Jesus v. Oyshi Table Corp. et al

Filing 94

OPINION AND ORDER. For the foregoing reasons, the Court grants Defendants' motion for partial summary judgment except as to the following: the weeks of June 19, 2015, April 8, 2016, and June 30, 2017 for Garcia's minimum wage and overtime c laims; and the week of June 30, 2017 for Morales's minimum wage and overtime claims. Within thirty days of the filing of this Opinion and Order, the parties shall submit a proposed joint pretrial order prepared in accordance with Rule 26(a)(3) o f the Federal Rules of Civil Procedure and 7.B of the Court's Individual Rules and Practices in Civil Cases. The parties shall follow the Court's Individual Rules and Practices in Civil Cases for any submission that must be made at the time of the proposed joint pretrial order, including any motions in limine. The Clerk of Court is respectfully directed to terminate the motion pending at Docket Number 76. SO ORDERED. re: 76 MOTION for Partial Summary Judgment filed by Matthew Ahn, Oyshi Table Corp. (Signed by Judge John P. Cronan on 2/17/2021) (rjm)

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
---------------------------------------------------------------------- X
:
FIDEL DE JESUS, VICTOR RAMOS, ISRAEL FLORES, :
CIRINO MORALES, ROGELIO BAZAN, ALFONSO :
MENDEZ, and JOSE JUAN GARCIA, on behalf
:
of themselves, FLSA Collective Plaintiffs and the Class, :
:
Plaintiffs,
:
:
-v:
:
OYSHI TABLE CORP. d/b/a TOASTIES et al.,
:
:
Defendants.
:
:
---------------------------------------------------------------------- X

19 Civ. 830 (JPC)
OPINION
AND ORDER

JOHN P. CRONAN, United States District Judge:
Plaintiffs are food preparers and delivery persons who worked at a deli in Manhattan. They
brought this suit against their former employers under the Fair Labor Standards Act and the New
York Labor Law, alleging numerous wage-and-hour violations. Presently before the Court is
Defendants’ motion for partial summary judgment to dismiss some of these claims. For the reasons
that follow, the Court grants Defendants’ motion in nearly every part, except for a few select work
weeks as to some of the Plaintiffs.
I. Background
A. Facts
The following facts are undisputed, unless otherwise noted. Defendant Matthew Ahn is the
president of Oyshi Table Corp. (“Oyshi”). Dkt. 81 (“Plaintiffs’ Rule 56.1 Response”) ¶ 6. In early
2014, Oyshi purchased “Toasties,” a delicatessen on Third Avenue in New York City from J.S.W.
Venture, Inc. Id. ¶ 2. Oyshi operated Toasties until July 2020 when it permanently closed as a
result of the COVID-19 pandemic. Id. ¶ 1. Five of the seven Plaintiffs who worked at Toasties

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under Oyshi’s management—Israel Flores, Jose Juan Garcia, Fidel De Jesus, Alfonso Mendez, and
Cirino Morales—also allege that they began working at Toasties prior to March 2014, when Oyshi
bought the deli. Dkt. 33 (“Amended Complaint” or “Amended Compl.”) ¶¶ 30(a), 32(a)-33(a),
35(a)-36(a); Dkt. 83 ¶ 1; Dkt. 84 (“Garcia Decl.”) ¶ 1; Dkt. 85 ¶ 1; Dkt. 86 (“Mendez Decl.”) ¶ 1;
Dkt. 87 (“Morales Decl.”) ¶ 1. 1
Three of the Plaintiffs—Garcia, Mendez, and Morales—are the subject of a good portion of
Defendants’ motion here, and thus the Court now turns to facts regarding their employment
specifically. The Amended Complaint alleges that Garcia worked as a “deli man” at Toasties five
or six days each week and between eight and eleven hours each day. Amended Compl. ¶ 36(a)-(b).
Garcia alleges that from January 2018 onward, he worked through his meal break once per week.
Id. ¶ 36(b). He thus claims that his wages were “time-shaved” by approximately one hour each
week during this time. Id. ¶ 36(d). In his declaration, Garcia further alleges that prior to January
2018, Defendants shaved forty-five minutes off each day for a meal break even though he never
took a break. Garcia Decl. ¶ 4.
Morales alleges that he worked at Toasties as a food preparer five days per week for a total
of 50 to 52.5 hours each week. Amended Compl. ¶ 33(a)-(b). In his declaration, Morales alleges
that he never took a break prior to January 2018, but Defendants deducted forty-five minutes per
workday anyway. Morales Decl. ¶ 4. Beginning in January 2018, he claims that he began taking
some breaks, but worked through his break once per week. Id. ¶ 5.

