Begum v. Ariba Discount, Inc.

Filing 64

OPINION AND ORDER ACCEPTING REPORT AND RECOMMENDATION adopting 60 Report and Recommendation, re: 46 MOTION for Default Judgment as to Amended Complaint filed by Shamim Ara Begum. The Report is accepted. Because no objection was filed to the Report, defendants have waived their rights of appeal from the judgment entered against them. United States v. James, 712 F.3d 79, 105 (2d Cir. 2013), cert. denied, 134 S. Ct. 2660 (2014). The Clerk of Court is directed to enter de fault judgment against defendants, jointly and severally, equal to the sum of (a) $29,747.94 in minimum wage, overtime compensation, and spread of hours damages; (b) $49,993.41 in liquidated damages; (c) $8,031.93 in prejudgment interest; and (d) postjudgment interest at the federal statutory rate tied to the Treasury yield. (Signed by Judge Denise L. Cote on 1/16/2015) Copies Sent by Chambers. (mro)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
----------------------------------------X
:
SHAMIM ARA BEGUM,
:
:
Plaintiff,
:
:
-v:
:
ARIBA DISCOUNT, INC., AFSAR KHAN, and
:
MAMADOU DIAMAN,
:
:
Defendants.
:
:
----------------------------------------X
Appearances:
For Plaintiff:
John K. Idouchi
JOHN K. IDOUCHI, ESQ.
136-40 39th Ave., Ste. 304
Flushing, NY 11354
For Defendant Ariba Discount, Inc.:
Christopher E. Chang
LAW OFFICES OF CHRISTOPHER E. CHANG
140 Broadway, 46th Floor
New York, NY 10005
Peter Hans Cooper
CILENTI & COOPER, P.L.L.C.
708 Third Avenue, 6th Flr
New York, NY 10017
For Defendant Afsar Khan:
Peter Hans Cooper
CILENTI & COOPER, P.L.L.C.
708 Third Avenue, 6th Flr
New York, NY 10017

12cv6620 (DLC)
OPINION AND ORDER
ACCEPTING REPORT
AND RECOMMENDATION

For Defendant Mamadou Diaman:
Mamadou Diaman
PRO SE
149 West 24th Street
New York, NY 10011
DENISE COTE, District Judge:
On October 28, 2014, Magistrate Judge Fox issued a report
(“Report”) recommending that plaintiff be awarded (a) $29,747.94
in minimum wage, overtime compensation, and spread of hours
damages; (b) $49,993.41 in liquidated damages; (c) $8,031.93 in
prejudgment interest; and (d) postjudgment interest.
objections to the Report have been filed.

No

For the reasons that

follow, the Report is accepted.
BACKGROUND
Familiarity with the case, as described in the Report, is
presumed.

Ariba Discount, Inc. (“Ariba Discount”) operates a

store where, from October 31, 2010 to July 14, 2012, Shamim Ara
Begum (“Begum”) was employed as a cashier continuously for 107
weeks, without taking any extended leave of absence, vacation,
or sick leave.

Begum typically worked six days a week, from

9:00am to 10:00pm and was paid six dollars an hour.
On August 29, 2012, Begum commenced this action against
Ariba Discount to recover unpaid wages and overtime compensation
pursuant to the Fair Labor Standards Act (“FLSA”), 29 U.S.C.
§§ 201-19, and the New York Labor Law (“NYLL”), §§ 190 to 199-a.
On January 17, 2013, the Court approved for distribution a
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collective action notice.

No party plaintiff was joined to the

lawsuit as a result of the collective action notice.

By August

28, 2013, Begum had amended the complaint to add as defendants
Ariba Discount’s owner, Afsar Khan, and its manager, Mamadou
Diaman.

By April 10, 2014, a certificate of default had been

entered against all three defendants pursuant to Federal Rule of
Civil Procedure 55(a).

This action was referred to the

Magistrate Judge for a Report respecting the amount due on wage
and overtime claims.

On September 4, 2014, the Magistrate Judge

conducted an evidentiary hearing on the amount due by defendants
to Begum.
DISCUSSION
A district court “may accept, reject, or modify, in whole
or in part, the findings or recommendations made by the
magistrate judge.”

