Arnold et al v. Acappella, LLC et al
Filing
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MEMORANDUM AND ORDER granting 20 Plaintiff's Motion to Certify Class; conditionally certifying the class; and directing Defendants to provide to Plaintiff's counsel the full legal name, last known residential address, and last know e-mail address for all Putative Class members. Signed by Magistrate Judge Beth P. Gesner on 9/29/2016. (Attachments: # 1 Notice, # 2 Consent)(bmhs, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
TODD ARNOLD,
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Plaintiff,
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v.
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Civil No. BPG-15-3001
ACAPPELLA, LLC, et al.,
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Defendants.
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MEMORANDUM AND ORDER
Currently pending before the court is plaintiff Todd Arnold’s Motion to Conditionally
Certify a Fair Labor Standards Act Collective Action Pursuant to 29 U.S.C. § 216(b) and for
Approval of and Facilitation of Notice to Potential Class Members (“Plaintiff’s Motion”). (ECF
No. 20.)
Defendants Acappella, LLC and Mihallaq Rapo a/k/a Mike Rapo have filed an
Opposition to Plaintiff’s Motion to Certify a Fair Labor Standards Act Collective Action
Pursuant to 29 U.S.C. § 216(b) and for Approval of and Facilitation of Notice to Potential Class
Members (“Defendant’s Opposition”). (ECF No. 63.) Plaintiff has filed its Reply (“Plaintiff’s
Reply”).
(ECF No. 68).
I have reviewed the parties’ papers, and no hearing is deemed
necessary. Loc. R. 105.6. For the reasons stated below, Plaintiff’s Motion is granted, and notice
to potential class members shall be given as set forth below.
I.
Factual Background
Defendant Acappella, LLC (“Acappella” or “the restaurant”) is a limited liability
company, organized under the laws of the State of Maryland, which operates a restaurant,
“Acappella Italian Restaurant,” located in Fallston, Maryland. (ECF No. 1 at ¶ 5, ECF No. 63 at
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1.) Defendant Mihallaq Rapo a/k/a Mike Rapo (“Rapo”) is the owner of Acappella. (ECF No. 1
at ¶ 7, ECF No. 63 at 1.)
In his sworn declaration, plaintiff Todd Arnold (“plaintiff” or “Arnold”) states that he
worked as a server at Acappella from mid-2014 through “the beginning of 2015.” (Arnold Decl.,
ECF No. 20-1 at ¶ 1.) Arnold states that he was paid $3.63 per hour during his employment at
Acappella. (Id. at ¶ 2.) Arnold asserts that he was never informed by defendants that that they
were taking a “tip credit” on his wages and that he had the right to retain all tips. Arnold also
asserts that he, like other servers, was required to pay to management six percent (6%)—later
five percent (5%)—of net sales, which amounted to approximately one-third (1/3) of all tips
received. (Id. at ¶¶ 2–3.)
Plaintiff alleges that defendants violated 29 U.S.C. §§ 203(m) of the Fair Labor Standards
Act 1 and § 3-419 of the Maryland Wage and Hour Law 2 by failing to inform plaintiff and
similarly situated employees that defendants were taking a “tip credit” on their wages and that
they had a right to retain all their tips except in a valid tip pooling arrangement. (ECF No. 1 at ¶
15.) Plaintiff also alleges that defendants violated the Maryland Wage Payment and Collection
Law 3 by failing to pay plaintiff and other tipped employees at least the Maryland hourly
minimum wage. (Id.)
Plaintiff seeks to represent a class of similarly situated persons who were subject to
defendant’s allegedly wrongful employment practices. (ECF No. 20.)
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29 U.S.C. §§ 201, et seq. (“FLSA”).
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Md. Code Ann. LE art. § 3-401, et seq. (“MWHL”).
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Md. Code Ann. LE art. § 3-501, et seq. (“MWPCL”).
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II.
Procedural History
Plaintiff filed a Collective Action and Class Action Complaint (“the Complaint”) on
October 4, 2015. 4 (ECF No. 1.) Pursuant to 28 U.S.C. § 636 and with the parties’ consent (see
ECF Nos. 13, 14), Judge Russell referred this case to the undersigned for all proceedings on
December 21, 2015. (ECF Nos. 10, 11.)
The now-pending Motion to Conditionally Certify was filed on February 2, 2016. (ECF
No. 20.) As the parties were, at that time, engaged in settlement negotiations, defendants were
granted additional time in which to respond to Plaintiff’s Motion.
(ECF Nos. 22, 23.)
Additional time passed as the parties engaged in further negotiations, and, on April 7, 2016, a
stay was imposed in this case pending the parties’ participation in a settlement conference before
Judge Coulson. (ECF No. 42.) The settlement conference before Judge Coulson was held on
May 3, 2016, but the parties were unable to reach a settlement. (See ECF No. 43.)
