Conroy v. Millennium Taximeter Corp. et al
Filing
17
ORDER granting 13 Motion for Default Judgment Ordered by Judge I. Leo Glasser on 10/22/2018. (Perlman, Alexa)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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BRIAN CONROY
Plaintiff,
MEMORANDUM AND ORDER
17-CV-03954
- against MILLENNIUM TAXIMETER CORP.,
SKILMAN CONSULTING CORP, AND
EVGENY FREIDMAN
Defendants.
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GLASSER, Senior United States District Judge:
Plaintiff Brian Conroy (“Conroy”) brought this Fair Labor Standards Act (“FLSA”)/New
York Labor Law (“NYLL”) action on June 30, 2017 against Defendants Millennium Taximeter
Corp., Skilman Consulting Corp, and Evgeny Freidman (collectively, “Defendants”) for the failure
to pay him overtime wages and provide him with required wage notices. (ECF No. 1 (“Compl.”)).
Defendants have failed to appear or otherwise respond to the complaint, and on August 30, 2017,
the Clerk of the Court entered a certificate of default. (ECF No. 10). On November 27, 2017,
Conroy filed a motion for (i) default judgment and (ii) amendment of the case caption to reflect
the individual defendant’s correct legal name. (ECF No. 13). On August 15, 2018, the Court (i)
deferred ruling on the motion for default judgment until Conroy complied with Local Civil Rule
55.2(c) and (ii) granted the request for amendment of the case caption. (ECF No. 15). On October
1, 2018, Conroy complied with Local Civil Rule 55.2(c). (ECF No. 16). Pending before the Court
is Conroy’s motion for a default judgment as to liability and damages. For the reasons set forth
below, Conroy’s motion is GRANTED.
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BACKGROUND
The corporation defendants are taxi cab companies owned and operated by individual
defendant Evgeny Freidman. (Compl. ¶ 14). Defendant Freidman is known in New York as the
“Taxi King” for his large fleet of cabs. (See Exhibit 9). Through his corporations, he leases cabs
to about 800 drivers each year in various cities including New York, Boston, Chicago,
Philadelphia, and New Orleans. (Conroy Decl. ¶ 7). He charges cab drivers about $130-$160 per
12-hour shift and about $1500 for longer rentals. (Conroy Decl. ¶ 8).
Conroy was employed by Defendants from July 13, 2013 to May 26, 2017 and worked
every day with the exception of two weeks each year. (Compl. ¶ 16; Conroy Decl. ¶ 12). During
his employment, he worked 60 hours per week at rates of $19-20.48 per hour. (Compl. ¶ 18). He
was paid every two weeks for 80 hours total. (Compl. ¶ 22). Defendants did not provide Conroy
with written wage notices or pay stubs showing overtime wages he earned. (Conroy Decl. ¶¶ 1617).
DISCUSSION
I.
Standard for Default Judgment
In deciding whether a default judgment should be entered following entry of a certificate
of default, a court may accept as true all well-pleaded allegations in the unanswered complaint but
must still satisfy itself that the plaintiff has established a sound legal basis upon which liability
may be imposed. Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981) (“[A] district
court has discretion under Rule 55(b)(2) once a default is determined to require proof of necessary
facts and need not agree that the alleged facts constitute a valid cause of action.”). A fact is not
“well-pleaded” if it is inconsistent with other allegations in the complaint or is “contrary to
uncontroverted material in the file of the case.” Chuchuca v. Creative Customs Cabinets Inc., No.
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13-CV-2506 (RLM), 2014 WL 6674583, at *5 (E.D.N.Y. Nov. 25, 2014). In addition, a pleading’s
legal conclusions are not assumed to be true. Id. Consequently, the factual allegations in the
complaint must themselves be sufficient to establish a right to relief. Id.
II.
Liability
a. Fair Labor Standards Act
Congress enacted the FLSA to “protect all covered workers from substandard wages and
oppressive working hours, labor conditions [that are] detrimental to the maintenance of the
minimum standard of living necessary for the health, efficiency and general well-being of
workers.” Barrentine v. Arkansas-Best Freight Sys. Inc., 450 U.S. 728, 739 (1981). The statute
applies to all “employers,” which Congress defines broadly to include “any person acting directly
or indirectly in the interest of an employer in relation to the employee.” 29 U.S.C. § 203(d). To
be covered under the FLSA, an employee must demonstrate that his employer is an enterprise that
either “has employees engaged in commerce or in the production of goods for commerce” and has
an annual gross volume of sales made or business done that is not less than $500,000. 29 U.S.C.