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The remaining two Plaintiffs—Victor Ramos and Rogelio Bazan—allege that they worked
at Toasties as of March 2017 and February 2018, respectively. Amended Compl. ¶¶ 31(a), 34(a);
Dkt. 82 ¶ 1; Dkt. 88 ¶ 1. Because Defendants have not moved for summary judgment as to any of
Bazan’s or Ramos’s claims, the Court does not discuss facts relevant to these two Plaintiffs.
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Mendez alleges that he worked at Toasties as a delivery person. Amended Compl. ¶ 35(a).
He claims that from the beginning of his employment to December 2017, Defendants deducted
forty-five minutes per workday for a meal break, despite the fact that he never took a break. Id.
¶ 35(b). Starting in January 2018, he claims that he began taking breaks, but worked through his
break once per week, and thus he still lost wages due to this “time-shaving policy.” Id. Mendez
alleges that at least twice per week, he worked thirty minutes past his scheduled hours but was not
compensated for this additional time. Id. ¶ 35(d). He also claims that he was not reimbursed for
his “tools of the trade” or for maintenance or repair costs that he incurred. Id. ¶ 41. Finally, Garcia,
Morales, and Mendez all allege that Defendants improperly claimed a meal credit of $6.50 per day
although these Plaintiffs sometimes were unable to eat, and Defendants sometimes provided no
meals. Id. at ¶ 42; Garcia Decl. ¶ 7; Morales Decl. ¶ 8; Mendez Decl. ¶ 14.
B. Procedural History
Plaintiffs initiated this action on January 28, 2019 and filed the Amended Complaint on
May 22, 2019. Dkts. 2, 33. Plaintiffs allege Defendants violated the Fair Labor Standards Act
(“FLSA”), 29 U.S.C. § 201 et seq., and the New York Labor Law (“NYLL”), N.Y. Lab. Law § 650
et seq., by, inter alia, failing to pay them minimum wage or overtime pay. Amended Compl. ¶¶ 5174. Plaintiffs also allege that Defendants failed to pay them a “spread of hours” premium under the
NYLL for each workday that exceeded ten hours. Id. ¶ 69. As part of the Southern District of New
York’s pilot program for cases involving claims under the FLSA, the Court referred this action for
mediation, Dkt. 30, but that failed to resolve the matter, Dkt. 41. On October 4, 2019, the Honorable
Analisa Torres entered a case management plan and scheduling order, and the parties proceeded to
discovery. Dkt. 45. On June 3, 2020, the parties again attempted to resolve this case, this time
through a settlement conference before the Honorable Sarah L. Cave, but were unsuccessful.

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After this, Judge Torres granted Defendants leave to file a motion for partial summary
judgment. Dkt. 75. Defendants filed their motion for partial summary judgment on September 1,
2020. Dkts. 76-79. Plaintiffs opposed Defendants’ motion on September 29, 2020, Dkts. 80-89,
the same day that the undersigned was reassigned to this matter. The motion became fully briefed
on October 13, 2020, Dkt. 90, and the Court held oral argument on February 8, 2021.
II. Legal Standard
Summary judgment is appropriate when “the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(a). “A genuine dispute exists where ‘the evidence is such that a reasonable jury could return a
verdict for the nonmoving party,’ while a fact is material if it ‘might affect the outcome of the suit
under the governing law.’” Chen v. 2425 Broadway Chao Rest., LLC, No. 16 Civ. 5735 (GHW),
2019 WL 1244291, at *4 (S.D.N.Y. Mar. 18, 2019) (quoting Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248 (1986)). The Court must “resolve all ambiguities and draw all justifiable factual
inferences in favor of the party against whom summary judgment is sought.” Major League
Baseball Props., Inc. v. Salvino, Inc., 542 F.3d 290, 309 (2d Cir. 2008). “The movant bears the
initial burden of demonstrating ‘the absence of a genuine issue of material fact,’ and if satisfied, the
burden then shifts to the non-movant to present ‘evidence sufficient to satisfy every element of the
claim.’” Chen, 2019 WL 1244291, at *4 (quoting Holcomb v. Iona Coll., 521 F.3d 130, 137 (2d
Cir. 2008)).
“To defeat a motion for summary judgment, the non-movant ‘must come forward with
specific facts showing that there is a genuine issue for trial.’” Chen, 2019 WL 1244291, at *4
(quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)). The nonmovant “may not rely on conclusory allegations or unsubstantiated speculation,” and “must offer

