Amaya et al v. DGS Construction, LLC et al
Filing
152
MEMORANDUM OPINION. Signed by Judge Theodore D. Chuang on 7/10/2018. (heps, Deputy Clerk)
UNITED STATES DISTRICT COURT
DISTRICT OF MARYLAND
MARIO RNESTO AMA YA,
JOSE N RLAND GONZALEZ and
JOSE A ADEO CASTILLO,
P aintiffs,
v
Civil Action No. TDC-16-3350
STRUCTION, LLC and
ITING- TURNER CONTRACTING
Y,
MEMORANDUM OPINION
P aintiffs Mario Ernesto Amaya, Jose NorIan Gonzalez, and Jose Amadeo Castillo,
former
arpenters employed by Defendant DGS Construction, LLC, d/b/a Schuster Concrete
ion ("Schuster"), on the construction of the MGM Resort Casino at National Harbor in
Prince
eorge's County, Maryland, have brought suit against Schuster and Defendant The
Whiting Turner Contracting Company ("Whiting-Turner")
and Ho
Law ("MWHL), Md. Code Ann., Lab & Empl.
for violations of the Maryland Wage
SS 3-401
to 3-431 (West 2016), and the
Wage Payment and Collection Law ("MWPCL"), Md. Code Ann., Lab & Empl.
501 to
SS 3-
-509, as well as for state law claims of breach of contract and unjust enrichment.
Plaintiff: . also seek a declaratory judgment that they are third-party beneficiaries of a Project
Labor A reement ("PLA") signed by Whiting-Turner and various trade unions. Plaintiffs allege
that Sch ster failed to pay Plaintiffs at the rate for carpenters for every hour worked and failed to
pay cert in fringe benefits for overtime work as required by the PLA. Pending before the Court
are Plaintiffs' Motion for Class Certification and Motion for Leave to Amend the Complaint.
For the reasons set forth below, both Motions are granted.
BACKGROUND
I.
Project Pay Requirements
Whiting- Turner served as the Project Contractor for the construction of the MGM Resort
Casino at National Harbor ("the Project").
On April 30, 2014, Whiting-Turner and 16 trade
unions entered into the PLA, which governed various aspects of the construction of the Project.
The PLA defines the Signatories of the PLA as "all construction contractors and subcontractors
of whatever tier engaged in on site construction work within the scope of this Agreement that
sign this Agreement or a letter of assent thereto."
PLA ~ 1.2, Motion for Class Certification
("MCC") Ex. 4, Joint Record ("J.R.") 46, ECF No. 118. The PLA further states that WhitingTurner "shall require all contractors and subcontractors who have been awarded contracts for
work covered by this Agreement" to execute a Letter of Assent binding them to the terms and
conditions of the PLA "prior to commencing work." Id. ~ 2.1.1, J.R. 48. In paragraph 12.5, the
PLA also provides that:
In the event that the Project Contractor or a Signatory does not receive at least
three bids on any trade package from contractors or subcontractors that are
qualified to perform the work identified in the trade package and have the
business resources necessary to perform the work and which may also have been
prequalified prior to bidding ("Qualified Contractor") and are signatories to a
collective bargaining agreement with a Union with jurisdiction over the work to
be performed, then that trade package shall be exempt from the requirements of
this Agreement; provided, however that the Agreement shall apply if the lowest
bidder on the trade package is a Qualified Contractor and is a signatory to such a
collective bargaining agreement.
Id. ~ 12.5, J.R. 61. The same provision, however, clarified that:
Exemption from this Agreement shall not automatically relieve the successful
bidder from complying with Project based requirements, such as, but not limited
to, safety and quality programs. For all contractors working on the project,
2
payment of prevailing wages and fringe benefit rates ofthe project as indicated on
the Maryland Department of Labor, Licensing, and Regulation Informational
Wage Rate for Prince George's County determined at the commencement of the
Project, which Developer has voluntarily adopted for the Project, shall be a
minimum requirement and contractors are free to provide wages and fringe
. benefits at rates in excess of such prevailing rates.
Id
On December 4,2014, Schuster entered into an express contract with Whiting-Turner to
perform concrete work on the Project.
Since only one contractor with a signed collective
bargaining agreement bid on the concrete contract, Schuster did not sign a Letter of Assent or
similar document expressly agreeing to the terms of the PLA. However, as a subcontractor on
the Project, Schuster was subject to the Whiting-Turner Project Manual, which established basic
hourly rates and fringe benefit payments for various classifications of workers.
