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

Filing 202

ORDER AND REASONS granting LKM Defendants' Motion 168 to Dismiss for Failure to State a Claim and dismisses the LKM Defendants without prejudice. Plaintiffs will be allowed 21 (21) days from the date of this order to amend their complaint. Failure to timely amend the complaint will result in dismissal of plaintiffs' claims against the LKM Defendants with prejudice.. Signed by Chief Judge Sarah S. Vance on 6/9/15. (Reference: ALL CASES)(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
Defendants Lenny Motwani, LKM Convenience, and LKM Enterprises
(collectively the "LKM Defendants") move the Court to dismiss
plaintiffs' claims against the LKM Defendants under Rule 12(b)(6).1
The Court grants the LKM Defendants' motion because plaintiffs fail
to adequately plead individual or enterprise coverage under the
Fair Labor Standards Act.

I.

Background
Plaintiffs Dania Mejia, Maria Mejia, Martha Balleza, and

Esther Torres filed this action on November 28, 2012 before Judge
Helen Berrigan alleging that Brothers Petroleum, LLC, Brothers Food
Mart, and Imad Faiez Hamdan (collectively the "Hamdan Defendants")
failed to adequately compensate plaintiffs in violation of the
overtime and minimum wage provisions of the Fair Labor Standards

1

R. Doc. 168.

Act ("FLSA").2

29 U.S.C. §§ 206 and 207.

One year later,

plaintiffs amended their complaint to state a collective action
under the FLSA, seeking damages against the Hamdan Defendants on
behalf of all individuals "similarly situated."3
On July 16, 2014, Judge Berrigan granted plaintiffs' motion to
conditionally certify a collective action.

Judge Berrigan defined

the collective action class to include
[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 9, 2009
through the present.4
Judge Berrigan further ordered the Hamdan Defendants to provide
plaintiffs' counsel with a list of all potential opt-in plaintiffs'
names, last known mailing addresses, and email addresses so that
plaintiffs'

counsel

could

facilitate

members of the collective action.5

notice

to

all

potential

To date, approximately 65

additional plaintiffs have opted into this action.
On

August

22,

2014,

after

Judge

Berrigan

conditionally

certified the collective action, plaintiffs moved for leave to file
a second amended complaint seeking to add two named plaintiffs,
Claudia Wilson and Dora Pimeda, as well as an additional forty-four

2

R. Doc. 1.

3

R. Doc. 37.

4

R. Doc. 79 at 3.

5

Id. at 8.
2

defendants to the action.6

The majority of the new defendants are

additional Brothers Food Mart locations owned and operated by the
original Hamdan Defendants.

Plaintiffs, however, also sought to

introduce three new Brothers Food Mart location owners to the
action--Lenny Motwani, Abdel Raoyf Mousa, and Ziad Mousa.

Lenny

Motwani allegedly owns and operates two Brothers locations, LKM
Convenience

and

LKM

Enterprises

(collectively

the

"LKM

Defendants").7 Abdel Raoyf Mousa allegedly owns and operates three
Brothers locations, Brothers Stonebridge, Brothers Terry Parkway,
and Brothers Behrman Hwy (collectively the "Raoyf Defendants").8
Ziad Mousa allegedly owns and operates one Brothers location,
Brothers Expressway, Inc. (collectively the "Ziad Defendants").9
In the Second Amended Complaint, plaintiffs allege that all of the
"Defendants worked in concert to operate and run a business that
served a single common goal, and Defendants are therefore joint
employers of Plaintiffs."10

Plaintiffs further allege that "some

or all" of the plaintiffs worked interchangeably for the Defendants

6

R. Doc. 99.

7

R. Doc. 113 at 6.

8

Id.

9

Id. at 7.

10

Id.
3

and that all Defendants utilized the same method for paying
plaintiffs.11
On

September

11,

2014,

Magistrate

Judge

Knowles

granted

plaintiffs' motion for leave to file the Second Amended Complaint,
stating:
The Court's main concern is that the District Court has
already ruled on the conditional collective class action,
but the Court's research has revealed no impediment to
filing an amended complaint after such a ruling. Indeed,
there has been no permanent certification, and any
defendant may move to de-certify the class at any time.12
Plaintiffs filed their Second Amended Complaint the same day.13 The
following day, Judge Berrigan recused herself and the case was
transferred to this section of the court.14
The LKM Defendants now move the Court to dismiss plaintiffs'
claims against the LKM Defendants under Rule 12(b)(6).

