Hamilton et al v. Partners Healthcare, Et Al

Filing 237

Judge Douglas P. Woodlock: MEMORANDUM AND ORDER entered directing final judgment of dismissal as to all claims. (Woodlock, Douglas)

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS

DIANE HAMILTON, LYNNE P.
CUNNINGHAM and CLAIRE KANE,
on behalf of themselves and
all other similarly situated,

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Plaintiffs,
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v.
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PARTNERS HEALTHCARE SYSTEM,
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INC., PARTNERS COMMUNITY
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HEALTHCARE, INC., THE BRIGHAM )
AND WOMEN=S HOSPITAL, INC.,
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BRIGHAM AND WOMEN=S/FAULKNER
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HOSPITALS, INC., MARTHA=S
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VINEYARD HOSPITAL, INC., THE )
MASSACHUSETTS GENERAL
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HOSPITAL, MCLEAN HEALTHCARE, )
INC., THE MCLEAN HOSPITAL
CORPORATION, NANTUCKET
COTTAGE HOSPITAL, NEWTONWELLESLEY HOSPITAL, NEWTONWELLESLEY HEALTHCARE SYSTEM,
INC., NORTH SHORE CHILDREN=S
HOSPITAL, INC., NORTH SHORE
MEDICAL CENTER, INC., NSMC
HEALTHCARE, INC., THE SALEM
HOSPITAL, UNION HOSPITAL
AUXILIARY OF LYNN, INC., and
FAULKNER HOSPITAL, INC.,
Defendants.

Civil Action NO.
09-11461-DPW

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MEMORANDUM AND ORDER
July 21, 2016
Plaintiffs Diane Hamilton, Lynne P. Cunningham and Claire
Kane (collectively, “Plaintiffs”) brought this action raising
federal claims on behalf of themselves and all other similarly

situated employees of a number of healthcare facilities
allegedly affiliated with Partners Healthcare System, Inc.
Plaintiffs contend that their employers maintain policies in
violation of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §
201 et seq. (First Cause) depriving them of compensation for
time worked.

Plaintiffs further contend that their employers’

policies violate recordkeeping (Second Cause) and fiduciary
(Third Cause) responsibilities under the Employee Retirement
Income Security Act (“ERISA”), 29 U.S.C. § 1001 et seq., and
constitute a scheme to deceive Plaintiffs and deprive them of
their wages using mail fraud in violation of the Racketeer
Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. §
1961 et seq. (Fourth Cause).

The defendants moved [Dkt. No.

115] for judgment on the pleadings on all counts.1

By

The original complaint in this action remains operative.
Although the parties jointly stipulated, in anticipation of a
class action settlement, to the filing of an amended complaint
on September 3, 2010 [Dkt No 88], I did not approve the class
action settlements proposed by the parties. Consequently, no
Order was entered as to the amended complaint. Both the
defendants and the plaintiffs withdrew their assent to the
filing of the amended complaint [Dkt Nos. 129 (Defendants) & 137
(Plaintiffs)] following rejection of the settlement proposals.
The Defendants had previously answered the original complaint;
consequently, the pleadings are closed for purposes of the Fed.
R. Civ. P 12(c) motion now before me.
Plaintiffs’ Fifth Cause of action, alleging estoppel, was
dismissed with prejudice by stipulation of the parties [Dkt. No.
83].
1

2

endorsement, I have granted [Dkt. No. 221] the motion by
endorsement.

This Memorandum and Order provides the parties

with the extended explanation I promised for that disposition of
the motion.
I. BACKGROUND
The named defendants in this action are the following
entities:

Partners HealthCare System, Inc., Partners Community

Healthcare, Inc., The Brigham and Women’s Hospital, Inc.,
Brigham and Women’s/Faulkner Hospitals, Inc., Martha’s Vineyard
Hospital, Inc., The Massachusetts General Hospital, McLean
Healthcare, Inc., The McLean Hospital Corporation, Nantucket
Cottage Hospital, Newton-Wellesley Hospital, Newton-Wellesley
Health Care System, Inc., North Shore Children’s Hospital, Inc.,
North Shore Medical Center, Inc., NSMC Healthcare, Inc., The
Salem Hospital, Union Hospital Auxiliary of Lynn, Inc., and
Faulkner Hospital, Inc.2

Compl. ¶ 14.

2

The complaint also named Youville Hospital and Rehabilitation
Center, Inc., James J. Mongan, M.D., and Dennis D. Colling as
defendants. Compl. ¶ 14. Plaintiffs voluntarily dismissed
Youville Hospital and Rehabilitation Center, Inc. by notice on
December 23, 2009 [Dkt. No. 45], and these individual defendants
by stipulation on July 2, 2010 [Dkt. No. 83].

3

In their complaint, Plaintiffs also list 27 health care
facilities and centers associated with the named defendants and
over 100 “affiliated” health care facilities and centers.
¶¶ 15-16.

Id.

Plaintiffs refer to the named defendants, their

facilities and centers, and the affiliated facilities and
centers as “Partners” or “Defendants.”

Id. ¶ 17.

With respect

to the Plaintiffs themselves, the complaint merely states that
they were “[a]t all relevant times . . . employees under the
FLSA, employed within this District and resid[ing] within this
District,” id. ¶ 76, and provides no further details regarding
their employment.
Plaintiffs’ claims are premised on allegations that
Defendants maintain pay policies that deny Plaintiffs their
compensation for all hours worked.

Id. ¶ 79.

In particular,

Plaintiffs allege that Defendants (1) automatically deduct
thirty minutes of time per day from each employee’s paycheck for
meal breaks without ensuring that such breaks are taken, (2)
suffer or permit Plaintiffs to work before and/or after each
scheduled shift without compensation, and (3) suffer or permit
Plaintiffs to attend compensable training programs without pay.
Id. ¶¶ 80-108.
Plaintiffs filed this action in this court on September 3,
2009.

The next week, they filed a complaint in the Middlesex
4

Superior Court asserting violations of Massachusetts wage laws,
MASS. GEN. LAWS ch. 149, §§ 148, 150 & ch. 151 §§ 1A, 1B, and
claims under Massachusetts contract and tort law.