For example, a
"Carpenter" on the Project was required to receive a basic hourly rate of $26.81 and a fringe
benefit payment of $8.19 per hour, while a "Laborer - Air Tool Operator" was required to
receive an hourly payment of$19.92 and a fringe benefit of $2.94 per hour. J.R. 71. According
to the Project Manual, these rates were derived from the Maryland Department
of Labor
Licensing and Regulation, Informational Wage Rates for Prince George's County.
Prior to June 10,2015, every new Schuster employee on the Project was first placed in a
"provisional" status upon hiring. J.R.285.
While in this provisional status, employees were paid
at the hourly rate for the type of work that they performed.
For example, if an individual
performed two hours of work as a laborer on a particular day, and six hours as a carpenter, that
individual would be paid for two hours of work as a laborer and six hours as a carpenter,
regardless of skill or experience.
During this provisional period, Schuster supervisors would
evaluate the employee's skills and performance and recommend a permanent job title. Once the
employee was approved for a permanent job title, the employee was paid at or above the
3
corresponding rate for all work. For example, if that same individual had a permanent title of
carpenter and performed two hours of work as a laborer and six as a carpenter, that employee
would be paid for eight hours as a carpenter.
According to Schuster, it paid its employees overtime pay for all hours worked in excess
of 40 hours per work week.
However, Schuster did not pay fringe benefits for these hours.
Therefore, a carpenter would be paid $26.81 in hourly pay and $8.19 in fringe benefits for the
first 40 hours worked each week, but $40.22 in hourly pay and no fringe benefits for each hour
worked in excess of 40.
Schuster also maintained a system for auditing the hours worked by its employees on the
Project. Schuster employees, known as "Work Reporters," distributed daily employee log sheets
("Daily EE Logs") to forepersons and other supervisors, with instructions to record the type of
work performed by each employee and the duration of that work. J.R. 302. At the end of each
day, employees were asked to sign the log, which contained the following statement, printed in
English and Spanish: "[B]y signing, I am verifying the accuracy of hours worked outside my
normal classification."
See, e.g., J.R. 472. According to Schuster, employees were directed not
to sign the Daily EE Log if it was missing information or was incorrect, and were instead
instructed to open a "trouble ticket" to document the request and track it to its resolution.
J.R.
302-03. The record contains 16 of these trouble tickets, which generally show Schuster's efforts
either to correct errors such as missing or misclassified work hours, or to explain to employees
that they were paid properly for their work. For example, on June 22, 2015, a Schuster employee
complained that he was missing carpentry hours for work he performed on walls and columns.
According to the ticket, a Schuster supervisor spoke with the employee and explained that he did
4
not receive the carpenter rate for the work, which consisted of clamping together pre-fabricated
panels, because it did not qualify as carpentry work.
II.
Plaintiffs and the Proposed Class
Plaintiffs were each employed by Schuster during several months in 2015. Amaya began
work on the Project as a provisional employee on May 11, 2015 and was upgraded to the job title
of carpenter on June 15,2015.
While employed by Schuster, Amaya was paid as a carpenter for
952.39 hours and as a laborer for 23.73 hours.
Gonzalez began work on the Project on April 27, 2015 as a provisional employee and
was upgraded to carpenter on June 29, 2015. On May 20,2015, while he was still classified as a
provisional employee, Gonzalez refused to sign his Daily EE Log because he did not agree with
the classification of 2.25 hours of work as laborer. work. Following an investigation, Schuster
concluded that Gonzalez worked for two different crews that day, and that the time recorded
under the laborer rate was actually spent as a carpenter. On July 2, 2015, Gonzalez was awarded
$28.30 in retroactive pay for the misclassification.
In total, Gonzalez was paid for 1,225 hours as
a carpenter and 64.75 hours as a laborer.
Castillo began work on the Project on March 23,2015 as a provisional employee and was
upgraded to the title of carpenter on June 8, 2015. Overall, Castillo was paid for 324 hours as a
carpenter and 5.5 hours as a laborer.
In identical affidavits, Amaya and Gonzalez state that Schuster regularly logged hours
worked by carpenters as time worked as a laborer.
Each further alleges that he was forced to
sign documents stating that he had worked certain hours as a laborer, when in fact he had worked
as a carpenter.
All three Plaintiffs assert that they were told by Schuster supervisors that they
5
would not be paid if they did not sign the records, and that they sometimes were forced to sign
records that were not filled out yet.
Plaintiffs have identified approximately 1,600 employees who allegedly were not paid
overtime fringe benefits.
