ANDERSON v. P.F. CHANG'S CHINA BISTRO, INC. et al
Filing
32
ORDER granting Plaintiff's #14 Motion to Dismiss Counterclaims, and denying Plaintiff's #17 Motion for Collective Action Certification Without Prejudice. Signed by District Judge Denise Page Hood. (JOwe)
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 1 of 31
Pg ID 602
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
JEREMY ANDERSON,
Plaintiff,
CASE NO. 16-14182
HON. DENISE PAGE HOOD
v.
P.F. CHANG’S CHINA BISTRO, INC.,
DOES #1-10,
Defendants.
/
ORDER GRANTING PLAINTIFF’S MOTION TO DISMISS
COUNTERCLAIMS [#14], AND DENYING PLAINTIFF’S MOTION FOR
COLLECTIVE ACTION CERTIFICATION [#17] WITHOUT PREJUDICE
BACKGROUND
On November 29, 2016, Plaintiff Jeremy Anderson (“Anderson”) filed this
case against Defendants P.F. Chang’s China Bistro, Inc. (“P.F. Chang’s”) and John
Does # 1-10 alleging violations of the Fair Labor Standards Act (“FLSA”),
Michigan labor law, and North Carolina labor law. (Doc # 1) Anderson seeks to
prosecute his claims as a collective action on behalf of all persons who are or were
formerly employed by Defendants as sous chef employees or similar positions with
different titles who were non-exempt employees within the meaning of the FLSA
and who were not paid minimum wage for hours worked and/or were not paid
1
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 2 of 31
Pg ID 603
overtime for hours worked over 40 hours in a work week during the three years
prior to the filing on this case.
On February 1, 2017, P.F. Chang’s filed an Answer and Counterclaims
against Anderson alleging accounting and offset/recoupment, breach of contract,
breach of good faith and fair dealing, unjust enrichment and restitution, and
faithless servant. (Doc # 8) On March 8, 2017, Anderson filed a Motion to
Dismiss P.F. Chang’s Counterclaims. (Doc # 14) P.F. Chang’s filed a Response
on March 29, 2017. (Doc # 19) Anderson filed a Reply on May 12, 2017. (Doc #
25)
On March 27, 2017, Anderson filed a Motion for Collective Action
Certification. (Doc # 17) P.F. Chang’s filed a Response on May 30, 2017. (Doc #
27) Anderson filed a Reply on June 12, 2017. (Doc # 29) The Court held a
hearing on the Motions on June 21, 2017.
Anderson began working for P.F. Chang’s, an Asian-themed restaurant
chain, in 2008 as a Line Cook in the Beachwood, Ohio restaurant. As a Line
Cook, Anderson was paid by the hour. Anderson worked at this Ohio restaurant
until about June 2013. Starting in or about August 2013, Anderson became a Sous
Chef at the P.F. Chang’s restaurant in Northville, Michigan. He worked at the
Michigan restaurant until about September 2014. From about September 2014 to
about March 2015, Anderson worked as a Sous Chef at the P.F. Chang’s restaurant
in Charlotte, North Carolina.
2
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 3 of 31
Pg ID 604
Anderson asserts that, as a Sous Chef in the Michigan and North Carolina
restaurants, he was a non-exempt employee within the meaning of the FLSA. He
claims that he is entitled to back wages for work performed for which P.F. Chang’s
did not pay him the legal minimum wage or overtime wages.
According to
Anderson, he worked four days a week, for approximately 66.5 to 70.5 hours per
week at the Michigan restaurant. He claims he worked five days a week, for
approximately 55 hours per week at the North Carolina restaurant.
Anderson alleges that, as a Sous Chef in the Michigan and North Carolina
restaurants, he spent over 90 percent of his time cooking and preparing food.
Anderson alleges that he did the same work as hourly Line Cooks except that he
worked longer hours as a Sous Chef and was not paid any overtime premium for
hours worked over 40 hours in a week. Anderson claims that he did not get any
breaks and was not permitted to leave the kitchen at either the Michigan restaurant
or the North Carolina restaurant. He alleges that his duties as a Sous Chef did not
include managerial responsibilities or the exercise of independent business
judgment. Anderson further alleges that he did not customarily direct the work of
two or more employees, review or approve employee hours, or prepare schedules.
According to the Complaint, Anderson did not have authority to and did not hire,
fire, or discipline employees (except on one occasion when Anderson wrote up an
3
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 4 of 31
Pg ID 605
employee as a result of the direct instruction to do so by the Chef at the Michigan
restaurant).
From about March 2015 to about June 2016, Anderson worked as an hourly
Line Cook back at the P.F. Chang’s restaurant in Ohio. From about August 2016
to about October 2016, Anderson worked as an hourly Line Cook at the P.F.
Chang’s restaurant in Palm Gardens, Florida. Anderson alleges that he observed
Sous Chefs at the Ohio and Florida restaurants performing the same duties as Line
Cooks, except that Sous Chefs worked weekly shifts that were over 40 hours and
were not paid time and one half for their overtime.
According to P.F. Chang’s, Line Cooks are hourly, non-exempt employees
who are responsible for preparing food for customers; Sous Chefs, on the other
hand, receive salaries and are exempt employees not entitled to overtime
compensation.
P.F. Chang’s alleges in its Counterclaims that the Sous Chef
position entails additional pay and benefits, not available to hourly cooks, in
exchange for the regular performance of managerial and other exempt duties.
