Schilling et al v. Schmidt Baking Company, Inc.

Filing 41

MEMORANDUM OPINION. Signed by Judge Theodore D. Chuang on 7/20/2018. (jf3s, Deputy Clerk)

UNITED STATES DISTRICT COURT
DISTRICT OF MARYLAND

RONALD J. SCHILLING, JR., RUSSELL E.
DOLAN, JONATHAN A. HECKER,
MICHAEL MCEWEN, MICHAEL
HALAGER, DONALD L. BOLLINGER and
MARCEL HAMIL TON, Individually and on
Behalf of Other Similarly Situated Employees,
Civil Action No. TDC-16-2498.

Plaintiffs,
v.
SCHMIDT BAKING COMPANY, INC.,
Defendant.

MEMORANDUM OPINION
Plaintiffs Ronald J. Schilling, Jr., Russell E. Dolan, Jonathan A. Hecker, Michael
McEwen,

Michael

Halager,

Donald

L. Bollinger,

and

Marcel

Hamilton

(collectively,

"Plaintiffs"), acting as individuals and on behalf of all similarly situated individuals, have filed
this action against their employer

Schmidt Baking Company,

violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C.
have filed a pre-discovery

alleging

201-219 (2012). Plaintiffs

Motion for Conditional Certification and a Motion for Equitable

Tolling of the Statute of Limitations.
no hearing necessary.

SS

Inc. ("Schmidt"),

Having reviewed the submitted materials, the Court finds

D. Md. Local R. 105.6.

For the reasons set forth below, Plaintiffs'

Motions are GRANTED.
BACKGROUND
Schmidt, a br~ad production and distribution company based in Baltimore, Maryland,
provides baked goods to various establishments,

including restaurants, grocery stores, small

businesses, schools, pnsons, and warehouses, throughout the mid-Atlantic region.

Schmidt

employs Plaintiffs and other individuals as District Sales Managers ("DSMs"), whose formal job
description states that their function is to "manage" a particular geographic region in which
Schmidt's products are sold. CompI. ~ 30, ECF No. 1.
Plaintiffs allege that despite this job description, DSMs' primary duty is to assist a group
of "independent

operators"-independent

contractors who lease delivery routes and vehicles

from Schmidt in order to deliver Schmidt's products. ld. ~ 31. Because independent operators
are not Schmidt employees, DSMs have no authority over them. The primary way that DSMs
assist independent operators is by filling in for them in driving their delivery routes, which
generally take from 12 to 16 hours to complete.

DSMs also fix any mistakes made by

independent operators, including by retrieving incorrectly delivered products and delivering the
correct ones. DSMs can be called on to take on such duties at any time, including on scheduled
days off and before or after scheduled shifts, including overnight.

Due to understaffing, in

addition to assisting those independent operators operating within their own districts, DSMs are
called upon to make deliveries originating in other districts and to correct errors occurring in
those districts. Plaintiffs allege that, all told, they spend between 65 and 85 percent of their time
each week making deliveries. Due to the limited number of delivery vehicles at each distribution
center, DSMs use their personal vehicles to complete these deliveries approximately 90 percent
of the time.
DSMs spend the remainder of their time performing clerical duties, manual labor around
Schmidt's warehouses, and work at customers'

stores.

Their clerical duties include routine

office work such as collecting receipts for transactions, checking the status of current orders,
monitoring order adjustments, and responding to calls regarding the status of deliveries.

2

DSMs

are expected to respond to calls and emails whenever an issue arises, even when they are offduty.

Their manual

warehouses,

labor includes

unloading

and applying labels to products.

products

from delivery

Their work at customers'

trucks,

cleaning

stores includes

rearranging and stocking Schmidt's products on customers' shelves, retrieving stale or unused
products, and completing one or two "product resets" per store each year, which may include
changes ranging from replacing signs to constructing aisle displays. Id. ~ 65.
According to Plaintiffs, DSMs have no discretion in completing these tasks.