They have further identified at least 388 employees who were
classified as carpenters on the Project. Plaintiffs retained a certified public accountant to analyze
the potential damages in lost wages and benefits owed to all construction employees employed
by Schuster on the Project. According to the expert's report, carpenters employed on the Project
were underpaid by approximately $4.35 million, based on (1) hours paid at the laborer rate when
they should have been paid at the carpenter rate and (2) hours for which carpenters were
otherwise not paid at the carpenter rate. The report further concludes that Schuster failed to pay
its Project employees approximately $1.11 million in overtime fringe benefits.
DISCUSSION
I.
Motion for Class Certification
In their Motion for Class Certification, Plaintiffs seek certification of two classes.
The
"Overtime Fringe Benefit Class" is composed of "(a]ll current and former employees who were
employed in. any craft worker classification by Defendant Schuster at the MGM Resort Casino at
National Harbor and worked overtime hours." MCC at 1, ECF No. 59. The "Carpenter Class"
consists of "all current and former employees who were employed by Defendant Schuster at the
MGM Resort Casino at National Harbor and performed carpentry work."
Id. The Court will
first discuss the legal standard for class certification, then consider each proposed class in turn.
A.
Legal Standard
A class action allows representative parties to prosecute not only their own claims, but
also the claims of other individuals which present similar issues.
6
Thorn v. Jefferson-Pilot Life
Ins. Co, 445 F.3d 311, 318 (4th Cir. 2006). The use of a class action is primarily justified on the
grounds of efficiency, because it advances judicial economy to resolve common issues affecting
all class members in a single action.
Id.
Because of the need to protect the rights of absent
plaintiffs to assert different claims and of defendants to assert facts and defenses specific to
individual class members, courts must conduct a "rigorous analysis" of whether a proposed class
action meets the requirements of Federal Rule of Civil Procedure 23 before certifying a class.
See id. Courts have wide discretion to certify a class based on their familiarity with the issues
and potential difficulties arising in class action litigation. See, e.g. Ward v. Dixie Nat. Life Ins.
Co., 595 F.3d 164, 179 (4th Cir. 2010).
A plaintiff has the burden to show that all of the
necessary prerequisites for a class action have been met. Gunnells v. Healthplan Serv., Inc., 348
F.3d 417, 458 (4th Cir. 2003).
The first of these prerequisites is that the class must exist and be "readily identifiable" or
"ascertainable" by the court through "objective criteria." EQT Prod. Co v. Adair, 764 F.3d 347,
359-60 (4th Cir. 2014). While it is not necessary to identify every class member at the time of
certification for a class to be "ascertainable," a class cannot be certified if its membership must
be determined through "individualized fact-finding or mini-trials."
Id. at 358. For example, in
EQT, the court concluded that a proposed class of all individuals who owned an interest in a gas
estate was not ascertainable because the actual owners could be determined only through an
individualized review ofland records. Id. at 359-60.
If a class is ascertainable,
it must then satisfy all four elements of Rule 23(a):
numerosity, commonality, typicality, and adequacy.
To satisfy the numerosity requirement, the
proposed class must be so numerous that 'joinder of all members is impracticable."
P.23(a)(1).
Fed. R. Civ.
In the assessment ofthis element, "numbers alone are not controlling," and a district
7
court should consider "all of the circumstances of the case" when deciding if this requirement
has been met. Ballard v. Blue Shield ofS. W Va., Inc., 543 Fold 1075, 1080 (4th Cir. 1976). The
United States Court of Appeals for the Fourth Circuit has stated that 74 members is "well within
the range appropriate fo~ class certification," Brady v. Thurston Motor Lines, 726 Fold 136, 145
(4th Cir. 1984), and has upheld the certification of a class with as few as 18 members, Cypress v.
"Newport News Gen. and Nonsectarian
Hosp. Ass'n,
375 Fold 648, 653 (4th Cir. 1967).
However, the burden is on the plaintiffs to show that other class members exist and that their
joinder is impracticable; a court may not rely on mere speculation that numerosity has been
satisfied. See Hayes v. Wal-Mart Stores, Inc., 725 F.3d 349, 356-57 (3d Cir. 2013); Poindexter
v. Teubert, 462 Fold 1096, 1097 (4th Cir. 1972).
Commonality requires that a class have "questions of law or fact common to the class"
which are capable of classwide resolution, such that the determination of the truth or falsity of
the common issue "will resolve an issue that is central to the validity of each one of the claims in
one stroke." Fed. R. Civ. P. 23(a)(2); Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338,350 (2011).
As for typicality, the named plaintiff must be "typical" of the class, such that that the
class representative's
claim and defenses are "typical of the claims or defenses of the class" in
that prosecution of the claim will "simultaneously tend to advance the interests of the absent
class members."