The LKM

Defendants argue that dismissal is warranted because (1) plaintiffs
have

"failed

uncompensated

to

provide

overtime

sufficient

element

of

factual
their

context

FLSA

for

the

claim,"15

(2)

plaintiffs failed to adequately plead interstate activity,16 and (3)

11

Id.

12

R. Doc. 112 at 3.

13

R. Doc. 113.

14

R. Doc. 114.

15

R. Doc. 168-1 at 4.

16

Id. at 5.
4

plaintiffs "have failed to identify even one plaintiff who worked
at an LKM store."17

II.

Legal Standard
To survive a Rule 12(b)(6) motion to dismiss, the plaintiff

must plead enough facts to “state a claim to relief that is
plausible on its face.”

Ashcroft v. Iqbal, 556 U.S. 662, 678

(2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)).

A claim is facially plausible “when the plaintiff pleads

factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.”
Id.

A court must accept all well-pleaded facts as true and must

draw all reasonable inferences in favor of the plaintiff.

Lormand

v. U.S. Unwired, Inc., 565 F.3d 228, 239 (5th Cir. 2009).

But the

Court is not bound to accept as true legal conclusions couched as
factual allegations. Iqbal, 556 U.S. at 678.
A legally sufficient complaint need not contain detailed
factual

allegations,

but

it

must

go

beyond

labels,

legal

conclusions, or formulaic recitations of the elements of a cause of
action.

Id.

In other words, the face of the complaint must

contain enough factual matter to raise a reasonable expectation
that

discovery

will

plaintiff’s claim.
17

reveal

evidence

of

each

Lormand, 565 F.3d at 257.

Id.
5

element

of

the

If there are

insufficient factual allegations to raise a right to relief above
the speculative level, or if it is apparent from the face of the
complaint that there is an insuperable bar to relief, the claim
must be dismissed.

Twombly, 550 U.S. at 555.

III. Discussion
An employer violates the FLSA if it fails to pay covered
employees at least one and one-half times their normal rate for
hours worked in excess of 40 hours per week, or fails to pay
covered employees a minimum wage of $7.25 per hour.
206 and 207.

29 U.S.C. §§

Thus, in order to state a claim for unpaid overtime

or minimum wages under the FLSA, a plaintiff must plead: "(1) that
there existed an employer-employee relationship during the unpaid
. . . periods claimed; (2) that the employee engaged in activities
within the coverage of the FLSA; (3) that the employer violated the
FLSA's overtime [or minimum wage] requirements; and (4) the amount
of overtime [or minimum wage] compensation due."

Johnson v.

Heckmann Water Resources, Inc., 758 F.3d 627, 630 (5th Cir. 2014).
Defendants

assert

that

plaintiffs'

Second

Amended

Complaint

inadequately pleads the first, second, and third elements of a
successful FLSA claim.

The Court will address these arguments in

turn.

6

A.

Employee-Employer Relationship

The LKM Defendants contend that plaintiffs' Second Amended
Complaint fails to adequately plead that the LKM Defendants qualify
as plaintiffs' employers 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).

FLSA regulations provide that multiple individuals or

entities

may

be

considered

an

employee's

joint

employers

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.
29 C.F.R. § 791.2.

The Fifth Circuit has adopted the "economic

realities test" to determine whether an individual or entity
qualifies as an employer under the FLSA.

Under the economic

realities test, Courts consider whether the putative employer:
(1) possessed the power to hire and fire the employees;
(2) supervised and controlled employee work schedules or
conditions of employment, (3) determined the rate and
method of payment, and (4) maintained employment records.

7

Williams v. Henagan, 595 F.3d 610, 620 (5th Cir. 2010).

The Court

must apply the economic realities test to each individual or entity
alleged to be an employer.
Cir. 2012).

Gray v. Powers, 673 F.3d 352, 355 (5th

However, all four of the factors need not be present

in each case to find an employee-employer relationship.
357.

