Key v. Butch's Rat Hole & Anchor Service, Inc.

Filing 49

MEMORANDUM OPINION AND ORDER by Sr. District Judge Robert C. Brack DENYING 20 MOTION for Partial Summary Judgment . AND DENYING 31 MOTION to Strike Disregard or Strike Plaintiff's Untimely Responses to Defendant's Motion for Partial Summary Judgment, (yc)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
WILLIAM KEY,
Plaintiff,
v.

No. CIV 17-1171 RB/KRS

BUTCH’S RAT HOLE & ANCHOR
SERVICE, INC.,
Defendant.
MEMORANDUM OPINION AND ORDER
This matter is before the Court on Defendant’s Motion for Partial Summary Judgment,
filed on March 30, 2018 (Doc. 20), and Defendant’s Motion to Disregard or Strike Plaintiff’s
Untimely Responses to Defendant’s Motion for Partial Summary Judgment, filed on June 18, 2018
(Doc. 31). Jurisdiction arises under 28 U.S.C. § 1332.1 Having considered the submissions of
counsel and relevant law, the Court will DENY both motions.
Plaintiff and all putative class members worked for Butch’s Rat Hole & Anchor Service,
Inc. (Defendant) laying pipe for oil and gas wells. This lawsuit arises out of a disagreement about
whether the workers were entitled to overtime pay under the New Mexico Minimum Wage Act
(MWA). Because Plaintiff has come forward with evidence that creates a genuine issue of material
fact, the Court will deny the motion for summary judgment.

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According to Plaintiff’s Complaint, this putative class action involves over 100 class members, at least
one of whom resides in New Mexico. (Doc. 1 (Compl.) ¶ 10.) Defendant is a Texas corporation. (Id. ¶ 9.)
The parties do not dispute that the amount in controversy exceeds $75,000. (See id. ¶ 10.)

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I.

Factual Background2
Defendant is a Texas oilfield service company that provides services to oil and gas industry

customers. (See Docs. 1 (Compl.) ¶ 2; 20 at 2 ¶ 1; 20-1 ¶ 2.) Defendant employed William Key
(Plaintiff) from November 2014 through August 2016. (Doc. 29-1 ¶ 1.) Plaintiff has filed a class
action complaint alleging that Defendant failed to pay certain “non-exempt workers” (also referred
to as “Field Workers”) overtime hours in violation of the New Mexico Minimum Wage Act, N.M.
Stat. Ann. § 50-4-22(D). (See Compl. ¶¶ 2–6, 8.) The Field Worker positions represented in the
declarations Plaintiff submitted include Casing Floor Hands, Derrick Hands, Stabbers, Tool
Haulers, Crew Haulers, and Relief Operators. (See Docs. 29-1–29-4.) Defendant moves for partial
summary judgment and asks the Court to dismiss Plaintiff’s claim only with respect to those Field
Workers who were employed as Casing Floor Hands. (See Doc. 20 at 1.)
During the time period covered by this lawsuit (see Compl. ¶ 8), Casing Floor Hands
received several different types of pay,3 two of which are relevant to this motion: (1) “Footage
Pay,” which is calculated on a per-foot-of-pipe-laid basis; and (2) “Location Hours Pay” (also
referred to as “Exceeded Hours Pay”), which is calculated on an hourly basis. (See Docs. 20-1 ¶¶
6, 8; 29-1 ¶ 3; 29-2 ¶ 3.) Defendant’s payment structure 4 worked as follows: Defendant allotted a
certain number of hours for its workers to lay pipe (also referred to as “running casing”) on each
customer’s project, based on Defendant’s estimate that workers can lay approximately 1,000 feet

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In accordance with summary judgment standards, the Court recites all admissible facts in a light most
favorable to the Plaintiff. Fed. R. Civ. P. 56; see also Garrison v. Gambro, Inc., 428 F.3d 933, 935 (10th
Cir. 2005). The Court recites only that portion of the factual and procedural history relevant to this motion.
3

Defendant contends that it “paid its Casing Floor Hands exclusively on a piecework or flat rate basis.”
(Doc. 20-1 ¶ 3.) The Court finds that the evidence submitted contradicts this assertion.
4

Defendant submitted an undated example of a “Wage Statement” form that outlines its payment structure.
(See Doc. 20-1-1.) Plaintiff, however, asserts that he does not recall seeing the Wage Statement exhibit or
anything similar to it when he worked for Defendant. (Doc. 29-1 ¶ 8.)

