Johnson v. Wave Comm GR LLC et al

Filing 164

MEMORANDUM-DECISION and ORDER. Defendants have not shown that common questions of law and fact no longer predominate over questions affecting individual class members such that decertification is warranted. ORDERED that defendants' Motion for Class Certification 141 is DENIED. Signed by Judge David N. Hurd on 3/14/2014. (lah)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF NEW YORK
-------------------------------BRETT JOHNSON, on behalf of himself and
all others similarly situated,
Plaintiff,
-v-

6:10-CV-346

WAVE COMM GR LLC; ROBERT GUILLERAULT,
individually; and RICHARD RUZZO, individually,
Defendants.
-------------------------------APPEARANCES:

OF COUNSEL:

NICHOLS KASTER PLLP
Attorneys for Plaintiff
4600 IDS Center
80 South Eighth Street
Minneapolis, MN 55402

PAUL J. LUKAS, ESQ.
TIMOTHY C. SELANDER, ESQ.

THOMAS & SOLOMON LLP
Attorneys for Plaintiff
693 East Avenue
Rochester, NY 14607

J. NELSON THOMAS, ESQ.
PATRICK J. SOLOMON, ESQ.
JUSTIN M. CORDELLO, ESQ.

GIRVIN & FERLAZZO, PC
Attorneys for Defendants
20 Corporate Woods Boulevard
2nd Floor
Albany, NY 12211

SCOTT P. QUESNEL, ESQ.
PATRICK J. FITZGERALD, III. ESQ.

