Juarez et al v. Wheels Pizza Inc et al
Filing
58
OPINION & ORDER....Defendants' April 3, 2015 motion for summary judgment is denied. (Signed by Judge Denise L. Cote on 6/30/2015) (gr)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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:
MARTIN JUAREZ, individually and on
:
behalf of others similarly situated,
:
:
Plaintiff,
:
:
-v:
:
WHEELS PIZZA INC., (d/b/a ANNA MARIA’S :
PIZZA) and ANN MARIE DELANEY,
:
:
Defendants.
:
:
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13cv261(DLC)
OPINION & ORDER
APPEARANCES:
For Plaintiff Martin Juarez:
Joshua S. Androphy
Michael Antonio Faillace
MICHAEL FAILLACE & ASSOCIATES, P.C.
60 East 42nd Street, Suite 2020
New York, NY 10165
For Defendants Wheels Pizza Inc. and Ann Marie Delaney:
Bradley Lawrence Waldman
O’DWYER & BERNSTEIN, L.L.P.
52 Duane Street
New York, NY 10007
DENISE COTE, District Judge:
Plaintiff Martin Juarez (“Juarez” or “plaintiff”) brings
various claims under the Fair Labor Standards Act (“FLSA”) and
the New York Labor Law (“NYLL”) against his former employer,
Wheels Pizza Inc. (“Wheels”) 1, and Ann Marie Delaney (“Delaney,”
Wheels Pizza operated “Anna Marie’s Pizza” during the time at
issue. All references to “Wheels” with respect to that time
refer to Anna Marie’s Pizza.
1
collectively “defendants”), the daughter of Wheels’s late owner.
Defendants now move for summary judgment on all claims.
For the
reasons stated below, the motion is denied.
BACKGROUND
The following facts are undisputed unless otherwise noted.
From summer 2008 to October 2012, Wheels operated a cash-only
pizza stand at Manhattan’s South Street Seaport.
Business was
seasonal, and the stand employed from four to eight employees at
any one time.
Wheels’s sole owner and shareholder was Austin
Delaney, who died in May 2009.
Before Austin Delaney’s death,
the stand was managed by Joseph Oliva (“Oliva”), who was in
charge of hiring, firing, setting schedules for, and
distributing pay to employees.
During this time Oliva consulted
with Austin Delaney regarding firing decisions, and Austin
Delaney also prepared pay for Oliva to distribute.
The parties
dispute whether and to what degree Oliva continued to manage the
stand after Austin Delaney’s death.
In October 2012, Superstorm
Sandy forced the stand to close, and it never reopened.
Juarez was hired by Oliva when Wheels opened the pizza
stand in 2008 and worked there until it closed in October 2012.
Juarez claims to have worked 8:00 a.m. to 9:00 p.m. six days a
week, occasionally staying past 9:00 p.m.
The parties agree his
primary responsibility was preparing pizzas and working the
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counters.
Juarez contends he was responsible for cleaning the
stand, as well.
He was paid partly by check and partly in cash.
He states that until January 2012 he received $250 by check
every week and $200 in cash every other week; in January 2012,
he states, he began receiving $15/hour.
On January 1, 2013, Juarez commenced this action pursuant
to 29 U.S.C. § 216(b), alleging violation of the FLSA’s minimum
wage and overtime provisions, the analogous provisions of the
NYLL, and a relevant state regulation. 2
Defendants filed the
instant motion for summary judgment on April 3, 2015; it was
fully submitted on May 15.
DISCUSSION
Summary judgment may not be granted unless all of the
submissions taken together “show[ ] that there is no genuine
dispute as to any material fact” and that defendants, the
movants, “[are] entitled to judgment as a matter of law.”
Fed. R. Civ. P. 56(a).
See
Defendants bear the burden of
demonstrating the absence of a material factual question, and,
in making this determination, all facts are viewed in the light
most favorable to Juarez and all reasonable inferences are drawn
This case was originally assigned to the Honorable Robert P.
Patterson. Following the reassignment to this Court, the
plaintiff indicated at a February 20, 2015 conference that he
was bringing this action on his own behalf alone and was not
pursuing either a collective or class action.
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in Juarez’s favor.
See Eastman Kodak Co. v. Image Technical
Servs., 504 U.S. 451, 456 (1992); Holcomb v. Iona Coll., 521
F.3d 130, 132 (2d Cir. 2008).