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of pipe per hour. (See, e.g., Doc. 29-1 ¶ 3.) Plaintiff asserts that Defendant added some additional
hours to each bid to allow time for “rigging up and rigging down.” (Id.) The total number of hours
bid gave Defendant the maximum “Footage Pay” it would pay out to its Casing Floor Hands. (Id.)
If the project exceeded this set number of bid hours, Defendant then paid Casing Floor Hands the
hourly “Location Hours Pay” rate for all hours worked over the bid hours. (Id.; see also Doc. 201 ¶ 8.)
Plaintiff asserts that at times, the Casing Floor Hands had to wait before beginning or
resuming their duties at a customer’s well location. (Doc. 29-1 ¶ 3.) Defendant required the Casing
Floor Hands to remain at the job site during these unproductive times.5 (Id.) If this unproductive
time occurred within Defendant’s bid hours and Casing Floor Hands were still being paid under
the Footage Pay structure, they were not compensated for the down time. 6 (Id. ¶¶ 3, 7.)
Both parties submitted sample pay stubs from the relevant time period. (See Docs. 20-1-2;
29-5–29-6.) Plaintiff’s four pay stubs demonstrate that, at least for these particular paychecks,
Plaintiff’s Location Hours Pay accounted for anywhere from 15.5% to 22.1% of his total pay. (See

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Defendant contends that it “did not require Casing Floor Hands to spend nonproductive, uncompensated
time waiting at the jobsite.” (Doc. 20-1 ¶ 11.) Plaintiff disputes Defendant’s assertion and presents
declarations from two former Casing Floor Hands (William Key and William Ty Neal) who allege that they
were required to wait at job sites during unproductive times. (See Docs. 29-1 ¶ 3; 29-2 ¶ 3.) The Court finds
that this dispute is material to its decision.
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Plaintiff attested that in addition to his duties laying pipe at customer locations, he was responsible for
transporting necessary tools and equipment to and from the customer’s well location. (Doc. 29-1 ¶ 5.)
Plaintiff describes these pre- and post-drive duties in his declaration and states that he was not paid for
completing the duties. (Id. ¶¶ 5–6.) Defendant disputes Plaintiff’s assertions regarding these duties. (See
Doc. 20-1 ¶¶ 9–10.) While there is an issue of fact about these pre- and post-drive duties, the Court finds
that the issue is inapposite to its decision. See, e.g., Casias v. Distrib. Mgmt. Corp., Inc., No. CV 11-00874
MV/RHS, 2013 WL 12091857, at *8 (D.N.M. Mar. 27, 2013) (discussing plaintiffs’ pre- and post-delivery
duties and finding that “[t]he Court need not consider this additional argument regarding active duties
because the Court already has concluded that a material factual question precluding summary judgment
exists”).

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Doc. 29-5.) The Location Hours Pay accounted for 16.9% of the total year-to-date pay as shown
on the employee’s paycheck that Defendant submitted.
II.

Summary Judgment Standard of Review
Summary judgment is appropriate when the Court, viewing the record in the light most

favorable to the nonmoving party, determines “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. P. 56(a); see also
Garrison v. Gambro, Inc., 428 F.3d 933, 935 (10th Cir. 2005). A fact is “material” if it could
influence the determination of the suit. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
A dispute over a material fact is “genuine” if a reasonable trier of fact could return a verdict for
either party. Id. The moving party bears the initial responsibility of “show[ing] that there is an
absence of evidence to support the nonmoving party’s case.” Bacchus Indus., Inc. v. Arvin Indus.,
Inc., 939 F.2d 887, 891 (10th Cir. 1991) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 325
(1986)).
Once the moving party meets this burden, Rule 56(e) “requires the nonmoving party to go
beyond the pleadings and by [his] own affidavits, or by the depositions, answers to interrogatories,
and admissions on file, designate specific facts showing that there is a genuine issue for trial.”
Celotex, 477 U.S. at 324 (quoting Fed. R. Civ. P. 56(e)) (quotation marks omitted). The party
opposing a motion for summary judgment “must set forth specific facts showing that there is a
genuine issue for trial as to those dispositive matters for which it carries the burden of proof.”
Applied Genetics Int’l, Inc. v. First Affiliated Sec., Inc., 912 F.2d 1238, 1241 (10th Cir. 1990)
(citing Celotex, 477 U.S. at 324).
III.

The Court will deny Defendant’s motion for partial summary judgment.