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some hard evidence showing that its version of the events is not wholly fanciful.” Jeffreys v. City
of New York, 426 F.3d 549, 554 (2d Cir. 2005) (internal quotation marks and citations omitted).
“The mere existence of a scintilla of evidence in support of the [non-movant’s] position will be
insufficient; there must be evidence on which the jury could reasonably find for the [non-movant].”
Anderson, 477 U.S. at 252. “Where no rational finder of fact could find in favor of the nonmoving
party because the evidence to support its case is so slight, summary judgment must be granted.”
Brown v. Eli Lilly & Co., 654 F.3d 347, 358 (2d Cir. 2011) (internal quotation marks and citation
omitted).
III. Discussion
There are two issues before the Court. First, should the Court grant summary judgment in
favor of Defendants with regard to certain claims brought by some individual Plaintiffs, namely:
(a) Garcia’s minimum wage and overtime claims under the FLSA and the NYLL for the years 2014
through 2019; (b) Garcia’s spread of hours claims under the NYLL for the year 2014; (c) Morales’s
minimum wage and overtime claims under the FLSA and the NYLL for the years 2016 through
2018; (d) Morales’s spread of hours claims under the NYLL for the years 2014 and 2016; (e)
Mendez’s minimum wage and overtime claims under the FLSA and the NYLL for the years 2019
and 2020; and (f) Mendez’s spread of hours claims under the NYLL for the years 2014, 2019, and
2020? Second, should the Court grant summary judgment in favor of Defendants on all claims for
damages that allegedly accrued prior to Oyshi’s purchase of Toasties in early 2014?
A. Individual Plaintiffs’ Claims
The starting point to analyzing whether the Court should grant Defendants’ partial summary
judgment motion as to certain claims brought by some Plaintiffs is Local Civil Rule 56.1. Pursuant
to Rule 56.1, a party moving for summary judgment must attach a “separate, short and concise

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statement, in numbered paragraphs, of the material facts as to which the moving party contends
there is no genuine issue to be tried.” Local Civil Rule 56.1(a). The party opposing summary
judgment must then set forth a statement responding to each numbered paragraph and may add
paragraphs with additional material facts for which that party contends there are genuine issues to
be tried. Id. at 56.1(b). “The facts set forth in a moving party’s statement ‘will be deemed to be
admitted unless controverted’ by the opposing party’s statement.” Chen, 2019 WL 1244291, at *5
(quoting Local Civil Rule 56.1(c)); see also Nunez v. Broadway Beauty Wholesale Inc., No. 19 Civ.
362 (JPO), 2020 WL 6063536, at *1 (S.D.N.Y. Oct. 14, 2020) (“Supported facts in a Rule 56.1
statement will be deemed admitted if the opposing party fails to controvert those facts.”). Finally,
each statement of material fact “must be followed by citation to evidence which would be
admissible” consistent with Federal Rule of Civil Procedure 56. Chen, 2019 WL 1244291, at *5
(quoting Local Civil Rule 56.1(d)).
The purpose of this rule is “to streamline the consideration of summary judgment motions
by freeing district courts from the need to hunt through voluminous records without guidance from
the parties.” Holtz v. Rockefeller & Co., 258 F.3d 62, 74 (2d Cir. 2001). However, it “does not
absolve the party seeking summary judgment of the burden of showing that it is entitled to judgment
as a matter of law, and a Local Rule 56.1 statement is not itself a vehicle for making factual
assertions that are otherwise unsupported in the record.” Id. If “the record does not support the
assertions in a Local Rule 56.1 statement, those assertions should be disregarded and the record
reviewed independently.” Id.
1. Garcia’s Claims
In accordance with Judge Torres’s individual practices, Defendants submitted a pre-motion
Rule 56.1 statement to which Plaintiffs responded. See Dkt. 73-2 (“Plaintiffs’ Pre-Motion Rule

