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

Filing 211

ORDER GRANTING 208 MOTION to Continue trial and pretrial deadlines. It is FURTHER ORDERED that a trial date will be set when the stay in this matter is lifted. It is ORDERED that the limited stay imposed in the Court's December 11, 2014 is hereby converted into a complete stay of the proceedings. It is FURTHER ORDERED that the complete stay will remain in effect for a period of six (6) months from the date of this order, unless a material change in the criminal investigation or other circumstances indicate that the stay should be modified or lifted. All parties are ORDERED to notify the Court immediately if they become aware of any significant developments that warrant reconsideration of the complete stay. Status Conference set for 3/17/2016 02:30 PM before Chief Judge Sarah S. Vance.The parties shall be prepared to discuss with theCourt the status of the criminal investigation and the propriety of continuing the completestay.. Signed by Chief Judge Sarah S. Vance on 9/9/15.(Reference: ALL CASES)(jjs)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
DANIA GISELLE CRUZ MEJIA, ET
AL.

CIVIL ACTION

VERSUS

NO: 12-2842
C/W 13-4831

BROTHERS PETROLEUM, LLC, ET
AL.

SECTION: R(4)

ORDER AND REASONS
Before the Court is the parties' joint motion to continue trial and pre-trial deadlines.
For the following reasons, the Court grants the motion and orders that the ongoing partial
stay in this case be converted to a complete stay of the proceedings for a period of six
months.

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 Brothers Food Mart convenience stores
throughout Louisiana and allegedly failed to compensate plaintiffs adequately during the
period from November 28, 2009 to the present.
On July 16, 2014, Judge Berrigan conditionally certified this lawsuit as a collective
action, defining the collective action class to include:

[a]ll current and former non-exempt, hourly employees who have been
employed by Brother 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.1
Judge Berrigan ordered defendants to produce a list of "all potential opt-in plaintiffs'
names, last know mailing addresses, and email addresses."2 Defendants produced a partial
list but omitted the names and contact information of undocumented workers employed
by defendants. Defendants then moved the Court to stay the civil proceeding due to the
United States Attorney's Office's criminal investigation of defendant Imad Hamdan's
alleged hiring of undocumented workers.3 Defendants argued that allowing discovery
concerning undocumented employees would force Mr. Hamdan 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."4 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

1

R. Doc. 79 at 3.

2

Id. at 8.

3

R. Doc. 88.

4

R. Doc. 107 at 5.
2

motions including a motion to reopen and/or another motion to stay, if appropriate."5 On
September 12, 2014, Judge Berrigan recused herself and this matter was transferred to this
section of the court.6
On November 5, 2014, plaintiffs moved the Court to lift the limited stay, arguing that
there had been no significant developments in the criminal investigation.7 Defendants
opposed the motion and attached copies of October 14, 2014 Grand Jury subpoenas served
on defendants in support of their contention that the criminal investigation remained
active.8 On December 11, 2014, the Court denied plaintiffs' request to lift the limited stay,
concluding that defendant Hamdan's Fifth Amendment rights would be jeopardized if the
Court lifted the limited stay.9 In so holding, the Court considered: (1) the extent of the
overlap between the criminal case and the civil case; (2) the status of the criminal case; (3)
the interest 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. The Court found that these factors
weighed defendants' favor and the Court extended the limited stay for an additional three
months.10

5

Id. at 6 (emphasis in original).

6

R. Doc. 114.

7

R. Doc. 128.

8

R. Doc. 135.

9

R. Doc. 161,

10

Id. at 10-11.
3

Three months later, defendants moved the Court for a further extension of the
limited stay.11 Defendants argued that an extension was warranted because the criminal
investigation into defendant Hamdan's hiring practices remained active. In support of this
position, defendants produced copies of March 4, 2015 immigration enforcement
subpoenas served on three Brothers Food Mart locations owned and operated by defendant
Hamdan.12 Defendants also provided copies of email correspondence in which the U.S.
Attorney's Office requested interviews with "some of the Brothers' employees."13 Plaintiffs
opposed the extension of the stay, arguing that "no meaningful progress has been made in
the alleged criminal investigation."14 On June 12, 2015, the Court granted defendants'
motion to continue the limited stay.15 The Court concluded that because defendants'
exhibits indicated that the criminal investigation remained active, an extension of the
partial stay was necessary for the reasons stated in the Court's December 11, 2012 ruling.
Accordingly, the Court extended the partial stay for three additional months.
On August 6, 2015, all parties to this case filed a joint motion to continue pre-trial
deadlines and trial, which is currently scheduled for November 2, 2015. The parties argued
that a stay was necessary because the ongoing, temporary stay of discovery had prevented
undocumented workers in the conditionally certified class from receiving notice of this
lawsuit. Additionally, the parties argued that they needed more time to conduct discovery
11

