Bazignan v. Team Castle Hill Corp.
Filing
50
OPINION & ORDER: CONCLUSION: For the foregoing reasons, Plaintiff is entitled to damages in the following amounts. The Clerk of Court is directed to enter judgment awarding Plaintiff the below amounts and to close this case: Actual Damages (FLSA a nd NYLL): $13,927--New York Spread of Hours: $812---FLSA Liquidated Damages: $13,927---NYLL Liquidated Damages: $14,739---Wage Statement Violations: $1700---Conversion: $109.83---Attorneys' fees: $23,871---Attorneys' costs: $947.47---Pre-Judgment Interest: $2396.08---Post-Judgment Interest: in accordance with 28 U.S.C. § 1961(b), but excluding attorneys' fees. SO ORDERED. (Signed by Judge Paul A. Crotty on March 5, 2015) (mov)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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RICHARD BAZIGNAN,
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Plaintiff,
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-against13 Civ. 8382 (PAC)
TEAM CASTLE HILL CORP., d/b/a
PAPA JOHN'S PIZZA,
OPINION & ORDER
Defendants.
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HONORABLE PAUL A. CROTTY, United States District Judge:
On February 9, 2015, the Court held an inquest on damages in this wage-and-hour matter.
Plaintiff Richard Bazignan ("Plaintiff'), a former employee ofDefendants Team Castle Hill
Corp. ("Defendants"), testified as the sole witness. The parties have now submitted proposed
findings of fact and conclusions oflaw, along with proposed damages calculations. The Court
finds for the Plaintiff and awards damages in the amounts indicated.
DISCUSSION
I.
Procedural History
Plaintiff filed this suit on November 22, 2013, alleging violations of the Fair Labor
Standards Act ("FLSA"), 29 U.S.C. §§ 201 et seq. , and the New York Labor Law ("NYLL"), §§
650 et seq. The Complaint includes allegations of minimum wage and ovetiime violations,
violations of the spread ofhours and wage statement provisions, conversion, and retaliation.
Dkt. 1. After miginally defaulting, see Dkt. 7, Defendants sought to vacate the Clerk of Court's
1
entry of default and filed an answer, Dkt. 12. After answering on July 11, 2014, Defendants
otherwise failed to participate in the litigation. On October 6, 2014, Defendants' counsel sought
to withdraw as counsel, arguing that because he represented Defendants pursuant to an indemnity
clause in the Sales Agreement between Defendants and purchasers of Defendants' business, and
because the purchasers and Defendants were opposing each other in a separate litigation, a
conflict of interest existed. See Dkt. 20. The Court rejected this request. Dkt. 23. On
November 24, 2014, Plaintiff informed the Court that Defendants had refused to participate in
discovery, Dkt. 25, and Defendants' counsel represented that Defendants were not cooperating in
his requests for documents, Dkt. 26. Accordingly, on November 26, 2014, the Court struck
Defendants' answer, reinstated the certificate of default, and reinstated Plaintiffs motion for
default. Dkt. 27. Defendants' counsel again sought to withdraw on December 4, 2014, Dkt. 28,
and the Court denied the request on January 5, 2014, Dkt. 31. An inquest to determine damages
was held on February 9, 2015, and consisted only ofPlaintiffs testimony.
II.
Findings of Fact1
Plaintiff worked for Defendants from March 25, 2013 until July 21, 2013. See Pl. Mem.
at 3, ,-r 1. Defendants' business generated at least $1,095,000 per year and was open every day of
the year. Id.
~~
2-3. Plaintiff worked at two locations owned by Defendants: 2241 Westchester
Avenue, Bronx, New York, and 6 Glen Head Road, Long Island. Id.
~ 4.
These locations were
open to customers from 10 a.m. to 1 a.m. Sunday through Thursday, and 10 a.m. to 2 a.m. on
Friday and Saturday. Id.
~
5. Plaintiffs hours were from 10 a.m. to 2:30a.m. Sunday through
Thursday, and from 10 a.m. to 4 a.m. on Friday and Saturday. Id.