Rather,

the

Court

must

consider

the

totality

Id. at
of

the

circumstances and the economic reality of the overall relationship.
Hodgson v. Griffin & Brand of McAllen, Inc., 471 F.2d 235, 237-38
(5th Cir. 1973) ("Whether appellant is an employer of the harvest
workers does not depend on technical or isolated factors but rather
on the circumstances of the whole activity; it depends not on the
form of the relationship but on the economic reality.") (internal
quotation and citations omitted).
With

respect

to

the

LKM

Defendants,

the

Second

Amended

Complaint states:
At all times material hereto, Defendant Lenny Motwani was
the owner and/or operator of the Brothers Food Mart
locations that were owned by [LKM Enterprises and LKM
Convenience] at issue herein. Plaintiffs . . . allege
that Defendant Lenny Motwani jointly employed Plaintiffs
. . . with the other Defendants as he was directly
responsible for the hiring, termination, scheduling,
control and payment of Plaintiffs and the employees.18
The Second Amended Complaint further alleges that all defendants,
including the LKM Defendants, worked in concert to operate and run
businesses that served a single common goal, allowed plaintiffs to

18

R. Doc. 113 at 6.
8

work interchangeably between all stores operated by defendants, and
utilized

the

same

method

for

paying

all

Brothers

Food

Mart

employees.19
The LKM Defendants contend that these allegations are "vague,
conclusory assertions" that are insufficient to survive a motion to
dismiss.20
failure

to

The LKM Defendants premise this argument on plaintiffs'
identify

by

name

the

particular

allegedly worked for the LKM Defendants.

plaintiffs

that

Additionally, without

providing a list of the individual plaintiffs that allegedly worked
interchangeably for all of the defendants, the LKM Defendants argue
that plaintiffs "have failed to make out a facially plausible claim
of joint employer liability."21
Limiting its analysis to the facts alleged in the complaint
and accepting them as true for the purposes of this motion, the
Court concludes that plaintiffs have adequately pleaded that the
LKM Defendants are plaintiffs' employers under the FLSA.

The

evidence may ultimately show that the LKM Defendants were not
plaintiffs' employers, and the LKM Defendants remain free to bring
a motion for summary judgment on that basis.

Similarly, while the

evidence may ultimately demonstrate that the LKM Defendants operate
independently from the other defendants in this action and do not

19

Id. at 7.

20

R. Doc. 179 at 4.

21

Id. at 4-5.
9

share employees with any of the other defendants, the Court is not
free to disregard plaintiffs' allegations that all defendants,
including

the

LKM

Defendants,

allowed

plaintiffs

to

interchangeably for their various Brothers Food Mart stores.

work
See

Soriano v. Gulf Coast Lift, LLC, Civ. A. No. 12-2744, 2014 WL
949145, at *6 (E.D. La. Mar. 11, 2014) ("[P]laintiffs have made
allegations against all defendants, Johnson included, which, if
proven as to Johnson, would qualify him as an employer under the
FLSA."); Rodriguez v. Gold & Silver Buyers, Inc., Civ. A. No. 121831, at *3 (S.D. Tex. Sept. 24, 2013) ("The contention that a
particular defendant is an employer is the very definition of a
factual allegation upon which plaintiffs are entitled to offer
proof.") (internal citations omitted);

McLaughlin v. Intrepid

Holdings, Inc., Civ. A. No. 08-798, 2008 WL 4692386, at *2 (S.D.
Tex. Oct. 22, 2008) (denying motion to dismiss because plaintiffs
were entitled to discovery on issue of defendants' relationships
with one another).
Accordingly, the Court finds that plaintiffs' have adequately
pleaded that the LKM Defendants are plaintiffs' employers.
B.

FLSA Coverage

Consistent

with

Congress's

power

to

regulate

interstate

commerce, the FLSA minimum wage and overtime provisions extend to
employees who are (1) "engaged in commerce or in the production of
goods for commerce" ("individual coverage"), or (2) "employed in an

10

enterprise engaged in commerce or in the production of goods for
commerce" ("enterprise coverage").

29 U.S.C. §§ 206(a), 207(a).

"Either individual or enterprise coverage is enough to invoke FLSA
protection." Martin v. Bedell, 955 F.2d 1029, 1032 (5th Cir. 1992)
(emphasis in original). Plaintiffs bear the burden of establishing
either individual or enterprise coverage.