They

operate at the direction of Schmidt's Branch Managers, who are their direct supervisors, and
Area Sales Managers. Because DSMs are salaried employees paid weekly, they receive the same
salary regardless of how many hours they actually work. Although DSMs such as Plaintiffs are
scheduled to work between approximately 45 and 54 hours per week, because they are expected
to perform job functions even during their scheduled time off, they consistently worked between
70 and 85 hours per week, sometimes working more than 100 hours over a seven-day work
week.
On July 6, 2016, Plaintiffs Schilling, Dolan, and Hecker filed this action on behalf of all
DSMs, alleging that Schmidt has unlawfully failed to pay them overtime wages.
brought the case as both a collective action pursuant to the FLSA, 29 U.S.C.

S

Plaintiffs

216(b), and a

class action pursuant to Maryland state wage laws. On July 27, 2016, Schmidt filed a Motion to
Dismiss and for Summary Judgment.

On September 23, 2016, the Court (Motz, J.), construing

the motion as a Motion to Dismiss, granted it: Plaintiffs appealed that ruling. On November 17,
2017, the United States Court of Appeals for the Fourth Circuit affirmed the dismissal of
Plaintiffs'

state law claims but reversed the dismissal of the FLSA claim.

Upon remand,

Plaintiffs McEwen, Halager, Bollinger, and Hamilton joined the case as named Plaintiffs.

3

On

February 26, 2018, Plaintiffs filed a Motion for Conditional Certification, asking the Court to
conditionally certify an FLSA collective action on behalf of all Schmidt DSMs and to assist them
in identifying and notifying DSMs who are not currently parties to the Complaint.

That same

day, Plaintiffs filed a Motion for Equitable Tolling of the Statute of Limitations, asking the Court
to toll the deadline for a putative class member to file an FLSA claim during the period from July
27,2016, the date on which Schmidt filed its Motion to Dismiss and for Summary Judgment, to
the date the Court rules on the Motion for Conditional Certification.
DISCUSSION
I.

Motion for Conditional Certification
A.

Legal Standard

The FLSA generally requires that employees who work more than 40 hours in a week
receive overtime pay at the rate of one and one-halftimes
207(a).

their regular pay rate. See 29 U.S.C.

S

If an employer violates these rules, employees may sue their employers as individuals

or, if they choose, in a collective action on behalf of themselves and "similarly situated"
employees. 29 U.S.C.

S 216(b);

758 (4th Cir. 2011).

If employees choose to pursue a collective action, they may seek court-

see Simmons v. United Mortg. & Loan Inv., LLC, 634 F.3d 754,

approved notice to inform similarly situated employees that they may join the litigation. See
Hoffman-La

Roche v. Sperling, 493 U.S. 164, 169 (1989) (discussing the parallel collective

action provision under the Age Discrimination in Employment Act).
The collective action provision serves several purposes.
plaintiffs "the advantage
resources."

First, collective actions allow

of lower individual costs to vindicate rights by the pooling of

See id at 170.

Second, collective actions allow the courts efficiently to resolve

common issues in one proceeding.

See id Third, FLSA collective actions promote enforcement

4

of the law by empowering employees to "join in their litigation so that no one of them need stand
alone in doing something likely to incur the displeasure of an employer." See Pentland v. Dravo
Corp., 152 F.2d 851,853 (3d Cir. 1945).
Although the Fourth Circuit has not provided specific guidance on how to address a
motion for conditional certification of an FLSA collective action, decisions from other Courts of
Appeals have identified, and judges of the United States District Court for the District of
Maryland generally apply, a two-step process to test the sufficiency of the purported class: (1) a
pre-discovery determination that the purported class is similarly situated enough to disseminate
notice (the "notice stage") and (2) a post-discovery determination, typically in response to a
motion for decertification,

that the purported class is indeed similarly situated.

