Newsom et al v. Carolina Logistics Services, Inc.
Filing
74
ORDER granting in part and denying in part 46 Motion for Summary Judgment; adopting 59 Report and Recommendation; granting in part and denying in part 67 Motion for Summary Judgment; dismissing 8 Motion to Dismiss for Failure to State a Claim. Signed by David C. Bramlette on 9/17/2012. (Levy, Philip)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF MISSISSIPPI
DELTA DIVISION
CEDRIC L. NEWSOM, ET AL.
PLAINTIFFS
v.
No. 2:11-CV-00172-DCB-JMV
CAROLINA LOGISTICS SERVICES, INC.
DEFENDANT
MEMORANDUM OPINION AND ORDER
This cause is before the Court on the Parties’ competing
Motions for Summary Judgment [docket entry nos. 46, 61] and the
Magistrate Judge’s Report and Recommendation that Plaintiff Jaji
Mani’s claims should be dismissed with prejudice for failure to
prosecute [docket entry no. 59]. Having carefully considered the
Motions,
the
Recommendation,
Parties’
opposition
applicable
thereto,
statutory
and
case
the
law,
Report
and
and
being
otherwise fully advised in the premises, the Court finds and orders
as follows:
I. Facts and Procedural History
In late April, 2008, Plaintiff Cedric Newsom began work for
Defendant Carolina Logistics Services, Inc., (CLS), as a facility
manager at its Memphis, Tennessee location. Newsom Depo. at 14.
Shortly after starting his work, Newsom made a special arrangement
with
his
center
manager,
Alfred
Taylor,
whereby
Newsom
was
permitted to clock out from work after his shift and clean CLS’s
warehouse in exchange for a banana box of food.1 Id. at 17, 18. The
1
The food apparently was acquired by CLS during its normal
course of business. CLS is a logistics and brokerage company
work consisted of sweeping, mopping, picking up trash, and using a
floor cleaning machine to clean the entire warehouse. Newsom Decl.
at 1. According to Newsom, he worked approximately four to fourand-a-half hours after each shift. Id.; Newsom Depo. at 36.
In October 2008, Newsom was transferred to CLS’s Olive Branch,
Mississippi center. There, Taylor remained his supervisor and
allowed the banana-box program to continue. Newsom Depo. at 14, 29.
Not long after the move, Newsom found that he could not clean the
new center alone and recruited Plaintiff Shanda Bramlett, another
CLS employee, to assist him with the more arduous work. Id. at 3132. Taylor agreed to allow Bramlett to participate in the program,
and Bramlett began assisting Newsom in March 2009. Id. Bramlett
Depo at 13. Bramlett’s work entailed sweeping floors, cleaning
bathrooms, and performing other cleaning tasks. Bramlett Decl. at.
1. She claims that she worked an average of somewhere between two
and three-and-a-half hours after each shift. Id.; Bramlett Depo. at
17. Taylor assisted Newsom and Bramlett by moving pallets that
obstructed their ability to clean the premises. Bramlett Dep. at
13-17.
In January 2010, Mark Hogenbirk replaced Taylor as the center
manager in Olive Branch. Newsom Depo. at 32. Taylor, who was still
employed by CLS, informed Hogenbirk of his deal with Newsom and
Bramlett, and Hogenbirk did not object to the agreement. Id. at 35.
headquartered in North Carolina.
2
The banana-box program continued uninterrupted under Hogenbirk’s
supervision. But in July 2010 Hogenbirk was replaced by Jerry
Whittington. Id. at 40. At first, Whittington was either unaware of
or tacitly assented to the arrangement.2 But in December 2010
Whittington discovered that someone was stealing from the CLS
warehouse and discontinued any CLS-approved banana-box programs.3
Id. at 40-41; Bramlett Depo. at 18-19. From December 2010 through
March 2011, no one was allowed to take anything from the warehouse.
Newsom Depo. at 41. Nevertheless, for reasons unexplained in their
depositions, both Newsom and Bramlett continued to perform their
after-hours work, apparently without any guarantee of compensation.
Newsom Depo. at 40-41; Bramlett Depo. at 18-19.