P.F. Chang’s points to the Sous Chef Position Description that was
applicable at the Ohio restaurant at the time that Anderson was being considered
for the promotion from Line Cook to Sous Chef. This Position Description states
that the Sous Chef position is a management position designed to manage and
execute all kitchen functions. (Doc # 8-2) It describes the essential functions of
4
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 5 of 31
the position to include:
Pg ID 606
supervising, assigning, delegating tasks, and giving
direction to the kitchen staff; ensuring proper timing and production of all food
orders; preparing work schedules for all kitchen staff; supervising and facilitating
training of all food preparation and execution of all menu items, procedure, and
recipes; maintaining all product quality standards; completing prep lists;
completing ordering guides; assisting with interviewing, hiring, and discharging
employees; assisting in providing feedback to staff; handling disciplinary activities
and recognition of staff; holding “front of the house” staff accountable for dress
code standards; being accountable for following safety and sanitation guidelines;
completing and costing all food inventories; completing opening and closing
checklists; and managing the P.F. Chang’s Message. Id. The Position Description
also states: “The largest percentage of a Sous Chef[’s] work day is spent directing
and supervising the employees on that shift. S/he operates with a great deal of
independent decision-making and discretionary authority. . . . In the absence of the
Culinary Partner, the Sous Chef is the back of the house lead.” Id.
According to P.F. Chang’s, after learning of the aforementioned Sous Chef
Position requirements, Anderson agreed to go through a “weeks’ long” Manager in
Training (“MIT”) formal training program. Anderson acknowledged and signed
P.F. Chang’s’ Management Fraternization Policy, which prohibits managers from
dating non-management employees. (Doc # 8-3) Anderson also acknowledged
5
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 6 of 31
Pg ID 607
and signed P.F. Chang’s’ Immigration Policy and I-9 Compliance Plan, agreeing
that he understood his “responsibility as a member of management to follow
proper hiring and immigration-related procedures.” (Doc # 8-4) P.F. Chang’s
claims that Anderson was trained on managerial duties and received a copy of the
Position Description.
The Counterclaim alleges that Anderson was expected to, and did, instruct
team members on best practices so that they could most effectively complete their
own tasks and allow him the flexibility to supervise and support each station in the
back of the house. P.F. Chang’s claims that Anderson conducted one-on-one
coaching and counseling sessions with employees, and he was not required to seek
approval from any other member of management to do so. P.F. Chang’s claims
that Anderson provided formal and informal performance reviews to employees he
managed, and he was required to draw on his observations while managing
employees and exercise his independent judgment in determining whether
employees were exceeding, meeting, or not meeting expectations. According to
P.F. Chang’s, Anderson also helped conduct interviews and hire new employees,
and he could end a candidate’s application process if, using his independent
judgment, he did not feel the candidate was a good fit. The Counterclaim alleges
that Anderson was expected to, and did, use his judgment when completing
inventory for his specific restaurant, and after conducting an analysis of his
6
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 7 of 31
Pg ID 608
particular restaurant’s needs at any given moment, forecast what food and supplies
to place in upcoming orders. According to P.F. Chang’s, the Operating Partners
and/or Culinary Partners at the Michigan and North Carolina restaurants observed
Anderson perform hiring, training, coaching, scheduling, and disciplining of “back
of the house” employees.
P.F. Chang’s claims that, as a Sous Chef, Anderson received a salary for all
hours of work and was an exempt employee not entitled to overtime compensation.
According to Anderson’s Complaint, he received an annual salary of about
$41,000.00. According to the Counterclaim, as a Sous Chef, Anderson received
and accepted an annual salary of $41,000.00, which was thereafter increased to
$42,000.00 and subsequently increased to $43,000.00. The Counterclaim further
alleges that Anderson received and accepted paid vacation time, eligibility for
health insurance benefits, long-term disability benefits, and short-term disability
benefits—which are only provided to management and not to hourly employees.
P.F. Chang’s maintains that, to the extent Anderson is found to have
regularly performed primarily non-exempt duties (as Anderson alleges in his
Complaint) during any time he held the position of Sous Chef, he has materially
breached his agreement to primarily perform exempt duties, and P.F. Chang’s has
suffered damages as a result of compensating Anderson for the performance of
managerial duties which he agreed to, but allegedly did not, perform. P.F. Chang’s
7
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 8 of 31
Pg ID 609
further asserts that Anderson acted in bad faith by accepting a promotion to Sous
Chef and accepting higher pay and additional benefits in exchange for the
performance of managerial and exempt duties, and then performing primarily nonexempt duties without informing P.F. Chang’s about it.
II.
MOTION TO DISMISS DEFENDANT’S COUNTERCLAIMS
A. Standard of Review
Rule 12(b)(1) of the Federal Rules of Civil Procedure provides for dismissal
for lack of jurisdiction over the subject matter. Fed. R. Civ. P. 12(b)(1). Motions
under Rule 12(b)(1) fall into two general categories: facial attacks and factual
attacks. See RMI Titanium Co. v. Westinghouse Elec. Corp., 78 F.3d 1125, 1134
(6th Cir. 1996). A facial attack challenges the pleading itself. In considering this
type of attack, the court must take all material allegations in the complaint as true,
and construe them in the light most favorable to the non-moving party. Id. Where
subject matter jurisdiction is factually attacked, the plaintiff bears the burden of
proving jurisdiction to survive the motion, and “the trial court is free to weigh the
evidence and satisfy itself as to the existence of its power to hear the case.” Id. In
a factual attack of subject matter jurisdiction, “no presumptive truthfulness attaches
to plaintiff’s allegations, and the existence of disputed material facts will not
preclude the trial court from evaluating for itself the merits of jurisdictional
claims.” Id.
8
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 9 of 31
Pg ID 610
B. Subject Matter Jurisdiction
Anderson argues that the Court lacks subject matter jurisdiction over P.F.
Chang’s’ state-law Counterclaims because there is no original federal jurisdiction;
the Counterclaims are not compulsory; the Counterclaims do not derive from a
common nucleus of operative facts with Anderson’s claims; and public policy
weighs against allowing in the retaliatory Counterclaims.
P.F. Chang’s responds that the Counterclaims are compulsory because they
arise out of the exact same transaction or occurrence as Anderson’s claims. P.F.
Chang’s also argues that, even if the Court were to determine that the
Counterclaims are not compulsory, the Counterclaims are permissive, and no facts
or allegations exist to warrant declining supplemental jurisdiction.
Anderson facially attacks the Counterclaims, so the Court takes the
allegations in the Counterclaims as true and construes them in the light most
favorable to P.F. Chang’s.