Cir.2006).
Fed. R. Civ. P. 23(a)(3); Deiter v. Microsoft Corp., 436 F.3d 461, 466-67 (4th
The plaintiffs claim "cannot be so different from the claims of absent class members
that their claims will not be advanced by" proof of the plaintiffs
436 F.3d at 466-67.
own individual claim. Deiter,
In analyzing this question, a court compares the class representative's
claims and defenses to those of the absent class members, considers the facts needed to prove the
class representative's
claims, and assesses the extent to which those facts would also prove the
8
claims of the absent class members.
Id.
These claims do not have to be factually or legal
identical, but the class claims should be fairly encompassed by those of the named plaintiffs.
Broussardv. Meineke Discount Muffler Shops, Inc., 155 F.3d 331,344 (4th Cir. 1998).
Finally, the named plaintiff must "fairly and adequately protect the interests of class"
without a conflict of interest with the absent class members.
Fed. R. Civ. P. 23(a)(4); Ward v.
Dixie Nat'l Life Ins. Co., 595 F.3d 164, 179-80 (4th Cir. 2010). A conflict of interest will not
defeat the adequacy requirement when "all class members share common objectives[,] the same
factual and legal positions, and ... the same interest in establishing the liability of defendants."
Ward, 595 F.3d at 180 (quoting Gunnells, 348 F.3d at 430). Moreover, the conflict must not be
"merely speculative or hypothetical."
Id.
If the named plaintiff satisfies each of these requirements under Rule 23(a), the Court
must still find that the proposed class action fits into one of the categories of class action under
Rule 23(b) in order to certify the class. Under Rule 23(b)(1), a class action may be maintained if
the plaintiff shows that absent a class action, there is a risk of "inconsistent
or varying
adjudications" across individual class members that would result in "incompatible standards of
conduct" for the defendant, or a risk of individual adjudications resulting in dispositive rulings
that "substantially impair or impede" the ability of other plaintiffs to protect their interests.
Fed.
R. Civ. P. 23(b )(1). A class action is also maintainable if the defendant has "acted or refused to
act on grounds that apply generally to the class," such that injunctive or declaratory relief
applying to the whole class is appropriate.
Fed. R. Civ. P. 23(b)(2). Finally, a class action may
be maintained under Rule 23(b)(3) if common questions of law or fact "predominate over any
questions affecting only individual members" and a "class action is superior to other available
methods for fairly and efficiently adjudicating the controversy."
9
Fed. R. Civ. P. 23(b)(3).
Although similar to Rule 23(a)'s commonality requirement, the test for predominance under
Rule 23(b )(3) is "far more demanding" and "tests whether proposed classes are sufficiently
cohesive to warrant adjudication by representation."
623-24 (1997).
The predominance
Amchem Prods. v. Windsor, 521 U.S. 591,
and superiority requirements
under Rule 23(b )(3) are
designed to ensure that the class action "achieve [s] economies of time, effort, and expense, and
promoters]
...
uniformity of decision as to persons similarly situated, without sacrificing
procedural fairness or bringing about other undesirable results."
(quoting Amchem, 521 U.S. at 615).
Gunnells, 348 F.3d at 424
If the named plaintiff satisfies all of the Rule 23(a)
requirements and one of the Rule 23(b) requirements, then class certification is appropriate.
Finally, the Court notes that a decision to certify a class is based on whether or not a
putative class satisfies the Rule 23 factors, not on a preliminary assessment of the underlying
merits of the claim.
See Eisen v. Carlisle & Jacquelin,
417 U.S. 156, 178 (1974) ("In
determining the propriety of a class action, the question is not whether the plaintiff or plaintiffs
have stated a cause of action or will prevail on the merits, but rather whether the requirements of
Rule 23 are met.").
B.
Overtime Fringe Benefits Class
Defendants do not significantly contest the certification of the Overtime Fringe Benefits
Class.
Schuster devotes its entire Memorandum
in Opposition
to the Motion for Class
Certification to opposing the Carpenter Class and does not challenge any aspect of the Overtime
Fringe Benefits Class.
Whiting- Turner nominally opposes class certification of the Overtime
Fringe Benefits Class, but its arguments are entirely on the merits of Plaintiffs' claim and are
thus not relevant to the analysis. See id.
10
The Overtime Fringe Benefits Class is clearly ascertainable,
satisfies the Rule 23(a)
factors, and meets the predominance and superiority requirements of Rule 23(b)(3). There is no
dispute that Schuster can identify those workers who were not paid overtime fringe benefits
without a significant administrative burden. On numerosity, there are at least 100 members, and
possibly up to 1,600 members, making joinder of all members impractical.