See, e.g.,

Thiessen v. General Electric Capital Corp., 267 F.3d 1095, 1102 (lOth Cir. 2001); Hipp v.
Liberty Nat'l Life Ins. Co., 252 F.3d 1208, 1218-19 (lIth Cir. 2001); Mooney v. Aramco, 54 F.3d
1207, 1213-14 (5th Cir. 1995); Randolph v. Powercomm Constr., Inc., 7 F. Supp. 3d 561, 575
(D. Md. 2014); Syrja v. Westat, Inc., 756 F.Supp.2d 682, 686 (D. Md. 2010). At the notice stage,
courts applying this process make a threshold determination

whether the class is similarly

situated based on "substantial allegations" in the pleadings and any submitted affidavits or
declarations.

See Thiessen, 267 F.3d at 1102. Then, once discovery is largely completed, such

courts perform a more stringent inquiry into whether the class is indeed similarly situated.
Mooney, 54 F.3d at 1214.
Because the record is sparse at the notice stage, courts often apply "a fairly lenient
standard." Id; Hipp, 252 F.3d at 1218 (noting that courts use a "fairly lenient standard" that
"typically results in 'conditional certification'"
575-76.

at the notice stage); Randolph, 7 F. Supp. 3d at

Thus, courts require no more than "substantial

5

allegations that the putative class

members were together the victims of a single decision, policy, or plan."
1102 (citations omitted); Randolph, 7 F.Supp.3d at 575-76.

Thiessen, 267 F.3d at

Although vague allegations with

meager factual support are generally insufficient to certify a class, proponents of conditional
class certification need not conclusively demonstrate that a class of similarly situated plaintiffs
exists. See Randolph, 7 F. Supp. 3d at 576; Syrja, 756 F. Supp. 2d at 686, (requiring "relatively
modest" evidence that the putative class members are similarly situated).
This Court will apply the two-step process because a modest inquiry into the propriety of
conditional

class certification

before issuing court-approved

purposes of the FLSA collective action provision.

notice is consistent

with the

Certainly, some threshold inquiry before

issuing notice to potential class members is appropriate to ensure that notice is not subject to
misuse and is "timely, accurate, and informative."

See Hoffman-La Roche, 493 U.S. at 171-72.

But it is equally important that the inquiry occur under a lenient standard to be consistent with
the FLSA's purposes of promoting efficient joint adjudication of claims, lowering the costs of
litigation to employee plaintiffs, and accounting for employees' natural reluctance to challenge
an employer. See id. at 170; Pentland, 152 F.2d at 853.
Finally, because all employees who join an FLSA collective action, unlike a class action
under Federal Rule of Civil Procedure 23, must affirmatively opt into the litigation as plaintiffs,
see Simmons v. United Mortg. & Loan Inv., LLC, 634 F.2d 754, 758 (4th Cir. 2011), it would be
unfair to impose an initial barrier significantly more stringent than the one imposed on ordinary
plaintiffs seeking to join a litigation under Rule 20. For these reasons, the Court will apply the
two-step process and the lenient standard at the notice stage.

6

B.

Conditional Certification

Here, the. Court finds that the members of the putative class are sufficiently similarly
situated to warrant conditional certification and notice. The Complaint alleges that DSMs are all
salaried employees who perform the same job functions.

Specifically, DSMs lack supervisory

authority, and their actual job duties include making deliveries in place of independent operators,
performing clerical duties, engaging in manual labor around Schmidt's warehouses, and working
at customers'

stores.

DSMs consistently work more than 40 hours per week, but they are

compensated with a weekly salary and thus do not receive overtime pay. They remain on call
and frequently receive assignments

outside of their standard work hours.