On October

16, 2009 the Defendants removed the state claim action to this
court, where it has been docketed as 09-cv-11725.
The plaintiffs' complaint was met with a motion to dismiss
the RICO count, asserting inadequate pleadings. [Dkt. No. 10].
When the parties reported that they were engaged in mediation
before any hearing, I denied the motion to dismiss and the
motion for remand “without prejudice to resubmittal if the
ongoing protracted mediation process proves unsuccessful.”
(Unnumbered docket entry 05/6/2010).
The mediation process ultimately generated two successive
motions for preliminary approval of class and collective action
settlements.

At separate hearings on each wave of motions, I

denied them because — for a variety of reasons — I could not
find the settlements proposed had any prospect of final approval
as fair, adequate or reasonable.

See generally Dkt. No. 95

(Dec. 23, 2010 Tr. concerning initial motion for preliminary
approval); Dkt. No. 110 (Mar. 2, 2011 Tr. concerning amended
motion for preliminary approval).

My fundamental concern, as

expressed at those hearings, was that the settlement proposals involving some 63,000 employees in a multiplicity of job
5

classifications at a multitude of institutional settings raised inadequately addressed structural problems.

Cf. In re

Payment Interchange Fee and Merchant Discount Antitrust
Litigation, 2016 WL 3563719 at *8 (2d Cir. June 30, 2016).3
Although I informed the parties that I would entertain one
last effort by them aimed at securing approval to notice a
proposed settlement, the defendants instead resumed pleadings
motion practice by filing motions for judgment on the pleadings
as to all counts in both the federal claim and the state claim
actions.

At a scheduling conference after those motions were

filed, Plaintiffs' Counsel voiced the possibility that they
might seek leave to amend, but have never followed through with
a proper motion to amend.4

After an extended period of time I

3

I recognize that the courts have imposed a less demanding
predicate burden for conditional certification of collective
actions under the FLSA than for Rule 23 settlement class
certification. The plaintiffs’ pleading deficiencies were so
fundamental that conditional certification under only the FLSA
would be no less improvident than under Rule 23.
4

A request to amend, made in argument, “does not constitute a
motion to amend a complaint.” Gray v. Evercore Restructuring
L.L.C., 544 F.3d 320, 327 (1st Cir. 2008). “In the absence of
exceptional circumstances, a district court is under no
obligation to offer a party leave to amend when such leave has
not been requested by motion.” Hochendoner v. Genzyme Corp.,
No. 15-1446, 2016 WL 2962148, at *9 (1st Cir. May 23, 2016). No
motion to amend, let alone no exceptional circumstances, has
been presented here despite a substantial passage of time before
issuance of the final judgment today.
6

explain in this — and the related Memorandum and Order I enter
in the state claims action today — the reasons why I am entering
the final judgments in this and the related case on the basis of
the operative complaint.
II. STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(c) provides that a
motion for judgment on the pleadings may be made “after the
pleadings are closed – but early enough not to delay trial.”

A

motion for judgment on the pleadings is evaluated under the same
standard as a motion to dismiss.

Remexcel Managerial

Consultants, Inc. v. Arlequín, 583 F.3d 45, 49 n.3 (1st Cir.
2009) (citing Citibank Global Mkts., Inc. v. Rodríguez Santana,
et al., 573 F.3d 17, 23 (1st Cir. 2009) (“[T]o survive a motion
to dismiss (or a motion for judgment on the pleadings), the
complaint must plead facts that raise a right to relief above
the speculative level.”)); see also Erlich v. Ouellette,
Labonte, Roberge and Allen, P.A., 637 F.3d 32, 35 n.4 (1st Cir.
2011) (describing the standards for evaluating motions to
dismiss and motions for judgment on the pleadings as
“essentially the same”).
Motions to dismiss are reviewed “accepting as true all
well-pleaded facts” in the complaint, “analyzing those facts in

7

the light most hospitable to the plaintiff’s theory, and drawing
all reasonable inferences for the plaintiff.”

United States ex.

rel. Hutcheson v. Blackstone Med., Inc., 647 F.3d 377, 383
(1st Cir. 2011).
A complaint must provide a “short and plain statement of
the claim showing that the pleader is entitled to relief” as
required by FED. R. CIV. P. 8(a)(2).

While a complaint attacked

on a motion to dismiss “does not need detailed factual
allegations, a plaintiff’s obligation to provide the ‘grounds’
of his ‘entitle[ment] to relief’ requires more than labels and
conclusions, and a formulaic recitation of the elements of a
cause of action will not do.”

Bell Atlantic Corp. v. Twombly,

550 U.S. 544, 555 (2007) (citations omitted).

The “[f]actual

allegations must be enough to raise a right to relief above the
speculative level,” id., and allow “the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.”
(2009).

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

The First Circuit has summarized the Twombly and Iqbal

standard as requiring “an adequate complaint” under Rule 8(a)(2)
to “provide fair notice to the defendants and state a facially
plausible legal claim.”

Ocasio-Hernández v. Fortuño-Burset, 640

F.3d 1, 12 (1st Cir. 2011).

8

Iqbal and Twombly set out two working principles underlying
the standard for adequately pled complaints; these principles
translate to a two-pronged approach for courts evaluating
motions to dismiss.

Id.

The first principle is that “the tenet

that a court must accept as true all of the allegations
contained in a complaint is inapplicable to legal conclusions.”
Iqbal, 556 U.S. at 678.

A court must therefore begin its

analysis by “identifying and disregarding statements in the
complaint that merely offer ‘legal conclusion[s] couched as . .
. fact[ ]’ or ‘[t]hreadbare recitals of the elements of a cause
of action.’”

Ocasio-Hernández, 640 F.3d at 12 (citations

omitted) (alterations in original).

Only factual allegations,

not conclusory statements regarding the applicability of law,
may be considered in assessing whether the Plaintiff has
satisfied the pleading standard.
The second working principle is that “only a complaint that
states a plausible claim for relief survives a motion to
dismiss.”

Iqbal, 556 U.S. at 679.

If the recited facts “do not

permit the court to infer more than the mere possibility of
misconduct,” the complainant has failed to show entitlement to
relief.