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56.1 Response”). In this statement, Garcia admitted that “Oyshi paid [him] at least the minimum
wage during the time-period of his employment with Oyshi.” Id. ¶ 53. More specifically, he
admitted that he “has failed to identify a single week during which he was not paid the minimum
wage” in the years 2014, 2015, 2016, 2017, 2018, and 2019. Id. ¶¶ 62, 65, 68, 71, 74, 77. Second,
Garcia also admitted that “Oyshi paid [him] overtime at the rate of 1.5 times his hourly wage during
the time-period of his employment with Oyshi.” Id. ¶ 54. And he agreed that he “has failed to
identify a single week during which he was not paid overtime at the rate of 1.5 times his hourly
wage” in the years 2014, 2015, 2016, 2017, 2018, and 2019. Id. ¶¶ 63, 66, 69, 72, 75, 78. Third,
he admitted that he “has failed to identify a single day during which he was not paid spread of hours
pay in the calendar year 2014.” Id. ¶ 64. As part of their opposition to Defendants’ motion,
Plaintiffs filed a renewed Rule 56.1 response in which Garcia again admitted these same facts.
Plaintiffs’ Rule 56.1 Response ¶¶ 55-56, 64-68, 70-71, 73-74, 76-77, 79-80.
The crux of Defendants’ motion is that these admissions are dispositive of the fact that
Garcia does not have a meritorious claim for minimum wage or overtime violations under the FLSA
or the NYLL while he was employed by Oyshi, or a valid spread of hours claim under the NYLL
for 2014. Dkt. 79 (“Motion”) at 5-6. Garcia argues that his admissions only went to the rates that
he was paid, but that after Defendants improperly deducted meal credits and time for breaks that he
did not take, Garcia did not “actually receive[] all his proper minimum wage and overtime.” Dkt.
80 (“Opposition”) at 3.
Garcia fails to point to any specific evidence in the record to support this. See id. at 2-3.
Besides the allegations in the Complaint, Garcia only cites his own declaration for support, as well
as portions of Plaintiffs’ Rule 56.1 Response, which in turn, cites Garcia’s declaration. Id. at 3.
Garcia’s declaration consists of nine unsubstantiated paragraphs across one and one-half pages. In

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the declaration, Garcia claims that “[f]rom the start of [his] employment through December 2017,
[he] worked without any breaks even though Defendants deducted forty-five minutes (45) minutes
per workday for a meal break, resulting in unpaid wages due to Defendants[’] time-shaving policy.”
Garcia Decl. ¶ 4. Further, he claims that “[f]rom January 2018 to the end of [his] employment, [he]
worked through [his] forty-five (45) minute break once per week, resulting in unpaid wages due to
Defendants’ time-shaving policy.” Id. ¶ 5. Finally, he claims that “[t]hroughout [his] employment,
Defendants deducted a meal credit from [his] wages” even though he generally did not get a meal
or did not have time to eat it because he continued working through his breaks. Id. ¶ 7.
These declaration statements are nothing more than a repetition of the allegations in the
Complaint, and Garcia points to no objective evidence in the record to support these assertions.
And even crediting the statements in Garcia’s declaration, he does not explain why this would mean
that Defendants failed to pay him minimum wage or overtime for all or a portion of his time at
Toasties. Garcia thus fails to offer any “hard evidence showing that [his] version of the events is
not wholly fanciful.” Jeffreys, 426 F.3d at 554.
This is so despite the fact that Defendants have produced years of comprehensive payroll
records detailing Garcia’s weekly pay. Dkt. 78, Exh. C. Garcia’s failure to rely on these records
may well be because they largely support Garcia’s very admission that Oyshi paid him “at least the
minimum wage” and “overtime at the rate of 1.5 times his hourly wage” during his employment.
Plaintiffs’ Rule 56.1 Response ¶¶ 55-56. Garcia has identified nothing in the pages of detailed pay
records that would suggest otherwise. Nor has Garcia submitted any hard evidence of his own,
such as payroll stubs, in an effort to challenge Defendants’ records. When asked at oral argument
why this was so, Plaintiffs’ counsel explained that Plaintiffs chose not to submit payroll records in
response to Defendants’ evidence because they encompassed “a lot of pages.” Feb. 8, 2021