Plaintiffs have

submitted five affidavits from DSMs attesting to these facts.
This limited factual showing is more than sufficient to satisfy the lenient standard at this
stage. For example, in Butler v. DirectSAT USA, LLC, 876 F. Supp. 2d 560 (D. Md. 2012), the
court certified an FLSA collective action of technicians who installed DirecTV equipment based
on the finding that the plaintiffs had "made a modest factual showing that they are similarly
situated to other technicians based out of the Waldorf and Beltsville warehouses during the last
three years," because "technicians in these warehouses were all subject to the same ... company
policies and procedures, and ... they followed the same timekeeping policies and practices and
same compensation plan," "they typically worked in excess of sixty hours per week but were not
compensated for all of this time," and "warehouse managers and supervisors instructed [them]
not to record any overtime hours on [their] timesheets even though [they] routinely worked in
excess of forty hours in a given week." Id. at 568 (internal citations omitted). Other cases in this
District have likewise resulted in certification of a collective action under similar circumstances.
See, e.g., Desmond v. Alliance, Inc., No. CCB-14-3499, 2015 WL 2165115, at *3 (D. Md. May

7

7, 2015) ("Through their declarations, the plaintiffs have made the necessary modest factual
showing that they are similarly situated to other Coordinators and Leads. The plaintiffs' .detailed
declarations

suggest they performed the same job duties, and explain how overwork and

understaffing caused them to work more than 40 hours per week."); Yeibyo v. E-Park of EC, Inc.,
No. DKC 2007-1919, 2008 WL 182502, at *8 (D. Md. Jan. 18,2008) ("(U]nder the fairly lenient
standard used at the notice stage, Plaintiffs have proffered sufficient allegations of similarity"
because "each named plaintiff in this case asserts a common claim; i.e., that Defendants violated
the FLSA by failing to compensate him with overtime wages for his work as a parking
attendant. ").
Schmidt argues that conditional certification is inappropriate because the precise amount
of time each DSM spends engaging in particular duties varies based upon the needs of the
specific independent operators and establishments to which the DSM is assigned.
variance is of little concern at this early stage.

Any such

To warrant conditional certification,

members' positions "need not be identical, only similar."

class

Robinson v. Empire Equity Group,

Inc., No. WDQ-09-1603, 2009 WL 4018560, at *2 (D. Md. Nov. 18, 2009) (quoting Yeibyo,
2008 WL 182502, at *7)); see Desmond, 2015 WL 2165115, at *3 (citing Robinson).
point, the allegations of similarity set forth in the Complaint and Plaintiffs'
sufficient.

At this

affidavits are

To the extent that Schmidt argues that individualized inquiries into each DSMs'

actual duties are necessary to assess whether any DSMs are subject to the administrative
exemption to the FLSA's overtime requirements, the potential that certain DSMs are not eligible
for FLSA overtime is a merits-based question that need not be resolved at this stage. See Essame
v. SSC Laurel Operating Company LLC, 847 F. Supp. 2d 821, 826 (D. Md. 2012).

8

Nor does the Motor Carrier Act ("MCA") exemption to the FLSA, or the Fourth Circuit's
prior ruling regarding that exception, alter the Court's analysis. Schmidt argues that based on the
Fourth Circuit's ruling on the prior appeal in this case, DSMs are not similarly situated because
some are exempt from FLSA overtime requirements under the MCA exemption, but others are
not, depending on the number of hours the DSM spends driving light vehicles as part of their
duties. The MCA exemption generally provides that the FLSA' s overtime requirements do not
apply to "any employee with respect to whom the Secretary of Transportation has the power to
establish qualifications and maximum hours of service."

29 U.S.C. ~ 213(b)(l).

Because the

Secretary of Transportation has authority to regulate the employees of "motor carriers," see 49
U.S.C. ~ 31502(b) (2012), Schmidt's employees engaged in activities affecting vehicles used to
transport property in interstate commerce on public highways would normally be exempt from
the FLSA's overtime-wage requirements.

However, the SAFETEA-LU Technical Corrections

Act of 2008 ("TCA"), Pub. L. No. 110-244 ~ 306(a), 122 Stat. 1572, 1620 (2008), provides that
the FLSA's overtime-wage requirements nevertheless apply to any "covered employee."