Id.

In evaluating the complaint, the “[n]on-conclusory

factual allegations in the complaint must then be treated as
true, even if seemingly incredible.”
9

Ocasio-Hernández, 640 F.3d

at 12.

The court may not assess the likelihood of proving the

factual allegations but instead must evaluate facial
plausibility based on whether the factual content, if proven,
“‘allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.’”

Id. (quoting

Iqbal, 556 U.S. at 663).
III. ANALYSIS
At the threshold, Defendants challenge Plaintiffs’
standing, citing Plaintiffs’ failure to allege an employment
relationship with any particular defendant.

Defendants further

argue that Plaintiffs fail to plead facts sufficient to allege
plausible FLSA, ERISA, or RICO claims.

I begin with a

discussion of First Circuit case law considering similar
complaints and then apply those decisions in the context of this
case and the arguments the parties have made to me.
A.

The First Circuit’s Treatment of Hospital Compensation
Cases
The First Circuit has addressed three related cases, which

it refers to as “hospital compensation cases,” asserting
substantially similar claims to those presented by Plaintiffs’
Counsel here.

See Manning v. Boston Medical Center Corp., 725

F.3d 34, 39 (1st Cir. 2013) (“Manning A”)5; Cavallaro v. UMass

5

The multiplicity of published opinions regarding the hospital
10

Mem’l Healthcare Inc., 678 F.3d 1 (1st Cir. 2012) (“Cavallaro
A”); Pruell v. Caritas Christi, 678 F.3d 10 (1st Cir. 2012)
(“Pruell A-2”).

Each complaint asserted that a hospital network

violated federal and state wage-and-hour laws in precisely the
same ways: by requiring or permitting unpaid work to be
performed during meal breaks due to an automatic timekeeping
deduction, before and after employee shifts, and in training
programs.

Thus, while “precise rules will always be elusive” in

determining whether a complaint states an adequate claim for
relief, Pruell A-2, 678 F.3d at 15, the First Circuit’s three
hospital compensation case opinions provide an unusually clear
map of the relevant terrain.

They lay out precisely what

information must be alleged to state these wage-and-hour claims
in the hospital context plausibly.
In Pruell A-2, the First Circuit found conclusory and
speculative the statement that plaintiffs “regularly worked
hours over 40 in a week and were not compensated for such time.”

compensation matters litigated in this district has caused me to
adopt a protocol for citations in the several Memoranda and
Orders I am issuing today. Thus, the First Circuit opinions in
the cases are identified by the name of the initial identified
plaintiff followed by the letter “A” and in the Pruell matter, a
number indicating the order of issuance of appellate opinions in
that matter. Published District Court opinions in the matters
are numbered in chronological order by the name of the initial
identified plaintiff followed by a roman numeral.
11

678 F.3d at 13.

The court also held that additional specificity

provided by the alleged mechanisms for undercompensation – the
unpaid meal breaks, pre- and post-shift work, and training
sessions – was not enough to render the complaint adequately
pled.

Id. at 14.

Without examples of the unpaid time, ideally

including descriptions of the type of work performed, the
complaint did not show that the relevant work was compensable
(the court noted that various types of pre-shift work or
training programs are non-compensable) or that the defendants
did not make it up to the employees through premium pay of one
form or another.

Id.

In Cavallaro A, the First Circuit focused on a different
deficiency in the complaint: the failure to identify any
employer for the named plaintiffs.

678 F.3d at 9-10.

It also

rejected plaintiffs’ arguments that since under a “joint
employer” or “integrated enterprise” theory liability could
extend beyond a particular hospital to the network, it was not
necessary to name any plaintiff’s direct employer specifically.
To the contrary, the First Circuit advised, “some direct
employer needs to be identified before anyone in the group could
be liable on the theory that some or all were responsible.”
Id. at 10.

12

The complaint in this case suffers from both of these
deficiencies.

As with the Cavallaro complaint, it does not

identify what defendant actually employed the plaintiffs.

It

states only that the named plaintiffs “were employees under the
FLSA, employed within this District and reside within this
District.”

[Dkt 1 ¶ 76].

And as with the Pruell complaint,

only the most general allegations of undercompensation are
provided without any of the examples or other forms of
specificity that could show a plausible claim of wage-and-hour
violations.

Indeed, the complaint before me does not even

allege that plaintiffs regularly worked more than 40 hours in a
week, a most basic predicate fact for finding overtime
violations.
In contrast, the First Circuit in Manning A found the FLSA
allegations to be sufficient.

725 F.3d at 47.

That complaint

identified the specific jobs of the named plaintiffs and what
work they performed during their meal breaks and before and
after shifts, describing nurses who chart or monitor patients
during the breaks and an administrative assistant who made phone
calls and drafted correspondence during her unpaid time.
45-46.

Id. at

The Manning complaint also included allegations that

estimate how often the named plaintiffs worked forty hour-perweek shifts: some regularly, some once a month, and some once a
13

year.

Id. at 46-47.

None of this detail, which the First

Circuit found important in distinguishing the Manning pleading
from the Pruell and Cavallaro complaints, appears in the
complaint before me.

Nor does any other form of specificity —

not otherwise highlighted by the First Circuit — distinguish
this complaint from those in Pruell or Cavallaro.

No other

information is provided that offsets the plaintiff’s failure to
identify their employers, their specific job descriptions, their
staffing patterns or the type of work for which they were not
compensated.

Under clear precedent – precedent with the unusual

benefit of analyzing complaints that to a large degree were
“‘substantially identical’ to the one at issue in this case,”
Manning A, 725 F.3d at 42 (quoting District Court) – the
complaint now before me fails adequately to state a claim under
the FLSA.
With this First Circuit case law regarding the pleading of
hospital compensation cases as backdrop, I now turn to more
detailed consideration of the specific shortcomings of the
operative complaint in this case.
B.

Standing and Employment Relationship
Defendants argue Plaintiffs lack standing because they have

failed to allege that they were employed by any particular
defendant, much less by all of the individual defendants or
14

entities listed in the caption of the case or described in the
complaint.