The remaining circumstances surrounding the reinstatement of
the banana-box program and the details leading up to Newsom’s
2
Whittington admitted that, before January 2011, he was aware
that Newsom was working after 4:30 p.m.–the time which the center
usually ceased operations–but testified that he did not inquire
into Newsom’s activities. Whittington Depo. at 24. Newsom
testified, however, that Whittington must have known about a few
details of the arrangement with Taylor since Whittington had
watched him fill banana boxes with food. See Newsom Depo. at 45. In
January 2011, Whittington asked Taylor about Newsom’s presence in
the warehouse after hours. Whittington Depo. at 26. Taylor informed
him of the arrangement, but Whittington chose not to look into it
further. Id.
3
CLS maintained another “banana-box” program, which appears
to be a company-sanctioned program, for CLS employees with perfect
work attendance. The CLS warehouse in Olive Branch appears to have
participated in this program. See Garland Depo. at 49.
3
termination remain unclear.4 Newsom testified that the program was
resumed, and judging from his deposition testimony, he believed the
program was reinstated in March 2011. But it is not clear whether
new conditions were laid upon the program and to what degree
Whittington was aware that the program resumed. Regardless, in midJune 2012, Whittington reviewed the surveillance videotapes of the
warehouse and discovered that Newsom had been “stealing” banana
boxes of food. Newsom Depo. 42-44. As a result, Whittington fired
Newsom. Id. Immediately thereafter, Newsom called Jack Garland,
CLS’s
regional
supervisor,
to
explain
to
him
the
banana-box
arrangement and complain about being fired. Id. at 78-79. Garland,
believing the arrangement to be improper, called Whittington and
Taylor to instruct them to calculate how many hours Newsom worked
after-hours and pay Newsom for that time.5 Garland Depo. at 57-58.
Whittington and Taylor did as they were instructed, and CLS sent
4
The missing details would be helpful to the Court in order
to formulate a coherent narrative, but they are not “material
facts” as contemplated by Rule 56. CLS does not attack Plaintiffs’
claims by disputing that CLS did not have constructive or actual
knowledge of Plaintiffs’ activities. There is no material dispute
that Taylor oversaw Plaintiffs’ activities. Typically, either he or
Whittington was responsible for locking up the warehouse after the
Plaintiffs finished their chores. Whittington Depo. at 26.
5
In his deposition (pgs. 57-58), Garland testified to the
following exchange with Whittington:
Attorney: “What did [Whittington] tell you in that next phone
call?”
Garland: “That [Newsom] was working off the clock and wasn’t
getting paid.”
4
Newsom a check for the amount Whittington and Taylor determined was
his uncompensated work, along with an apology letter.6 Newsom at
80-81. Garland was not made aware of Bramlett’s after-hours work
nor was Bramlett compensated for the extra work.
On
August
17,
2011,
Newsom
and
Bramlett
on
behalf
of
themselves and all others similarly situated filed a complaint
against CLS, asserting one federal and one state law claim. First,
they alleged that CLS violated the Fair Labor Standards Act (FLSA),
29 U.S.C. § 201 et seq., by failing to compensate them for their
overtime work. Second, they asserted a state law quantum meruit
claim. Some months later, the Plaintiffs filed an Amended Complaint
adding Plaintiff Jaja Mani to the suit but dropping their intention
to represent a larger class.
On
April
4,
2012,
the
Court
granted
a
motion
allowing
Plaintiff Jaja Mani’s attorney to withdraw as counsel. As a result,
Mani was ordered to notify the Court within fourteen days either
that he had retained new counsel or that he intended to proceed pro
se. Mani failed to respond to this Order. Accordingly, Magistrate
Judge Virden entered a Report and Recommendation [docket entry no.
59] that Mani be dismissed from the lawsuit with prejudice for
6
The apology letter stated in unequivocal terms the
impropriety of the arrangement: “It has come to our attention that
you were mistakenly underpaid your wages for certain hours worked
at our warehouse facility. We certainly regret this oversight and
are very interested in ensuring you are properly paid at the
appropriate rate for all hours worked.” See July 22, 2011 Letter,
docket entry no. 68-12.
5
failure to prosecute. More recently, the Court entered an Order
[docket entry no. 73] denying CLS’s request to dismiss Plaintiffs’
FLSA claims but found that the federal statute preempted, in part,
Plaintiffs’ state law claims.