1
~~
7-8. Accordingly, Plaintiff
The Court found Plaintiffto be a credible witness and credits the majority of Plaintiffs testimony. Moreover,
Defendants' default constitutes an admission of the well-pleaded allegations of liability. See Cement & Concrete
Workers Dist. Council Welfare Fund v. Metro Found. Contractors Inc. , 699 F.3d 230,234 (2d Cir. 20 12).
2
worked 16.5 hours per day from Sunday through Thursday and 18 hours per day on Friday and
Saturday. Id. ~~ 7-8. Plaintiff received no uninterrupted breaks throughout the day. Id.
~
9. He
received two days off per month, which took place the second and last Monday of each month.
Id. at 4, ~ 10. While Defendants utilized a computer system to track employees' hours, managers
clocked Plaintiff in and out and did not allow Plaintiff to review, revise, or approve the hours
recorded. !d. ,[11. As a result, the hours recorded are inaccurate. !d. Plaintiff received a
portion of his wages in cash and a portion by check every week, except for his final two weeks,
when he received only cash. Id.
~~
12-13. Plaintiff was paid between $70 and $322 per week in
cash; he received $70 in cash his first week of work and $322 in cash for his last week. Id.
~~
17-19. These wages were intended to compensate Plaintiff for forty hours of work, and he did
not receive compensation for any additional hours. Id.
~
14. Plaintiff did not receive "spread of
hours" wages for shifts in which he worked ten hours or longer. Id.
~
16. Defendants provided
Plaintiff with wage statements which inaccurately reported hours worked by Plaintiff and tips
Plaintiff received. Id. at 5, ~ 20. Defendants deducted wages from Plaintiffs paycheck for tax
purposes, but Plaintiff never received any documentation indicating that the taxed wages had
been remitted to the government. Id.
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21. Plaintiffbegan complaining to his manager every day
starting his second or third week of work regarding Defendants' failme to pay minimum wage or
overtime. I d.
III.
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22. He complained about this on the day he was terminated. Id.
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24.
Conclusions of Law and Damages Calculations
A. Actual Damages under the FLSA and the NYLL
Plaintiffhas established a violation of the minimum wage and overtime provisions of the
FLSA. Under the FLSA, all employers must pay employees no less than the minimum wage,
and must compensate employees for hours worked over forty hours per week at a rate not less
3
than 1.5 times the regular rate of pay. 29 U.S.C. § 206(a)(l), § 207(a)(l). The FLSA applies to
employers with an annual gross volume of sales of at least $500,000. !d. § 203(s)(l )(A)(ii).
Likewise, the NYLL requires employers to pay the minimum wage and overtime for hours
worked over forty hours at a rate of 1.5. N.Y. Lab. Law§§ 198(1-a), 663(1), N.Y. Comp. Codes
R. & Regs. tit. 12, §§ 142-2.1, 142-2.2. During Plaintiffs employment with Defendants, the
minimum wage under both federal and New York state law was $7.25. 29 U.S.C. §
206(a)(1)(C); N.Y. Comp. Codes. R. & Regs. tit. 12, § 142-2.1.
Here, Plaintiff credibly testified that he worked between 102 and 118.5 hours per week.
He also testified that Defendants earned between $3000 and $5000 per day, which represents at
least $1,095,000 per year.2 Moreover, Plaintiff testified that his weekly salary was intended to
cover forty hours of work. Plaintiffs calculations3 reflect that for all but his third and final
weeks of work, Plaintiff was paid below the minimum wage. Plaintiffs calculations to
determine actual damages are reflected in the chart below, and a review of these calculations
confirm their accuracy. Accordingly, under the FLSA, Plaintiff is entitled to $13,927 in actual
damages.
2
In their response, Defendants argue that Plaintiff has failed to provide proof that Defendants' business satisfies the
FLSA' s gross income threshold. Def. Mem. at 3. Plaintiffs testimony on this issue is uncontroverted; as a result,
this argument is rejected.