Id ~

306(a). A "covered employee" includes, as relevant here, "an individual":
(l)

who is employed by a motor carrier ... ;

(2)

whose work, in whole or in part, is defined(A)
(B)

(3)

as that of a driver, driver's helper, loader, or mechanic; and
as affecting the safety of operation of motor vehicles weighing
10,000 pounds or less in transportation on public highways in
interstate or foreign commerce ... ; and

who performs duties on motor vehicles weighing 10,000 pounds or less.

Id ~ 306(c) (emphasis added). Applying this statutory framework, the Fourth Circuit held that
Schmidt's DSMs are "covered employees" "entitled to FLSA overtime wages for hours worked

9

in excess of 40 hours per week" because they spend "the majority of their working hours making
deliveries" and because "between 70% and 90% of their delivery trips [a]re made on vehicles
indisputably weighing less than 10,000 pounds." Schilling v. Schmidt Baking Co., Inc., 876 F.3d
596,602-03

(4th Cir. 2017).

Schmidt argues that a DSM is only a "covered employee," and therefore subject to the
FLSA overtime requirements, during those weeks when the employee has driven vehicles for
work weighing less than 10,000 pounds.

Schmidt asserts that because DSMs necessarily spend

different amounts of time making deliveries in their personal vehicles each week, individualized
determinations would be required to assess whether and for what time periods DSMs are covered
employees, such that they are not similarly situated.

This argument is unavailing for. two

reasons. First, and most significantly, the Fourth Circuit's ruling does not require this Court to
assess each Plaintiff's status as a covered employee on a week-to-week basis.

In the appeal, the

Fourth Circuit rejected Schmidt's argument that its employees are not "covered employees" if
they spend more than a de minimis amount of time operating large vehicles. Schilling, 876 F.3d
at 600.

Instead, the court held that because the definition of a covered employee includes

someone "whose work, in whole or in part" affects the safety of vehicle weighing 10,000 pounds
or less, the fact that the DSMs spent a "substantial percentage of time" driving small vehicles
was sufficient for them to be deemed covered employees, without defining any minimum
percentage of time.

Id. at 600, 603 & n.5.

Significantly, the Fourth Circuit held, without

qualification, that plaintiffs "[a]re entitled to FLSA overtime wages for hours worked in excess
of 40 hours per week."

Schilling, 876 F.3d at 602.

Nothing in the opinion suggests that a

DSM's status as a covered employee is based on meeting any particular threshold of work on
small vehicles during any given week.

10

Second, by its plain text, the TCA exception applies to employees based on their job
duties, not based on their actual work performed each week. See Pub. L. No. 110-244
122 Stat. 1572, 1621 (stating that a "covered employee" is "any employee ...
whole or in part, is defined ...

S 306(c),

whose work, in

as affecting the safety of operation of motor vehicles weighing

10,000 pounds or less") (emphasis added). The requirement that an employee "performs duties
on motor vehicles weighing 10,000 pounds or less," id.

S

306(c)(3), provides no specific time

period, whether a week or longer, during which such activities must occur. Particularly where
the FLSA is a remedial statute for which exemptions

should be narrowly construed, see

Schilling, 876 F.3d at 602, the Court declines to read into the statute a limitation unsupported by
its plain language.
Schmidt's argument therefore rests solely on a 2010 United States Department of Labor
("DOL")

Field Assistance

Bulletin

interpreting

the TCA to provide that "overtime

pay

requirements apply to an employee of a motor carrier . . . in any workweek in which the
employee works 'in whole'or in part,' as a driver ...

affecting the safety of operation of small

vehicles on public highways in interstate or foreign commerce."
Dep't

of

Labor,

Field

Assistance

Bulletin

https://www.dol.gov/whd/FieldBulletins/fab2010_2.htm
regulation promulgated after notice-and-comment
Division,

U.S.

Dep't

of

Labor,

https://www.dol.gov/whd/FieldBulletins/

Field

No.

Wage and Hour Division, U.S.