Sobrinio v. Med. Ctr.

Visitor's Lodge, 474 F.3d 828, 829 (5th Cir. 2007).
1.

Individual Coverage

To sufficiently plead individual coverage, a plaintiff must
allege facts giving rise to a reasonable inference that he or she
was engaged in commerce or in the production of goods for commerce.
29 U.S.C. §§ 206(a), 207(a); Morrow v. J W Elec., Inc., Civ. A. No.
11-1988, 2011 WL 5599051, at *2-3 (N.D. Tex. Nov. 16, 2011).

To

determine whether an employee is engaged in commerce, the Fifth
Circuit employs a "practical test," asking whether the employee's
"work is so directly and vitally related to the functioning or an
instrumentality or facility of interstate commerce as to be, in
practical effect, a part of it rather than an isolated activity."
Williams v. Henagan, 595 F.3d 610, 621 (5th Cir. 2010) (internal
citations omitted).

"Commerce" under the FLSA, "means trade,

commerce, transportation, transmission, or communication among the
several States or between any State and any place outside thereof."
29 U.S.C. § 203(b).

Accordingly, "[w]ork that is purely local in

nature does not meet the FLSA's requirements, but any regular

11

contact

with

coverage."

commerce,

no

matter

how

small,

will

result

in

Henagan, 595 F.3d at 621.

Here, the Second Amended Complaint is devoid of any facts or
allegations

regarding

the

plaintiffs'

relationship

instrumentalities or facilities of interstate commerce.

to

Indeed,

the only allegations in the Second Amended Complaint regarding
plaintiffs' work duties are that plaintiffs worked as hourly
cashiers, cooks, and store operators at defendants' convenience
stores.22

While these allegations provide a generic description of

plaintiffs' work, "they do not show how the work engages plaintiffs
in interstate commerce."

Lopez-Santiago v. Coconut Thai Grill,

Civ. A. No. 4268, 2014 WL 840052, at *4 (N.D. Tex. Mar. 4, 2014).
Plaintiffs' allegation that they worked at convenience stores,
without more, does not give rise to an inference that plaintiffs
were engaged in interstate commerce.

See McLeod v. Threlkeld, 319

U.S. 491, 494 (1943) ("[H]andlers of goods for a wholesaler who
moves them interstate on order or to meet the needs of specified
customers are in commerce, while those employees who handle goods
after acquisition by a merchant for general local disposition are
not."); Sobrino, 474 F.3d at 830 (FLSA does not cover work which
"amounts to nothing more than providing local transportation for
motel patrons").

22

R. Doc. 113 at 8-9.
12

The Second Amended Complaint is devoid of any description or
mention

of

plaintiffs'

relationship

to

interstate

commerce.

Plaintiffs' bare-bones description of their work responsibilities
does not adequately plead individual coverage under the FLSA.
2.

Enterprise Coverage

To plead enterprise coverage, plaintiffs must allege facts
giving rise to a reasonable inference that defendants constitute
"enterprise[s] engaged in commerce or in the production of goods
for commerce."

29 U.S.C. §§ 206(a), 207(a).

The FLSA defines an

"enterprise engaged in commerce or in the production of goods for
commerce" as an enterprise that:
(A)(i) has employees engaged in commerce or in the
production of goods for commerce, or that has employees
handling, selling, or otherwise working on goods or
materials that have been moved in or produced for
commerce by any person; and
(ii) is an enterprise whose annual gross volume of sales
made or business done is not less than $500,000
(exclusive of excise taxes at the retail level that are
separately stated) . . . .
29 U.S.C. § 203(s)(1).
Here,

plaintiffs

make

the

conclusory

allegation

that

"Defendants were and continue to be engaged in interstate commerce
and in the production of goods for commerce throughout the United
States."23

This allegation is nothing more than "a formulaic

recitation" of the FLSA enterprise coverage standard. Twombly, 550
U.S. at 555.

23

See also Payne v. Universal Recovery, Inc., Civ. A.