R. Doc. 191.

12

R. Doc. 191-2 at 1.

13

R. Doc. 191-3 at 2.

14

R. Doc. 194 at 1.

15

R. Doc. 203.
4

related to a group of defendants who were added to this lawsuit by plaintiff's Third
Amended Complaint on June 30, 2015. In order to facilitate resolution of the parties' joint
motion to continue pre-trial deadlines and trial, the Court scheduled a status conference
and asked the parties to submit letters addressing: (1) the status of the criminal
investigation into defendant Hamdan's hiring practices and whether a further continuation
of the partial stay or, in the alternative, a complete stay of civil proceedings is in order; (2)
whether a motion to decertify the conditionally certified class is contemplated.
During the September 6, 2015 status conference two things became apparent. First,
the criminal investigation at issue remains very active. Although Hamdan's counsel in this
case is not involved in the criminal matter, counsel provided the Court with a letter from
Hamdan's criminal defense attorney, which describes the grand jury investigating involving
Hamdan as active and ongoing. In addition, Hamdan's counsel stated that the Government
recently requested an interview with an individual who is a bookkeeper at several of
Hamdan's stores. Second, several parties and witnesses in this case have indicated that
they will assert their Fifth Amendment privilege in these proceedings and will not
participate in discovery or testify at trial until the criminal investigation is resolved.

II.

DISCUSSION

A.

Complete Stay of this Lawsuit
A district court has inherent power to "control the disposition of the causes on its

docket with economy of time and effort for itself, for counsel, and for litigants." Landis v.
N. Am. Co., 299 U.S. 248, 254, 57 S. Ct. 163, 166, 81 L. Ed. 153 (1936). This authority
includes the district court's wide discretion to stay a pending matter to control the course
5

of litigation. In re Ramu Corp., 903 F.2d 312, 318 (5th Cir. 1990). When a defendant in a
civil case is facing criminal charges, a district court may, when the interests of justice so
require, stay the civil action. United States v. Kordel, 397 U.S. 1, 12 (1970). 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 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).
As mentioned above, the Court weighed the six Alcala factors when it denied
plaintiffs' motion to lift the limited state on December 11 2014. The Court again referenced
those factors and its prior reasoning in granting defendants' motion to continue the limited
stay on June 12, 2015. The issue is now before the Court once more, and defendants have
again provided this Court with information indicating that the criminal investigation
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involving defendant Hamdan remains active. Specifically, Hamdan's counsel in this case
states that authorities have arranged to interview a bookkeeper for several of Hamdan's
stores. Counsel has also produced a letter from Hamdan's criminal defense attorney, which
states that the grand jury investigation of Hamdan is active and ongoing. Additionally,
plaintiffs again raise no arguments against the stay that the Court did not consider in its
December 11, 2014 order denying plaintiff's motion to lift the limited stay. Accordingly,
for the reasons set forth in the Court's prior rulings, the Court finds that a stay remains
necessary to avoid jeopardizing defendant Hamdan's Fifth Amendment rights.
The Court concludes, however, that given the current posture of proceedings, it is
no longer feasible to impose a partial stay of discovery. As mentioned above, multiple
parties and witnesses in this case have indicated that they will not participate in discovery
or testify at trial while the criminal investigation is ongoing. Among the likely nonparticipants are defendant Hamdan--the alleged owner of 37 of the 43 entities named as
defendants in plaintiff's Third Amended Collective Action Complaint--and many of the
managers of Hamdan's convenience store locations. These individuals are central to this
litigation. Without their participation, this litigation cannot go forward on central issues,
such as whether defendants are "joint employers"16 of store employees and whether