See RMI Titanium Co., 78 F.3d at 1134.
The
Counterclaims raise questions of state law, and do not raise federal questions. P.F.
Chang’s fails to allege the amount in controversy, which does not appear to meet
the $75,000.00 minimum for diversity jurisdiction.
Accordingly, there is no
original federal jurisdiction, and the Court must decide whether to exercise
supplemental jurisdiction over P.F. Chang’s’ Counterclaims.
9
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 10 of 31
Pg ID 611
28 U.S.C. § 1367 gives the Court discretion to exercise supplemental
jurisdiction over state law claims “that are so related to claims in the action within
[the court’s] original jurisdiction that they form part of the same case or
controversy under Article III of the United States Constitution.” 28 U.S.C. § 1367.
“Claims form part of the same case or controversy when they derive from a
common nucleus of operative facts.” Harper v. AutoAlliance Int’l, Inc., 392 F.3d
195, 209 (6th Cir. 2004) (internal quotations and citation omitted). Section 1367
further guides a court in determining whether supplemental jurisdiction should be
exercised:
The district courts may decline to exercise supplemental jurisdiction
over a claim under subsection (a) if—
(1) the claim raises a novel or complex issue of State law,
(2) the claim substantially predominates over the claim or
claims over which the district court has original jurisdiction,
(3) the district court has dismissed all claims over which it has
original jurisdiction, or
(4) in exceptional circumstances, there are other compelling
reasons for declining jurisdiction.
28 U.S.C. § 1367(c).
Rule 13 of the Federal Rules of Civil Procedure defines two types of
counterclaims: (1) compulsory counterclaims, which arise “out of the transaction
or occurrence that is the subject matter of the opposing party’s claim” and do “not
10
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 11 of 31
Pg ID 612
require adding another party over whom the court cannot acquire jurisdiction;” and
(2) permissive counterclaims, which are any counterclaims that are not
compulsory. Fed. R. Civ. P. 13. A counterclaim arises out of the same transaction
or occurrence as the original claim if the issues of law and fact raised by the claims
are largely the same or if substantially the same evidence would support or refute
both claims. Sanders v. First Nat’l Bank & Trust Co. in Great Bend, 936 F.2d 273,
277 (6th Cir. 1991).
In this case, the parties’ claims involve different laws and evidence.
Anderson’s labor claims focus on how many hours he worked, how much he was
paid, and whether, as a Sous Chef, he was an exempt or non-exempt employee
under the FLSA.
P.F. Chang’s’ Counterclaims, on the other hand, involve
questions of whether the parties had a contract (P.F. Chang’s does not include any
written contract signed by the parties), what any contract required, whether
Anderson breached any contract, whether Anderson was unjustly overpaid for
work he performed, whether Anderson engaged in misconduct or grossly
mismanaged P.F. Chang’s’ affairs, and to what extent, if any, P.F. Chang’s was
damaged. The Court finds that P.F. Chang’s’ Counterclaims are not compulsory
because they do not arise from the same transaction or occurrence as Anderson’s
claims. See Sneed v. Wireless PCS Ohio #1, LLC, No. 1:16CV1875, 2017 WL
879591, at *2 (N.D. Ohio Mar. 6, 2017); Wagoner v. N.Y.N.Y., Inc., No. 1:14-CV11
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 12 of 31
Pg ID 613
480, 2015 WL 1468526, at *3 (S.D. Ohio Mar. 30, 2015) (“Though the outcome of
the minimum wage determination may also impact Defendant’s breach of contract
counterclaim, that breach of contract counterclaim seeks affirmative relief and will
require investigation into the validity of the contract Plaintiff entered into with
Defendant and whether Plaintiff breached that contract.”); Morris v. Blue Sky
Mgmt., LLC, No. 11-00979-CV-DGK, 2012 WL 527936, at *3-4 (W.D. Mo. Feb.
16, 2012) (holding that counterclaims for breach of contract, breach of fiduciary
duty, breach of duty of loyalty, and unjust enrichment did not share a common
nucleus of operative fact with the plaintiff’s FLSA claim even though the question
of whether the plaintiff was an exempt worker as defined by the FLSA was
pertinent to both claims). 1
Having found that P.F. Chang’s’ Counterclaims are permissive, the Court
next turns to determining whether to exercise supplemental jurisdiction under 28
U.S.C. § 1367. The Counterclaims are not so related to Anderson’s claims that
they form part of the same case or controversy because they do not derive from a
1
P.F. Chang’s relies heavily on Doe v. Cin-Lan, Inc. in support of its argument that its
Counterclaims are compulsory. See Doe v. Cin-Lan, Inc., No. 08-CV-12719, 2010 WL 726710,
at *5 (E.D. Mich. Feb. 24, 2010). However, Anderson correctly notes that Cin-Lan did not
concern a challenge to subject matter jurisdiction. Rather, the court’s analysis centered on
whether the law permits a contingent counterclaim, and whether the defendant had suffered any
harm sufficient to state a breach of contract counterclaim under Rule 12(b)(6) of the Federal
Rules of Civil Procedure. See id.; see also Wagoner, 2015 WL 1468526, at *4 (acknowledging
Cin-Lan in footnote 2, while collecting cases that held that state law counterclaims based on
breach of contract or other state common laws do not arise out of the same occurrence as claims
for statutory minimum wage).
12
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 13 of 31
Pg ID 614
common nucleus of operative facts. The accounting and offset/recoupment, breach
of contract, unjust enrichment and restitution, and faithless servant Counterclaims
arise under state law not implicated in Anderson’s claims. Although there would
be some evidentiary overlap regarding the type of duties that Anderson performed
as a Sous Chef, the Counterclaims would involve a substantial amount of
additional evidence that would not be necessary to prove or defend Anderson’s
claim. See Sneed, 2017 WL 879591, at *3; Coronado v. D. N.W. Houston, Inc.,
No. CIV.A. H-13-2179, 2014 WL 2779548, at *4 (S.D. Tex. June 19, 2014)
(holding that the proposed counterclaims did not form part of the same case or
controversy as the FLSA claim because the FLSA claims turned on the economic
realities of the relationship between the parties, while the proposed counterclaims
turned on contract language and issues of consideration, conscionability, and the
defendant’s damages).