Defendants argue that the complaint contains

insufficient facts to demonstrate that any individual entity
qualifies as one of the Plaintiff’s employers under the FLSA.
Although presented as distinct issues, the questions
whether there is standing and whether Plaintiffs have alleged an
employment relationship under FLSA are here essentially the
same.

The existence of the FLSA cause of action, and by

extension the ERISA and RICO causes of action premised on FLSA
violations, see Compl. ¶¶ 151-58, is dependent on a threshold
finding that Plaintiffs are employees of Defendants under the
FLSA.

As a result, if Plaintiffs have failed to allege a

plausible FLSA employment relationship, there is no case or
controversy and Plaintiffs do not have standing.6
The FLSA regulates aspects of the relationship between
employers and employees, unless certain exemptions apply.
U.S.C. § 201 et seq.

29

Employees may bring a private right of

6

Despite the fact that the complaint is filed as a putative
class action, each named plaintiff must demonstrate standing in
her own right. See Sosna v. Iowa, 419 U.S. 393, 402 (1975)
(explaining that, as a general matter, a named plaintiff must
have a case or controversy at the time a complaint is filed and
at the time of class certification). The Constitution’s Article
III case or controversy requirement “must be satisfied at each
and every stage of the litigation.” Cruz v. Farquharson, 252
F.3d 530, 533 (1st Cir. 2001).
15

action to recover minimum wages or overtime wages not paid by an
employer in violation of the FLSA.

Id. §§ 206, 207, 216(b).

Under the FLSA, an “employer” is “any person acting directly or
indirectly in the interest of an employer in relation to an
employee,” id. § 203(d), and a “person” is “an individual,
partnership, association, corporation, business trust, legal
representative, or any organized group of persons,” id. §
203(a).

Generally an “employee” is “any individual employed by

an employer,” id. § 203(e)(1), and “employ” means “to suffer or
permit to work,” id. § 203(g).
As noted, the complaint contains little information about
Plaintiffs, only stating that they were, “at all relevant times
. . . employees under the FLSA, employed within this District
and reside within the District.”7

Compl. ¶ 76.

The allegations

contain no facts as to the particular entity which employed
Plaintiffs or the location of their employment, job title, or
dates of employment.

As Plaintiffs’ Counsel have been

instructed by the Second Circuit, this is insufficient pleading
in a wage-and-hour case.

See Nakahata v. New York-Presbyterian

Healthcare Sys., Inc., 723 F.3d 192, 201 (2d Cir. 2013)

7

The class members are described as “those employees of
defendants who were suffered or permitted to work by defendants
and not paid their regular or statutorily required rate of pay
for all hours worked.” Compl. ¶ 77.
16

(“Plaintiffs’ actual and direct employer is an essential element
of notice pleading under these circumstances.”).
Plaintiffs argue that it is unnecessary to identify which
Defendant employs each individual because Defendants together
constitute a joint employer or a single “enterprise” and may
therefore be held liable jointly, or as one entity.

Plaintiffs

conflate the distinct concepts of joint employer liability and
that of employment in an “enterprise.”

I will unbundle the

concepts by addressing them separately.
In support of the complaint’s legal conclusion that
“defendants are the employer (single, joint or otherwise) of the
Plaintiffs and Class Members and/or alter egos of each other,”
Compl. ¶ 25, Plaintiffs allege that the named Defendants “are
related organizations through, for example, common membership
governing bodies, trustees and/or officers and benefit plans.”
Compl. ¶ 14.

Plaintiffs also allege that named Defendants and

their affiliates “have centralized supply chain management,
financial, computer, payroll and health records systems that are
integrated throughout their locations,” id. ¶ 21; their “labor
relations and human resources are centrally organized and
controlled, including” through the employment of a Vice
President of Human Resources and “maintenance of system-wide
policies and certain employee benefit plans,” id. ¶ 22; and they
17

“share common management, including oversight and management by
a senior management team, Trustees and Institution Leadership,”
id. ¶ 23.
In addition, Plaintiffs make certain conclusory statements,
to which I give no weight. These include the statements that
“Partners is an enterprise,” id. ¶ 18, and that “Defendants
consider themselves a single employer under the FLSA,” id. ¶ 26,
both of which are essentially legal conclusions.

I disregard

such statements in considering whether it is reasonable to infer
that Defendants may be held liable as employers under the FLSA.
1.

Joint Employer Liability

The Supreme Court has instructed that the FLSA’s use of the
term “employ,” is broad, explaining that “employ” and related
terms are “‘comprehensive enough to require its application to
many persons and working relationships, which prior to [the
FLSA], were not deemed to fall within an employer-employee
category.’”

Rutherford Food Corp. v. McComb, 331 U.S. 722, 729

(1947) (quoting Walling v. Portland Terminal Co., 330 U.S. 148,
150 (1947)).

The First Circuit applies an “economic reality”

analysis to the question whether an employment relationship
exists under the FLSA.

Chao v. Hotel Oasis, Inc., 493 F.3d 26,

33-34 (1st Cir. 2007).

Under this test, the actual

circumstances of employment “prevail[] over technical common law
18

concepts of agency.”

Donovan v. Agnew, 712 F.2d 1509, 1510 (1st

Cir. 1983).
The FLSA’s expansive concept of the employment
relationship extends to circumstances where an employee is
jointly employed by multiple employers.

See Falk v. Brennan,

414 U.S. 190, 195 (1973) (finding maintenance workers to be
employees of building owners as well as of a management
company).

However, the cases are clear that joint employment

exists only when there is an actual employment relationship
between the employee and each joint employer.
In Baystate Alt. Staffing, Inc. v. Herman, 163 F.3d 668
(1st Cir. 1998), the First Circuit deployed four factors
identified by the Ninth Circuit in Bonnette v. California Health
& Welfare Agency, 704 F.2d 1465 (9th Cir. 1983), to evaluate
whether an entity is a joint employer of an individual.

These

factors examine “the totality of the circumstances bearing on
whether the putative employee is economically dependent on the
alleged employer” and include “whether the alleged employer (1)
had the power to hire and fire the employees; (2) supervised and
controlled employee work schedules or conditions of employment;
(3) determined the rate and method of payment; and (4)
maintained employment records.”