2010-2

(2010),

available

at

(emphasis added). The Bulletin is not a

and formal rulemaking.
Assistance

See Wage and Hour

Bulletins,

available

at

(stating that Field Assistance Bulletins "provide Wage

and Hour Division (WHD) investigators and staff with guidance on enforcement positions and
clarification of policies or changes in policy of WHD" and are "developed under the general
authority to administer the various laws enforced by WHD").

11

Accordingly, it is owed only

limited deference.

Christensen v. Harris County, 529 U.S. 576, 587 (2000) ("Interpretations

such as those in opinion letters-like
manuals, and enforcement
Chevron-style deference.").

interpretations

contained in policy statements, agency

guidelines, all of which lack the force of law-do
"(I]nterpretations

not warrant

contained in formats such as opinion letters are

entitled to respect under our decision in Skidmore v. Swift, 323 U.S. 134, 140,65 S. Ct. 161, 89
L. Ed. 124 (1944), but only to the extent those interpretations have the power to persuade."
Christensen, 529 U.S. at 587. Where it appears to conflict with the text of the statute, and it
predates the Fourth Circuit's ruling in Schilling which contemplates no such limitation, the
Bulletin's guidance is not persuasive.
For purposes of resolving the present motion, however, the Court need not decide
whether a DSM is a "covered employee" only for specific weeks in which the employee worked
on light vehicles.

Even if such a limitation applies, that would not provide a basis to deny

collective certification at this time. Plaintiffs' allegations, fairly construed, assert that all DSMs
conducted deliveries on light vehicles to a substantial degree.

If any particular DSM did not

work on a light vehicle during a given week, that would not change the fact that the DSM was a
"covered employee" for at least some period of employment and is thus similarly situated to
Plaintiffs. Regardless of the number of weeks of overtime pay to which a DSM would ultimately
be entitled as damages, they are similarly situated because the core question whether DSMs are
actually managers subject to the administrative exemption of the FLSA, 29 U.S.C.

S 213(a)(1),

is

common to all DSMs and is most appropriately answered on a collective basis.
To the extent that individualized assessments may need to be made to determine whether
there are weeks for which a particular DSM is not entitled to overtime pay, such findings do not
justify denying conditional certification under the lenient standard.

12

See Dunkel v. Warrior

Energy Services, Inc., 304 F.R.D. 193,201 (W.D. Pa. 2014) ("[W]hile it may turn out to be true
that the exact determination of uncompensated overtime hours will require the Court to make
individual assessments of how often each employee drove the smaller vehicles ... and in which
work weeks, it would be inappropriate to deny conditional 'certification'

now on that basis.").

Notably, in the cases cited by Schmidt in which courts have favorably cited the 2010 DOL
Bulletin, the court had granted conditional certification of a collective action and considered the
Bulletin later in the case, on the issue of class certification under Rule 23 or on summary
judgment. See, e.g., Moore v. Performance Pressure Pumping Services, LLC, No. 5:15-ev-432RCL, 2017 WL 1501436, at *2, *13 (W.D. Tex. Apr. 26, 2017) (denying plaintiffs' motion for
summary judgment, because "questions of material fact remain as to whether defendants are
entitled to any exemption under the FLSA," after granting a motion for conditional certification);
Cooper v. Noble Casing, Inc., No. 15-ev-1907-WJM-CBS,

2016 WL 6525740, at *1 (D. Colo.

Nov. 3, 2016) (denying a motion for class certification under Rule 23 after granting motion for
conditional certification).

If discovery reveals that some or all DSMs, in fact, do not drive light

trucks or their personal vehicles at all, Schmidt can re-assert its argument that the DSMs are not
similarly situated in a post-discovery Motion for Decertification.

See Dunkel, 304 F.R.D. at

202.
Finally,

the

Court

finds

unpersuaSlve

Schmidt's

argument

that

certification

is

inappropriate because a determination whether DSMs are subject to the TCA exception requires
an individualized assessment whether each DSM actually drove vehicles in interstate commerce
in each workweek.