Further delays ensued when original counsel for defendants, Messrs. Walsh and Berger,
filed a Motion for Leave to Strike Appearance of Counsel on May 19, 2016. (ECF No. 47.) As
it was not apparent that Messrs. Walsh and Berger had complied with Local Rule 101.2’s notice
requirements, the court directed them to do so; the court also advised defendant Acappella that,
as a limited liability company, it was required to be represented by counsel. Loc. R. 101.2(b).
(ECF No. 51.) Messrs. Walsh and Berger complied with the court’s order regarding Local Rule
101.2 on June 10, 2016.
(ECF No. 55.) As required by Local Rule 101.2(b), defendant
Acappella was given thirty (30) days in which to obtain new counsel. Loc. R. 101.2(b). (See
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At the time of filing, there were two named plaintiffs in this case, Mr. Arnold and Matthew Dippel. (See ECF No.
1.) On March 29, 2016, counsel for plaintiff filed a “Motion to Withdraw Appearance as Attorney as to Plaintiff
Dippel, Only,” in which counsel for plaintiff stated that Mr. Dippel no longer wished to pursue any claims against
defendants. (ECF No. 38.) Notice having been given to Mr. Dippel regarding counsel’s motion to withdraw, the
motion was granted on June 7, 2016. (ECF No. 52.)
Mr. Dippel was directed to notify the court whether he wished to proceed pro se or obtain new counsel. (ECF No.
52, 54.) Mr. Dippel did not respond to the court’s order. Accordingly, Mr. Dippel’s claims were dismissed without
prejudice on June 30, 2016. (ECF No. 57.)
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ECF No. 51.) On July 8, 2016, Mr. McCormick entered his appearance on behalf of both
defendants.
(ECF No. 58.)
Accordingly, Messrs. Walsh and Berger’s Motion to Strike
Appearance was granted the same day. (ECF No. 59.)
On July 28, 2016, the stay imposed in this case on April 7, 2016 was lifted, and
defendants were directed to respond to plaintiff’s Motion to Conditionally Certify within fifteen
days. (ECF No. 62.) Defendants’ Opposition was timely filed on August 10, 2016. (ECF No.
63.) This court granted plaintiff additional time to file a reply on August 31, 2016, and plaintiff
filed its Reply on September 16, 2016. (ECF No. 68). Plaintiff’s Motion is thus ripe for
adjudication.
III.
Conditional Certification
a. Legal Standard for Conditional Certification
Pursuant to 29 U.S.C. § 216(b), plaintiffs may maintain a collective action against their
employer for violations of the FLSA. Quinteros v. Sparkle Cleaning, Inc., 532 F. Supp. 2d 762,
771 (D. Md. 2008). Section 216(b) allows “similarly situated” employees to opt in to a lawsuit
by giving their consent. Id. (citation omitted). It is well settled that the district court has the
discretion to decide whether to allow an FLSA claim to proceed as a collective action and to
facilitate notice to potential plaintiffs. Id. (citation omitted); see also Marroquin v. Canales, 236
F.R.D. 257, 259 n.7 (D. Md. 2006) (holding that “the same legal standards apply for assessing
the appropriateness of both proceeding as a collective action and providing court approved notice
to potential class members”).
When deciding whether to certify a collective action, courts generally follow a two-step
process. Syrja v. Westat, Inc., 756 F. Supp. 2d 682, 686 (D. Md. 2010). At the first step, known
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as the notice stage, the court “makes a threshold determination of whether the plaintiffs have
demonstrated that potential class members are similarly situated, such that court-facilitated
notice to the putative class members would be appropriate.” Syrja, 756 F. Supp. 2d at 686.
(citation omitted) (internal quotation marks omitted). The second stage, referred to as the
decertification stage, occurs after the close of discovery. Rawls v. Augustine Home Health Care,
Inc., 244 F.R.D. 298, 300 (D. Md. 2007). At the decertification stage, the court makes a final
decision about whether a collective action is proper. Id.
At the notice stage, a putative class plaintiff must make a “relatively modest factual
showing” that he is similarly situated to potential opt-in plaintiffs. Marroquin, 236 F.R.D. at 259
(citation omitted). “A group of potential plaintiffs are ‘similarly situated’ when they together
were victims of a common policy or scheme or plan that violated the law.” Id. at 260 (citation
omitted). While mere allegations in a complaint are insufficient to show substantial similarity, a
plaintiff may make an adequate factual showing by affidavit. Id. at 259–60 (citation omitted).
Such an affidavit must set forth more than “vague allegations” with “meager factual support” to
establish substantial similarity. D’Anna v. M/A-COM, Inc., 903 F. Supp. 889, 894 (D. Md.