28 U.S.C. § 636(b)(1)(C).

“To accept those

portions of a report to which no timely objection has been made,
a district court need only satisfy itself that there is no clear
error on the face of the record.”

Deng v. 278 Gramercy Park

Grp., LLC, No. 12cv7803 (DLC), 2014 WL 4996255, at *3 (S.D.N.Y.
Oct. 7, 2014) (citation omitted).

Here, on the face of the

record there is no clear error in the Magistrate Judge’s
calculation of minimum wage, overtime compensation, and spread
of hours damages; liquidated damages; prejudgment interest; or
postjudgment interest.
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I.

Minimum Wage, Overtime Compensation, and Spread of
Hours

Under FLSA § 206, “[e]very employer shall pay to each of
his employees who in any workweek is engaged in commerce or in
the production of goods for commerce, or is employed in an
enterprise engaged in commerce or in the production of goods for
commerce, . . . not less than $7.25 an hour.”
§ 206(a)(1)(C).

29 U.S.C.

Pursuant to § 207, “no employer shall employ

any of his employees . . . for a workweek longer than forty
hours unless such employee receives compensation for his
employment in excess of the hours above specified at a rate not
less than one and one-half times the regular rate at which he is
employed.”

Id. § 207(a)(1).

“Any employer who violates the

provisions of section 206 or section 207 of the [FLSA] shall be
liable to the employee or the employees affected in the amount
of their unpaid minimum wages, or their unpaid overtime
compensation . . . .”

Id. § 216(b).

The NYLL and associated

regulations 1 contain provisions that are materially similar for
present purposes.

See NYLL § 160(3); N.Y. Comp. Codes R. &

Regs. tit. 12, §§ 142-2.1 to -2.2, -2.4, -2.18.
There is nothing clearly erroneous in the way the
Magistrate Judge applied these rules to the evidence here.
the eighty-nine weeks for which receipts documenting Begum’s

For

The term “the NYLL” hereinafter encompasses the associated
regulations.
1

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hours were presented, the Magistrate Judge calculated overtime
hours by subtracting forty from the total number of hours worked
in a day and adopted the minimum hourly wage of $7.25 and the
overtime hourly wage of $10.88 (or $7.25 times 1.5).

And for

the eighteen weeks for which no receipts were presented, the
Magistrate Judge used the arithmetic mean of weekly hours worked
as calculated based on all of the available information.
II.

Liquidated Damages

Under the FLSA, an employer may be liable for liquidated
damages “in an additional equal amount” to the amount owed for
“unpaid minimum wages, or . . . unpaid overtime compensation.”
29 U.S.C. § 216(b).

But “if the employer shows . . . that the

act or omission giving rise to [FLSA liability] was in good
faith and that he had reasonable grounds for believing that his
act or omission was not a violation of the [FLSA], the court
may, in its sound discretion, award no liquidated damages or
award [a lesser] amount thereof.”

29 U.S.C. § 260.

Similarly, under the NYLL, “unless the employer proves a
good faith basis to believe that its underpayment of wages was
in compliance with the law, an additional amount as liquidated
damages equal to one hundred percent of the total amount of the
wages found to be due” may be recovered by a plaintiff.
§ 198(1-a).

NYLL

Prior to April 9, 2011, these liquidated damages

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under the NYLL were calculated at twenty-five percent of the
lost pay.

See NYLL § 198(1-a) (1999) (amended 2011).

Courts in the Second Circuit are divided over whether
a plaintiff may recover liquidated damages under both
[the] FLSA and the NYLL, but allowing recovery under
both statutes appears to be the majority approach.
This is because the Supreme Court has specified that
liquidated damages under [the] FLSA are compensatory,
Overnight Motor Transp. Co. v. Missel, 316 U.S. 572,
583 (1942), but the Second Circuit has held that
liquidated damages under the NYLL are punitive, Reilly
v. Natwest Markets Grp., Inc., 181 F.3d 253, 265 (2d
Cir. 1999). Therefore, the two types of liquidated
damages are not functional equivalents, and a
plaintiff may recover both.
Tackie v. Keff Enters. LLC, No. 14cv2074 (JPO), 2014 WL 4626229,
at *5 (S.D.N.Y. Sept. 16, 2014) (citation omitted); see also
McLean v. Garage Mgmt. Corp., No. 09cv9325 (DLC), 2012 WL
1358739, at *10 (S.D.N.Y. Apr. 19, 2012) (“FLSA liquidated
damages and NYLL liquidated damages serve fundamentally
different purposes, and the plaintiffs are entitled to both FLSA
and NYLL liquidated damages for unpaid wages.”).
Again, there is nothing clearly erroneous in the way the
Magistrate Judge applied these principles to the evidence in
this case.