Even if P.F. Chang’s’ Counterclaims derived from a common nucleus of
operative facts with Anderson’s claims, the Court declines to exercise
supplemental jurisdiction over the Counterclaims because of the concern that the
Counterclaims would change the nature of this lawsuit and substantially
predominate over Anderson’s statutory wage claims. P.F. Chang’s’ Counterclaims
outnumber Anderson’s claims, are distinct from Anderson’s claims, and involve
proof that is not needed to establish or defend Anderson’s claims. See Sneed, 2017
13
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 14 of 31
Pg ID 615
WL 879591, at *3. Many federal courts have also noted that counterclaims in
FLSA litigation should be disfavored because they could be viewed as retaliation
for an employee bringing an FLSA claim against the employer. Id.; Morris, 2012
WL 527936, at *4-5. As the Fifth Circuit has noted,
The FLSA decrees a minimum unconditional payment and the
commands of that Act are not to be vitiated by an employer, either
acting alone or through the agency of a federal court. The federal
courts were not designated by the FLSA to be either collection agents
or arbitrators for an employee’s creditors. Their sole function and
duty under the Act is to assure to the employees of a covered
company a minimum level of wages. Arguments and disputations
over claims against those wages are foreign to the genesis, history,
interpretation, and philosophy of the Act. The only economic feud
contemplated by the FLSA involves the employer’s obedience to
minimum wage and overtime standards. To clutter these proceedings
with the minutiae of other employer-employee relationships would be
antithetical to the purpose of the Act. Set-offs against back pay awards
deprive the employee of the “cash in hand” contemplated by the Act,
and are therefore inappropriate in any proceeding brought to enforce
the FLSA minimum wage and overtime provisions, whether the suit is
initiated by the individual employees or by the Secretary of Labor.
Brennan v. Heard, 491 F.2d 1, 4 (5th Cir. 1974), overruled on other grounds,
McLaughlin v. Richland Shoe Co., 486 U.S. 128 (1988).2
2
The Court notes that P.F. Chang’s seeks more than a defensive offset in its Counterclaims as
permitted under the FLSA. P.F. Chang’s seeks affirmative relief for damages arising from
Anderson asserting the statutory right to be properly classified and compensated under the FLSA
and other labor statutes. As the court noted in Wagoner, “[t]he statutory scheme of the FLSA
provides for certain offsets and credits when appropriate, and no separate affirmative common
law counterclaim is necessary to adjudicate those issues.” 2015 WL 1468526, at *5. P.F.
Chang’s has pled offset as an affirmative defense. “As such, counterclaims raising other
minutiae of employer-employee relationships are contrary to the purposes of the statutory
provisions.” Id.; see also Coronado, 2014 WL 2779548, at *3 (finding that the proposed setoff
counterclaim was not compulsory because it had not yet matured). The Court further notes, as
14
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 15 of 31
Pg ID 616
The Court declines to exercise supplemental jurisdiction over the
Counterclaims in this case. The Court dismisses without prejudice P.F. Chang’s’
Counterclaims for lack of subject matter jurisdiction. Because the Court lacks
subject matter jurisdiction over the Counterclaims, the Court need not reach the
parties’ remaining arguments under Rule 12(b)(6) of the Federal Rules of Civil
Procedure.
III.
MOTION FOR COLLECTIVE ACTION CERTIFICATION
A. Standard of Review
Anderson seeks conditional class certification and judicial notice of a
collective action as permitted under Section 216(b) of the FLSA:
An action . . . may be maintained against any employer . . . in any
Federal or State court of competent jurisdiction by any one or more
employees for and in behalf of himself or themselves and other
employees similarly situated. No employee shall be a party plaintiff to
any such action unless he gives his consent in writing to become such
a party and such consent is filed in the court in which such action is
brought.
29 U.S.C. § 216(b) (emphasis added).
Unlike class actions under Rule 23 of the Federal Rules of Civil Procedure,
collective actions under the FLSA require putative class members to opt into the
was observed in Sneed, that “[n]othing stops defendants from suing plaintiff for damages in state
court. A state court judgment could be used as a set off to any judgment plaintiff obtains in this
case. But these practical concerns don’t give rise to federal jurisdiction.” 2017 WL 879591, at
*3 n.6. The Court acknowledges that P.F. Chang’s has cited some case law that supports its
argument that the Court should exercise supplemental jurisdiction over its Counterclaims for
reasons of judicial economy and efficiency; however, this Court finds the cases cited above to be
more persuasive for the reasons set forth above.
15
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 16 of 31
Pg ID 617
class, and these opt-in employees are party plaintiffs, unlike absent class members
in a Rule 23 class action. Comer v. Wal-Mart Stores, Inc., 454 F.3d 544, 546 (6th
Cir. 2006); Fisher v. Michigan Bell Tel. Co., 665 F. Supp. 2d 819, 824 (E.D. Mich.
2009).
Section 216(b) of the FLSA establishes two requirements for a collective
action: (1) the plaintiffs must actually be similarly situated; and (2) all plaintiffs
must signal in writing their affirmative consent to participate in the action. Comer,
454 F.3d at 546. The district court’s first task is to “consider whether the plaintiffs
have shown that the employees to be notified [of the collective action] are, in fact,
‘similarly situated.’” Id. If the plaintiffs meet their burden, then the district court
may exercise its discretion to authorize notification of similarly situated employees
to allow them to opt into the lawsuit. Id.
In order to determine whether the plaintiffs are similarly situated, district
courts generally follow a two-stage certification process. Id.; Fisher, 665 F. Supp.
2d at 825.
The first stage of § 216(b) certification, also known as the “notice
stage,” takes place early in the litigation; i.e., at the beginning of
discovery. It is here where the court determines whether the suit
should be “conditionally certified” as a collective action so that
potential opt-in plaintiffs can be notified of the suit’s existence and of
their right to participate. The second stage occurs much later; after
all of the opt-in forms have been received and discovery has been
concluded.