3
Plaintiff calculates the regular rate of pay by dividing the total amount paid that week by 40. Where that results in
a figure below minimum wage, Plaintiff calculates the overtime rate owed by using the minimum wage. Plaintiff
calculates the amount owed on the minimum wage violations by determining the difference between $290 ($7 .25 per
40 hours) and the amount actually paid.
4
Week
Ending
Hours
Worked
Unpaid
Hours
Amount Amount
Paid by Paid by
Check
Cash
Total
Amount
Paid
Regular
Rate of
Pay
3/31/ 13
4/7/13
4/14/ 13
4/21 / 13
4/28/ 13
5/5/13
5/12/ 13
5/19/13
5/26/13
6/2/13
6/9113
6/16/13
6/23/13
6/30/13
7/7/13
7/14/13
7/21/13
118.5
118.5
102
118.5
102
118.5
118.5
102
118.5
102
118.5
102
118.5
102
118.5
102
118.5
78.5
78.5
62
78.5
62
78.5
78.5
62
78.5
62
78.5
62
78.5
62
78.5
62
78.5
$66.41
$66.38
$102.94
$81.22
$70.90
$74.49
$84.84
$84.95
$60.71
$87.46
$60.06
$56.09
$74.22
$58.92
$59.74
$0.00
$0.00
$70.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$196.00
$322.00
$136.41
$262.38
$298.94
$277.22
$266.90
$270.49
$280.84
$280.95
$256.71
$283.46
$256.06
$252.09
$270.22
$254.92
$255.74
$196
$322
$3.41
$6.56
$7.47
$6.93
$6.67
$6.76
$7.02
$7.02
$6.42
$7.09
$6.40
$6.30
$6.76
$6.37
$6.39
$4.90
$8.05
Overtime Actual
Rate of
Damages
(minimum
Pay
wage plus
overtime)
$1,007.68
$10.88
$10.88
$881.70
$11.21
$695.02
$10.88
$866.86
$10.88
$697.66
$873.59
$10.88
$10.88
$863.24
$10.88
$683.61
$10.88
$887.37
$10.88
$681.10
$10.88
$888.02
$10.88
$712.47
$873.86
$10.88
$10.88
$709.64
$10.88
$888.34
$10.88
$768.56
$12.08
$948.28
The NYLL allows employees to recover compensation for an extra hour for each day
during which an employee works more than ten hours per day. N.Y. Comp. Codes R. & Regs.
tit. 12, § 142-2.4. Plaintiffhas credibly shown that he worked for ten hours or longer on 112
days during his employment. Accordingly, applying the minimum wage rate, Plaintiff is entitled
to $812 in spread ofhours damages under the NYLL.
B. Liquidated Damages
The FLSA grants liquidated damages for violations of the overtime provision in an
amount equal to that of actual damages. 29 U.S.C. § 216(b). While an exception exists for
employers who acted in good faith, id. § 260, Defendants have not suggested the existence of
good faith. Accordingly, Plaintiff is entitled to $13,927 in liquidated damages under the FLSA.
5
Likewise, the NYLL authorizes liquidated damages in an amount equal to that of actual
damages. N.Y. Lab. Law§§ 198(1-a), 663(1). While a split of authority exists on whether a
plaintiff may recover liquidated damages under both the FLSA and the NYLL for the same
violations during the same time period, the majority of courts in the Second Circuit allow for the
simultaneous recovery of both forms of liquidated damages. See Yu Y Ho v. Sim Enters. , 2014
WL 1998237, at *17-19 (S.D.N.Y. May 14, 2014); accord Easterly v. Tri-Star Transport, 2015
WL 337565, at *2 (S.D.N.Y. Jan. 23, 2015). Plaintiff is thus also entitled to $14,739 ($13,927 +
$812) in liquidated damages under the NYLL (inclusive of damages for the NYLL spread of
hours violation).