Baystate, 163 F.3d at 675; see

also Donovan, 712 F.2d at 1514 (finding that “corporate officers
19

with a significant ownership interest who had operational
control of significant aspects of the corporation’s day to day
functions, including compensation of employees, and who
personally made decisions” resulting in FLSA violations were
liable as joint employers).

The Baystate court explained that

the first two factors “address the extent of a putative
employer’s control over the nature and structure of the working
relationship,” Baystate, 163 F.3d at 675, and the second two
“address the extent of a putative employer’s control over the
economic aspects of the working relationship.” Id. at 676.
Thus, there must be some element of an actual employment
relationship between an employee and each putative joint
employer.

Put differently, joint employer status recognizes

that an employee can have multiple discrete but related
employers, not that employment status can be ineffable.
Plaintiffs rely in part on the First Circuit’s opinion in
Donovan to argue that factors such as “operational control” must
be considered in evaluating employment relationships.
F.2d at 1514.

See 712

Donovan narrowly addressed the question of

personal liability for corporate officers, specifically whether
officers may be held to be jointly liable for violations under
the FLSA, based on their direct control over conditions of
employment and responsibility for the FLSA violations, even
20

though the officers do not personally employ individuals.

Id.

Plaintiffs here made no allegations that any particular
Defendants (apart from the individuals who have been removed
from the case)8 have “significant ownership interest,”
“operational control of significant aspects of the corporation’s
day to day functions, including compensation of employees,” or
“personally made decisions” relevant to the alleged FLSA
violations with respect to Plaintiffs.

Id.

Plaintiffs also cite to an opinion letter from the United
States Department of Labor for the proposition that entities
comprising a “health care system” are joint employers for
purposes of the FLSA.

The opinion letter in fact contains no

such general conclusion, but rather finds that where an employee
actually works for more than one member of a health care system,
a joint employment relationship exists among the particular

8

These allegations relate to the individual Defendants, James J.
Mongan (“Mongan”) and David D. Colling (“Colling”), Compl. ¶¶
27-74, who are no longer parties to this case, see supra note 2.
The allegations assert that there is joint control over
employment issues. Plaintiffs allege that Mongan, as President
and CEO of Partners and Colling, as Vice President of Human
Resources of Partners, maintain control over a variety of human
resources policies and employees’ benefits and salaries.
Although Plaintiffs seem to argue these allegations imply
Partners as a whole has uniform policies that confer joint
liability, the facts necessary to demonstrate this proposition
are not alleged in the complaint except in the most conclusory
fashion.
21

entities that employ the individual.

U.S. Dept. of Labor, Wage

& Hour Division, Opinion Letter FLSA2005-15 (Apr. 11, 2005).
The opinion letter concludes that “a joint-employment
relationship exists in weeks in which an individual works for
more than one of” a health care “System’s employers,” conferring
joint and several liability for compliance with the FLSA with
respect to such employees.

Id.9

Plaintiffs do not address the factors laid out in Baystate.
They have not plausibly alleged that they are employed by any
one (or more) of the Defendants, and the conclusory invocation
of the theory of joint employment does not cure that deficiency.
2.

“Enterprise” or “Single Employer” Liability

Plaintiffs also argue that Defendants comprise a “single

9

The Wage and Hour Division’s regulations also reflect the
understanding that a joint employer actually employs the
employee in question. In describing joint employment, these
regulations state that “[a] single individual may stand in the
relation of an employee to two or more employers at the same
time . . . since there is nothing in the act which prevents an
individual employed by one employer from also entering into an
employment relationship with a different employer.” 29 C.F.R. §
791.2. Joint employment exists under the regulations “if the
facts establish that the employee is employed jointly by two or
more employers, i.e., that employment by one employer is not
completely disassociated from employment by the other
employer(s).” Id. In such a case “all of the employee’s work
for all of the joint employers during the workweek is considered
as one employment for purposes of the Act,” and all joint
employers are individually and jointly responsible for
compliance with the FLSA. Id.
22

employer” or “integrated enterprise” and that, as a result,
Plaintiffs are “employed by all defendants.”

The “integrated

enterprise” test is used to determine whether a group of related
employers are so interrelated that they should be treated as one
employer, often when determining whether to hold a parent
corporation liable for violations of a subsidiary.

This is

distinct from the “joint employer” analysis where two or more
distinct employers may be held liable when they have, in fact,
jointly employed particular individuals.10
The integrated enterprise test involves four factors: “(1)
interrelation of operations; (2) common management; (3)
centralized control of labor relations; and (4) common
ownership.”
2000).

Romano v. U-Haul Int’l, 233 F.3d 655, 662 (1st Cir.

It was originally developed to “determine whether

interrelated companies should be treated as one entity under the
National Labor Relations Act, 29 U.S.C. § 164.”

10

The test has

Plaintiffs erroneously describe the factors considered in the
“integrated enterprise” test discussed more fully in the text
above as those “considered in determining whether separate
entities can be held jointly liable.” The cases cited describe
the “integrated enterprise” test and not “joint employer”
analysis. See Penntech Papers, Inc. v. N.L.R.B, 706 F.2d 18 (1st
Cir. 1983); N.L.R.B. v. Browning-Ferris Indus. of Pennsylvania,
Inc. 691 F.2d 1117, 1122 (3d Cir. 1982) (noting that “[t]he
‘joint employer’ and ‘single employer’ concepts are distinct”);
United Paperworkers Int’l Union, AFL-CIO, CLC v. Alden
Corrugated Container Corp., 901 F. Supp. 426 (D. Mass. 1995).
23

also been adopted for evaluating employer status in the context
of Title VII of the Civil Rights Act, Torres-Negrón v. Merck &
Co., Inc., 488 F.3d 34, 41-43 & n.7 (1st Cir. 2007), the
Americans with Disabilities Act, id. at 43, and the Family and
Medical Leave Act, see Engelhardt v. S.P. Richards Co., Inc.,
472 F.3d 1, 4-5 (1st Cir. 2006), as well as other statutory
schemes related to labor relations.
The First Circuit has not applied the “integrated
enterprise” test in the context of the Fair Labor Standards
Act.11

Application of the “integrated enterprise” theory has

been addressed in the District Court for the District of Maine.
Anderson v. Theriault Tree Harvesting, Inc., No. 1:08-cv-330JAW, 2010 WL 2490119 (D. Me. Jan. 20, 2010).