R. Doc. 113 at 5.
13

No. 11-1672, 2011 WL 7415414, at *5 (N.D. Tex. Dec. 7, 2011)
(plaintiff's "conclusory allegations that . . . Universal was an
enterprise engaged in interstate commerce and . . . regularly owned
and operated businesses engaged in commerce or in the production of
goods for commerce as defined by the FLSA . . . failed to
sufficiently plead enterprise coverage"). Additionally, plaintiffs
do not make any allegation whatsoever that defendants' stores
grossed more than $500,000 annually. See Perez v. Muab, Inc., Civ.
A. No. 10-62441, 2011 WL 845818, at *2 (S.D. Fla. Mar. 7, 2011)
(dismissing

action

because

"[t]he

Complaint

does

not

allege

anything regarding whether Defendant Muab has $500,000 in gross
revenue during the relevant period"). Accordingly, the Court finds
that plaintiffs have also failed to plead enterprise coverage under
the FLSA.

See Baker v. ABC Provider DFW, LLC, Civ. A. No. 13-288,

2014 WL 1267302, at *2 (S.D. Tex. Mar. 26, 2014) (dismissing
similarly phrased complaint).
C.
The

Plaintiffs' Overtime Claims

Second Amended Complaint alleges:
During the time they worked for Defendants, plaintiffs
worked approximately 70-80 hours per week for Defendants.
In July 2012, Defendants reduced Plaintiffs hours to
approximately 50 hours per week.
Although Plaintiffs
regularly worked in excess of 40 hours per week for
Defendants, they were not paid time and one-half for
hours worked in excess of 40 per week, in direct
violation of the FLSA.24

24

R. Doc. 113 at 10.
14

The LKM Defendants argue that the FLSA requires plaintiffs to plead
the uncompensated overtime element of their claim with greater
particularity.25 More specifically, the LKM Defendants contend that
the Second Amended Complaint fails because "[p]laintiffs do not
approximate how many weeks, nor identify any particular weeks, in
which they worked more than 40 hours without overtime."26
The Court finds that plaintiffs have adequately pleaded the
uncompensated overtime element of their FLSA claim.

Plaintiffs

allege that they worked approximately 70-80 hour per week before
July of 2012, and then approximately 50 hours per week thereafter,
without

receiving

overtime

pay.

"Those

are

all

factual

allegations--not legal conclusions--and, if proven, they give rise
to a plausible claims for relief."

Hoffman v. Cemex, Inc., Civ. A.

No. 09-3144, 2009 WL 4825224, at *3 (S.D. Tex. Dec. 8, 2009).

The

allegations in the Second Amended Complaint put the defendants on
notice

as

to

the

approximate

date

ranges,

as

well

as

the

approximate number of hours worked, for which plaintiffs claim they
were under-compensated. The FLSA does not require more.

Id. at *3

(finding plaintiffs' allegations "that they regularly worked more
than 40 hours per []week, and that they were not paid time-and-ahalf for those overtime hours" sufficient to state a claim under
the FLSA).

See also Qureshi v. Panjwani, Civ. A. No. 08-3154, 2009

25

R. Doc. 168-1 at 3.

26

Id. at 4.
15

WL 1631798, at *3 (S.D. Tex. June 9, 2009) (denying motion to
dismiss when plaintiffs alleged that "they were required to work in
excess of a forty-hour week without overtime compensation"); Solis
v. Time Warner Cable San Antonio, L.P., Civ. A. No. 10-231, 2010 WL
2756800, at *2 (W.D. Tex. July 13, 2010) (denying motion to dismiss
when plaintiffs alleged that they "routinely worked more than 40
hours per workweek, and in many workweeks in excess of 60 hours per
workweek").

IV.

Conclusion
For the foregoing reasons, the Court finds that plaintiffs

have failed to plead either individual or enterprise coverage under
the FLSA. Accordingly, the Court grants the LKM Defendants' motion
to dismiss without prejudice.

Plaintiffs will be allowed twenty-

one (21) days from the date of this order to amend their complaint.
Failure to timely amend the complaint will result in dismissal of
plaintiffs' claims against the LKM Defendants with prejudice.

9th
New Orleans, Louisiana, this _____ day of June, 2015.
_____________________________________
SARAH S. VANCE
UNITED STATES DISTRICT JUDGE

16