On commonality,
Schuster admits that it did not pay any of its workers fringe benefits for overtime hours worked,
and the legality of this policy is a question that not only is common to the class, but also
predominates over any other factor or defense that each individual class member might have on
this claim, such that a class action is a superior, more efficient means to resolve this dispute. As
for typicality, the named Plaintiffs' claims that they were not paid fringe benefits for overtime
hours worked, and their legal arguments regarding the applicability of the PLA's provisions to
Schuster and Whiting-Turner' s responsibility to enforce the agreement, are identical to the
claims and arguments that would be offered by other proposed class members.
Adequacy is
satisfied because there is no apparent conflict of interest, and Plaintiffs' counsel is experienced in
complex civil litigation. Accordingly, the Court will grant the Motion for Class Certification as
to the Overtime Fringe Benefits Class.
C.
Carpenter Class
As was the case for the Overtime Fringe Benefits class, there is no significant dispute that
the Carpenter Class satisfies the requirements of ascertainability, numerosity, and adequacy. The
class consists of every employee classified as a carpenter on the Project, estimated at 388
individuals,
who can be identified
administrative burden.
from Schuster's
payroll
records
without
significant
Likewise, there is no apparent conflict of interest between the named
11
Plaintiffs and their counsel and the rest of the class members.
Therefore, the Court finds that
these factors are satisfied.
Defendants, however, dispute that typicality and commonality have been established.
Schuster argues that Plaintiffs cannot be considered "typical" of any putative class because they
were paid at carpenter rates for almost all of the hours they worked, with Amaya receiving pay at
the carpenter rate for 98 percent of his hours, Gonzalez receiving the carpenter rate for 94
percent of his hours, and Castillo receiving that rate 95 percent of the time.
But the test for
typicality is whether the facts relied upon by the plaintiffs to prove their claims "would also
prove the claims of the absent class members," not whether they have suffered the same or
greater damages than the average class member.
See Deiter, 436 F.3d at 466-67 (noting that
typicality is established if "as goes the claim of the named plaintiff, so go the claims of the
class"). Here, Plaintiffs are advancing claims for the higher rate for those hours for which they
were not paid as carpenters, and the core of these claims is Plaintiffs'
impermissible
performed.
position that it is
to pay a carpenter at a rate below the carpenter rate, regardless of the work
Other than the number of hours worked at a lower rate, the facts and theories
underlying Plaintiffs' claims will mirror those of other Carpenter Class members.
The Court
therefore finds that typicality has been satisfied for the Carpenter Class.
On commonality, Schuster argues that Plaintiffs have not made a showing that it engaged
in a pattern or practice of failing to pay carpenters the prevailing carpenter wage rate for every
hour worked.
The three named Plaintiffs have offered affidavits attesting to this practice and
stating that, under the threat of not getting paid at all, they were forced to sign records either
certifying that some of their hours were laborer hours, or leaving the type of hours blank, only to
have those records filled in to classify some work as payable at the laborer, rather than carpenter,
12
wage rate. They also offer records, such as those relating to Employees #005992 and #101012,
which appear to show that certain carpenters were at one point paid at the laborer rate, then at the
carpenter rate, then again at the laborer rate multiple months later.
Although Schuster has
offered explanations for the various "trouble tickets" and noted that pay adjustments in the
employee's
favor were sometimes made, those explanations effectively acknowledge that in
several cases, including ticket numbers 000025, 000120, 000031, 000147, 000213, and 000032,
Schuster applied the carpenter rate only to work qualifying as carpenter work, not to all work
performed by qualified carpenters. See Schuster Opp'n MCC at 20-21, ECF No. 91. While it is
unclear whether these trouble tickets related to provisional employees, permanent laborers, or
permanent carpenters, they are consistent with Plaintiffs' assertion that Schuster had a policy of
paying carpenters at the carpenter rate only for carpenter work.
Schuster argues that these factual allegations are insufficient to support a finding of
commonality based on Wal-Mart v. Dukes, 564 U.S. 338 (2011), and related cases. In Wal-Mart,
the United States Supreme Court held that the plaintiffs had failed to demonstrate commonality
because 120 affidavits submitted by Wal-Mart employees describing sex discrimination
at
various stores nationwide did not constitute "significant proof that an employer operated under a
general policy of discrimination."
!d. at 353. Here, Plaintiffs' offering of three affidavits from
Plaintiffs and a limited number of examples arising from payment records, out of 388 putative
class members, is less than ideal to establish a pattern or practice of unlawful conduct.