Defendants advance four principal arguments.
First, they
argue that Wheels did not have a sufficient amount of gross
revenue to be covered by the FLSA.
Second, they argue that
Delaney cannot be liable because she was never Juarez’s
employer, as that term is used in the relevant statutes.
Third,
they argue that Juarez’s testimony is “not credible as a matter
of law.”
Finally, they argue that Juarez’s claims fail because
he cannot establish damages.
Each argument will be addressed in
turn.
I. Enterprise Test
The FLSA defines an “enterprise engaged in commerce” as a
business that (1) has employees “engaged in commerce or in the
production of goods for commerce, or that has employees
handling, selling, or otherwise working on goods or materials
that have been moved in or produced for commerce by any person,”
and (2) has an annual gross revenue of at least $500,000.
U.S.C. § 203(s)(1)(A)(i), (ii).
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Defendants contend that Wheels
has never had annual gross revenue of at least $500,000 and
therefore cannot be liable under the FLSA. 3
3
Defendants also assert that the FLSA does not apply to Juarez
4
In support of this contention, Wheels offers the first page
of each of its corporate tax returns for the years 2008 through
2012. 4
The largest amount of gross income reported on these tax
returns is $432,662, for the year 2011.
unsigned.
The returns are
Accompanying these pages is a March 3, 2015 letter
from Joel Zipper (“Zipper”), a certified public accountant at
the accounting firm of Josephson Luxenberg Kance & Dolinger, PC.
Zipper states that the pages submitted are true and accurate
copies of the returns filed with the IRS.
Plaintiffs offer Juarez’s estimates that the stand’s daily
sales were $2,500 to $3,500, depending on the day of the week.
Assuming these daily totals to be correct, Wheels’s annual sales
would have been well over $500,000.
Since what is at issue is
the actual revenue and not simply the reported revenue, there is
because “the pizza business was not engaged in interstate
commerce.” Juarez’s complaint alleges that he “regularly
handled goods in interstate commerce, such as food and other
supplies produced outside the state of New York,” and his
deposition testimony describes the sale at the stand of, inter
alia, soft drinks and beer. It is logical to infer that these
and other goods moved in interstate commerce, which is
sufficient to satisfy this requirement. See, e.g., Jacobs v.
N.Y. Foundling Hosp., 577 F.3d 93, 99 (2d Cir. 2009) (“[The
interstate commerce] requirement is rarely difficult to
establish . . . because it is met by showing that two or more
employees have handled materials that have been moved in
commerce.”) (citation omitted).
Given the FLSA’s three-year statute of limitations, only those
returns from 2010, 2011, and 2012 are relevant here.
4
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a genuine dispute of material fact over whether Wheels is a
statutory “enterprise.”
II. Liability of Delaney
The FLSA defines “employer” as “any person acting directly
or indirectly in the interest of an employer in relation to an
employee.”
29 U.S.C. § 203(d).
“The Court has instructed that
the determination of whether an employer-employee relationship
exists for purposes of the FLSA should be grounded in economic
reality rather than technical concepts.”
Irizarry v.
Catsimatidis, 722 F.3d 99, 104 (2d Cir. 2013) (citation
omitted), cert. denied, 134 S. Ct. 1516 (2014).
Accordingly,
the Second Circuit has
established four factors to determine the “economic
reality” of an employment relationship: whether the
alleged employer (1) had the power to hire and fire
the employees, (2) supervised and controlled employee
work schedules or conditions of employment, (3)
determined the rate and method of payment, and (4)
maintained employment records.
Id. at 104-05 (citation omitted).
“The ‘economic reality’ test
applies equally to whether workers are employees and to whether
managers or owners are employers.”
Id., 722 F.3d at 103.
Where
individual liability under FLSA is concerned, the “overarching
concern [is] whether the alleged employer possessed the power to
control the workers in question.”
omitted).
Id. at 105 (citation
“A person exercises operational control over
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employees if his or her role within the company, and the
decisions it entails, directly affect the nature or conditions
of the employees' employment.”
Id. at 110.
The NYLL, in turn, defines “employer” as “any person ...
employing any individual in any occupation, industry, trade,
business or service” or “any individual . . . acting as
employer.” N.Y. Lab. Law. §§ 190(3), 651(6).