1995). As noted above, however, a plaintiff need not conclusively establish that there is a
similarly situated class until the post-discovery decertification stage. Rawls, 244 F.R.D. at 300.
b. Conditional Certification Is Appropriate in This Case
Through his sworn declaration, plaintiff has made the required modest factual showing
that there exists a similarly situated class of potential plaintiffs who were subject to a common
policy, scheme, or plan which may have violated the law. Marroquin, 236 F.R.D. at 260.
Arnold’s sworn declaration indicates that he and other servers at the restaurant: were paid at an
hourly rate of $3.63; were never informed that defendants were taking a “tip credit” against the
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minimum wage, the amount of their tip credit, and their right to retain all tips; and were required
to pay to management six percent (6%)—later five percent (5%)—of net sales, which amounted
to approximately one-third (1/3) of all tips received. (ECF No. 20-1 at ¶¶ 2–3.)
While defendants challenge the basis of Arnold’s knowledge regarding Arnold’s belief
that “others were [not] informed that the Defendants were taking a tip credit,” this objection is
unpersuasive. (ECF No. 63 at 4.) As to this particular statement, Arnold identifies the lack of
any written notice (“poster, handbook, etc.”) as a reason why he believed that other servers were
unaware of the tip credit arrangement. (ECF No. 20-1 at ¶ 2.) Arnold’s declaration, moreover,
repeatedly refers to conversations with other employees at the restaurant which would provide
him with knowledge of their similar treatment. 5 (Id. at ¶¶ 2, 3, 6.) Accordingly, plaintiff Arnold
has made adequate factual allegations regarding conditions of which he has personal knowledge.
Plaintiff has, therefore, met his modest burden of establishing that there exists a class of similarly
situated potential plaintiffs who were subject to a common policy that violated the FLSA.
IV.
Notice to Potential Class Members
a. Scope of Conditional Class and Production of Contact Information
Because plaintiff has met his preliminary burden to show that there are other similarly
situated employees, notice will be provided to current and former employees who worked as
servers at the restaurant from October 5, 2012 through October 5, 2015, the time period
alleged in the Complaint. (See ECF No. 1 at ¶ 17A.) To facilitate that notice, plaintiff requests
that defendant produce: “the first, middle (if applicable), and last name of each person who held
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The court notes that hearsay statements that may be inadmissible at trial may be considered at the notice stage
where the affiant has knowledge of the statement. Robinson v. Empire Equity Grp., Inc., No. WDQ-09-1603, 2009
WL 4018560, at *3, nn.16–17 (D. Md. Nov. 18, 2009) (considering affiant’s statement regarding knowledge of
defendant’s compensation of certain loan officers that affiant learned from speaking to those loan officers about how
they were paid).
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such a position, the position(s) held, all telephone numbers and email addresses on record, and
the dates of employment.” (ECF No. 20 at 14.) Defendants argue that plaintiff’s requests are
overbroad and specifically oppose plaintiff’s request for putative class members’ telephone
numbers and email addresses. (ECF No. 63 at 5.) Defendants argue that: “the entire process of
obtaining the Court’s approval of the Notice to be used in informing potential plaintiffs of the
existence of this lawsuit would be rendered superfluous if Plaintiff and their counsel are
permitted to contact plaintiffs by telephone and email and communicate information not
contained in the official Notice.” (Id.)
As to plaintiff’s request to receive “all telephone numbers…on record” of all potential
plaintiffs, the request is denied because plaintiff has not shown any special circumstances to
necessitate such production. McFeeley v. Jackson St. Entm’t, LLC, No. DKC-12-1019, 2012
WL 5928902, at *5 n.2 (D. Md. Nov. 26, 2012) (“Absent a showing by plaintiffs of special need
for the disclosure of class members’ telephone numbers, ordering such disclosure is not
appropriate.” (citations omitted) (internal quotation marks omitted)); see also Arevalo v. D.J.’s
Underground, No. DKC-09-3199, 2010 WL 4026112, at *2 (D. Md. Oct. 13, 2010) (denying
request to make contact by telephone, holding that plaintiffs’ counsel’s speculation that mailed
notices were not received did not outweigh inherent risks of improper solicitation and intrusion
into privacy).
Defendant’s objection to production of potential plaintiff’s email addresses, however, is
less persuasive. This court has recognized that e-mail communication is “now the norm” and in
numerous cases has directed FLSA defendants to produce such information. See Calder v. GGCBaltimore, LLC, No. BPG-12-2350, 2013 WL 3441178, at *3 (D. Md. July 8, 2013) (citing
Butler v. DirectSAT USA, LLC, 876 F. Supp. 2d 560, 575 (D. Md. 2012)).