§§ 203, 207. An employee may, as here, be simultaneously employed by multiple “employers.”
Chuchuca, 2014 WL 6674583, at *6.
Section 207 of the FLSA requires an employer to pay any employee who works more than
40 hours per week a premium for overtime hours “at a rate not less than one and one-half times
the regular rate at which he is employed.” 29 U.S.C. § 207(a)(1). Employers who violate this
provision “shall be liable to the employee or employees affected in the amount of . . . their unpaid
overtime compensation . . . and in an additional equal amount as liquidated damages.” 29 U.S.C.
§ 216. The fact that an employer pays wages above the statutory minimum set by Congress is not
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a defense to an employer’s non-payment of overtime compensation. Walling v. Helmerich &
Payne, Inc., 323 U.S. 37, 42 (1944).
After reviewing the undisputed allegations in the Complaint and the default judgment
submissions, the Court finds there is a sufficient basis for establishing Defendants’ liability under
the FLSA for violations of the overtime provisions. Conroy provided a sworn declaration
containing information as to rates of pay and estimates of hours worked based on his recollection.
In addition, he provided earnings statements, to the extent he saved them, to support his allegations
that he was only paid for 80 hours on a bi-weekly basis rather than the 120 hours that he actually
worked. See Exhibits 1-3.
b. New York Labor Law
NYLL mirrors the FLSA in its wage and overtime compensation provisions. Like the
FLSA, NYLL requires that employers provide time-and-a-half compensation for employees who
work more than 40 hours per week, and adopts the same methods used by the FLSA for calculating
overtime damages. N.Y. Comp. Codes R. & Regs. tit. 12, § 142-2.2. NYLL also requires that
employers, at the time of hiring, provide employees with a notice containing their pay rates and
how they will be paid, and during employment, statements detailing important information such
as the rates of pay and the hours worked, including any overtime wages. N.Y. Lab. Law § 195(1),
(3). For the same reasons the Court finds Defendants liable under the FLSA, it also finds them
liable under the NYLL for violations of the overtime provisions and record-providing
requirements.
III.
Damages
Although allegations pertaining to liability are deemed admitted upon entry of a default
judgment, allegations related to damages are not. Credit Lyonnais Sec., Inc. v. Alcantara, 183
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F.3d 151, 155 (2d Cir. 1999); Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981).
A court must conduct an inquiry to ascertain the amount of damages with reasonable certainty.
Credit Lyonnais, 183 F.3d at 155.
An employee bringing an action for unpaid wages under the FLSA or NYLL has the burden
of proving he was not adequately compensated. Carrasco-Flores v. Comprehensive Health Care
& Rehab. Servs., LLC, No. 12-CV-5737 (ILG), 2014 WL 4954629, at *3 (E.D.N.Y. Oct. 2, 2014)
(Glasser, J.). Employers are required to “make, keep, and preserve” records of employee wages
and hours. 29 U.S.C. § 211(c). However, if an employer fails to keep or produce records, the
plaintiff may satisfy his burden by producing “sufficient evidence to show the amount and extent
of that work as a matter of just and reasonable inference.” Carrasco-Flores, 2014 WL 4954629,
at *3. A plaintiff may satisfy this evidentiary burden “by relying on recollection alone.” Id.