Fisher, 665 F. Supp. 2d at 825 (internal quotations and citations omitted).
16
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 17 of 31
Pg ID 618
At the second stage, the court has much more information and employs a
stricter standard to decide whether particular members of the class are, in fact,
similarly situated. Comer, 454 F.3d at 547. “The action may be ‘de-certified’ if
the record reveals that they are not, and the opt-in plaintiffs’ claims may be
dismissed without prejudice.” Shipes v. Amurcon Corp., No. 10-14943, 2012 WL
995362, at *4 (E.D. Mich. Mar. 23, 2012) (internal quotation marks and citation
omitted).
Through the instant Motion, Anderson seeks only conditional certification at
the notice stage, not final certification. “District courts use a fairly lenient standard
that typically results in conditional certification of a representative class when
determining whether plaintiffs are similarly situated during the first stage of the
class certification process.” White v. Baptist Mem’l Health Care Corp., 699 F.3d
869, 877 (6th Cir. 2012) (internal quotations and citations omitted). “The plaintiff
must show only that his position is similar, not identical, to the positions held by
the putative class members.” Comer, 454 F.3d at 546-47 (internal quotations and
citations omitted). “[A] named plaintiff can show that the potential claimants are
similarly situated by making a modest factual showing sufficient to demonstrate
that they and potential plaintiffs together were victims of a common policy or plan
that violated the law.” Olivo v. GMAC Mortg. Corp., 374 F. Supp. 2d 545, 548
(E.D. Mich. 2004).
17
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 18 of 31
Pg ID 619
“Although the standard for granting conditional certification is lenient, it is
not non-existent.” Cason v. Vibra Healthcare, No. 10-10642, 2011 WL 1659381,
at *3 (E.D. Mich. May 3, 2011). At this stage, courts consider factors such as
whether potential plaintiffs have been identified; whether affidavits of potential
plaintiffs have been submitted; and whether evidence of a widespread unlawful
policy or plan has been submitted. Olivo, 374 F. Supp. 2d at 548.
At this first stage of conditional certification, the court “does not resolve
factual disputes, decide substantive issues on the merits, or make credibility
determinations.” Fisher, 665 F. Supp. 2d at 826. Additionally, the plaintiff’s
evidence on a motion for conditional certification “is not required to meet the same
evidentiary standards applicable to motions for summary judgment because to
require more at this stage of the litigation would defeat the purpose of the twostage analysis under Section 216(b),” and would fail to take into account that the
plaintiff “has not yet been afforded an opportunity, through discovery, to test fully
the factual basis of his case.” Id. (internal quotations and citations omitted).
Nevertheless, affidavits submitted at the notice stage must still be based on the
personal knowledge of the affiant. White v. MPW Indus. Servs., Inc., 236 F.R.D.
363, 369 (E.D. Tenn. 2006).
18
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 19 of 31
Pg ID 620
B. Whether Anderson Has Sufficiently Shown That A Class of Similarly
Situated Potential Sous Chef Plaintiffs Exists
Anderson argues that the Court should grant conditional certification of a
collective action class consisting of current and former employees of P.F. Chang’s
who worked as food preparation employees with the title “Sous Chef” or in other
similar non-managerial, non-administrative positions on or after November 20,
2013. Anderson argues that courts have consistently granted collective action
certification to sous chefs under the FLSA. Anderson further argues that courts
have granted collective action certification where employees were misclassified.
In support of his Motion, Anderson includes his own declaration as well as a
declaration from Patrick Stancil (“Stancil”), a former P.F. Chang’s employee.
Anderson argues that the two declarations demonstrate that P.F. Chang’s adopted
and adhered to a policy requiring their cooks with the title “Sous Chef” to work a
double shift in excess of 40 hours per week and paid them a salary but failed to pay
them overtime compensation in violation of the FLSA.
P.F. Chang’s argues that Anderson cannot meet his burden of demonstrating
the appropriateness of conditional certification based solely on his conclusory
declarations that his and Stancil’s experiences are similar to those of the
approximately 900 other Sous Chefs across over 200 P.F. Chang’s locations. P.F.
Chang’s further argues that uniform classification does not demonstrate that Sous
Chefs are similarly situated. According to P.F. Chang’s, Anderson has not offered
19
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 20 of 31
Pg ID 621
sufficient evidence to show a nationwide de facto illegal policy pursuant to which
Sous Chefs are assigned duties that render inappropriate P.F. Chang’s exempt
classification of the Sous Chef position. In support of its position, P.F. Chang’s
includes declarations from twelve individuals who work/worked as Sous Chefs in
sixteen different P.F. Chang’s restaurants. P.F. Chang’s also points to Anderson’s
deposition testimony indicating that he had some exempt duties as Sous Chef, and
indicating that he lacks personal knowledge regarding the duties carried out by any
other Sous Chef.
Anderson replies that the declarations submitted by P.F. Chang’s have little
evidentiary value at the conditional certification notice stage. Anderson notes that
he has not had the opportunity to depose the employees of P.F. Chang’s who
submitted declarations on P.F. Chang’s’ behalf, and that these witnesses were not
disclosed in the Rule 26 disclosure or interrogatory responses. Anderson asserts
that these declarants have been cherry-picked by P.F. Chang’s and are under P.F.
Chang’s’ control and potentially subject to coercion.
A named plaintiff is not similarly situated to a proposed plaintiff simply
because they share exempt status.
Shipes, 2012 WL 995362, at *9.
In
misclassification cases, “similarly situated” must be analyzed in terms of the nature
of the job duties performed by each class member, as the ultimate issue to be
determined is whether each employee was properly classified as exempt. . . . A
20
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 21 of 31
Pg ID 622
collective action is only appropriate where the plaintiffs make a modest factual
showing that the nature of the work performed by all class members is at least
similar to their own. Id. at *10.