But Magistrate

Judge Kravchuk in that opinion noted that the parties did not
dispute the application of the integrated enterprise theory in
the FLSA context.

Id. at *9.

She concluded in Anderson that

the result there was the same under either the enterprise test
or joint employer test.

11

Id.12

See Roman v. Guapos III, Inc., 970 F. Supp. 2d 407, 414-15 (D.
Md. 2013) (rejecting “single employer” theory under FLSA but
collecting cases applying the theory).
12 The “integrated enterprise” test must be distinguished from
the FLSA’s application of certain terms to individuals “employed
in an enterprise engaged in commerce or in the production of
goods for commerce.” 29 U.S.C. §§ 206, 207. This provision is
jurisdictional in nature; an employee “employed in an
24

I find it unnecessary to reach whether the “integrated
enterprise” theory extends to the FLSA because Plaintiffs have
failed to plead sufficient facts to demonstrate an employment
relationship with any of the Defendants.

The First Circuit

requires that some direct employer be identified before an
integrated enterprise can be found.
10.

Cavallaro A, 678 F.3d at 9-

Apart from the conclusory statement that Plaintiffs “were

employees under the FLSA,” the complaint is silent on the
circumstances of Plaintiffs’ employment, including their
title(s), employer(s), location(s) of employment, and the
“relevant” time period(s).

Even if Partners were effectively a

single enterprise, plaintiffs have not made the requisite
allegation regarding what entity formally employs them.

See

Cavallaro v. UMass Mem’l Healthcare Inc., No. 09-cv-40152, 2011
WL 2295023, at *5 (D. Mass. June 8, 2011) (“Cavallaro II”),
vacated and remanded to allow one last amendment to pleadings by
Cavallaro A, 678 F.3d 1, 10 (1st Cir. 2012) (concluding, in a

enterprise” is entitled to the protections in 29 U.S.C. §§ 206,
207. See Donovan v. Agnew, 712 F.2d 1509, 1514-16 (1st Cir.
1983) (discussing whether the Secretary of Labor had shown that
the corporation was an “enterprise” triggering application of §
207 separately from analysis of joint employment); Chao v. AOne Med. Servs., Inc., 346 F.3d 908, 916-17 (9th Cir. 2003)
(explaining that, because the employer was engaged in an
“enterprise,” the employees were subject to § 207 of the FLSA,
but that joint liability is premised on working for more than
one employer in a workweek).
25

case based on essentially identical fact-pleading by the same
counsel representing the plaintiffs in the case before me, that
“plaintiffs have not alleged sufficient facts to suggest that
even one of the defendants is their employer”).

Because

Plaintiffs have not alleged a plausible employee-employer
relationship under the FLSA, their FLSA claim must fail on both
pleading and standing grounds.13

I recognize that in addressing the pleadings in the parallel
state claims action presented in this hospital compensation
matter, I have made jurisdictional fact finding regarding the
actual employer of the named Plaintiffs. See Memorandum and
Order, Hamilton v. Partners Healthcare System, Inc., 09-cv11725-DPW (July 21, 2016, Dkt. No. 175) at 9-13. I there found
Plaintiffs Hamilton and Cunningham to be employees of the
Shaughnessy-Kaplan Rehabilitation Hospital and Plaintiff Kane to
be an employee of Massachusetts General Hospital. ShaughnessyKaplan Rehabilitation Hospital is not identified as an
individually named defendant in the original and operative
complaint but rather as a “Health Center” (¶ 15) and “Affiliate”
(¶ 16) of the named defendants. However, in the abandoned
amended complaints submitted in connection with the effort to
get settlement approval, see Note 1 supra, Shaughnessy-Kaplan
Rehabilitation Hospital was added as a named defendant in this
action (Dkt. No. 88-1, ¶ 14) and the state claim action (Dkt.
No. 89-1, ¶2), an implicit acknowledgment that the actual
employer of a named class member had not been identified
properly in the original complaint. The jurisdictional fact
finding in the parallel state claim case, made over the
resistance of Plaintiffs’ Counsel, may be seen to have cured one
deficiency in the complaint by providing, through no effort of
Plaintiffs’ Counsel, the basis for finding a plausible
allegation of a specific employer-employee relationship in this
case. Nevertheless, as Subsections III C and D infra
demonstrate, even if the employer is seen as adequately pled as
a result of the action of the Court in the parallel case, there
remain substantial pleading deficiencies in the failure
13

26

C.

FLSA Violations
Even if Plaintiffs had alleged a plausible employer-

employee relationship with some or all Defendants, their FLSA
claim must be dismissed because they have not alleged sufficient
facts to demonstrate that Defendants violated relevant
provisions of the FLSA.

Plaintiffs allege that Defendants

maintained policies that denied them “compensation for all hours
worked, including applicable premium pay rates.”

Compl. ¶ 79.

The FLSA requires employers to pay a minimum wage for all hours
worked, 29 U.S.C. § 206, and overtime compensation for time in
excess of forty hours per workweek, id. § 207; Plaintiffs fail
to plead a violation of either requirement adequately.
To the extent that Plaintiffs purport to bring a minimum
wage claim under § 206(a) because they were denied “compensation
for all hours worked,” they have failed to plead the necessary
elements of such a violation.

Section 206(a) requires that an

employer pay each employee a certain minimum dollar amount per
hour of work in any workweek.

Id. § 206(a)(1)(C).

The relevant

plausibly to allege violations of the relevant provisions of the
FLSA and of ERISA.
I separately note that because the relevant “employer” in this
complaint for RICO purposes is an “enterprise,” I do not, in any
event, rest my findings of deficiencies in the RICO count
pleading, see Subsection III E infra, on the particular hospital
entity employer of the Plaintiffs.
27

minimum wage was set at $7.25 per hour.

Id.