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Transcript at 18. Garcia thus has failed to “come forward with specific facts showing that there is
a genuine issue for trial.’” Matsushita, 475 U.S. at 587 (internal quotation marks and citation
omitted).
The Court nonetheless carefully reviewed the evidence produced by Defendants, including
the records reflecting Garcia’s weekly pay, to ensure that it supports the uncontroverted Rule 56.1
statements, see Holtz, 258 F.3d at 74, and sees no reason to not credit Garcia’s admissions with
respect to the vast majority of weeks that Garcia worked at Toasties. However, for the following
three weeks, the record suggests that Garcia may have been underpaid based on the reported hours
worked and the prevailing minimum wage and overtime rates at the time: June 19, 2015; April 8,
2016; and June 30, 2017. See Dkt. 78, Exh. C at 4, 6-7. The Court thus does not grant summary
judgment in favor of Defendants as to these weeks.
The only authority Garcia cites in support of his opposition to partial summary judgment
dismissing certain wage and overtime claims is Bellegar de Dussuau v. Blockbuster, Inc.,
Opposition at 3, for the unremarkable proposition that on a motion for summary judgment, “[t]he
court is required to resolve any ambiguities and to make all reasonable inferences in favor of the
non-moving party.” No. 03 Civ. 6614 (WHP), 2006 WL 465374, at *3 (S.D.N.Y. Feb. 28, 2006).
The Court fails to see how this axiom saves Garcia’s claims. Garcia admitted that he was paid
minimum wage and overtime and has failed to point to any specific evidence to suggest that a
reasonable jury could return a verdict in his favor despite these admissions. See Zhang v. XYZ
Limousine, Inc., No. 15 Civ. 7440 (JS) (AKT), 2019 WL 1220310, at *9 (E.D.N.Y. Mar. 15, 2019),
report and recommendation adopted (E.D.N.Y. Apr. 9, 2019) (recommending that the court grant
the defendants’ motion for summary judgment because the plaintiffs “failed to point out any
evidence in the record which creates a genuine issue of fact as to Plaintiffs’ rates of pay”). The

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Court thus grants Defendants’ motion for summary judgment as to Garcia’s minimum wage and
overtime claims under the FLSA and the NYLL, except for the three weeks identified above.
Despite Defendants’ motion for summary judgment as to Garcia’s 2014 spread of hours
claims, Garcia failed to mention these claims at all in his opposition or point to any evidence in the
record to suggest that a reasonable jury could find for him on this claim. And again, Garcia admitted
that he “failed to identify a single day during which he was not paid spread of hours pay in the
calendar year 2014.” Plaintiffs’ Rule 56.1 Response ¶ 66. The Court thus grants Defendants’
motion for summary judgment as to Garcia’s 2014 spread of hours claims under the NYLL as well.
2. Morales’s Claims
In Plaintiffs’ pre-motion Rule 56.1 response, Morales admitted facts nearly identical to
those that Garcia admitted. Morales admitted that “Oyshi paid [him] at least the minimum wage
during the time[] period of his employment with Oyshi.” Plaintiffs’ Pre-Motion Rule 56.1
Response ¶ 27. Like Garcia, Morales admitted that for the years 2016, 2017, and 2018, he “has
failed to identify a single week during which he was not paid the minimum wage.” Id. ¶¶ 41, 44,
47. Morales too admitted that “Oyshi paid [him] overtime at the rate of 1.5 times his hourly wage
during the time-period of his employment with Oyshi.” Id. ¶ 28. Thus, he concedes that he “has
failed to identify a single week during which he was not paid overtime at the rate of 1.5 times his
hourly wage” for the years 2016, 2017, and 2018. Id. ¶¶ 42, 45, 48. Finally, Morales agrees he
“has failed to identify a single day during which he was not paid spread of hours pay” in 2014 or
2016. Id. ¶¶ 37, 43. And in Plaintiffs’ renewed Rule 56.1 response, Morales again admitted these
same facts. Plaintiffs’ Rule 56.1 Response ¶¶ 29-30, 39, 43-47, 49-50.
Defendants argue that this Court must grant summary judgment for Morales’s minimum
wage and overtime claims for 2016, 2017, and 2018, as well as Morales’s spread of hours claims