Because Mani failed to comply with the Court’s Order and
failed to object to the Report and Recommendation, and has not
otherwise given this Court any indication that he intends to
prosecute this case, the Court adopts the Report and Recommendation
of
the
Magistrate
Judge
and
will dismiss
Mani’s
claims
with
prejudice without further discussion, leaving only Newsom and
Bramlett’s federal law and state law claims unresolved. These
claims are ripe for consideration and will be addressed in detail
below.
II. Summary-Judgment Standard
Summary judgment is apposite “if the movant shows that there
is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. Pro. 56(a).
“A fact is ‘material’ if its resolution in favor of one party might
affect the outcome of the lawsuit under governing law. An issue is
‘genuine’ if the evidence is sufficient for a reasonable jury to
return a verdict for the non-moving party.” Ginsberg 1985 Real
Estate P’ship v. Cadle Co., 39 F.3d 528, 531 (5th Cir. 1994)
(citations omitted). The party moving for summary judgment bears
the initial responsibility of apprising the district court of the
6
basis for its motion and the parts of the record which indicate the
absence of a genuine issue of material fact. Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986).
“Once the moving party presents the district court with a
properly supported summary judgment motion, the burden shifts to
the
non-moving
party
to
show
that
summary
judgment
is
inappropriate.” Morris v. Covan World Wide Moving, Inc., 144 F.3d
377, 380 (5th Cir. 1998). “The evidence of the non-movant is to be
believed, and all justifiable inferences are to be drawn in his
favor.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).
But the nonmovant must “do more than simply show that there is some
metaphysical doubt as to the material facts.” Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).
Moreover, “[t]he mere existence of a scintilla of evidence is
insufficient to defeat a properly supported motion for summary
judgment.” Anderson, 477 U.S. at 252. Summary judgment must be
rendered when the nonmovant “fails to make a showing sufficient to
establish the existence of an element essential to that party’s
case, and on which that party will bear the burden of proof at
trial.” Celotex Corp., 477 U.S. at 322.
III. Analysis
It is undisputed that Newsom and Bramlett worked for CLS “off
the clock” in exchange for a banana box of food. This case turns on
a simple legal question: Does Newsom and Bramlett’s after-hours
7
work constitute a violation of the FLSA? The Plaintiffs advance a
simple
and
persuasive
argument
why
the
Court
should
answer
affirmatively. Put simply, the Plaintiffs maintain that, at all
times pertinent to the present suit, they worked as CLS employees
with CLS’s knowledge and under CLS’s supervision.7 Judging from the
record, CLS’s management appears to have initially adopted this
view, at least with respect to Newsom, by sending him a check and
an apology letter. Now at the summary-judgment stage of litigation,
however, CLS takes a different view of the matter, offering two
legal theories why the Plaintiffs cannot recover for their FLSA
claims: (1) Newsom and Bramlett acted as independent contractors,
not employees, when performing their after-hours work, and (2) even
if
Newsom
and
Bramlett
were
employees,
they
were
properly
compensated for their work with food.
1. Liability Under the FLSA
A. The Plaintiffs are Employees, not Independent Contractors
Most discussions of whether a plaintiff should be considered
an employee under the FLSA typically begin with then-Senator Hugo
Black’s observation that the term ‘employee’ under the FLSA has
“the broadest definition that has ever been included in any one
act.” E.g., United States v. Rosenwasser, 323 U.S. 360, 363 n.3
(1945) (citations omitted); Johns v. Stewart, 57 F.3d 1544, 1557
7
CLS concedes that it is an employer subject to the FLSA. 29
U.S.C. § 203(d).
8
(10th Cir. 1995);
Preston v. Settle Down Enters., Inc., 90 F.
Supp. 2d 1267, 1274-75 (N.D. Ga. 2000). ‘Employ’ is defined,
simply, as to “suffer or permit to work.” 29 U.S.C. § 203(g).8 By
its plain terms, that definition would appear to encompass the
activities of both Newsom and Bramlett, who were suffered or
permitted to work for CLS in exchange for food. Nevertheless,
courts have scaled back the expansive reach of the definition by
limiting its application. One such curtailment occurs in situations
where the worker seeking FLSA protection is considered to be an
independent contractor rather than an employee. Carrell v. Sunland
Const., Inc., 998 F.2d 330, 332 (5th Cir. 1993); see also Goldberg
v. Whitaker House Co-op., Inc., 366 U.S. 28, 32 (1961).