Although

Plaintiffs allege that they were not specifically compensated
for certain time periods, there is no allegation that their
average hourly wage per week fell below that minimum amount.
Courts have held that such a showing is necessary to demonstrate
a violation of § 206(a).

See United States v. Klinghoffer Bros.

Realty Corp., 285 F.2d 487, 490 & 494 (2d Cir. 1960) (holding
that an allegation that the average hourly wage per week is not
above the minimum wage is necessary to meet the requirements of
§ 206(a)); Pruell II, 2010 WL 3789318, at *2-3 (D. Mass. Sept.
27, 2010) (collecting cases applying the holding in Klinghoffer)
aff’d, 678 F.3d 10, 15 (1st Cir. 2012).

As a result, there is

no reasonable basis to infer that a violation of § 206 has
occurred.
Plaintiffs have also failed to allege facts sufficient to
demonstrate a plausible claim for unpaid overtime payments under
29 U.S.C § 207, which requires employers to compensate employees
at a rate of 1.5 times their regular rate of pay for any time
worked in excess of forty hours per week.

Plaintiffs make the

general allegation that “if Plaintiffs’ and Class Members’ hours
had been properly calculated, the time spent” work during meal
breaks, before and after shifts, and during training, “often
would include work that should have been calculated at
28

applicable premium rates.”

Compl. ¶¶ 98, 102, 106.

Notwithstanding these conclusory statements, Plaintiffs fail to
allege sufficient facts to demonstrate a plausible claim for
premium payments.
Plaintiffs do not state that the uncompensated time is in
excess of forty hours per week, and courts have consistently
found that, at a minimum, plaintiffs must make such an
allegation in order to plead a plausible § 207 claim.

Manning

A, 725 F.3d at 46 (allegations that “plaintiffs worked more than
forty hours in a given work week . . . required to bring a FLSA
overtime claim.”); Nakahata, 723 F.3d at 201 (“Plaintiffs must
provide sufficient detail about the length and frequency of
their unpaid work to support a reasonable inference that they
worked more than forty hours in a given week”); Davis v.
Abington Mem. Hosp., 765 F.3d 236, 243 (3d Cir. 2014) (same);
Pruell v. Caritas Christi, 2010 WL 3789318, at *3-4 (D. Mass.
Sept. 27, 2010) (“Pruell I”) (same); see generally Manning v.
Boston Med. Ctr. Corp., No. 09-cv-11463, 2011 WL 796505, at *1*2 (D. Mass. Feb. 28, 2011) (“Manning I”) (concluding, with
respect to a similar complaint, that it was not possible to
“draw a reasonable inference of liability from this aggregation
of conclusory statements and general allegations”).

29

As a

result, I find Plaintiffs failed to plead sufficient facts to
allege a plausible claim for overtime pay under § 207.
D.

ERISA Claims
Plaintiffs assert that two violations of ERISA arise out of

Defendants’ alleged underpayment of compensation under the FLSA.
First, Plaintiffs contend that Defendants “failed to keep
accurate records of all time worked” and that such records are
“legally insufficient to determine benefits” and thus violated
29 U.S.C. § 1059(a)(1).

Compl. ¶ 153.

Second, Plaintiffs argue

that Defendants breached their fiduciary duties under 29 U.S.C.
§ 1104(a)(1).

Id. ¶ 155.

The alleged ERISA violations are predicated on violations
of the FLSA, and because Plaintiffs have failed to plead
sufficient facts to allege a plausible cause of action under the
FLSA, the ERISA claims must be dismissed as well.

See Cavallaro

II, 2011 WL 2295023, at *7 (dismissing ERISA claims in similar
action in light of the dismissal of FLSA claim), vacated and
remanded for an opportunity to amend the complaint, 678 F.3d 1,
10 (1st Cir. 2012); Pruell I, 2010 WL 3789318 at *4 (same) aff’d
with respect to FLSA claim but vacated and remanded to allow an
opportunity to amend the complaint, 678 F.3d 10, 15 (1st Cir.
2012).

However, even if Plaintiffs had alleged plausible FLSA

30

claims, this complaint still does not support a plausible claim
under ERISA.
Plaintiffs offer minimal facts in their complaint regarding
pension plans applicable to the employees.

Their complaint

merely states that “[d]efendants sponsor pension plans . . . for
their employees” and “Plaintiffs and Class members participated
in the Plans as plan participants and beneficiaries.”
121-22.

Compl. ¶¶

The complaint alleges that the Defendants’ policies of

under-compensating employees resulted in inaccurate records of
time worked, id. ¶ 122, and that the Defendants failed to credit
them “with all of the hours of service for which they were
entitled to be paid” or credit or “investigate crediting
overtime pay as compensation used to determine benefits to the
extent overtime may be included as compensation under the
Plans.”

Id. ¶ 123.

Plaintiffs do not indicate who their employer is, what
plan they participated in, or the fiduciary for any such plan.
Moreover, they make no allegations about the terms of the
pension plan or plans in which they participated even though
recordkeeping “duties and the nature of the records required to
be maintained can only be determined by looking to the language
of the pension plans themselves.”

31

Henderson v. UPMC, 640 F.3d

524, 528 (3d Cir. 2011) (collecting cases).

As a result, they

have failed to state a claim under ERISA.
E.

RICO Claim
In their final claim, Plaintiffs contend that Defendants

violated 18 U.S.C. § 1962(a) and (c) of the RICO Act by
“refusing to pay their regular or statutorily required rate of
pay” and by “devising a Scheme to obtain Plaintiffs’ and Class
Members’ property by means of false or fraudulent
representations, at least some of which were made in the
misleading payroll checks which defendants mailed.”
¶ 158.

Compl.

As a threshold matter, the RICO claim, like the ERISA

claim, is predicated on deliberate violations of the FLSA.
Because the FLSA claim has been insufficiently pled, Plaintiffs
have no basis for alleging that the mailed paychecks contained
false or fraudulent information about wages earned.
reason alone, the RICO claims must fail.
3789318, at *4.

For this

See Pruell I, 2010 WL

However, even were this not the case,

Plaintiffs have failed to meet the heightened pleading standard
required to bring an action alleging violations of the RICO Act
by fraud.
1.