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for 2014 and 2016 due to these admissions. See Motion at 6. Morales opposes summary judgment
for his minimum wage and overtime claims for the same reasons as Garcia. Opposition at 4-5. For
support, Morales also only points to his declaration, id. at 4, which includes nearly identical
statements as Garcia’s declaration. Compare Morales Decl. ¶¶ 4-5, 8 with Garcia Decl. ¶¶ 4-5, 7.
Morales also fails to point to any hard evidence supporting his bare assertions, such as payroll
records, which Defendants also produced as to Morales. See Dkt. 78, Exh. A. For the same reasons
as stated above, Morales also has not identified anything “in the record which creates a genuine
issue of fact as to [his] rates of pay.” Zhang, 2019 WL 1220310, at *9.
However, after careful review of Defendants’ records reflecting Morales’s weekly pay, the
Court concludes that Morales may have been underpaid for the week of June 30, 2017, in light of
the number of hours he apparently worked that week and the applicable minimum wage and
overtime rates at the time. See Dkt. 78, Exh. A at 7. Finally, like Garcia, Morales fails to raise any
argument opposing Defendants’ motion for summary judgment as to his spread of hours claims.
Thus, the Court grants Defendants’ summary judgment motion as to Morales’s minimum wage and
overtime claims under the FLSA and the NYLL for 2016, 2017 (with the exception of the week of
June 30, 2017), and 2018, and Morales’s spread of hours claims under the NYLL for 2014 and
2016.
3. Mendez’s Claims
Mendez’s claims work slightly differently because he worked as a tipped employee at
Toasties. Plaintiffs’ Rule 56.1 Response ¶ 103. Thus, his minimum wage and overtime claims rest
in large part on the allegation that Defendants claimed an impermissible tip credit on his wages.
See Amended Compl. ¶¶ 24, 37. However, in Plaintiffs’ pre-motion Rule 56.1 response, Mendez
admitted that “Oyshi did not claim a tip credit on [his] wages in 2019 or 2020.” Plaintiffs’ Pre-

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Motion Rule 56.1 Response ¶ 103. Further, he admitted that he “has failed to identify a single day
during which he was not paid spread of hours pay” in the years 2014, 2019, or 2020. Id. ¶¶ 115,
120-21. And he admitted these same facts in Plaintiffs’ Rule 56.1 response filed with their
opposition. Plaintiffs’ Rule 56.1 Response ¶¶ 105, 117, 122-23.
Once again, Defendants argue that these admissions show that the Court must grant
summary judgment on these claims. Motion at 6. Mendez’s arguments are no different than Garcia
or Morales, and he too points only to his own, unsubstantiated declaration for support. Opposition
at 5-6. Without citation, Mendez states that he worked through some breaks and that Defendants
impermissibly deducted a meal credit. Mendez Decl. ¶¶ 6, 14. These arguments fail for the same
reasons as stated above. However, Mendez further claims that his minimum wage and overtime
claims are also based on the fact that “Defendants failed to reimburse [him] for the delivery vehicles
[he] was required to purchase and maintain” and that he spent “approximately one hundred ($100)
dollars per month on maintenance and repairs.” Id. ¶ 7. However, once again, Mendez fails to cite
any “hard evidence showing that [his] version of the events is not wholly fanciful.” Jeffreys, 426
F.3d at 554. For example, Mendez does not offer even the slightest description of the type of
maintenance or repairs he needed and does not bring forth any proof of such services, such as
receipts. The Court thus grants Defendants’ motion for summary judgment as to Mendez’s
minimum wage and overtime claims for 2019 and 2020.
Finally, like Garcia and Morales, Mendez in his opposition does not mention his spread of
hours claim. Therefore, and in light of Mendez’s admissions, the Court also grants Defendants’
motion for summary judgment as to Mendez’s spread of hours claims for 2014, 2019, and 2020.