C. Failure to Furnish Proper Wage Statements
Under the NYLL, the failure to provide employees with accurate wage statements is a
violation for which plaintiffs are entitled to $100 per work week in statutory damages. New
York Lab. Law§ 195(3). Such damages are capped at $2500. !d. § 198(1-d).4
Plaintiff has credibly testified, and demonstrated, that the wage statements provided by
Defendants were inaccurate, and that Defendants failed to furnish Plaintiff with any wage
statement for his final two weeks of work. Plaintiff's employment lasted for 17 weeks, during
which he never received a proper wage statement. Accordingly, he is entitled to $1700 for
Defendants' failure to provide proper wage statements.
4
On February 27, 2015, this section was amended to provide for a weekly amount of $250 with a statutory cap of
$5000.
6
D. Retaliation
Plaintiff requests $50,000 in compensatory and punitive damages for retaliation and the
emotional distress he consequentially suffered. The NYLL prohibits retaliation against
employees who have complained to the employer about any NYLL violations, N.Y. Lab. Law§
215(1)(a), and a proper retaliation claim requires a plaintiff to demonstrate a nexus between the
complaint and the retaliatory action, Higueros v. N.Y. State Catholic Health Plan, Inc., 526 F.
Supp. 2d 342, 347 (E.D.N.Y. 2007). Here, the Court finds that Plaintiff has not demonstrated a
nexus between Plaintiffs complaints and his termination. Plaintiff complained each day of his
employment beginning his second week of work, yet Defendants continued to employ him for
approximately four additional months. Plaintiffs allegations fail to demonstrate how Plaintiffs
termination was triggered by complaints he made daily for a substantial amount of time.
Although Plaintiff argues that Defendants' proffered reason for Plaintiffs termination is
pretextual, Pl. Mem. at 14, the dearth of facts linking the termination to the complaints renders
Plaintiffs retaliation allegations conclusory. Accordingly, the Court denies Plaintiffs request
for compensatory and punitive damages for retaliation.
E. Conversion
Plaintiff requests $107.83 in actual damages for conversion and the same amount in
punitive damages. A claim for conversion under New York law requires a showing of
"plaintiffs legal ownership or immediate superior right of possession to property; and[]
defendant's unauthorized interference with plaintiffs ownership or possession of such property."
Lama v. Malik, 2014 WL 5590785, at *7 (E.D.N.Y. Nov. 3, 2014) (citing Weizmann Inst. of Sci.
v. Neschis, 229 F. Supp. 2d 234, 253 (S.D.N.Y. 2002)). Plaintiff asserts that Defendants
committed conversion by withholding money from Plaintiffs paycheck, allegedly for tax
7
purposes, without remitting such money to the government. Pl. Mem. at 15-16. Plaintiff argues
that he is entitled to the full amount deducted, as well as an equal amount in punitive damages,
because "conversion resembles an improper deduction under New York law," and punitive
damages for such NYLL violations is awarded at an amount equal to actual damages. !d. at 16.
The Court agrees that Plaintiff is entitled to actual damages for conversion. Plaintiff
credibly testified that while his wage statements reflected deductions for tax purposes, he never
received documentation that the money had been remitted to the government. The Court,
however, declines to grant punitive damages. Punitive damages are recoverable when "the
circumstances establish that the conversion was accomplished by malice or reckless or willful
disregard of the plaintiffs right." Doo Nam Yang v. ACBL Corp., 427 F. Supp. 2d 327, 341-42
(S.D.N.Y. 2005) (internal citations omitted). Plaintiffs complaint does not allege malice or
reckless or willful disregard, and no such testimony was introduced during the inquest nor
suggested in Plaintiffs submissions. As a result, the Court denies Plaintiffs request for punitive
damages for conversion and awards Plaintiff$109.83 5 in actual damages for conversion.
F. Attorneys' Fees
Plaintiff's counsel seeks $23,871 in attorneys' fees and $947.47 in costs. Under both the
FLSA and the NYLL, the prevailing party in wage and hour cases is entitled to recover costs and
reasonable attorneys' fees. 29 U.S.C. § 216(b); N.Y. Lab. Law§ 663(1). A reasonable fee is
calculated by determining "the lodestar-the product of a reasonable hourly rate and the
reasonable number of hours required by the case- which creates a presumptively reasonable
fee." Stanczyk v. City ofNY., 752 F.3d 273,284 (2d Cir. 2014) (internal citation, alterations,
5
Plaintiff misreads his own records and as a result has incorrectly calculated the amount improperly withheld. The
Court notes that the pay stub for the period 5/27/2013 through 6/09/2013 reflects that $8.90 was withheld from
Plaintiff's paycheck, and not the $6.90 that Plaintiff used in calculating damages.