RICO Allegations

Plaintiffs allege that Defendants engaged in racketeering
activity related to a scheme to deprive Plaintiffs of
32

compensation.

The RICO provisions Defendants are alleged to

have violated are as follows:
(a) It shall be unlawful for any person who has received
any income derived, directly or indirectly, from a
pattern of racketeering activity or through collection
of an unlawful debt . . . to use or invest, directly or
indirectly, any part of such income, or the proceeds of
such income, in acquisition of any interest in, or the
establishment or operation of, any enterprise which is
engaged in, or the activities of which affect,
interstate or foreign commerce.
• • •
(c) It shall be unlawful for any person through a pattern
of racketeering activity or through collection of an
unlawful debt to acquire or maintain, directly or
indirectly, any interest in or control of any enterprise
which is engaged in, or the activities of which affect,
interstate or foreign commerce.
18 U.S.C. § 1962.

“Racketeering activity” includes any act

indictable under various state and federal laws, including 18
U.S.C. § 1341, prohibiting mail fraud.

Id. § 1961(1).

Plaintiffs bring this action under 18 U.S.C. § 1964(c) which
provides a civil remedy for those injured by an illegal activity
described in § 1962.
2.

Pleading Standard

For a RICO claim to survive a motion to dismiss, the
complaint must allege: “(1) conduct (2) of an enterprise (3)
through a pattern (4) of racketeering activity.”

Sedima,

S.P.R.L. v. Imrex Co., Inc., 473 U.S. 479, 496 (1985).
33

Because

Plaintiffs accuse defendants of racketeering activity involving
mail fraud in violation of 18 U.S.C. § 1341, they must also
allege “(1) a scheme to defraud based on false pretenses; (2)
the defendant’s knowing and willing participation in the scheme
with the intent to defraud; and (3) the use of interstate mail
or wire communications in furtherance of that scheme.”

United

States v. Cheal, 389 F.3d 35, 41 (1st Cir. 2004).
RICO claims where the racketeering activity is mail or wire
fraud are subject to a heightened pleading standard.

It is

“well settled law in this circuit that RICO pleadings of mail
and wire fraud must satisfy the particularity requirements” of
Federal Rule of Civil Procedure 9(b).
F.3d 886, 889 (1st Cir. 1997).

Ahmed v. Rosenblatt, 118

Rule 9(b) requires a party

“alleging fraud or mistake” to “state with particularity the
circumstances constituting fraud or mistake.”
9(b).

Fed. R. Civ. P.

This heightened standard “is satisfied by an averment ‘of

the who, what, where, and when of the allegedly false or
fraudulent representation.’”

Rodi v. S. New England Sch. of

Law, 389 F.3d 5, 15 (1st Cir. 2004) (quoting Alt. Sys. Concepts,
Inc. v. Synopsys, Inc., 374 F.3d 23, 29 (1st Cir. 2004)).
In a RICO wire or mail fraud case, “‘the pleader is
required to go beyond a showing of fraud and state the time,
place and content of the alleged mail and wire communications
34

perpetrating that fraud.’”

Cordero-Hernández v. Hernández-

Ballestros, 449 F.3d 240, 244 (1st Cir. 2006) (citations
omitted).

The particularity standard has three purposes: (1) to

place defendants on notice and enable them to prepare meaningful
responses; (2) to preclude the use of fraud allegations as a
pretext for groundless fishing expeditions; and (3) to protect
defendants from charges of fraud that may damage their
reputations.

New England Data Servs., Inc. v. Becher, 829 F.2d

286, 289 (1st Cir. 1987).
I find that Plaintiffs have failed to plead with sufficient
particularity the facts on which the RICO mail fraud claim is
based.

In particular, they have failed to allege which

particular defendants sent the mailings, how the mailings were
misleading, and during what time periods they were sent.

See

Becher, 829 F.2d at 289.
3.

“In Furtherance” Element of Mail Fraud

Even overlooking the failure to plead fraudulent activity
with particularity, Plaintiffs’ complaint fails to point to any
basis for concluding that the mailing of the paychecks satisfied
the “in furtherance” element of mail fraud.14

14

As discussed by

The First Circuit has advised that “the success of the scheme
must be dependent in some way on the mailings, either in
obtaining the desired objection in avoiding or delaying
35

Judge Saylor in Cavallaro I, 2010 WL 3609535 at *3, paychecks
omitting the time employees actually worked would have increased
the likelihood of discovery of the alleged scheme.

If an

employee works 42 hours in a week, but the paycheck reflects
compensation for only 40 hours, the employee would be alerted to
the underpayment.

Id.

See also Manning v. Boston Medical

Center, 2011 WL 796505, at *2 (adopting the reasoning of
Cavallaro I) (“Manning I”), Nakahata, 723 F.3d at 204-5
(applying same reasoning).

As a result, even if Plaintiffs had

provided sufficient particularity with respect to the alleged
mail fraud, there is no plausible basis upon which the paychecks
could be said to have been in furtherance of that alleged
predicate.15

detection of the scheme.” U.S. v. Greenleaf, 692 F.3d 182, 186
(1st Cir. 1982).
15 To the extent that Plaintiffs allege a RICO claim under 18
U.S.C. § 1962(a), that claim must also be dismissed. As
explained by Judge Saylor, “[i]n the First Circuit, the
‘investment use rule’ requires plaintiffs asserting a § 1962(a)
cause of action to allege a specific injury flowing from the
investment and use of racketeering proceeds.” Cavallaro v.
UMass Memorial Health, Inc., 2010 WL 3609535 at *5 (D. Mass.
July 2, 2010) (“Cavallaro I”) (quoting Compagnie de Reassurance
D’Ile de France v. New England Reinsurance Corp., 57 F.3d 56, 91
(1st Cir. 1995)). None is alleged here.
36

V. CONCLUSION
For the reasons outlined herein, I have granted Defendants’
Motion for Judgment on the Pleadings [Dkt. No. 115] and hereby
ORDER the Clerk to enter a judgment of dismissal as to all
claims.

/s/ Douglas P. Woodlock______
DOUGLAS P. WOODLOCK
UNITED STATES DISTRICT JUDGE

37