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Accordingly, defendant is directed to supply plaintiff with identifying information for the
potential plaintiffs: full name, last known residential address, and last known e-mail address. 6
b. Content of Notice and Notice Methods
As to the content of the notice, plaintiff submitted a proposed notice, which defendants
argue is deficient. Plaintiff also requests an order compelling defendants to conspicuously post
the proposed notice on the premises of defendants’ restaurant, and to include a copy with the
paychecks of all employees, which defendants oppose. Pursuant to the FLSA, the notice must
provide accurate and timely notice to potential plaintiffs so they may make informed decisions
about whether to join a collective action.
McFeeley, 2012 WL 5928902, at *5 (citations
omitted). “The district court has broad discretion regarding the ‘details’ of the notice sent to
potential opt-in plaintiffs.” Id. (citation omitted).
Defendants’ argument rests on two related grounds. First, defendants object that the
proposed notice does not “consistently indicate that potential plaintiffs are free to seek advice
from counsel of their choosing…” (ECF No. 63 at 8–9.) Second, defendants argue that the
proposed notice improperly instructs class plaintiffs to submit their “opt-in” forms to plaintiff’s
counsel—not the court. (Id. at 9.) Defendants cite as authority Guzman v. VLM, Inc., No. 07CV-1126 (JG)(RER), 2007 WL 2994278, at *7–8 (E.D.N.Y. Oct. 11, 2007), in which the court
modified the proposed notice to clarify potential plaintiffs’ right to select an attorney other than
plaintiff’s counsel. In its Reply, plaintiff argues that the “opt-in” forms should be returned to
plaintiff’s counsel so that plaintiff may determine whether the potential class members have an
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As the potential class is of current and former servers only, defendants need not indicate the position(s) held, as
requested in Plaintiff’s Motion. (ECF No. 20 at 14.) Nor are defendants required at the notice stage to provide
information regarding each potential class member’s dates of employment—also requested by plaintiff. (Id.) While
such information would undoubtedly be pertinent to damages calculations, the purpose of the notice stage is merely
to advise potential plaintiffs of the existence of this suit and their right to “opt-in.” See Alderoty v. Maxim
Healthcare Servs., Inc., No. TDC-14-2549, 2015 WL 5675527, at *5 (D. Md. Sept. 23, 2015) (noting that, because
employees who join an FLSA action must affirmatively opt-in before the statute of limitation tolls, purpose of notice
stage is to ensure “timely, accurate, and informative” notice to potential class members).
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informed, sincere, and viable interest in pursuing their claims. (ECF no. 68 at 3–4.) Plaintiff
further contends that requiring the forms to be returned to the court would discourage potential
class members from pursuing their claims, and would create unnecessary work for the court. (Id.
at 4.)
Upon consideration of the parties’ arguments on this issue, I conclude that defendants’
concerns are adequately addressed by the language set forth in the appended notice clearly
advising potential plaintiffs that they have the right to obtain their own counsel.
As for
plaintiff’s request that notice be conspicuously posted in defendants’ restaurant, defendants have
advanced no arguments why plaintiff’s request should be denied. Moreover, this procedure is
commonly allowed when potential plaintiffs work in the same physical location. Mendoza v.
Mo’s Fisherman Exchange, Inc., No. ELH-15-1427, 2016 WL 3440007, at *21 (D. Md. June 22,
2016) (citations omitted). Under the circumstances, however, I find it unnecessary for defendant
to include the notice with all current employees’ paychecks. See Calderon v. Geico Gen. Ins.
Co., No. RWT-10-1958, 2011 WL 98197, at *8 (D. Md. Jan. 12, 2011) (declining to impose
upon defendants the cost of including “duplicative notice” with potential plaintiffs’ paychecks).
Accordingly, Plaintiff’s Motion will be granted in part and denied in part.
V.
Conclusion
For the reasons stated above, it is hereby ORDERED that:
1. Plaintiff’s Motion (ECF No. 20) is GRANTED;
2. The class is CONDITIONALLY CERTIFIED as to all individuals who worked as
servers at Acappella, LLC t/a Acappella Italian Restaurant at any time from
October 5, 2012 through October 5, 2015, and who were not informed of their
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right to retain all their tips except in a valid tip pooling arrangement and who
were paid less than the Maryland hourly minimum wage (the “Putative Class”);
3. Defendants shall, within 14 days of the entry of this Memorandum and Order,
provide to plaintiff’s counsel the full legal name, last known residential address,
and last known e-mail address of all Putative Class members;
4. Plaintiff may notify other potential plaintiffs by first-class mail and e-mail, using
the court-approved notice and consent form appended to this Order.
5. Defendants shall, within 14 days of the entry of this Memorandum and Order,
post a copy of the court-approved notice in a conspicuous place on the premises
of defendants’ Acappella Italian Restaurant.
Date: September 29, 2016
__________/ s /_______________
Beth P. Gesner
United States Magistrate Judge
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