DAVID N. HURD
United States District Judge

MEMORANDUM-DECISION and ORDER
I. INTRODUCTION
Brett Johnson ("plaintiff") brings this class action on behalf of himself and all others
similarly situated against Wave Comm GR LLC ("Wave Comm"), and its two owners, Robert
Guillerault ("Guillerault") and Richard Ruzzo ("Ruzzo") (collectively "defendants") alleging
violations of the Fair Labor Standards Act, as amended, 29 U.S.C. §§ 201–219 ("FLSA") and
New York Labor Law ("NYLL"), N.Y. Lab. Law §§ 190–191. Plaintiff claims Wave Comm
failed to properly compensate cable technician installers ("installers") for overtime work.
Defendants deny any violations of the FLSA or NYLL.
Defendants filed a motion for complete class decertification of both the FLSA and
NYLL classes pursuant to 29 U.S.C. § 216(b) and Federal Rule of Civil Procedure ("Rule
___") 23(c)(1)(C), respectively. Plaintiff opposed, and defendants replied. The motion was
considered on its submissions without oral argument.
II. FACTUAL BACKGROUND
It is assumed the parties are familiar with the underlying facts as detailed in the prior
decisions in this case. ECF No. 163; see also Johnson v. Wave Comm GR LLC, No.
6:10–CV–346, 2011 WL 10945630 (N.D.N.Y. Oct. 4, 2011) (Report-Recommendation)
(Baxter, M.J.) adopted by 2011 WL 10945627 (N.D.N.Y. Oct. 25, 2011).
In short, this case is a collective and class action lawsuit brought to recover unpaid
overtime wages under the FLSA and the NYLL. It involves approximately 200 current
and former employees of defendant Wave Comm. Two classes of installers were
certified, one under the FLSA pursuant to 29 U.S.C. § 216(b), and another under the
NYLL pursuant to Rule 23(b)(3).
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The FLSA class is comprised of 57 opt-in plaintiffs and includes Wave Comm
employees who worked as installers within the three years preceding the filing of this
lawsuit, as FLSA claims are subject to a maximum three year statute of limitations.
The NYLL class is made up of approximately 200 plaintiffs, which includes the 57
opt-in plaintiffs and is comprised of all Wave Comm employees who worked as installers
between April 2006 and April 2011, as NYLL claims are subject to a six year statute of
limitations.
The classes are broken down into two subclasses:
Subclass I: All persons who worked for Wave Comm as installers . . . at any
time between April 2006 and March 2010 . . . who did not receive proper
overtime pay when they worked more than forty (40) hours in any given work
week. [under Compensation Plan A ("Plan A")]
Subclass II: All persons who worked for Wave Comm as installers . . . at
any time between March 2010 and April 2011, with compensation
determined based on Wave Comm's weighted halftime compensation
system . . . who did not receive proper overtime pay when they worked more
than forty (40) hours in any given work week. [under Compensation Plan B
("Plan B")]
On this date, the parties' cross-motions for summary judgment were granted in part
and denied in part. ECF No. 163. Specifically, it was found that some opt-in plaintiffs'
claims under the FLSA are time barred, subject to a determination of willfulness by the jury.
Additionally, it was held that Wave Comm satisfied the first two prongs of the retail or service
establishment exemption under 29 U.S.C. § 207(i), that is, Wave Comm qualifies as a retail
or service establishment and paid installers on a commission basis under Plan A. However,
defendants could not sustain their burden as to the third prong, that is, to prove all installers
were compensated at a rate of one and one-half times the minimum wage for all weeks of
work.
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Specifically, as to the FLSA Subclass I, defendants could provide no record of hours
worked for the period between April 2006 and September 27, 2009. As a result, they could
not show that installers were compensated at a rate of one and one-half times the minimum
wage for those weeks of work, and the exemption was denied for that period. For the period
from September 28, 2009 through the end of the period encompassing Subclass I (March
2010), defendants established that the regular rate of pay for each Subclass I member was
at least one and one-half times the minimum wage in some, but not all weeks. It was found
that Wave Comm is entitled to the exemption only for those weeks from September 28, 2009
forward in which the requirement was met.
As to the NYLL Subclass I, defendants provided no evidence of hours worked nor
wages for the period April 2006 through March 2010, which comprised the entire period in
which Plan A was in effect, and thus it was impossible to determine on summary judgment
whether Wave Comm satisfied the third prong of the exemption for the NYLL class.
Accordingly, the exemption was denied without prejudice for the NYLL class.
It was also found that the formula by which Plan B calculated wages for members
of Subclass II complied with the FLSA, except for during the first pay period of Plan B
which defendants conceded. Plaintiff also established that a reasonable fact finder could
conclude that the defendants knowingly failed to compensate members of Subclass II for
hours worked during lunch breaks and at home completing billing sheets. Therefore,
summary judgment with regard to plaintiff's claim of unreported hours was denied.
Plaintiff was also granted summary judgment on the claim that Guillerault and
Ruzzo are employers and thus individually liable under the FLSA and defendants'
counterclaim for unjust enrichment was dismissed.
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III. STANDARD OF REVIEW
A. FLSA Collective Action
Courts in this Circuit apply a two-step method in certifying a FLSA collective action.
First, if "plaintiffs make a modest factual showing that they and potential opt-in plaintiffs
together were victims of a common policy or plan that violated the law," the court will send
notice to those potential opt-in plaintiffs who may be "similarly situated." Myers v. Hertz
Corp., 624 F.3d 537, 555 (2d Cir. 2010) (internal quotations omitted). The second stage
occurs after discovery on a more developed record. At that time, the court determines if the
opt-in plaintiffs "are in fact 'similarly situated' to the named plaintiffs." Id. The action may be
decertified if the evidence reveals that they are not. Id.
B. NYLL Class Action
"The class action is 'an exception to the usual rule that litigation is conducted by and
on behalf of the individual named parties only.'" Comcast Corp. v. Behrend, 133 S. Ct. 1426,
1432 (2013) (quoting Califano v. Tamasaki, 442 U.S. 682, 700–01 (1979)). "A party seeking
class certification must affirmatively demonstrate his compliance with [Rule 23] . . . ." WalMart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551–52 (2011). In order to demonstrate
compliance with Rule 23(a), parties seeking class certification must show: (1) the class is so
numerous that joinder of all members is impracticable; (2) there are questions of law or fact
common to the class; (3) the claims or defenses of the representative parties are typical of
the claims or defenses of the class; and (4) the representative parties will fairly and
adequately protect the interests of the class. Fed. R. Civ. P. 23(a). After a party has
established compliance with Rule 23(a), it must then "satisfy through evidentiary proof at
least one of the provisions of Rule 23(b)." Comcast Corp., 133 S. Ct. at 1432.
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In this case, class certification was granted pursuant to Rule 23(b)(3). Rule 23(b)(3)
requires a showing that "questions of law or fact common to class members predominate
over any questions affecting only individual members, and that a class action is superior to
other methods for fairly and efficiently adjudicating the controversy." Factors supporting such
a finding include: "(A) the class members' interests in individually controlling the prosecution
or defense of separate actions; (B) the extent and nature of any litigation concerning the
controversy already begun by or against class members; (C) the desirability or undesirability
of concentrating the litigation of the claims in the particular forum; and (D) the likely
difficulties in managing a class action." Id. A district court may later decertify a previously
certified class if it becomes apparent that the requirements of Rule 23 are in fact, not met.
See Rule 23(c)(1)(C).
C. Consideration of Both Actions Together
The FLSA class certified pursuant to 26 U.S.C. § 216(b) required installers to opt in to
the collective action to seek recovery through the suit, whereas the NYLL class certified
pursuant to Rule 23(b)(3) required installers who met the class description to opt out of the
class action to avoid being bound by the judgment. Although claims brought under the FLSA
are brought as a collective action, and claims brought under the NYLL constitute a class
action, the certification standard for the different types of actions is largely the same.
Epenscheid v. DirectSat USA, LLC, 705 F.3d 770, 772 (7th Cir. 2013). Accordingly, when
considering motions for decertification for collective actions brought under the FLSA and
parallel class actions under state law, courts may treat the set of suits as if it were a single
class action. Id.