Whether “the tests
for ‘employer’ status are the same under the FLSA and the NYLL .
. . has not been answered by the New York Court of Appeals.”
Irizarry, 722 F.3d at 117.
Defendants contend that Delaney is not a proper defendant
under the FLSA and the NYLL because she is not an “owner” of
Wheels and had no “operational control” over Wheels.
Both
Delaney and Oliva testified that Delaney had no involvement with
hiring, firing, or supervising Wheels employees at any time, and
indeed that she had no substantial involvement with Wheels at
all.
According to Juarez, Delaney was, in fact, involved in
setting his pay rate and approved the hiring of new employees.
Moreover, plaintiff submits a database maintained by the New
York Department of State Division of Corporations that lists
Delaney as the Chief Executive Officer of Wheels, something she
is unable to explain.
Juarez’s assertions suffice to make
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Delaney’s role with respect to Wheels and Juarez a genuine
dispute of material fact.
III. Juarez’s Testimony
Although they challenge Juarez’s testimony with respect to
their other arguments, defendants argue separately that summary
judgment is appropriate because his testimony as a whole is not
credible.
“While it is undoubtedly the duty of district courts
not to weigh the credibility of the parties” on summary
judgment,
[I]n the rare circumstance where the plaintiff relies
almost exclusively on his own testimony, much of which
is contradictory and incomplete, it will be impossible
for a district court to determine whether the jury
could reasonably find for the plaintiff, and thus
whether there are any “genuine” issues of material
fact, without making some assessment of the
plaintiff's account.
Jeffreys v. City of New York, 426 F.3d 549, 554 (2d Cir. 2005)
(citation omitted).
“[W]hen the facts alleged are so
contradictory that doubt is cast upon their plausibility, the
court may pierce the veil of the [plaintiff’s] factual
allegations and dismiss the claim.”
Id. at 555 (citation
omitted).
Defendants contend that Juarez’s reports of how much pizza
he made, how many hours he worked, and how much work he did at
Wheels simply cannot be believed.
They also point to instances
where, they allege, “plaintiff contradicted his testimony, under
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egregious, objectionable leading question[s] by his own
attorney.” 5
While it is true that corroborating evidence is
lacking for many of Juarez’s claims and that some of them strain
credulity, the alleged inconsistencies and what defendants
characterize as “ludicrous” statements do not cast on his claims
the degree of doubt necessary to justify summary judgment on the
issue of credibility alone.
The determination of Juarez’s
credibility will be left to the fact-finder.
IV. Establishing Damages
Defendants finally argue that they are entitled to summary
judgment because Juarez lacks any documentation of the hours he
worked and the amounts paid him, and therefore any damages due
to him cannot be determined.
Defendants concede, however, that
they do not have any such records, either.
“[A]t summary
judgment, if an employer’s records are inaccurate or inadequate,
an employee need only present sufficient evidence to show the
amount and extent of the uncompensated work as a matter of just
and reasonable inference.”
Kuebel v. Black & Decker Inc., 643
F.3d 352, 362 (2d Cir. 2011) (citation omitted).
“[A]n
Specifically, defendants say that Juarez first testified to
receiving cash payments of $200 per week, then later testified
to receiving such payments every other week after, “[d]uring the
break . . . counsel conferred with [him] . . . outside the
deposition room.” Defendants also note that Juarez did not
mention Delaney the first time he was asked about his
supervision at work.
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employee’s burden in this regard is not high,” and “it is
possible for a plaintiff to meet this burden through estimates
based on his own recollection.”
Id.
“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.”
Anderson v. Mt. Clemens Pottery
Co., 328 U.S. 680, 687-88 (1946).
Juarez has offered his estimates of the hours he worked and
the pay he received.
In the absence of adequate and accurate
records maintained by Wheels, this is sufficient to satisfy the
low burden imposed on FLSA plaintiffs on this issue.
Defendants, meanwhile, have offered Oliva’s own recollections of
the amount and extent of the work performed by Juarez.
As with
the other issues on which defendants seek summary judgment, the
appropriate amount of damages is ultimately a question for the
fact-finder.
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CONCLUSION
Defendants’ April 3, 2015 motion for summary judgment is
denied.
Dated:
New York, New York
June 30, 2015
________________________________
DENISE COTE
United States District Judge
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