16

The FLSA's minimum wage and overtime pay requirements apply only
to"employers." 29 U.S.C. §§ 206 and 207. The FLSA defines "employers" as "any
person acting directly or indirectly in the interest of an employer in relation to an
employee." 29 U.S.C. § 203(d). In the Fifth Circuit, courts use the economic reality test
to determine a party's status as an employer. Gray v. Powers, 673 F.3d 352, 354 (5th
Cir.2012). Thus, courts evaluate "whether the alleged 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." Id. at 355 (citation and internal quotation marks
omitted). Under the FLSA, a single employee can have multiple employers, even within
7

plaintiffs are subject to a "common policy, plan, pattern, or practice," as required for final
collective action certification. See Falcon v. Starbucks, 580 F.Supp.2d 528, at 535 (S.D.
Tex. 2008). Thus, it is apparent that further discovery conducted under a limited stay
would not allow the case to become trial-ready. Piecemeal discovery would also be
inefficient and potentially duplicative, undermining the Court's interest in judicial
economy. This finding weighs in favor of completely staying proceedings. See Trustees of
Plumbers & Pipefitters Nat. Pension Fund v. Transworld Mech., Inc., 886 F. Supp. 1134,
1141 (S.D.N.Y. 1995) (finding that efficiency required a complete stay as to all corporate
defendants when criminal case involving central figures in the corporation precluded their
participation in discovery on key issues).
The Court also concludes that proceeding towards trial under a partial stay would
prejudice defendant Hamdan.

As long as he is the subject of an active criminal

investigation, Hamdan cannot participate in discovery or testify at trial without risking
waiver of his rights under the Fifth Amendment. This prejudice to defendant Hamdan
suggests that a complete stay of proceedings is warranted pending resolution of the
criminal investigation. Doe v. Morris, No. CIV.A. 11-1532, 2012 WL 359315, at *2 (E.D. La.
Feb. 2, 2012) (staying proceedings pending resolution of criminal trial where defendant
would otherwise be forced to choose between his civil discovery obligations and his Fifth
Amendment privilege against self-incrimination). Accordingly, the Court finds that the
interests of justice require a complete stay of proceedings for a period of six months.

a single business institution. Martin v. Spring Break '83 Prods., LLC, 688 F.3d 247, 251
(5th Cir.2012). Nonetheless, in a joint employer context, each employer must meet the
economic reality test. Gray, 673 F.3d at 355.
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B.

Continuance of Pre-Trial Deadlines and Trial

A scheduling order "shall not be modified except upon a showing of good cause and
by leave of the district judge." Fed. R. Civ. P. 16(b). The "good cause" standard requires the
party seeking relief to "show that the deadlines cannot reasonably be met despite the
diligence of the party needing the extension." S&W Enters., L.L.C. v. SouthTrust Bank of
Ala., NA, 315 F.3d 533, 535 (5th Cir. 2003). Whether to grant or deny a continuance is
within the sound discretion of the trial court. United States v. Alix, 86 F.3d 429, 434 (5th
Cir. 1996). In deciding whether to grant a continuance, the court's "judgment range is
exceedingly wide," for it "must consider not only the facts of the particular case but also all
of the demands on counsel's time and the court's." Streber v. Hunter, 221 F.3d 701, 736
(5th Cir. 2000).
As discussed above, the Court finds that this lawsuit cannot realistically go forward
at this time. Until there is more clarity on the criminal investigation involving defendant
Hamdan, it is not feasible to conclude discovery or proceed toward a trial date. Therefore,
the Court concludes that there is good cause to the continue trial and pre-trial dates until
such time as the complete stay in this case is lifted. The Court grants the parties' joint
motion to continue trial and pre-trial deadlines.

III.

CONCLUSION
For the foregoing reasons, the parties' joint motion to continue trial and pre-trial

deadlines is GRANTED. It is FURTHER ORDERED that a trial date will be set when the
stay in this matter is lifted.

9

It is ORDERED that the limited stay imposed in the Court's December 11, 2014 is
hereby converted into a complete stay of the proceedings. It is FURTHER ORDERED that
the complete stay will remain in effect for a period of six (6) months from the date of this
order, unless a material change in the criminal investigation or other circumstances
indicate that the stay should be modified or lifted. All parties are ORDERED to notify the
Court immediately if they become aware of any significant developments that warrant
reconsideration of the complete stay.
Finally, it is ORDERED that a status conference will be held March 17, 2016 at 2:30
p.m. in the Chambers of United States District Judge Sarah S. Vance, 500 Poydras Street,
Room C255, New Orleans, Louisiana. The parties shall be prepared to discuss with the
Court the status of the criminal investigation and the propriety of continuing the complete
stay.

9th
New Orleans, Louisiana, this ____ day of September, 2015.

________________________________
SARAH S. VANCE
UNITED STATES DISTRICT JUDGE

10