To
distinguish
between
an
employee
and
an
independent
contractor, a district court “focus[es] on whether the alleged
employee,
as
a
matter
of
economic
reality,
is
economically
dependent upon the business to which he renders his services.”
Carrell, 998 F.2d at 332 (citing Brock v. Mr. W Fireworks, Inc.,
814 F.2d 1042, 1043, 1054 (5th Cir. 1987)). In other words, the
task is to determine “whether the individual is, as a matter of
economic reality, in business for himself.” Carrell, 998 F.2d at
332 (citation omitted); see also, Dole v. Snell, 875 F.2d 802, 804
(10th Cir. 1989). Economic independence is judged using a five-
8
29 U.S.C. § 203(e) does exclude some types of “employment,”
but none of the exclusions apply in this case.
9
factor test:
(1) (T)he degree of control exercised by the alleged
employer, (2) the extent of the relative investments of
the worker and alleged employer, (3) the degree to which
the worker’s opportunity for profit and loss is
determined by the alleged employer, (4) the skill and
initiative required to perform the job, and (5) the
permanency of the relationship.
Carrell, 998 F.2d at 332. No one factor is determinative. Id.
In
an
effort
to
make
out
their
independent-contractor
argument, CLS argues that it had no control over Newsom and
Bramlett’s activities by highlighting the voluntary nature of the
program and the fact that it was initiated by Newsom. Just because
Newsom initiated and voluntarily participated in the program,
however, does not mean that he controlled the terms and nature of
his work. While Taylor’s oversight of Newsom and Bramlett may not
have been stringent, the minimal oversight appears to be more a
product of Plaintiffs’ industrious work ethic than their ability to
exercise independent judgment in the performance of their tasks.
Taylor, as a CLS supervisor, at all times maintained the authority
to
instruct
them
in
their
duties,
inspect
their
work,
and
discontinue the program at any time if he was unsatisfied.
Moreover,
demonstrates
application
that
the
of
the
Plaintiffs
remaining
are
miscast
factors
as
plainly
independent
contractors, so much so that the Court needs to devote only a few
sentences to each factor’s application. The second factor (relative
investments) weighs exclusively in the Plaintiffs’ favor as they
10
invested only
their
time
into
their
after-hours
work.
It
is
undisputed that CLS provided all the necessary cleaning supplies
and allowed Newsom to operate its floor machine in the execution of
his duties. Whittington Depo. at 24. The third factor (opportunity
for profit or loss) undoubtedly favors the Plaintiffs inasmuch as
CLS was Plaintiffs’ exclusive outlet for cleaning work. Should CLS
have discontinued the program, the Plaintiffs would have had no
opportunity
for
profit.
The
fourth
factor
(skill
required)
highlights the fact that the Plaintiffs were performing simple
cleaning tasks for the employer–not the sort of dexterous work that
is typically envisioned in an independent-contractor relationship.
The fifth factor (permanency of the relationship) underscores the
obvious conclusion. The Plaintiffs worked solely and exclusively
for CLS for the period of time in which they were providing
cleaning services and can only be considered CLS employees. In sum,
the factors all point in one direction: Newsom and Bramlett were
not, as a matter of economic reality, in business for themselves.
Carrell, 998 F.2d at 332; see also Weisel v. Singapore Joint
Venture, Inc., 602 F.2d 1185, 1189 (5th Cir. 1979).
B. Banana Boxes of Food Do Not Constitute Wages
CLS advances its second contention–that Newsom and Bramlett
were compensated appropriately under the FLSA with a brief–and
incomplete–reference to the definition of ‘wages’ in the statute,
and therefore the Court will give this argument short shrift. Under
11
the FLSA, the term ‘wages’ can include board, lodging, and other
facilities as CLS suggests. 29 U.S.C. § 209(m). As an initial
matter, it is unclear as to whether banana boxes of food fall
within the categories of “board, lodging, or other facilities.” The
statute does not mention food, sustenance, or any other similar
term. Moreover, the statute continues that in order for “board,
lodging, and other facilities” to constitute wages under the FLSA,
they must be “customarily furnished by such employer to employees.”