Where, as here, a defendant employer defaults, the plaintiff employee’s “recollection and estimates
of hours worked are presumed to be correct.” Id.
a. Statute of Limitations
Conroy requests damages for violations of the relevant statutes that occurred between July
13, 2013 and May 26, 2017. As a threshold matter, every action under the FLSA must “be
commenced within two years after the cause of action accrued . . . except that a cause of action
arising out of a willful violation may be commenced within three years after the cause of action
accrued.” 29 U.S.C. § 255(a). Willfulness, in this context, is found where an employer knowingly
disregards its obligations under the FLSA. Young v. Cooper Cameron Corp., 586 F.3d 201, 207
(2d Cir. 2009). Courts have found that a defendant’s default alone suffices to support a finding of
willfulness. Carrasco-Flores, 2014 WL 4954629, at *4. Accordingly, the three-year statute of
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limitations applies to Conroy’s FLSA claims. For his NYLL claims, a six-year statute of
limitations applies. N.Y. Lab. Law § 198(3).
b. Unpaid Overtime Wages
Conroy has satisfied his evidentiary burden of proving Defendants did not adequately
compensate him. The Court will assume that his recollection and estimates of hours worked are
correct. From 2013 to 2015, he was paid $1,532.50 on a bi-weekly basis for 80 hours. (Conroy
Decl. ¶ 13). From January 16 to March 2016, he was paid $1,485.53 on a bi-weekly basis for 80
hours. (Conroy Decl. ¶ 14). From April 2016 until the end of his employment, he was paid
$1,638.36 on a bi-weekly basis for 80 hours. (Conroy Decl. ¶ 15). Therefore, Conroy is owed
time-and-a-half in the amount of $70,125.60 for the period July 2013 to March 2016; $6,685.20
for the period January 2016 to March 2016; and $33,177.60 for the remainder of his employment,
for a total amount of $109,988.40 in a single award under the FLSA and NYLL.
c. Liquidated Damages
Under the FLSA, an employee can be awarded liquidated damages in an amount equal to
one hundred percent of the amount awarded for compensatory damages. 29 U.S.C. § 216(b). The
employer bears the burden of establishing that “the act or omission giving rise to such action was
in good faith” and that liquidated damages should not be awarded. 29 U.S.C. § 260; CarrascoFlores, 2014 WL 4954629, at *6. An employer may establish a good faith, reasonable basis
defense by offering “plain and substantial evidence of at least an honest intention to ascertain what
the [FLSA] requires and to comply with it.” Brock v. Wilamowsky, 833 F.2d 11, 20 (2d Cir. 1987).
“[T]he [employer’s] burden is a difficult one, with double damages being the norm and single
damages the exception.” Carrasco-Flores, 2014 WL 4954629, at *6.
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The standard for collecting liquidated damages under the NYLL is essentially the same as
the standard under the FLSA. Id. There are, however, two significant differences. First, under
the NYLL, absent an employer’s proof of good faith, claims for liquidated damages may be
assessed up to six years after the alleged violation. N.Y. Lab. Law § 663(1), (3). Second, as of
April 9, 2011, the NYLL provides for a liquidated damages award of one hundred percent of the
total compensatory damages awarded. N.Y. Labor Law §§ 198(1-a), 663(1). Previously, a
prevailing party was entitled only to liquidated damages equal to twenty five percent of
compensatory damages. Carrasco-Flores, 2014 WL 4954629, at *6.
An award of liquidated damages under both the FLSA and NYLL is appropriate here
because Defendants defaulted and, thus, have not carried their burden of proving that liquidated
damages should not be awarded. Id. While some courts decline to award liquidated damages
under both the FLSA and the NYLL, the majority view is that prevailing plaintiffs may recover
liquidated damages under both statutes. Id. Accordingly, Conroy is awarded liquidated damages
under both statutes in the sum of $109,988.40.
d. Prejudgment Interest
Conroy also seeks an award of prejudgment interest on his state law claims. Unlike the
FLSA, “prejudgment interest and liquidated damages under New York Labor Law are not
functional equivalents . . . because the liquidated damages provided for in the New York Labor
Law are punitive in nature rather than compensatory.” Gunawan v. Sake Sushi Rest., 897 F. Supp.
2d 76, 92 (E.D.N.Y. 2012). Therefore, prejudgment interest may be applied to violations of the
NYLL and added to the liquidated damages that have already been awarded. Id. However, where
a plaintiff has already received an award of liquidated damages under the FLSA, the plaintiff is
only entitled to an award of prejudgment interest on unpaid overtime wages for which liquidated
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damages under the FLSA were not awarded. Id. Because there is a three-year statute of limitations
for Conroy’s FLSA claims and he brought this action on June 30, 2017, Conroy did not receive
compensatory or liquidated damages under the FLSA for unpaid overtime between July 13, 2013
and June 30, 2014. Accordingly, Conroy is entitled to prejudgment interest for unpaid overtime
only between those dates.