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IV. DISCUSSION
Defendants contend that now that discovery has been completed, the evidence that
has been adduced indicates that the claims being pursued in this case cannot be efficiently
and fairly adjudicated as a collective or class action due to the vast number of highly
individualized inquiries that are required. Accordingly, defendants move to decertify the
conditional FLSA collective action and the NYLL class action. Plaintiff argues this is a small
and locally confined collective and class action comprised of installers who performed the
same job duties and were paid in the same manner. According to plaintiffs, the overarching
legal issues were addressed in the parties' motions for summary judgment, damages may be
addressed at trial with representative proof, and therefore the collective and class actions
should be maintained.
The case is now at the second step of the two-step process discussed in Myers, and it
must now be determined whether the record establishes that the plaintiffs who have opted in
are in fact similarly situated to the named plaintiff. Similarly situated does not mean
identically situated. When determining whether opt-in plaintiffs are similarly situated, other
courts have considered: (1) the nature of the factual and employment settings of the
individual plaintiffs; (2) whether available defenses appear to be individual to each plaintiff;
and (3) whether fairness and procedural considerations warrant proceeding collectively.
Zivali v. AT&T Mobility, Inc., 784 F. Supp. 2d 456, 460 (S.D.N.Y. 2011).
Defendants argue that an accurate calculation of damages would be impossible given
the unique factual circumstances surrounding each individual plaintiff, and that defendants
intend to present defenses which are unique to each plaintiff individually. Plaintiff contends

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that class members are similarly situated, defendants may present their defenses
collectively, and procedural considerations favor collective adjudication.
A. Nature of Factual and Employment Settings
Defendants contend that each individual plaintiff experienced unique factual and
employment circumstances, and that representative proof would be inadequate to properly
compensate class members. They claim that their argument is supported by answers to
interrogatories which show that the average number of hours worked by individual plaintiffs
per workweek varied widely. Defendants further cite variations in each individual plaintiff's
hours per workweek for the period during which they tracked their employees' hours in
support of their position. They argue that these variations compel individual questioning of
each plaintiff to determine the reasonableness of their estimated hours of work for the period
when Wave Comm did not track its employees' hours.
Defendants rely on a case with similar facts in which the court was forced to decertify
the class on the eve of trial. Epenscheid v Directsat USA, LLC, No. 09-CV-625, 2011 WL
2009967 (W.D. Wisc. May 23, 2011) aff'd, 705 F.3d 770 (7th Cir. 2013). In Epenscheid, the
Court decertified a class action brought under the FLSA where twelve subclasses were
originally created in an attempt to consolidate the claims of cable installers from three states
into one action. Id. at *1–2. The Seventh Circuit upheld the district court's decision to
decertify the classes due to the inadequacy of representative proof, which, according to the
plaintiffs' proposed trial plan, would have consisted of testimony from forty-two class
members, to accurately represent the experiences of the 2,341 class members who were
employed across three different states. Epenscheid, 705 F.3d at 774. In its decision, the
district court expressed concerns over variances in plaintiffs' experiences, which resulted
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from working in different offices. Epenscheid, 2011 WL 2009967, at *6. In decertifying the
action, the district court explained that "this case is not fit for adjudication as a collective and
class action, at least under the plan proposed by plaintiffs." Id. at *1. According to
defendants, "Epenscheid stands as a warning to courts which accept vague notions of
'representative proof' and wait until the eve of trial when confronted with unmanageable
pretrial plans to thoroughly evaluate whether class and collective treatment is appropriate."
Defs.' Mem. Supp. Mot. Decertification, 5.
There are significant differences between Epenscheid and the present case. As
previously noted when the classes were certified, "there are substantial common issues of
law and fact in this case because Wave Comm had compensation plans that were uniformly
applied to a relatively small group of installers in one state who all performed the same type
of work." Johnson, 2011 WL 10945630, *9 n.17. In this case, all of the class members
worked out of the same office in Utica, New York, performed the same type of work under
the direction of the same employers, and were compensated under the same plans.
Additionally, the mere difference in number of class members in this case makes the use of
representative proof more feasible than in Epenscheid.
"To show that they are similarly situated, Plaintiffs may present evidence to show that
an employer engaged in a unified policy, plan, or scheme of FLSA violations." Kautsch v.
Premier Commc'ns, No. 06-CV-04035, 2008 WL 294271, at *1 (W.D. Mo. Jan. 31, 2008)
(citing Grayson v. K-Mart Corp., 79 F.3d 1086, 1095–96 (11th Cir. 1996)). It is undisputed
that members of Subclass I were all compensated according to Plan A, which failed to
provide overtime pay. Plaintiffs have also submitted evidence to show that defendants
engaged in a policy to deny overtime payments to members of Subclass II by instructing
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them to record having taken a lunch break regardless of whether or not one was taken, and
by knowingly allowing members of Subclass II to perform work filling out billing sheets at
home without providing compensation. This evidence, which tends to show that plaintiffs
were subjected to unified policies of their employer which violated the FLSA and NYLL,
supports a finding that plaintiffs are similarly situated.
B. Available Defenses
Defendants argue that decertification is necessary because they intend to present
defenses which are unique to each class member. They argue that individual inquiries are
required to determine whether the FLSA's statute of limitations bars or limits each class
member's claims, or if individual plaintiffs were exempt from overtime payments under the
retail or service establishment exemption.1 Defendants also contend that they are entitled to
question each plaintiff individually to determine the reasonableness of their estimates of
hours worked during the period in which Wave Comm did not track its employees hours.
Defendants' "right to defend against individualized claims on an individual basis, rather
than collectively . . . must be balanced with the rights of the plaintiffs—many of whom would
likely be unable to bear the costs of an individual trial—to have their day in court." Nerland v
Caribou Coffee Co., Inc., 564 F. Supp. 2d 1010, 1024 (D. Minn. 2007) (internal citations
omitted). Furthermore, where individualized inquiries into damages may be necessary, Rule
23(b)(3) does not preclude class certification when common questions regarding liability
predominate. Alonso v. Uncle Jack's Steakhouse, Inc., No. 08-CV-7813, 2011 WL 4389636,