Id. (emphasis added). The Court declines to opine as to whether
banana boxes of food are customarily furnished by CLS to its
employees for cleaning services, and since CLS fails to make such
an argument, the Court will dismiss it without prejudice. CLS may
raise this argument subsequently with respect to damages, provided
it advances the argument with cited legal authority.9
C. CLS is Liable for Newsom and Bramlette’s After-Hours Work
Having determined, based on the uncontroverted facts in the
record, that Bramlett and Newsom were employees of CLS who were not
paid wages for their after-hours work, the Court finds that CLS is
liable under the FLSA and thus grants summary judgment in favor of
the Plaintiffs. The Court now must determine whether there is a
genuine dispute of material fact as to the damages to which the
9
There is also the additional matter of whether CLS kept
adequate records of the banana boxes distributed to Newsom and
Bramlett and whether those boxes cost CLS anything. See Donovan v.
I & J, Inc., 567 F. Supp. 93, 109 (D. N.M. 1983).
12
Plaintiffs are entitled. If the Court finds that the damages are
factually in dispute, that issue must be presented to the factfinder. See Preston, 90 F. Supp. 2d at 1276 (granting summary
judgment as
to
liability
but
finding
that
damages
should
be
determined by a jury).
2. Whether the Court Can Determine Damages
As to damages, there are two matters which the Plaintiffs must
demonstrate in order to be awarded damages at the summary-judgment
stage. First, they must show that there is no genuine dispute of
material fact as to the number of their uncompensated hours. See
Mitchell v. Mitchell Truck Line, Inc., 286 F.2d 721, 726 (5th Cir.
1961) (requiring the defendant to put forward evidence negating the
reasonableness of the plaintiff’s estimated work hours). Second,
because the Plaintiffs seek damages beyond the two-year general
statute of limitations, they must show that CLS acted “willfully”
in order for the Court to extend FLSA’s statute of limitations to
three years. 29 U.S.C. § 255(a).10
A. There is a Genuine Dispute Regarding
Uncompensated Hours the Plaintiffs Worked
the
Number
of
Even a cursory look at the record demonstrates that the number
of hours worked by Newsom and Bramlett is in genuine dispute.
Newsom maintains that he worked from the time he clocked out until
10
The Plaintiffs, seeking to recover liquidated damages equal
to the amount of their actual damages, also allege that CLS acted
in bad faith, but, as explained below, they do not have the burden
of proving bad faith. See 29 U.S.C. § 216(b).
13
9:00 p.m. every day at the Olive Branch warehouse. Newsom Depo. at
37. Taylor’s testimony, however, rebuts this assertion, as do the
warehouse records, which indicate that on many days the Olive
Branch facility was locked prior to the time Newsom could have
plausibly
worked
the
four-and-a-half
hours
he
asserts.
When
confronted with the warehouse closing records, which indicate that
the
plant
was
closed
before
9:00
p.m.,
Newsom
unequivocally
responded, “Those records are wrong.” Newsom Depo. at 37.
Not only does Newsom’s testimony conflict with Taylor’s, the
expert report offered by the Plaintiffs is incompatible to Newsom’s
own testimony. Rather than using Newsom’s four-and-a-half-hour
estimation, Plaintiffs’ expert used the time Newsom clocked out at
the plant until the official time the warehouse closed–sometimes
after 9:00 p.m. and sometimes well before 9:00 p.m.–in order to
calculate the number of Newsom’s daily uncompensated hours. See May
8, 2012, Letter, docket entry no. 68-14. Moreover, Plaintiffs’
expert
calculated
Newsom’s
after-hours
work
at
the
Memphis
warehouse at fifteen hours per week despite Newsom’s testimony that
he worked twelve-and-a-half hours per week. See Newsom Depo. at 18.
At this point, there is a genuine dispute as to the number of hours
Newsom worked, and certainly, the Court cannot award Newsom the
damages outlined in his expert report, which do not appear to have
any basis in the testimony presented to the Court.
As for Bramlett, there are two reasons the Court cannot award
14
her damages at this point. First, there is contradictory evidence
in the record as to the number of hours she worked. In her
deposition she estimates that she worked three-and-a-half hours per
day, but in her declaration she states that she worked two hours
per day. Bramlett Depo. at 13; Bramlett Decl. at 1. Second, for
reasons unexplained to the Court, Plaintiffs’ expert calculated the
amount of Bramlett’s actual damages by using the number of hours
Newsom worked overtime as a baseline for determining the number of
hours Bramlett worked after she clocked out.11 See May 8, 2012,
Letter at 2, docket entry no. 68-14. As explained above, the number
of
hours
used
to
calculate
Newsom’s
damages
are
flawed,
and
consequently the expert’s calculation of Bramlett’s damages must be
flawed.