8
and quotation marks omitted). In assessing the reasonableness of attorneys' fees, the Court must
consider: "(1) the time and labor required; (2) the novelty and difficulty of the questions; (3) the
level of skill required to perform the legal service properly; (4) the preclusion of employment by
the attorney due to acceptance of the case; (5) the attorney's customary hourly rate; (6) whether
the fee is fixed or contingent; (7) the time limitations imposed by the client or the circumstances;
(8) the amount involved in the case and the results obtained; (9) the experience, reputation and
ability of the attorneys; (10) the 'undesirability' of the case; (11) the nature and length of the
professional relationship with the client; ... (12) awards in similar cases;" and the fact that "a
reasonable, paying client wishes to spend the minimum necessary to litigate the case
effectively." Arbor Hill Concerned Citizens Neighborhood Ass 'n v. Cnty. of Albany, 522 F.3d
182, 186 n.3, 190 (2d Cir. 2008).
Plaintiffs counsel has submitted a declaration attaching the contemporaneous time
records kept by the firm as well as a chart calculating the lodestar, which reflects the hourly rates
requested and the amount ofhours spent by each attorney. See Declaration of Michael J.
Borrelli, Esq. The Court notes that Plaintiffs counsel has reduced its usual hourly billing rates
in submitting this request. !d.~~ 17-18, 42-43, 55-56, 59-60, 62-63 , 65. Plaintiff was
represented by Michael J. Borrelli, Alexander T. Coleman, Peter J. Famighetti, and Alexander
Gastman of Borrelli and Associates. After reviewing the resumes, time records, and calculations
submitted by Plaintiffs counsel, the Court finds that Plaintiffs attorneys' fees request is
reasonable. Plaintiffs counsel spent a total of 118.18 hours on this litigation. This amount of
time was reasonable and represents what "a reasonable attorney would have engaged in," Grant
v. Martinez, 973 F.2d 96, 99 (2d Cir. 1992). While this case involved limited discovery, no
depositions, and no substantive motions, litigation has been ongoing since November 2013 , and
9
Plaintiffs counsel was forced to spend significant time attempting to contact Defendants, as well
as preparing various letters in response to Defendants' counsel's numerous requests to withdraw,
in addition to the work otherwise necessary to the litigation.
The most significant expenditure of time on the case was from an associate attorney,
Gastman, seeking $200 per hour. Based on his three years of experience, this is a reasonable
hourly rate. See Chen v. TYT East Corp., 2013 WL 1903735, at *3 (S.D.N.Y. May 8, 2013).
Alexander Coleman, the Senior Counsel, and Michael Borrelli, the partner, spent only 9.9 and
10.4 hours, respectively, on this litigation, and request hourly rates of $400 and $300,
respectively. This approach served to reduce costs, and reflects both a reasonable amount of
time and a reasonable hourly rate. See Kahlil v. Original Old Homestead Rest., Inc. , 657 F.
Supp. 2d 470,474-76 (S.D.N.Y. 2009). The amount of time spent by Plaintiffs counsel's
paralegals, was well as the hourly rate requested for them, is also reasonable. Hernandez v.
Prof'! Maint. & Cleaning Contractors Inc., 2015 WL 128020, at *8 (E.D.N.Y. Jan. 8, 2015)
(finding $75 per hour a reasonable fee for paralegal work and citing cases).