To certify a class covering all of defendant’s locations, plaintiffs do
not need to allege facts or present other evidence for each of those
locations. Nonetheless, plaintiffs must provide sufficient evidence of
a company-wide practice through declarations of present and former
employees at other locations to justify sending notice to similarly
situated employees at all locations at issue in the litigation.
Cobus v. DuHadway, Kendall & Assocs., Inc., No. 13-CV-14940, 2014 WL
4181991, at *5 (E.D. Mich. Aug. 21, 2014).
The Court turns to the factual showing put forth by Anderson. As noted
before and according to Anderson’s declaration, as a P.F. Chang’s Sous Chef
during the relevant time period, he worked for approximately 66.5 to 70.5 hours
per week at the Michigan restaurant, and approximately 55 hours per work at the
North Carolina restaurant. He spent over 90 percent of his time cooking and
preparing food, and he did the same work as hourly Line Cooks except that he
worked longer hours as a Sous Chef and was not paid any overtime premium for
hours worked over 40 hours in a week. He did not get any breaks and was not
permitted to leave the kitchen.
His duties as a Sous Chef did not include
managerial responsibilities or the exercise of independent business judgment. He
did not customarily direct the work of two or more employees, review or approve
employee hours, or prepare schedules. He did not have authority to and did not
21
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 22 of 31
Pg ID 623
hire, fire, or discipline employees (except on one occasion when Anderson wrote
up an employee as a result of the direct instruction to do so by the Chef at the
Michigan restaurant).
Anderson’s declaration further states that, at the Ohio
restaurant and Florida restaurant where he worked as a Line Cook, he observed the
Sous Chefs performing the same duties as the Line Cooks, except that they worked
weekly shifts that were over 40 hours in a week and were not paid overtime.
Anderson’s Reply Declaration states that, during 2016, P.F. Chang’s changed their
policy and divided Sous Chefs into two categories: regular “Sous Chefs” who
cook and are paid hourly including overtime, and “Senior Sous Chefs” who are
paid a salary and are not paid overtime and are prohibited from performing any
cooking work. (Doc # 29-3, Pg ID 529-28)
Anderson does not make any specific allegations regarding the primary
duties of Sous Chefs at the Ohio or Florida restaurants, or regarding the percentage
of time the Sous Chefs spent on “Line Cook” duties versus any other duties.
Notably, Anderson makes no allegations regarding other Sous Chefs who worked
in the Michigan or North Carolina restaurants at the same time as him. During his
deposition, Anderson could not recall duties performed by any other P.F. Chang’s
Sous Chefs, even at locations where he worked. Anderson further testified that,
outside of speculation and talk around the restaurants where he worked about Sous
22
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 23 of 31
Pg ID 624
Chefs being “glorified cooks,” he has no personal knowledge of the duties of any
other Sous Chefs.
The Court takes note that parts of Anderson’s deposition testimony seem to
contradict his own declaration. For example, his declaration states that his duties
did not include any managerial responsibilities. However, Anderson testified at his
deposition that there were times when he was the person in charge of the kitchen,
overseeing kitchen staff. He testified that he had the authority to direct staff to
complete tasks. He testified that if a Line Cook prepared a dish incorrectly, it
would come back to him as Sous Chef. He testified that if something went wrong,
the issue would come to the manager or to him as Sous Chef, and not to the Line
Cooks.
The Court next turns to Stancil’s declaration, the only other declaration that
Anderson has put forth to support conditional certification. Stancil declares that he
worked as a P.F. Chang’s Sous Chef during the relevant time period in the
Stamford, Connecticut restaurant. According to Stancil, his duties as a Sous Chef
did not include managerial responsibilities or the exercise of independent business
judgment. He did not customarily direct the work of two or more employees, or
review or approve employee hours. He did not have authority to and did not hire,
fire, or discipline employees. Stancil declares that he often worked 60-75 hours
per week, and that he spent 50-60% of his time cooking on the line. Most of the
23
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 24 of 31
Pg ID 625
remainder of his time was spent on food-preparation tasks. He spent some time
checking whether orders were correct before going out, keeping times of the tickets
and checks, 1-2 hours per week drafting schedules for approval, and 1-2 hours per
week ordering inventory. The Court also notes that Stancil has not opted into this
proposed collective action and cannot do so.
Stancil’s declaration states that he worked with two other Sous Chefs at the
Stamford restaurant, Amilcar Huyhua (“Huyhua”) and Omar Vega. Stancil also
talked to Lamar and Andrew who work at the P.F. Chang’s in Farmington,
Connecticut. Stancil talked to Jose and Fransciso who work as Sous Chefs at the
P.F. Chang’s in White Plains, New York. Stancil talked to Jaime, a Sous Chef at
the P.F. Chang’s in Albany, New York. Stancil talked to Vance, a former P.F.
Chang’s Sous Chef who worked at the restaurant in Syracuse, New York. And
Stancil talked to Greg who works as a Sous Chef at the P.F. Chang’s in Nanuet,
New York. The declaration includes no description of the duties that these nine
individuals performed as Sous Chefs, and no statement regarding whether the
duties were exempt, non-exempt, or some combination. The declaration simply
states that Stancil knows, based on an unknown number of conversations on
unknown dates, that these people had “the same job” as Stancil, worked much
more than 40 hours per week, were paid a salary, and were not paid overtime
24
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 25 of 31
Pg ID 626
premium pay. The Court notes that none of these individuals have opted into this
proposed collective action.
Anderson also attaches a complaint from another action to his Reply to add
to his factual showing. This action was brought by Stancil and Huyhua against
P.F. Chang’s in the District of Connecticut in July 2015. Defendants assert that
this action was voluntarily dismissed. A review of this complaint shows that the
allegations as to Stancil are the same as what he states in his declaration discussed
above. The allegations as to Huyhua are very similar, although no declaration or
sworn testimony from Huyhua has been submitted to this Court. Huyhua has not
opted into this proposed collective action either.