See
Brown v. Nucor Corp., 785 F.3d 895, 912-13 (4th Cir. 2015) (finding that affidavits alleging
discrimination from approximately one out of every 6.25 class members was "substantially more
probative than that in Wal-Mart" of a pattern and practice of companywide discrimination).
The
Wal-Mart plaintiffs, however, were seeking certification of a nationwide class, across 3,400
13
stores, asserting claims of employment discrimination by employees in different jobs at different
levels of the organization,
where the corporate policy was to allow "discretion
supervisors over employment matters."
much narrower finding.
by local
Wal-Mart, 564 U.S. at 355-56. Here, Plaintiffs seek a
They seek to establish commonality for claims of a single class of
employees--earpenters-working
within
a
single
construction
project
with
common
management, based on an alleged pattern and practice of failing to pay the prevailing carpenter
wage. Wal-Mart is therefore not dispositive.
Although
Plaintiffs'
Plaintiffs have nevertheless
pattern or practice allegations
could have been more robust,
established commonality based on their allegation that Schuster
violated the PLA by regularly failing to pay carpenters at the carpenter rate for certain work
while they were in a "provisional"
status at the outset of their employment.
Schuster
acknowledges that it had such a policy and applied it uniformly to employees who worked on the
Project. If Schuster's policy of temporarily placing an employee in a provisional status is found
to be invalid, then Schuster would likely be liable for unpaid wages for every carpenter paid at
the laborer rate during the provisional period. The claim that the provisional status policy was
invalid is thus a "common contention" establishing commonality for the Carpenter Class because
"the determination of its truth or falsity will resolve an issue that is central to the validity of each
one of the claims in one stroke."
acknowledged
Wal-Mart, 564 U.S. at 350.
policy extended beyond the provisional
Likewise, whether that
period, as suggested by Plaintiffs'
affidavits and payroll record evidence, presents a common question central to the class claims
and subject to common resolution;
The question of whether such a policy was valid would
predominate over individual fact issues because its answer would necessarily resolve whether
carpenters would be entitled to damages for every hour paid as a laborer. Therefore, the Court
14
finds that the Carpenter Class has satisfied both the commonality requirement of Rule 23(a) and
the more stringent predominance requirement under Rule 23(b)(3).
Although
a finding that the provisional
policy was valid may jeopardize
class
certification because it could require an individualized assessment of each carpenter's claim of
improper payments at the laborer rate, that possibility is not a valid basis for failing to certify the
Carpenter Class at this point. In United Steel, Paper & Forestry, Rubber, Mfg. Energy, Allied
Indust. & Servo Workers Int'l Union, AFL-CIO, CLC v. ConocoPhillips Co., 593 F.3d 802 (9th
Cir. 2010)
("United
Steel"),
oil refinery
workers
brought
suit against
their employer,
ConocoPhillips, alleging that they were forced to remain "on duty" during their lunch break, in
violation of California law. Id. at 804. Plaintiffs argued that ConocoPhillips had a uniform
policy of requiring operators to respond to their radios and alarms during the lunch breach that
provided the basis for class certification. Id. at 804 & n.3. The district court rejected this theory,
concluding that "there could be no assurances that plaintiffs would prevail on their 'on duty'
theory," such that "the inquiry would then shift to whether plaintiffs actually missed meal
breaks, and the Court would be faced with a case requiring individualized trials on each class
member's meal period claims."
Id. at 808. The United States Court of Appeals for the Ninth
Circuit reversed this decision, finding that the district court "abused its discretion by declining
certification based on the possibility that the plaintiffs would not prevail on the merits of their
'on duty' theory." Id. The Ninth Circuit noted that the district court had discretion to modify a
class certification order based on subsequent developments in the case, including decertifying the
class if the "on duty" theory was eventually rejected. Id. at 809-810 (citing Gen. Tel. Co. of the
Sw.
V.
Faison, 457 U.S. 147, 160 (1982)).
15
The logic of United Steel is equally applicable here. Schuster's policy of hiring workers
in a "provisional"
status for a period of time presents a uniform policy that, if found to be
invalid, would provide common grounds for relief across the whole class.
Accordingly, the
Court finds that the Carpenter Class satisfies the Rule 23(a) requirements
of numerosity,
commonality, typicality, and adequacy, that common issues "predominate over any questions
affecting only individual members, and that a class action is superior to all other meth~ds for
fairly and efficiently adjudicating the controversy."
Fed. R. Civ. P. 23(b)(3).
The Motion for
Class Certification is granted as to the Carpenter Class.
II.
Motion for Leave to Amend the Complaint
Plaintiffs have also filed a Motion for Leave to Amend the Complaint.