1

The retail or service establishment exemption was discussed in great detail in the previous
Memorandum-Decision and Order. ECF No. 163.

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at *5 (S.D.N.Y. Sep. 21, 2011). Common questions of law and fact predominate over
individualized questions concerning the application of the statute of limitations and FLSA
exemption in this matter. If it is determined that plaintiffs are entitled to damages, the statute
of limitations can be readily applied to correctly limit each opt-in class member's claim as the
date on which each class member consented to join the action is known with certainty.
Defendants have already produced a chart establishing the earliest date of recovery for each
opt-in plaintiff under both the three year statute of limitations for willful violations of the FLSA
and the two year statute of limitations for non-willful violations. See Quesnel Aff., Jan. 25,
2013, Ex. W, ECF No. 124–122. It would be inefficient to deny the collective adjudication of
these claims merely because the statute of limitations must be applied to each plaintiff
individually when determining damages.
Common questions concerning defendants' liability also predominate over questions
of whether the retail or service establishment exemption applied to individual plaintiffs. For
the vast majority of the weeks in which employees were compensated under Plan A, the
exemption cannot be applied to any installers in the FLSA or NYLL classes because Wave
Comm failed to track its employees' hours. ECF No. 163. For the weeks in which Wave
Comm did track its employees' hours, it can be easily determined if individual plaintiffs were
paid one and one-half times the minimum wage and were exempt from overtime payments.
Again, defendants have already compiled a chart showing what weeks individual FLSA
Subclass I members were exempt from overtime payments. See Quesnel Aff., Jan. 25,
2013, Ex. U, pts. 1 & 2, ECF No. 124–119. Accordingly, defendants' argument that their due
process rights would be violated by proceeding collectively is unpersuasive.