To determine how much prejudgment interest to award Conroy, the Court must determine
the number of overtime hours he worked during that period. From July 13, 2013 to June 30, 2014,
Conroy worked approximately 58 weeks and was paid $1,532.50 on a bi-weekly basis for 80 hours.
(Conroy Decl. ¶ 13). That equals $19.15 per hour. Because he worked 60 hours per week, he was
owed 20 hours per week of overtime. Over the 58-week period, he was owed time-and-a-half
overtime wages for 1,160 hours, or $33,321.
The statutory annual interest rate is nine percent. N.Y. C.P.L.R. § 5004. Therefore, Conroy
is entitled to nine percent of $33,321, which equals $2,998.89 in prejudgment interest.
e. NYLL Statutory Penalties
Conroy was not given the proper notices in accordance with Sections 195(1) and 195(3) of
the NYLL, which provides that “[i]f any employee is not provided within ten business days of his
or her first day of employment a notice as required by subdivision one of section one hundred
ninety-five of this article, he or she may recover in a civil action damages of fifty dollars for each
work day that the violations occurred or continue to occur, but not to exceed a total of five thousand
dollars, together with costs and reasonable attorney's fees . . . .” N.Y. Lab. Law § 198(1-b).
Similarly, “[i]f any employee is not provided a statement or statements as required by subdivision
three of section one hundred ninety-five of this article, he or she shall recover in a civil action
damages of two hundred fifty dollars for each work day that the violations occurred or continue to
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occur, but not to exceed a total of five thousand dollars, together with costs and reasonable
attorney's fees . . . .” N.Y. Lab. Law § 198(1-d).
Conroy worked for Defendants for about 4 years. He never received a wage notice
containing his rates of pay in accordance with NYLL Section 195(1). Therefore, he is entitled to
$50 per workday or a maximum of $5,000. Because he worked approximately 1,460 days over a
four-year period, the Court will award the maximum of $5,000.
Conroy submitted three pay statements with his motion for default judgment in support of
his allegations. He claims Defendants did not provide him with wage statements or pay stubs for
each pay period. However, he did not provide an approximation of how many pay stubs he did
receive. Therefore, the Court cannot calculate statutory damages for a violation of NYLL Section
195(3).
f. Attorney’s Fees and Costs
Both the FLSA and NYLL entitle prevailing plaintiffs to reasonable attorneys’ fees. 29
U.S.C. § 216(b); NYLL §§ 198(1-a). The same attorneys’ fee analysis applies in determining fees
under both statutes. Carrasco-Flores, 2014 WL 4954629, at *8. “Attorneys’ fees are awarded by
determining a presumptively reasonable fee, reached by multiplying a reasonable hourly rate by
the number of reasonably expended hours.” Bergerson v. N.Y. State Office of Mental Health, Cent.
N.Y. Psychiatric Ctr., 652 F.3d 277, 289-90 (2d Cir. 2011). In addition, courts have continuously
recognized the right to reimbursement of costs such as photocopying, postage, transportation,
transcript fees, and filing fees. Quantum Corp. Funding, Ltd. v. Westwood Design/Build Inc., No.
08 CIV. 0539 (LAK), 2010 WL 5185072, at *11 (S.D.N.Y. Nov. 19, 2010), report and
recommendation adopted, No. 08 CIV. 0539 (LAK), 2010 WL 5222120 (S.D.N.Y. Dec. 21, 2010).
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Having failed to provide any information regarding attorneys’ fees and costs, if seeking
their award, counsel is directed to provide the necessary time sheets for services rendered and
evidence of costs incurred on or before November 2, 2018.
CONCLUSION
For the reasons set forth above, Conroy’s motion for default judgment as to liability and
damages under the FLSA and NYLL is GRANTED. Conroy is awarded a total amount of
$227,975.69 in compensatory damages, liquidated damages, statutory penalties, and prejudgment
interest.
SO ORDERED.
Dated:
Brooklyn, New York
October 22, 2018
/s/
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I. Leo Glasser
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U.S.D.J.
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