Through the
Motion, Plaintiffs seek to add (1) factual support for the argument that all workers on the Project
were intended third-party beneficiaries of the PLA; (2) allegations that Whiting-Turner
was
contractually obligated to enforce the PLA against non-signatories to the PLA; (3) allegations
that Schuster assented to the terms of the PLA through its conduct; and (4) allegations that
Schuster failed to comply with the wage and fringe benefits requirements of the Project Manual.
These proposed amendments
come after the October 16, 2017 deadline for amending the
pleadings established in the Court's Amended Scheduling Order.
A.
Legal Standard
When a Motion to Amend has been filed after a deadline for amendment in a scheduling
order, a plaintiff must satisfy a two-part test. First, the plaintiff must show "good cause" for the
delay in order to justify a modification of the deadline in the scheduling order pursuant to
Federal Rule of Civil Procedure 16(b)(4). See Nourison Rug Corp. v. Parvizian, 535 F.3d 295,
298 (4th Cir. 2008). If the plaintiff satisfies the requirements of Rule 16, the Court must then
16
consider the amendment under the standards of Rule 15. See Elat v. Negoubene, 993 F. Supp. 2d
497,519 (D. Md. 2014).
In order to show "good cause" for a modification of a scheduling order under Rule
16(b)(4), "the party seeking relief [must] show that the deadlines cannot reasonably be met
despite the party's diligence." Cook v. Howard, 484 F. App'x 805, 815 (4th Cir. 2012); see, e.g.,
Squyres v. Heico Cos., LLC, 782 F.3d 224, 237 (5th Cir. 2015). This inquiry largely revolves
around whether the plaintiff has diligently attempted to comply with the deadline set forth in the
scheduling order. See, e.g., Morrison Enters., LLC v. Dravo Corp., 638 F.3d 594, 610 (8th Cir.
2011) ("The primary measure of good cause is the movant's diligence in attempting to meet the
order's requirements.")
Rule 15(a) requires that leave to file an amended complaint should be "freely given when
justice so requires."
Fed. R. Civ. P. 15(a)(2). "A motion to amend should be denied 'only when
the amendment would be prejudicial to the opposing party, there has been bad faith on the part of
the moving party, or the amendment would be futile.'" HCMF Corp. v. Allen, 238 F.3d 273,276
(4th Cir. 2001) (quoting Edwards v. City o/Goldsboro,
178 F.3d 231,242 (4th Cir. 1999)). To
determine whether a proposed amended complaint would be futile, the Court reviews the revised
complaint under the standard used to evaluate a motion to dismiss for failure to state a claim.
Katyle v. Penn Nat. Gaming, Inc., 637 F.3d 462,471 (4th Cir. 2011).
B.
Rule 16
Plaintiffs filed a Notice of Intent to File a Motion for Leave to Amend Complaint on
April 5, 2018, nearly six months after the October 16,2017 deadline for amending the complaint
set forth in the Court's Amended Scheduling Order.
automatically indicative of a lack of diligence.
While this delay is significant, it is not
Here, Plaintiffs' proposed amendments largely
17
consist of the addition of facts from the affidavit of Brent Booker, one of the individuals who
negotiated the PLA on behalf of various trade unions. Plaintiffs were first notified that Booker
might "have knowledge about the negotiation, drafting, and execution of the Project Labor
Agreement" in a September 29, 2017 response to an interrogatory.
Ex. 14, ECF No. 151.
Resp. Interrog No.3, MAC
Booker was listed as one of seven individuals who may have had
knowledge of the PLA, but no contact information was provided.
Plaintiffs first received
specific facts known to Booker on November 6,2017, after the amendment deadline had passed,
when they received the transcript of an arbitration hearing at which Booker testified.
From that point, it reasonably took Plaintiffs some time to locate Booker, obtain an
affidavit from him, and incorporate certain facts from that affidavit into an amended complaint.
Although several months passed until Plaintiffs secured an affidavit from Booker on February
13,2018, they were simultaneously processing voluminous amounts of discovery. According to
Plaintiffs, they received over 15,000 pages of documents on September 29, 2017, just before the
amendment deadline, and an additional 60,000 pages after the deadline for amendment had
passed. Courts have found good cause under Rule 16 when the factual basis for an amendment
was identified in discovery, particularly if discovery is extensive.
See Ground Zero Museum
Workshop v. Wilson, 813 F. Supp. 2d 678, 707 (D. Md. 2011) (finding that the defendant had
acted with appropriate diligence when the amendment was based off of 902 pages of discovery);
Weisheit v. Rosenberg & Associates, LLC, No. JKB-17-0823, 2018 WL 1942196, at *3-4 (D.