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B. Plaintiffs’ Claims for Damages Prior to 2014
The parties do not dispute that Defendants purchased Toasties from J.S.W. Venture in
March 2014. Plaintiffs’ Rule 56.1 Response ¶¶ 1-2. It is not entirely clear from the face of the
Amended Complaint that Plaintiffs allege that Defendants are liable for damages prior to March
2014, but such a theory fails in all events. Defendants argue that a theory of successor liability
could be relevant only to Plaintiffs’ NYLL claims because of the FLSA’s statute of limitations.
Motion at 7 n.3. Plaintiffs do not argue otherwise and appear to agree that the Court should apply
the traditional common law test applicable to NYLL claims. See Opposition at 6-8. The Court
agrees this test is appropriate here.
“Under both New York law and traditional common law, a corporation that purchases the
assets of another corporation is generally not liable for the seller’s liabilities.” New York v. Nat’l
Serv. Indus., Inc., 460 F.3d 201, 209 (2d Cir. 2006). “Under the common law test, a business buyer
is liable for the seller’s debts only when ‘(1) a buyer . . . formally assumes a seller’s debts; (2) [the]
transactions [are] undertaken to defraud creditors; (3) a buyer . . . de facto merged with a seller; [or]
(4) a buyer . . . is a mere continuation of a seller.’” Diaz v. Slayton One Cleaner Inc., No. 17 Civ.
1311 (LTS), 2018 WL 4935831, at *3 (S.D.N.Y. Oct. 11, 2018) (alterations in original) (quoting
Cargo Partner AG v. Albatrans, Inc., 352 F.3d 41, 45 (2d Cir. 2003)).
The Court is aware of no evidence suggesting that either of these first two exceptions are
met, and Plaintiffs do not argue they are. Instead, Plaintiffs rely on the latter two exceptions and
assert that successor liability is met here because there was either a de facto merger or continuity
of the seller. Opposition at 7-8; see also Plaintiffs’ Rule 56.1 Response ¶ 2. “To determine whether
a transaction is a de facto merger or a mere continuation, courts consider whether there was ‘(1)
continuity of ownership; (2) cessation of ordinary business and dissolution of the acquired

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corporation as soon as possible; (3) assumption by the purchaser of the liabilities ordinarily
necessary for the uninterrupted continuation of the business of the acquired corporation; and (4)
continuity of management, personnel, physical location, assets, and general business operation.’”
Wang v. Abumi Sushi Inc., 262 F. Supp. 3d 81, 87 (S.D.N.Y. 2017) (quoting Nat’l Serv. Indus., 460
F.3d at 209). “[B]ecause ‘continuity of ownership is the essence of a merger,’ . . . the exception
‘cannot apply in its absence.’” Id. (quoting Priestley v. Headminder, Inc., 647 F.3d 497, 505-06
(2d Cir. 2011)).
Here, Plaintiffs do not allege that there was any continuity of ownership. Instead, Plaintiffs
only point to three reasons to support their theory of de facto merger or continuity of the seller: (1)
five of the Plaintiffs allegedly worked at Toasties before the sale; (2) the deli was called “Toasties”
before and after the sale; and (3) the deli did not move its location. Opposition at 8. At best, this
shows some “continuity of . . . personnel [and] physical location.” Nat’l Serv. Indus., 460 F.3d at
209. Plaintiffs cite no authority suggesting that such minor facts are enough to impose successor
liability on a buyer, and the Court is aware of none. Instead, the weight of authority instructs that
a plaintiff’s allegation of successor liability fails absent any suggestion that there was continuity of
ownership. See, e.g., Wang, 262 F. Supp. 3d at 87 (holding that without this “indispensable factor,”
successor liability fails as a matter of law); Battino v. Cornelia Fifth Ave., LLC, 861 F. Supp. 2d
392, 401 (S.D.N.Y. 2012) (“Here, there is no dispute that ownership of the business changed hands;
thus regardless of whether the other de facto merger factors are present, the de facto merger and
‘mere continuation’ exceptions do not apply.”). The Court thus grants Defendants’ motion for
summary judgment as to Plaintiffs’ claims for damages that allegedly accrued prior to March 2014.

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IV. Conclusion
For the foregoing reasons, the Court grants Defendants’ motion for partial summary
judgment except as to the following: the weeks of June 19, 2015, April 8, 2016, and June 30, 2017
for Garcia’s minimum wage and overtime claims; and the week of June 30, 2017 for Morales’s
minimum wage and overtime claims. Within thirty days of the filing of this Opinion and Order,
the parties shall submit a proposed joint pretrial order prepared in accordance with Rule 26(a)(3) of
the Federal Rules of Civil Procedure and 7.B of the Court’s Individual Rules and Practices in Civil
Cases. The parties shall follow the Court’s Individual Rules and Practices in Civil Cases for any
submission that must be made at the time of the proposed joint pretrial order, including any motions
in limine.
The Clerk of Court is respectfully directed to terminate the motion pending at Docket
Number 76.
SO ORDERED.
Dated: February 17, 2021
New York, New York

__________________________________
JOHN P. CRONAN
United States District Judge

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