "public has an interest in the resolution of
disputes with minimal delay, but only to the extent that the
integrity of the defendant's rights can be maintained."

Id.

(quoting St. Martin v. Jones, CIV. A. No. 08-1047, 2008 WL 4534398,
at *3 (E.D. La. Oct. 2, 2008)).

Here, the Court issued its

scheduling order on September 12, 2014, and trial is currently set
for June 22, 2015. Further, although the public has an interest in
the timely resolution of cases, granting a stay delays resolution
of the matter only temporarily.

Doe v. Morris, CIV. A. No. 11-

1532, 2012 WL 359315, at *2 (E.D. La. Feb. 2, 2012). The Court
finds that the court's interest and the public interest counsel in
favor of continuing the limited stay. Cf. Whitney Nat'l Bank, 2007
WL 1468417, at *3 (court's interest and public interest factors
weighed

against

granting

a

stay

when

parties

had

completed

discovery and were prepared for trial).

III. Conclusion
For the foregoing reasons, plaintiffs' motion to lift the
limited stay is DENIED.
10

IT IS FURTHER ORDERED that the limited stay imposed in the
Court's September 3, 2014 order staying defendants Imad Hamdan's
and Brother Petroleum, LLC's discovery obligations concerning
undocumented employees is hereby continued for a period of three
(3) months from the date of this order, at which time the Court
will consider appropriate motions to lift or continue the stay.
To the extent that other defendants believe their Fifth
Amendment

rights

are

implicated

in

this

proceeding,

those

defendants may seek appropriate relief based upon a particularized
showing.

11th
New Orleans, Louisiana, this _____ day of December, 2014.
_____________________________________
SARAH S. VANCE
UNITED STATES DISTRICT JUDGE

11