Md. Apr. 25, 2018) (finding that, even though the plaintiff "had some sense before the
[amendment deadline] of the constellation of facts that undergird" a proposed crossclaim and it
was technically possible to file the amendment prior to the deadline, good cause was shown
based on the need for considerable consultation with experienced counsel before filing the
18
amendment).
At the same time, Plaintiffs were required to prepare a Motion for Class
Certification by December 1,2017, which included a Joint Record of over 1,300 pages, and file a
reply brief by February 28, 2017. Notably, Plaintiffs explanation for the delay is more robust
than those rejected as insufficient to meet the good cause standard.
See Nourison, 535 F.3d at
298 (finding that the moving party failed to show good cause under Rule 16 when the only
articulated reason for the delay in seeking to amend an Answer was that counsel had noticed an
additional potential defense during the course of responding to a motion for summary judgment).
Under these circumstances,
Plaintiffs have demonstrated diligent efforts to comply with the
Court's order. Accordingly, the Court finds that Plaintiffs have shown good cause under Rule
16.
C.
Rule 15
Having found that Plaintiffs have satisfied the requirements of Rule 16, the Court also
finds that leave to amend the complaint should be granted under the more liberal standard of
Rule 15, which permits amendment in the absence of bad faith, prejudice, or futility.
Fed. R.
Civ. P. 15; Nourison, 535 F.3d at 299. Based on the finding that Plaintiffs acted with diligence,
there is no evidence that they have acted in bad faith in seeking to amend at this time. As for
prejudice, Plaintiff s proposed amendments,
while adding new legal arguments and factual
support for their claims, do not add qualitatively new claims or alter the scope of discovery. For
example, Plaintiffs have already argued, in their Memorandum in Opposition to the Motion to
Dismiss, that they are third-party beneficiaries of the PLA. They have likewise argued in their
Motion for Class Certification that the Project Manual bound Schuster to pay the prevailing wage
rates.
Notably, neither Defendant has articulated any basis for prejudice as a result of the
proposed amendments.
Defendants have not yet moved for summary judgment.
19
Courts have
allowed amendments
under these circumstances,
even immediately before trial.
See, e.g.,
Medigen of Ky., Inc. v. Pub. Servo Comm 'n ofW V, 985 Fold 164, 168 (4th Cir. 1993) (affirming
the district court's granting of leave to amend the complaint on the eve of trial when the
amendment "did not change the substance of the case, did not require additional discovery, and
did not prejudice" the defendant, even though plaintiff could "have asserted its claim earlier").
Accordingly,
.the Court finds that the proposed amendments
present no prejudice to the
Defendants.
Finally, the proposed amendments are not futile. They do not add new causes of action
that could be subject to a motion to dismiss.
Rather, they simply add more facts to support
certain claims and reframe others in a manner consistent with the legal arguments advanced by
Plaintiffs throughout this litigation.
these new allegations.
Moreover, there is some factual and legal basis underlying
Plaintiffs' proposed amendments asserting that all workers are intended
third-party beneficiaries of the PLA and that Schuster assented to the provisions of paragraph
12.5 of the PLA by performing work on the Project, are supported by the affidavit of Booker,
one of the lead union negotiators on the PLA, who stated that the intent of paragraph 12.5 of the
PLA "was that all employees of any contractor or subcontractor who worked on the project
would be paid according to Maryland state prevailing wage law."
l.R. 1334. The proposed
amendment alleging that Schuster violated the Project Manual by failing to pay overtime fringe
benefits is based on the text of the Project Manual itself.
Finally, Plaintiffs' contention that
Whiting- Turner was bound to require Schuster to comply with the terms of the PLA is supported
by Baltimore/Washington
Construction and Public Employee Laborer's District Council, 244 F.
Supp. 3d 490 (D. Md. 2017), in which the court held that Whiting-Turner was required to submit
a dispute arising out of paragraph
12.5 of the PLA to arbitration, because it was at least
20
ambiguous whether Whiting-Turner
Schuster.
Id. at 496-97.
was required to enforce compliance with the PLA by
Accordingly,
the Court finds that Plaintiffs have satisfied the
requirements of Rule 15. The Motion for Leave to Amend the Complaint shall be granted.
CONCLUSION
For the foregoing reasons, Plaintiffs'
Motion for Class Certification and Motion for
Leave to Amend the Complaint are GRANTED. A separate Order shall issue.
Date: July 10,2018
~
21
..
CooANs
~~
THEODORE D.
United States District Judge
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