Defendants argue in opposition to the request for attorneys' fees that Plaintiff is not
entitled to attorneys' fees because he has not established his FLSA or NYLL claims; that
Plaintiffs request is excessive; and that Plaintiffs fees should be limited to the attorneys who
prepared filings in this case or appeared in this case. Def. Mem. at 6. Defendants state that
Defendants' counsel has "never dealt with Michael Borrelli, Esq. , who is requesting $400.00 per
hour in this matter." Id. These arguments are rejected. First, Plaintiff is only requesting
attorneys' fees for attorneys who have filed Notices of Appearance in this case, that is, Gastman,
Coleman, Borrelli, and Famighetti. Next, it is unreasonable to assume that the only necessary
work perforn1ed on this case was by those who appeared or performed filings in the case.
10
Finally, with respect to Defendants' argument regarding Michael Borrelli, it is entirely
reasonable that Borrelli would spend some amount of time supervising this case without
interacting with Defendants' counsel. For these reasons, Defendants' arguments are meritless.
A review of Plaintiffs counsel's Statement of Costs, Ex. B to the Declaration of Michael
J. Borrelli, Esq., demonstrates that all costs in this case were reasonable. Accordingly, Plaintiffs
request for costs is granted.
G. Pre-Judgment Interest
Plaintiff requests pre-judgment interest on the minimum wage, spread of hours, and
overtime claims under the NYLL. A plaintiff is entitled to pre-judgment interest on claims under
the NYLL. See Begum v. Ariba Discount, Inc., 2015 WL 223780, at *3 (S.D.N.Y. Jan. 2015)
(citing Reilly v. Natwest Markets Grp. Inc., 181 F.3d 253,265 (2d Cir. 1999)). The N.Y. CPLR
applies a statutory interest rate of9% per year and instructs that interest should be computed
"upon each item due from the date it was incurred or upon all the damages from a single
reasonable intermediate date." N.Y. C.P.L.R. §§ 5001(b), 5004.
Plaintiff suggests that a reasonable mid-point for determining interest is May 23, 2013,
and the Court agrees. This is approximately halfvvay between the beginning and end of
Plaintiffs employment with Defendants. Using that date, Plaintiffhas calculated the interest
owed on the period from May 23, 2013 to May 23, 2014 as $1326.51. The Court agrees with
this calculation. The Court rejects Plaintiffs calculations of interest for the period from May 23,
2014 until February 16, 2015 (the date Plaintiffs memorandum was submitted), which he asserts
amounts to $1445.90. Plaintiffs proposed formula is correct; however, Plaintiff erred in
applying this formula. The correct amount of interest for the period from May 23, 2014 to
11
February 16, 2015 is $1069.57. Accordingly, the total amount of pre-judgment interest owed is
$2396.08.
Plaintiff requests $300.19 in pre-judgment interest on his claim for attorneys' fees. But
Plaintiff has failed to explain why he is entitled to pre-judgment interest on attorneys' fees, and
his brief addresses only his entitlement to pre-judgment interest on his NYLL claims for unpaid
minimum wage, spread ofhours, and overtime. See Pl. Mem. at 17. Accordingly, this request is
denied.
H. Post Judgment Interest
Plaintiff requests that post-judgment interest be awarded in accordance with 28 U.S.C. §
1961. Post-judgment interest is mandatory on awards in civil cases. Schipani v. McLeod, 541
F.3d 158, 165 (2d Cir. 2008). Accordingly, Plaintiff is entitled to post-judgment interest
calculated pursuant to 28 U.S.C. § 196l(b).
12
CONCLUSION
For the foregoing reasons, Plaintiff is entitled to damages in the following amounts. The
Clerk of Court is directed to enter judgment awarding Plaintiff the below amounts and to close
this case:
Actual Damages (FLSA and NYLL): $13,927
New York Spread ofHours: $812
FLSA Liquidated Damages: $ 13,927
NYLL Liquidated Damages: $14,739
Wage Statement Violations: $ 1700
Conversion: $109.83
Attorneys' fees: $23,871
Attorneys' costs: $947.4 7
Pre-Judgment Interest: $2396.08
Post-Judgment Interest: in accordance with 28 U.S.C. § 1961(b), but excluding attorneys' fees.
Dated: New York, New York
March 5, 2015
SO ORDERED
/{J;~
PAUL A. CROT:x.
United States District Judge
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