P.F. Chang’s, on the other hand, has put forth the declarations of (1) Angie
Adler, Director of HR Field Operations at P.F. Chang’s; (2) Moria Saunders, Sous
Chef at the P.F. Chang’s in Boca Raton, Florida; (3) Paul Duco, Sous Chef at the
P.F. Chang’s in Sherman Oaks, California; (4) Carey Ball, Culinary Partner at the
P.F. Chang’s in Raleigh, North Carolina (and former Sous Chef at this same
restaurant); (5) Michael Smalley, Sous Chef at the P.F. Chang’s in Miami, Florida
(and previously Sous Chef at the P.F. Chang’s in Boca Raton, Florida, and
Culinary Partner at the P.F. Chang’s in Palm Beach, Florida); (6) Nick Lucas, Sous
Chef at the P.F. Chang’s in Austin, Texas; (7) Jaime Hoffman, Sous Chef at the
P.F. Chang’s in Albany, New York; (8) Nhat Le, Culinary Partner at the P.F.
25
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 26 of 31
Pg ID 627
Chang’s in Durham, North Carolina (and previously Sous Chef at the P.F. Chang’s
in Ashville, North Carolina, as well as the P.F. Chang’s in Greensboro, North
Carolina; (9) Edward Dunham, Operating Partner at the P.F. Chang’s in Towson,
Maryland (and previously Sous Chef at the P.F. Chang’s in Chevy Chase,
Maryland); (10) Keith Bussue, Senior Sous Chef at the P.F. Chang’s in Galleria
Mall, Ft. Lauderdale, Florida (and previously Sous Chef at the P.F. Chang’s in
Falls Mall and also Dolphin Mall—both in Miami, Florida); (11) Ben Delgado,
Senior Sous Chef at the P.F. Chang’s in Chattanooga, Tennessee; (12) Gerry Heim,
Sous Chef at the P.F. Chang’s in Northville, Michigan; and (13) John Lopez, Sous
Chef at the P.F. Chang’s in The Falls, Miami, Florida.
A review of these
declarations indicates that, as Sous Chefs, these individuals spent a varying
percentage of time on exempt managerial tasks, seemingly based on the needs of
the company in different locations at different times, and the varying preferences
of different Culinary Partners. Each of them declared that they spent the majority
of their time, as P.F. Chang’s Sous Chefs, on managerial duties.
The Court takes note that one of P.F. Chang’s’ declarations is from one of
the Sous Chefs named in Stancil’s declaration (the only declaration that Anderson
put forth besides his own). Stancil declared that he talked to a Sous Chef named
Jaime from Albany, New York who had “the same job” as Stancil and was not paid
overtime. Jaime Hoffman’s (“Hoffman”) declaration, however, states as follows.
26
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 27 of 31
Pg ID 628
I understand that the individuals who filed this lawsuit included my
name in the suit and that they have stated that I am similarly situated,
in some respects at least, to those individuals. However, at no point
did I consent for my name or experience to be used in this lawsuit in
any way. I did travel to the Stamford, CT location to help train
employees there, but I do not in any way agree with the claims alleged
in this lawsuit. I believe that as a manager, which sous chefs are, it is
our responsibility to do whatever it takes to ensure the restaurants are
profitable. Indeed, it is my understanding that this accountability is a
basis for paying sous chefs higher salaries and expecting them to be
able to effectively and independently respond to any problems in the
kitchen without supervision.
(Doc # 27-9, Pg ID 433)
One of P.F. Chang’s’ declarations is from an individual who works as Sous
Chef in the same restaurant in Northville, Michigan as Anderson did. Gerry
Heim’s (“Heim”) declaration states that his primary day-to-day job responsibility
is managing and being accountable for the daily operations of the kitchen. Heim
declares that his duties include preparing schedules, monitoring labor needs,
monitoring and ordering food inventory, overseeing the work of kitchen staff,
recruiting staff, interviewing applicants, negotiating pay rate with applicants,
conducting new hire orientations, disciplining and terminating employees, and
recommending employees for raises or promotions. Before Heim became Sous
Chef, he was supervised by Plaintiff Anderson for a period of time:
For about four to six months while I worked as a Pantry Cook, Jeremy
Anderson was also employed at the Northville restaurant. During this
time, Anderson was a Sous Chef, and therefore was one of my
supervisors when we worked the same shifts. I recall that during such
shifts, Anderson oversaw the Pantry station at which I worked and
27
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 28 of 31
Pg ID 629
conducted a nightly review of my station. Anderson had to approve
that all tasks associated with my station were timely and satisfactorily
completed before I could end my shift.
I also recall that Anderson reprimanded me once because, in his mind,
I took too much time in the bathroom and was not working. As a
result, Anderson instructed me to end my shift for the day.
(Doc # 27-14, Pg ID 464)
The Court finds that Anderson has not met his burden, even under the “fairly
lenient” standard, for conditional collective action certification. Although not
dispositive, one factor that the Court considers is that no other plaintiff has opted
into this proposed collective action—not even any individual identified in Stancil’s
declaration. While Anderson’s declaration and Stancil’s declaration contain some
detail regarding their duties as Sous Chefs, these two declarations are contradicted
in part by Anderson’s own deposition testimony, Hoffman’s declaration, and
Heim’s declaration.
Although the Court does not engage in credibility
determinations at this stage, and although the Court agrees with Anderson that the
declarations submitted by P.F. Chang’s are of limited evidentiary value at this
stage, the Court notes that Anderson has not put forth any other affidavit or
declaration describing the duties of any other Sous Chef besides himself and
Stancil (an individual who cannot opt into the proposed collective action). P.F.
Chang’s’ declarations, on the other hand, significantly outnumber Anderson’s
declarations and contain more detail regarding the declarants’ duties as Sous
28
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 29 of 31
Pg ID 630
Chefs. Anderson has also admitted in his deposition testimony that he has no
personal knowledge of what any other P.F. Chang’s Sous Chefs does.
Under these circumstances, it cannot be said that Anderson has made a
modest factual showing sufficient to demonstrate that he and potential plaintiffs
together were victims of a widespread, unlawful de facto policy or plan of P.F.