He found that defendants had failed to show that the

conduct giving rise to this action was in good faith or that
they had reasonable grounds for believing that their conduct was
not a violation of law.

Accordingly, he imposed liquidated

damages under the FLSA in an amount equal to the minimum wage,
overtime compensation, and spread of hours award.
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Similarly, he

imposed liquidated damages under the NYLL at a rate of twentyfive percent of the minimum wage, overtime compensation, and
spread of hours award for the period until April 8, 2011, and at
a rate of 100% of the minimum wage, overtime compensation, and
spread of hours award for the period beginning April 9, 2011.
III. Prejudgment Interest
“It is well settled that in an action for violations of the
[FLSA] prejudgment interest may not be awarded in addition to
liquidated damages.”

Brock v. Superior Care, Inc., 840 F.2d

1054, 1064 (2d Cir. 1988) (per curiam opinion on motion for
clarification).

Under the NYLL, however, prejudgment interest

may be awarded pursuant to the New York Civil Practice Law and
Rules (“N.Y. C.P.L.R.”) in addition to liquidated damages.

See

Reilly v. Natwest Markets Grp. Inc., 181 F.3d 253, 265 (2d Cir.
1999).

This remains true even where liability is found not only

under the NYLL but also under the FLSA.

See Thomas v. iStar

Fin., Inc., 652 F.3d 141, 150 n.7 (2d Cir. 2011) (citing Heng
Chan v. Sung Yue Tung Corp., No. 03cv6048 (GEL), 2007 WL
1373118, at *9 (S.D.N.Y. May 8, 2007)).
Under N.Y. C.P.L.R., interest “shall be at the rate of nine
per centum per annum” and “computed from the earliest
ascertainable date the cause of action existed, except that
interest upon damages incurred thereafter shall be computed from
the date incurred.

Where such damages were incurred at various
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times, interest shall be computed upon each item from the date
it was incurred or upon all of the damages from a single
reasonable intermediate date.”

N.Y. C.P.L.R. 5001(b), 5004.

The Magistrate Judge did not clearly err in calculating
prejudgment interest here.

He picked the reasonable

intermediate date of September 7, 2011 and applied the rate of
nine percent to the award under the NYLL for minimum wage,
overtime compensation, and spread of hours damages.
IV.

Postjudgment Interest

Pursuant to federal law, “[i]nterest shall be allowed on
any money judgment in a civil case recovered in a district
court. . . .

Such interest shall be calculated from the date of

the entry of the judgment, at a rate equal to the weekly average
1-year constant maturity Treasury yield . . . for the calendar
week preceding . . . the date of the judgment.”
§ 1961(a).

28 U.S.C.

The Magistrate Judge did not clearly err in finding

that Begum is entitled to postjudgment interest under this
statute.
CONCLUSION
The Report is accepted.

Because no objection was filed to

the Report, defendants have waived their rights of appeal from
the judgment entered against them.

United States v. James, 712

F.3d 79, 105 (2d Cir. 2013), cert. denied, 134 S. Ct. 2660
(2014).
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The Clerk of Court is directed to enter default judgment
against defendants, jointly and severally, equal to the sum of
(a) $29,747.94 in minimum wage, overtime compensation, and
spread of hours damages; (b) $49,993.41 in liquidated damages;
(c) $8,031.93 in prejudgment interest; and (d) postjudgment
interest at the federal statutory rate tied to the Treasury
yield.
SO ORDERED.
Dated:

New York, New York
January 16, 2015
__________________________________
DENISE COTE
United States District Judge

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COPY SENT TO
Mamadou Diaman
149 West 24th Street
New York, NY 10011

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