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The MWA “generally requires employers to pay overtime to employees who work more
than 40 hours per week.” Casias v. Distrib. Mgmt. Corp., Inc., No. CV 11-00874 MV/RHS, 2013
WL 12091857, at *5 (D.N.M. Mar. 27, 2013) (citing N.M. Stat. Ann. § 50-4-22(D)). “The Act,
however, contains several exemptions from the definition of ‘employee.’” Id. (citing N.M. Stat.
Ann. § 50-4-21(C)). The MWA defines the term “employee” as “an individual employed by an
employer.” N.M. Stat. Ann. § 50-4-21(C). Relevant to this lawsuit, however, the Act excludes
from that term “salespersons or employees compensated upon piecework, flat rate schedules or
commission basis.” Id. § 50-4-21(C)(5)).
Plaintiff contends that Defendant violated § 50-4-22(D) when it failed to pay its Field
Workers, including Casing Floor Hands, overtime pay. (Compl. ¶¶ 1, 45–46.) Defendant contends
that Casing Floor Hands are excluded from the definition of “employee” because Defendant pays
them “exclusively on a piecework or flat rate basis” pursuant to § 50-4-21(C)(5). (Doc. 20-1 ¶ 3
(emphasis added); see also Doc. 20 ¶ 6.) Plaintiff disagrees, noting that Casing Floor Hands were
paid under both a piecework schedule and an hourly schedule, as they received “Location Hours
Pay” on certain projects. (Doc. 30 at 4.)
It is Defendant’s burden “to prove an employee meets an exception” under the MWA. See
Rivera v. McCoy Corp., 240 F. Supp. 3d 1150, 1155 (D.N.M. 2017) (citations omitted).
“Exemptions from the New Mexico Minimum Wage Act are strictly and narrowly construed
against employers.” Casias, 2013 WL 12091857, at *5 (citing State ex rel. State Labor Comm’r v.
Goodwill Indus., 478 P.2d 543, 545 (N.M. 1970) (internal citations omitted)). “Thus, an employer
asserting an exemption defense must prove that the exemption ‘unmistakably’ includes the
employee whom the employer claims to be exempt from the Act.” Id. (quoting State Labor
Comm’r, 478 P.2d at 545).

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The MWA “does not define the terms ‘piecework’ or ‘flat rate.’ The common definition of
piecework, however, is ‘work done by the piece and paid at a set rate per unit.’” Id. (quoting
Merriam Webster’s Collegiate Dictionary, 938 (2003 11th ed.)). Plaintiff does not dispute that
Defendant’s Footage Pay structure is based on a piecework or flat rate payment system. (See Doc.
30 at 7.) As Defendant paid the Casing Floor Hands a set rate per unit of pipe laid, the Court agrees
that Footage Pay meets the definition of piecework or flat rate pay pursuant to § 50-4-21(C)(5).
Not only did Defendant pay Casing Floor Hands on a piecework basis, however, it also
paid them an hourly wage when Defendant exceeded its bid hours on a project. The Court finds it
curious, then, that Defendant maintains it paid Casing Floor Hands exclusively on a piecework
basis. (See Docs. 20 ¶ 6; 20-1 ¶ 3.) Plaintiff argues that this “mixed-status system . . . does not fall
within the [MWA’s] piecework or flat rate pay exclusion . . . .” (Doc. 30 at 8.) Defendant believes
Plaintiff’s interpretation of the exception is too narrow and urges the Court to reject “the extreme
position that the MWA exempts only workers paid exclusively flat-rate or piecework for every
component of pay . . . .” (Doc. 32 at 8, 9.) Defendant cites two cases in support of its position.
Defendant primarily relies on an order published in Corman v. JWS of N.M., Inc., No. CIV
15-0913 JB/SMV, 2017 WL 5152171 (D.N.M. Mar. 13, 2017). (See Docs. 20 at 6; 32 at 3.)
Corman also involves a collective action under the MWA for overtime wages, and the defendants
there moved for summary judgment on the basis that the plaintiff truck drivers were exempt under
§ 50-4-21(C)(5). Corman, 2017 WL 5152171, at *1. The plaintiff truck drivers argued that because
they were paid an hourly rate for certain tasks, such as washing and maintaining their trucks, they
were not exempt from the MWA’s overtime provision. See Corman, No. CIV 15-0913 JB/SMV,
Mot. for Partial Summ. J. at *4 n.5 (D.N.M. June 17, 2016). The defendants argued that any
“hourly pay was de minimis as compared with” the commission-based pay. Id. The Corman Court