The MCA exemption, by its own terms, would only exempt an employee

from FLSA overtime-wage
interstate commerce.

requirements

if that employee worked on vehicles engaged in

See 29 U.S.C. ~ 213(b)(1); 49 U.S.C. ~~ 13501-02,501,

13

31502(a). Thus,

a finding that a DSM did not work on vehicles engaged in interstate commerce would not exempt
that employee from the FLSA.
Thus, the Court finds that, at this stage, Plaintiffs' allegations that the DSMs are similarly
situated are sufficient. Therefore, the Court will conditionally certify the collective action and
will facilitate notice to those DSMs who are not currently parties to the Complaint.

C.

Notice

Having conditionally certified the collective action, the Court will authorize the provision
of notice to members of the putative class. Although Plaintiffs request certain specific rulings
relating to notice, such as authorization to post a notice at Schmidt and to use a webpage,
Schmidt requests an opportunity to discuss the form of notice with Plaintiffs.

Because the

arguments for and against specific notice provisions have yet to be fully articulated, and the
parties may reach a resolution of some or all of the disputes relating to notice, the Court will
decline to issue an order on the specific form or forms of notice and will instead require the
parties to meet and confer and submit a comprehensive, joint proposal regarding notice within 15
days.
II.

Motion for Equitable Tolling
FLSA claims are subject to a two-year statute of limitations, which is extended to three

years for willful violations.

29 U.S.C.

S 255(a).

An individual employee is not deemed to have

filed an FLSA action until the date that employee consents in writing to join the collective
action. 29 U.S.C.

S 256(b).

With only seven named Plaintiffs having joined the collective action

since the filing of the case in 2016, and delay in the case resulting from the earlier appeal,
Plaintiffs ask the Court to toll the statute of limitations on behalf of those putative class members

14

who would otherwise be barred from asserting FLSA claims for some or all of the time period of
alleged violations.
The Fourth Circuit has described equitable tolling as "a discretionary doctrine that turns
on the facts and circumstances of a particular case [and] does not lend itselfto bright-line rules."
Harris v. Hutchinson, 209 F.3d 325, 330 (4th Cir. 2000) (quoting Fisher v. Johnson, 174 F.3d
710, 713 (5th Cir. 1999)). "[A ]ny invocation of equity to relieve the strict application of a statute
of limitations must be guarded and infrequent, lest circumstances of individualized hardship
supplant the rules of clearly drafted statutes." Harris, 209 F.3d at 330.

Generally, equitable

tolling is available when (l) "the plaintiffs were prevented from asserting their claims by some
kind of wrongful conduct on the part of the defendant," or (2) "extraordinary

circumstances

beyond plaintiffs' control made it impossible to file the claims on time." Cruz v. Maypa, 773
F.3d 138, 146 (4th Cir. 2014) (quoting Harris, 209 F.3d at 330)).
Plaintiffs argue that both of these circumstances are present here. Specifically, Plaintiffs
argue that equitable tolling is justified by the extraordinary delay in this case arising from the
dismissal of the FLSA claims and the reversal of that dismissal on appeal, which prevented
putative class members from asserting their claims in a timely manner.

They also assert that

Schmidt engaged in wrongful conduct, consisting of a threat by a Schmidt Vice President that
putative class members should not join the collective action, which warrants equitable tolling.
The Court agrees with Plaintiffs that the unique circumstances
equitable tolling.

of this case warrant

Generally, ordinary litigation delay is not considered an "extraordinary

circumstance" warranting equitable tolling. See, e.g., Sandoz v. Cingular Wireless, LLC, 700 F.
App'x 317, 321 (5th Cir. 2017); LaFleur v. Dollar Tree Stores, Inc., No. 2:12-cv-00363, 2012
WL 4739534, at *5 (E.D. Va. Oct. 2, 2012); MacGregor v. Farmers Ins. Exchange, No. 2:10-

15

CV-03088, 2011 WL 2731227, at *2 (D.S.C. JuI. 13, 2011), Here, however, Plaintiffs' FLSA
claim was dismissed on September 23, 2016, the Fourth Circuit reversed that dismissal on
November 17,2017, and the mandate on that reversal was issued on December 11,2017.