The Plaintiffs are entitled to a fair estimation of their
damages even if they cannot recount the exact amount of time they
worked, but at the summary-judgment stage they may not recover
damages which are directly disputed by other evidence in the
record. Mitchell, 286 F.2d at 726. Because there is conflicting
evidence as to the amount of compensable damages, the Court finds
that the issue of how many hours the Plaintiffs worked should be
presented to the finder of fact at trial. See Preston, 90 F. Supp.
11
Plaintiffs’ expert explained that he understood that
Bramlett worked two-and-a-half hours less than Newsom. See id. It
is not clear where he got this information, but it is contrary to
either Newsom’s four-and-a-half-hour claim or Bramlett’s three-anda-half-hour claim.
15
2d at 1276.
B. There is Insufficient Evidence to Determine Whether CLS
Committed a Willful Violation of the FLSA
Contrary to both Parties tendency to conflate the issue of
willfulness with the issue of bad faith, the issues, arising under
different provisions of the FLSA, are not interchangeable, and the
inquiries the Court undertakes to resolve each matter are distinct.
Procedurally, whether an employer willfully violated the FLSA is a
mixed question of fact and law appropriate for presentation to a
fact-finder when a genuine dispute is present, whereas the Court
possesses
sole discretion
as
to
whether
to
deny
a
plaintiff
liquidated damages when the employer demonstrates good faith. See
Jarrett v. ERC Properties, Inc., 211 F.3d 1078, 1082-84 (8th Cir.
2000). Moreover, the Plaintiffs bear the burden of convincing the
Court that the statute of limitations should be extended one year
for willfulness, while the Defendants must present the good-faith
defense. See id.
Here, the Court finds that CLS is not entitled to summary
judgment on the issue of willfulness. As the Supreme Court noted in
McLaughlin v. Richland Shoe Company, Congress intentionally chose
to create a two-tiered statute of limitations under the FLSA,
drawing a distinction between “ordinary violations” and “willful
violations.” 486 U.S. 128, 132-33. On first impression, the Court
views the present violation as unique, but not deserving of the
heightened liability imposed by Congress for more-than-negligent
16
violations. See id. (Discussing how the term ‘wilful’ is synonymous
with ‘voluntary’, ‘deliberate’, and ‘intentional’.) Applying the
wilfulness standard established in McLaughlin, this Court finds no
evidence in the record to indicate that CLS “either knew or showed
reckless disregard for the matter of whether its conduct was
prohibited by the statute.” Id. at 133.
There
is
no
question
that
CLS,
by
virtue
of
Taylor’s
supervision, knew or should have known about the activities of the
Plaintiffs, but there is no indication that anyone at CLS knew or
showed reckless disregard for the fact that Newsom and Bramlett
were working in violation of the FLSA.12 Taylor, it appears, did
little more than accept Newsom’s proposal for additional work and
oversee Newsom and Bramlett’s activities. While Taylor’s ignorance
of the law does not excuse CLS of liability, it is relevant to the
issue of wilfulness. Mireles v. Frio Foods, 899 F.2d 1407, 1416
(5th Cir. 1990) (“Simply failing to seek legal advice . . . does
not evidence a willful violation.”).
Additionally,
the
evidence
indicates
that
when
Newsom’s
activities were discovered by those knowledgeable of employment
law, CLS immediately worked to resolve the issue, even sending
12
Even under the Fifth Circuit’s overruled, laxer Jiffy June
standard, it not apparent that CLS was aware that the FLSA was “in
the picture.” See id. 486 U.S. at 135 (imposing a more stringent
standard for establishing “wilful” violations of the FLSA than
simply demonstrating that the employer knew the FLSA was “in the
picture”).
17
Newsom an apology letter. As for Bramlett, it does not appear that
CLS was aware of her claims prior to this litigation. CLS’s
conduct, at least as presented by the Plaintiffs in their Motion,
does not rise to the level of wilfulness typically evidenced in
other cases. Singer v. City of Waco, Tex., 324 F.3d 813, 822 (5th
Cir. 2003) (noting that the defendant admitted that the plaintiffs
were being paid incorrectly but continued the practice); Reich v.