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apparently agreed, as it granted the defendant’s motion for summary judgment on the plaintiffs’
MWA claim. See Corman, 2017 WL 5152171, at *1.
Defendant urges the Court to rely on Corman to find that the hourly pay Plaintiffs received
in this case was de minimis and, therefore, the MWA’s overtime provision is inapplicable. (See
Doc. 32 at 4.) Defendant asserts that the Corman “Court found the plaintiffs were not covered by
the MWA and granted summary judgment in favor of the defendants despite it being undisputed
that more than half of the plaintiffs’ pay was according to an hourly pay rate.” (Id. (bolding
added).) Defendant does not cite to any document, but the Court takes notice that Defendant is
referring to a statement contained in the Corman plaintiffs’ cross-motion for summary judgment.
See Corman, No. CIV 15-0913 JB/SMV, Pl.’s Mem. in Support of his Cross Mot. for Partial
Summ. J. on Def.’s Exemption Defense, at *6 (D.N.M. June 17, 2016) (“Drivers are paid on an
hourly basis for about 50% of the jobs they are assigned, and on a bid basis for about 50% of the
jobs they are assigned.”) (citation omitted). Defendant’s citation to this “undisputed fact” is
disingenuous at best, since the Corman defendants explicitly argued that the proffered fact was
indeed disputed. See id., Defs. JWS’s & KPK’s Resp. to Pl.’s Cross Mot. for Partial Summ. J., at
2–3 (D.N.M. July 1, 2016) (“Response: Inaccurate. For jobs charged to the customer on an hourly
basis, Plaintiffs received 25% of [defendants’] transportation charge to the customer.”) (citations
omitted). Under the defendants’ interpretation of this fact, even though the defendants charged
some customers on an hourly basis, the plaintiffs received a 25% commission of the total charge—
not hourly pay. See id.
The Corman defendants also demonstrated that the plaintiffs received very little in hourly
pay compared with what they received as a commission or flat rate for their driving jobs: for
example, only 2% of one plaintiff’s total annual pay reflected the hourly pay rate, as opposed to

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the commission/flat rate pay. Corman, No. CIV 15-0913 JB/SMV, Mot. for Partial Summ. J. at *4
n.5. Thus, the defendants maintained, plaintiffs received commission/flat rate pay 98% of the time,
not 50% of the time. See id. Defendant’s reliance on Corman to establish that the Plaintiff’s hourly
pay rate here is de minimis is misplaced. The undisputed facts here demonstrate that Plaintiffs
received hourly pay for 15–22% of their total salary, a much higher number than the 2% in
Corman. (See Docs. 20-1-2; 29-5; 29-6.)
The Court is reluctant to rely on the Corman decision, because Judge Browning’s order
granting the Corman defendants’ motion for summary judgment is devoid of legal analysis and
notes that “[t]he Court will, at a later date, issue a Memorandum Opinion more fully detailing its
rationale for [its] decision.” Corman, 2017 WL 5152171 at *1 n.1. Judge Browning has not yet
published a Memorandum Opinion. As the Court explains above, however, Defendant misstates
the facts in Corman, and the Court is able to distinguish Corman without guessing at Judge
Browning’s reasoning.
Defendant next cites to Olivo v. Crawford Chevrolet Inc., 799 F. Supp. 2d 1237 (D.N.M.
2011). The Olivo defendants paid the plaintiffs, an autopainter and a bodyman, a flat rate per job
to work on cars. Id. at 1239–40. The defendants also required the plaintiffs to remain on the job
site even when they weren’t working on a project, but the defendants did not pay plaintiffs for this
downtime, which added up to approximately 10–15 hours per week. Id. at 1240. The plaintiffs
alleged that the defendants violated the MWA by failing to pay them for these unproductive hours.
Id. at 1239, 1242. The court stated that, “[a]lthough not explicit, Plaintiffs’ argument appears to
be that Defendants altered their piecework employee status by compelling them to remain on the
premises even when no assignments were available.” Id. at 1242. “Based on the limited record”