Chang’s.3 See, e.g., Cason, 2011 WL 1659381, at *2-3; Lankford v. CWL Invs.,
3
Anderson fails to cite a case in which any court in our circuit granted conditional certification
of a nationwide class based solely on two declarations that are vague as to any other employee’s
experience. See, e.g., Kim v. 511 E. 5th St., LLC, 985 F. Supp. 2d 439, 444, 447 (S.D.N.Y. 2013)
(finding, based on two declarations describing kitchen employees’ duties at one restaurant
location, that the plaintiff had only shown that he and kitchen staff members in that one
restaurant location were victims of a common unlawful policy); Baez v. Ocean One Rest. Grp.,
LLC, No. 08-21709-CIV, 2009 WL 712050, at *2 (S.D. Fla. Mar. 17, 2009) (conditionally
certifying collective action seeking that notice be sent to one restaurant location based on six
declarations); Casalez v. Mercadito Miami, LLC, No. 13-22208-CIV, 2014 WL 11881026, at *12 (S.D. Fla. Jan. 30, 2014) (denying the defendant’s motion for summary judgment in an FLSA
action in which the plaintiff did not seek conditional certification of a collective action); Clark v.
Royal Transp. Co., No. 15-13243, 2016 WL 2983900, at *3 (E.D. Mich. May 24, 2016)
(conditionally certifying collective action of allegedly misclassified shuttle bus drivers based on
five affidavits and signed consent forms from nine additional opt-in plaintiffs who all worked out
of the same location); Lee v. Gab Telecom, Inc., No. 12-CV-14104, 2013 WL 1632552, at *1-2
(E.D. Mich. Apr. 16, 2013) (conditionally certifying collective action of allegedly misclassified
technicians based on affidavits and supplemental affidavits of three former technicians who were
named plaintiffs in the action, which had a total of four named plaintiffs who all worked at the
same location); Fisher, 665 F. Supp. 2d at 826 (conditionally certifying collective action of
allegedly misclassified call center employees based on declarations from 67 opt-in plaintiffs and
deposition testimony from eight opt-in plaintiffs); Wlotkowski v. Michigan Bell Tel. Co., 267
F.R.D. 213, 214-15 (E.D. Mich. 2010) (conditionally certifying collective action of allegedly
misclassified employees in an action with eleven named plaintiffs and 60 opt-in plaintiffs, based
on declarations from 35 named and opt-in plaintiffs); Brown v. Ak Lawncare, Inc., No. 14-14158,
2015 WL 5954811, at *4 (E.D. Mich. Oct. 14, 2015) (conditionally certifying collective action,
specifically noting that the affidavits and declarations submitted by the three named plaintiffs
were equal in number and weight to the ones submitted by the defendants); Myers v. Marietta
Mem’l Hosp., 201 F. Supp. 3d 884, 887, 889, 892 (S.D. Ohio 2016) (conditionally certifying
collective action based on affidavits from three named plaintiffs in an action with at least one
other opt-in plaintiff involving a single worksite); Lacy v. Reddy Elec. Co., No. 3:11-CV-52,
2011 WL 6149842, at *4-5 (S.D. Ohio Dec. 9, 2011) (conditionally certifying collective action
29
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 30 of 31
Pg ID 631
LLC, No. 13-CV-14441, 2014 WL 3956184, at *5-6 (E.D. Mich. Aug. 13, 2014);
Arrington v. Michigan Bell Tel. Co., No. 10-10975, 2011 WL 3319691, at *6 (E.D.
Mich. Aug. 1, 2011). The Court concludes that Anderson has not met his burden
of showing that the putative class is similarly situated.
The Court denies
Anderson’s Motion for Collective Action Certification without prejudice. See
Shipes, 2012 WL 995362, at *12 (“[W]hen courts deny such motions at this stage
of the proceedings, the court still may permit discovery to provide plaintiffs a
second opportunity to obtain sufficient evidence of a collective to warrant
conditional certification and notice to opt in.”); Arrington, 2011 WL 3319691, at
*6. Anderson may ask the Court to revisit the issue of conditional certification
after additional discovery if appropriate.
III.
CONCLUSION
For the reasons set forth above,
IT IS HEREBY ORDERED that Plaintiff Jeremy Anderson’s Motion to
Dismiss P.F. Chang’s Counterclaims (Doc # 14) is GRANTED.
based on deposition testimony from two named plaintiffs in an action involving one location);
Penley v. NPC Int’l, Inc., No. 13-1031, 2016 WL 7228901, at *5-8 (W.D. Tenn. Dec. 13, 2016)
(conditionally certifying nationwide collective action with two named plaintiffs and 56 opt-in
plaintiffs, based on 40 declarations); Bradford v. Logan’s Roadhouse, Inc., 137 F. Supp. 3d
1064, 1073, 1078 (M.D. Tenn. 2015) (conditionally certifying nationwide collective action with
two named plaintiffs and approximately 100 opt-in plaintiffs, based on approximately 100
declarations); Smith v. Pizza Hut, Inc., No. 09-CV-01632-CMA-BNB, 2012 WL 1414325, at *1
n.1, 5 (D. Colo. Apr. 21, 2012) (conditionally certifying collective action based on several
declarations from opt-in plaintiffs, which were “numerous,” and deposition testimony from one
of the defendant’s executives).
30
2:16-cv-14182-DPH-RSW Doc # 32 Filed 08/23/17 Pg 31 of 31
Pg ID 632
IT IS FURTHER ORDERED that Defendant P.F. Chang’s’ Counterclaims
are DISMISSED WITHOUT PREJUDICE.
IT IS FURTHER ORDERED that Plaintiff Jeremy Anderson’s Motion for
Collective Action Certification (Doc # 17) is DENIED WITHOUT PREJUDICE.
Dated: August 23, 2017
s/Denise Page Hood
Chief, U.S. District Court
I hereby certify that a copy of the foregoing document was served upon counsel of
record on August 23, 2017, by electronic and/or ordinary mail.
s/Julie Owens
Acting in the absence of LaShawn Saulsberry
Case Manager
31
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?