Bay, Inc., 23 F.3d 110, 117 (5th Cir. 1994) (stating that the
defendant heard that the practice might violate the FLSA but failed
to investigate). The Court denies the Plaintiffs summary judgment
on this issue and notes that summary disposition was not sought by
CLS. The Plaintiffs will be allowed to present evidence, if it is
available, on this issue to the fact-finder when they present their
claims for damages. Cash v. Conn Appliances, Inc., 2 F. Supp. 2d
884, 897 (E.D. Tex. 1997) (“Willfulness is a fact issue for the
jury.” (internal quotation marks and citations omitted)).
C. CLS Has Not Presented a Good-Faith Defense
As to whether CLS has a defense, it is up to CLS to assert a
good-faith defense at the appropriate time. Liquidated damages
equal to the amount of actual damages are the norm under the FLSA,
29 U.S.C. § 216(b), and they may be remitted by the Court upon a
showing of good faith. 29 U.S.C. § 260; see Jarrett, 211 F.3d at
1083.
To
demonstrate
good
faith,
the
defendant
must
offer
“reasonable grounds for believing that his act or omission was not
18
a violation of the [FLSA].” 29 U.S.C. § 260. While CLS made a
passing reference to good faith in a heading in its summary
judgment brief, it has not put forward this argument for serious
consideration, that is, it has not alleged a specific ground for
believing that Newsom and Bramlett’s after-hours work was not a
violation of the FLSA. The Court will proceed to trial with the
issue of good faith left unresolved.
3. The Quantum Meruit Claim
Having thoroughly addressed Plaintiffs’ FLSA claim, the Court
will briefly address what remains of their state law claim over
which this Court has supplemental jurisdiction. See September 6,
2012 Order (limiting Plaintiffs’ recovery to “gap time” claims).
The Plaintiffs contend that they should be able to recover the cash
value for
their
services
under
a
quantum
meruit
theory.
CLS
responds, quite simply, that, if the rules of contract theory are
to apply, the Court should find that the Plaintiffs received the
benefit of their bargain: banana boxes of food. Def.’s Resp. Br. at
13-14. Indeed, there is evidence that Taylor and Newsom reached an
oral agreement and that the contract between Taylor and Newsom was
not
broken.
While
Congress,
through
the
FLSA,
has
imposed
restrictions on certain employers, such as the manner in which
their employees should be paid ‘wages’, see supra, the Court finds
no merit to Plaintiffs’ attempt to use contract theory as a vehicle
to
impose
an
alternative
liability
19
upon
CLS.
The
evidence
demonstrates that CLS, while failing to abide by the regulations
established by the FLSA, did at least uphold its end of the deal,
and therefore it cannot be liable under a quantum meruit theory.
IV. Conclusion
IT HEREBY ORDERED THAT Plaintiffs’ Motion for Summary Judgment
[docket entry no. 61] is GRANTED IN PART AND DENIED IN PART. The
Court finds no genuine dispute of material fact as to Plaintiffs’
FLSA claim and therefore GRANTS summary judgment in their favor
with respect to the Defendant’s liability. In all other respects,
Plaintiffs’ Motion is DENIED. IT IS FURTHER HEREBY ORDERED THAT the
Defendant’s Motion for Summary Judgment [docket entry no. 46] is
GRANTED IN PART AND DENIED IN PART. The Court finds no genuine
dispute of material fact at to Plaintiffs’ quantum meruit claim and
GRANTS summary judgment in the Defendant’s favor. Plaintiffs’
quantum meruit claim is DISMISSED WITH PREJUDICE. In all other
respects, the Defendant’s motion is DENIED. IT IS FURTHER HEREBY
ORDERED THAT the Defendant’s First Motion to Dismiss [docket entry
no. 8] is DISMISSED AS MOOT, in accordance with the Court’s
previous Order. See Sep. 6, 2012 Order at 1 n.1. Finally, as
indicated above, IT IS FURTHER HEREBY ORDERED that the Report and
Recommendation [docket entry no. 59] of the Magistrate Judge is
ADOPTED IN FULL. Plaintiff Jaja Mani’s claims are DISMISSED WITH
PREJUDICE. No further order shall issue.
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So ORDERED, this the 17th day of September, 2012.
/s/ David Bramlette
UNITED STATES DISTRICT JUDGE
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