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on summary judgment, the Olivo Court found that “there is some evidence that Plaintiffs are either
mixed-status employees or non-piecework employees.” Id.
Defendant acknowledges the Olivo decision but focuses on Judge Black’s findings of fact
and conclusions of law after trial in Olivo. (Doc. 20 at 8–9 (citing Olivo v. Crawford Chevrolet,
Inc. (Olivo II), No. CV 10-782 BB/LFG, 2012 WL 12897385 (D.N.M. Jan. 12, 2012)).) There,
Judge Black found that while the plaintiffs were paid on a piecework basis and were not
compensated for downtime, the MWA “excludes ‘employees compensated upon piecework, flat
rate schedules or commission basis,’ and thus [was] not applicable to Plaintiffs.” Olivo II, 2012
WL 12897385, at *1–3 (quoting NMSA 1978 § 50-4-21(C)(5) (2008)).
Defendant argues that “Plaintiff’s assertion of unpaid waiting and preparatory time in this
case is precisely what the Court found existed in Olivio [sic] II.” (Doc. 32 at 8 (citing Olivo II,
2012 WL 12897385, at *2).) The Court disagrees. It is true that Plaintiffs have demonstrated they
were not paid for unproductive waiting time when that time fell within Defendant’s bid hours and
Casing Floor Hands were still being paid under the Footage Pay structure. (Doc. 29-1 ¶¶ 3, 7.) But
the Court can draw a reasonable implication that Plaintiffs were paid for unproductive waiting
time when that time fell outside of Defendant’s bid hours. (See Doc. 30 at 10; see also Doc. 20-1
¶ 8 (Defendant paid Location Hours pay as “an additional payment for after bid hours or hours
when Casing Floor Hands’ work was delayed”) (emphasis added).) In other words, if the
unproductive time occurred after the bid hours had expired, then the Casing Floor Hands were
compensated at the Location Hours Pay rate. (Id.) This difference is significant and distinguishes
this action from Olivo.7

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Additionally, the Court hesitates to rely on Judge Black’s decision in Olivo because there is no legal
analysis relevant to the conclusion of law about the MWA that would help guide the Court in this case. See
Olivo II, 2012 WL 12897385, at *3. Moreover, Judge Black made his findings of fact and conclusions of
law after trial. “[T]he Court looks at evidence offered in support of (or opposition to) a motion for summary

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As the court found in Casias, “[a]t this stage in the litigation, the Court must tip the scales
in favor of Plaintiff[] as the part[y] opposing summary judgment.” 2013 WL 12091857, at *6
(relying on Olivo to deny defendant’s motion for summary judgment under the MWA) (citation
omitted). “Moreover, the Court is required to construe the Section 50-4-21(C)(5) exemption to the
Wage Act narrowly and cannot grant summary judgment in Defendant’s favor unless the
exemption ‘unmistakably’ includes Plaintiff[].” See id. (citing State Labor Comm’r, 478 P.2d at
545 (internal citation omitted)). Based on the foregoing, the Court finds that Plaintiff has come
forward with evidence sufficient to create a genuine dispute of fact with respect to whether Casing
Floor Hands are truly exempt from the MWA.
IV.

The Court will deny Defendant’s motion to disregard or strike the response.
Plaintiff received three extensions to file his response to Defendant’s motion. (See Docs.

22; 25; 27.) In its order granting Plaintiff’s third request for an extension, the Court stated that
“[n]o further extensions will be granted. (Doc. 27.) On June 13, 2018, at 11:59 p.m., the proverbial
eleventh hour, Plaintiff filed his response. (See Doc. 28.) He filed the exhibits to his response seven
minutes later, at 12:06 a.m. on June 14, 2018. (See Doc. 29.)
Unbeknownst to Plaintiff at the time, he had inadvertently filed a draft of his response,
rather than the final version. (See Doc. 39 at 1.) When he discovered his error the next day, he filed
the final draft of the response. (See id. at 2; see also Doc. 30.) Defendant now asks the Court to
strike Plaintiff’s late response. (Doc. 31.) Because Plaintiff attempted to comply with the Court’s
order and file his response on June 13, 2018, and because Defendant has not been prejudiced by
Plaintiff’s late filing of the final version of his response on June 14, 2018, the Court will deny
Defendant’s motion to strike.
judgment differently than it looks at evidence offered at trial.” In re Tiger Petroleum Co., 319 B.R. 225,
234 (Bankr. N.D. Okla. 2004).

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THEREFORE,
IT IS ORDERED that Defendant’s Motion for Partial Summary Judgment (Doc. 20) is
DENIED;
IT IS FURTHER ORDERED that Defendant’s Motion to Disregard or Strike Plaintiff’s
Untimely Responses to Defendant’s Motion for Partial Summary Judgment (Doc. 31) is DENIED.

___________________________________
ROBERT C. BRACK
SENIOR U.S. DISTRICT JUDGE

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