In the

interim, no putative class member would have had reason to believe that the claim was
meritorious and worthy of the risk of joining the collective action.

Where the ruling of the

district court, which was later adjudged to be incorrect, caused a delay of approximately

15

months, accounting for more than half the limitations period, the Court finds an "extraordinary"
circumstance that by itself warrants equitable tolling.

See Jackson v. Bloomberg, L.P., 298

F.R.D. 152, 171 (S.D.N.Y. 2014) (granting equitable tolling during the nine-month period during
which a motion for conditional certification of a collective action was pending).

Cf Nedds v.

Calderon, 678 F.3d 777, 782 (9th Cir. 2012) (finding, in the habeas context, that good-faith
reliance upon later-overturned circuit precedent was an extraordinary circumstance warranting
equitable tolling).
Furthermore, Plaintiffs have introduced an affidavit stating that in August 2016, shortly
after the filing of the Complaint, a Vice President of Schmidt told a group of more than a dozen
DSMs that he "better not find out any of you joined this lawsuit."

McEwen Aff. ,-r 5, ECF No.

26-8. The Schmidt Vice President denies making such a threat. Although such a threat, if made,
could constitute wrongful conduct warranting equitable tolling, resolution of this factual dispute
would be time consuming and is unnecessary at this time. The reality is that, whether or not an
overt threat was made, any DSM who wished to continue working at Schmidt would have risked
antagonizing

his or her employer by asserting an FLSA claim.

Next to this risk stood a

possibility of reward that, once the district. court had dismissed the case, appeared remote, at
best, until the dismissal was overturned by the Fourth Circuit over a year later.

16

Under the

specific facts of this case, putative class members could not realistically have been expected to
assert their FLSA claim in a timely manner.
Schmidt notes that some courts have declined to grant equitable tolling to putative
members of an FLSA collective action, whether because counsel for the named plaintiffs do not
actually represent those individuals or because the court cannot assess the diligence of unknown
individuals. See, e.g., Atkinson v. Teletech Holdings, Inc., No. 3:14-cv-253, 2015 WL 853234, at
*8 (S.D. Ohio Feb. 26, 2015); In re Amazon. com, Inc., Fulfillment Center Fair Labor Standards
Act and Wage and Hour Litigation, MDL No. 2504,2014 WL 3695750, at *3 (W.D. Ky. Jui. 24,
2014). However, the vast majority of courts have allowed named plaintiffs to request such relief.
See, e.g., Chime v. Peak Security Plus, Inc., 137 F. Supp. 3d 183, 188,204-05

(E.D.N.Y. 2015);

Jackson v. Bloomberg, L.P., 298 F.R.D. 152, 171 (S.D.N.Y. 2014); Struck v. PNC Bank, 931 F.
Supp. 2d 842, 849 (S.D. Ohio 2013); Stransky v. HealthONE of Denver, Inc., 868 F. Supp. 2d
1178, 1181-82 (D. Colo. Jun. 14,2012); Putnam v. Galaxy 1 Marketing, Inc., 276 F.R.D. 264,
276 (S.D. Iowa 2011). In the Court's view, the majority approach is appropriate when applying
a doctrine grounded in equity.
Where individuals have a potentially meritorious FLSA claim, but are prevented from
asserting that claim by extraordinary circumstances not of their own making, the proper course is
to toll the statute of limitations to allow adjudication of their claim on the merits. Accordingly,
the Court will Grant Plaintiffs' Motion for Equitable Tolling. The statute of limitations will be
tolled from July 27,2016 until the date notice is disseminated.

17

CONCLUSION
For the foregoing reasons, Plaintiffs' Motion for Conditional Certification and Motion for
Equitable Tolling of the Statute of Limitations are GRANTED.

The parties will be directed to

submit a joint proposal relating to notice of the collective action within 15 days.
order shall issue.

Date:

July 20,2018
THEODORE D. CHU
United States District

18

A separate