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Defendants further contend that individual inquiries into the reasonableness of each
plaintiff's reported hours will be required as representative proof would be insufficient to
reasonably represent the amount of work performed by non-testifying plaintiffs. However,
where defendants failed to track their employees' hours, "it is well-established that the
[plaintiff] may present the testimony of a representative sample of employees as part of his
proof of the prima facie case under the FLSA." Reich v. S. New England Telecomm. Corp.,
121 F.3d 58, 67 (2d Cir. 1997).
[W]here the employer's records are inaccurate or inadequate and the employee
cannot offer convincing substitutes . . . [t]he solution . . . is not to penalize the
employee by denying him any recovery on the ground that he is unable to
prove the precise extent of uncompensated work. Such a result would place a
premium on an employer's failure to keep proper records in conformity with his
statutory duty; it would allow the employer to keep the benefits of an
employee's labors without paying due compensation as contemplated by the
Fair Labor Standards Act. In such a situation we hold that an employee has
carried out his burden if he proves that he has in fact performed work for which
he was improperly compensated and if he produces sufficient evidence to show
the amount and extent of that work as a matter of just and reasonable
inference. The burden then shifts to the employer to come forward with
evidence of the precise amount of work performed or with evidence to negative
the reasonableness of the inference to be drawn from the employee's
evidence. If the employer fails to produce such evidence, the court may then
award damages to the employee, even though the result be only approximate.
Id. at 66–67 (quoting Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687–88 (1946)).
Furthermore, "[t]he employer cannot be heard to complain that the damages lack the
exactness and precision of measurement that would be possible had he kept records."
Anderson, 328 U.S. at 688.
Defendants cannot support their decertification motion with claims that representative
proof is inadequate to accurately assess the extent of their liability when Wave Comm's
failure to track its employees' hours is the reason that representative proof is necessary.

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Decertification on those grounds would unjustly penalize the plaintiffs and reward defendants
for their failure to keep records. Such an argument is also insufficient to establish that
individual questions regarding damages predominate over common questions of liability.
Plaintiffs have established that the representative testimony they intend to introduce satisfies
their burden of establishing a prima facie violation of the FLSA and NYLL. Defendants will
have the opportunity to introduce all of the evidence they have cited which calls into question
the reasonableness of the class members' estimates to negate any inference of liability
raised by plaintiffs' representative testimony.
C. Fairness and Procedural Considerations
When considering whether fairness and procedural considerations weigh in favor of
class certification, courts are to consider the purposes to the FLSA's collective action
mechanism: "(1) to lower costs to the plaintiffs through the pooling of resources; and (2) to
limit the controversy to one proceeding which efficiently resolves common issues of law and
fact that arose from the same alleged activity." Moss v. Crawford & Co., 210 F.R.D. 398, 410
(W.D. Pa. 2000) (citing Hoffman-La Roche Inc., v. Sperling, 493 U.S. 165, 170 (1989)).
Defendants argue that proceeding as a class action "would result in unjustly rewarding some
technicians who have already been compensated fully, while simultaneously reducing the
awards to which others may be entitled." Defs.' Mem. Supp. Mot. Decertification, 29–30.
Plaintiff claims that considerations of fairness and judicial efficiency weigh in favor of
collective adjudication.
Plaintiff asserts that many class members would be unable to bear the costs of
proceeding individually, and decertification of this action would force them to abandon their
claims. Pl.'s Mem. Opp. Mot. Decertification, 19. Defendants did not respond to this
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argument. As decertification of this action would be contrary to the FLSA's goal of reducing
costs to plaintiffs through the pooling of resources, considerations of fairness weigh against
decertification.
If this action were to be decertified, adjudication of these claims would require
hundreds of mini trials. Thus, considerations of judicial efficiency weigh heavily in favor of
collective adjudication as decertification of this action would be inefficient and expensive for
both the parties involved and the court. See Monroe v. FTS USA, LLC., 763 F. Supp. 2d
979, 996 (W.D. Tenn. 2011) ("The investment of time and resources required for
. . . separate trials would render adjudication of Plaintiffs' claims so unwieldy and expensive
as to substantially hinder, if not preclude, their resolution by judicial means."); see also
Kautsch, 2008 WL 294271, at *4 ("[S]eparate trials is the worst possible outcome in terms of
efficiency.").
V. CONCLUSION
Defendants have not shown that common questions of law and fact no longer
predominate over questions affecting individual class members such that decertification is
warranted. Class members are similarly situated with regards to their factual and
employment circumstances. They all worked in the same office, were compensated under
the same payment plans, and allege that they were subjected to unified policies which
violated the FLSA and NYLL. Defendants' ability to present available defenses will not be
harmed by proceeding collectively. They retain the ability to challenge representative proof
introduced by class members regarding defendants' violation of the FLSA and the extent of
damages. Concerns of fairness to individual plaintiffs and considerations of judicial

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efficiency also weigh in favor of collective adjudication. For these reasons, defendants'
motion to decertify the action will be denied.
Therefore, it is
ORDERED that
Defendants' Motion for Class Decertification pursuant to 29 U.S.C. § 216(b) and
Federal Rule of Civil Procedure 23 is DENIED.
IT IS SO ORDERED.

Dated: March 14, 2014
Utica, New York.

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