Martinez et al v. Mendoza et al
Filing
147
ORDER denying 114 Motion to equitably toll FLSA statute of limitation. Signed by District Judge Louise Wood Flanagan on 8/6/2019. (Collins, S.)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
NO. 5:17-CV-628-FL
PEDRO RODRIGUEZ MARTINEZ,
MATEO HERNANDEZ LOPEZ, and
ELMER MENJIVAR ARGETA, on behalf
of themselves and all others similarly
situated,
Plaintiffs,
v.
CESAR MENDOZA; JORGE RAMOS;
EAST CAROLINA COMMERCIAL
SERVICES, LLC; SOLAR GUYS, INC.;
and ALPHA TECHNOLOGIES
SERVICES, INC.,
Defendants.
ALPHA TECHNOLOGIES SERVICES,
INC.,
Cross-Claimant,
v.
SOLAR GUYS, INC.,
Cross-Defendant.1
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ORDER
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This matter is before the court on plaintiffs’ motion to equitably toll the statute of limitations
under the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. (“FLSA”). (DE 114). The motion has
1
The court constructively amends the caption to reflect the filing of cross-claims by cross-claimant
Alpha Technologies Services, Inc. (“ATS”). (See DE 90 at 33-39; November 27, 2018 order).
been fully briefed, and, in this posture, the issues presented are ripe for ruling. For reasons noted,
the motion is denied.
BACKGROUND
Plaintiffs, claiming they have been misclassified as independent contractors as opposed to
employees, commenced this action December 20, 2017, alleging violations of the FLSA and North
Carolina Wage and Hour Act, N.C. Gen. Stat. §§ 95-25.1, et seq. (See Compl (DE 1); see also
Second Am. Compl. (DE 81)). On June 19, 2018, plaintiffs filed motion requesting the court
conditionally certify two FLSA collective actions and requesting permission to share notice of the
collective actions, in part, through public Facebook posts because plaintiffs believed defendants
might not have complete contact information for the putative class members.2 (DE 50 at 13; DE 115
at 2).
Thereafter the parties reached an agreement concerning plaintiffs’ motion, as reflected in
defendants’ joint response and conditional consent to plaintiffs’ motion for conditional certification.
(DE 64). On November 27, 2018, with the consent of all parties, the court conditionally certified
the following two collectives:
1.
A collective consisting of all similarly situated individuals engaged in the
construction of IS46 through Defendant East Carolina Commercial Services
individually or jointly with one or more of the other Defendants who were required
to work in excess of forty hours per week and were not paid the appropriate overtime
rate for hours worked over 40 in a workweek, and who timely file (or have already
2
The FLSA provides, in relevant part, that “[a]n action . . . may be maintained . . . by any one or more
employees for and in behalf of himself or themselves and other employees similarly situated.” 29 U.S.C. 216(b). A
worker becomes a party to a FLSA collective action upon filing a document granting consent to sue on the docket of the
court in which a collective action is pending. The main purpose of conditional certification is to authorize named
plaintiffs to issue notice to potential class members so they may opt in and halt the statute of limitations clock. See 29
U.S.C. § 256(a) (providing that a claimant is deemed a party for determining the applicable limitations period upon filing
written consent to sue in the court in which the action is brought).
2
filed) a written consent to be a party to this action pursuant to 29 U.S.C. § 216(b);
and
2.
A collective consisting of all similarly situated individuals engaged in the
construction of IS46 through Defendant East Carolina Commercial Services
individually or jointly with one or more of the other Defendants who were required
to purchase and provide their own hard hats, vests, boots, safety glasses and/or
gloves and were not reimbursed for those purchases or paid minimum wage for their
first week of work, and who timely file (or have already filed) a written consent to
be a party to this action pursuant to 29 U.S.C. § 216(b).
(DE 93 at 1-2).
Also, with the consent of all parties, the court directed the parties to meet and confer to
attempt to agree on whether any additional means of distribution of the notice to potential opt-in
plaintiffs is necessary and to report back to the court regarding the outcome of the conference.
Defendants were further directed to provide to plaintiffs, by December 11, 2018, available
information regarding the full names, dates of employments, job titles, last known addresses, email
addresses, telephone numbers, and dates of birth of all putative members of the collectives “to assist
Plaintiffs in the distribution of the approved notice.” (Id. at 2-3).
The court set a deadline of March 27, 2019, for joinder of opt-in plaintiffs filing consent to
join forms, further providing that “[u]pon timely application by Plaintiffs and a showing that
Defendants have failed to provide personal contact information . . . for a significant number of the
members of the proposed collectives,” the court may extend the opt-in period by up to two months.
(Id. at 3).
On January 25, 2019, the parties filed joint report and motion to modify the discovery plan,
informing the court that defendants Cesar Mendoza and East Carolina Commercial Services
(“ECCS”) produced to plaintiffs “all available W-9 and 1099 tax documents containing
approximately two-hundred and seventy addresses for potential members of the FLSA collectives”
3
and that no other contact information is in any of the defendants’ custody or control. (DE 107 at 2).
In the same filing, plaintiffs informed the court that the FLSA collectives may include as many as
770 people, and that plaintiffs have not received phone numbers, e-mail addresses, or dates of birth
for anyone. The parties informed the court that based on this information, the parties agreed
additional means of distributing notice were appropriate, including providing the necessary
information for notice and consent via the internet, press release, Facebook advertisements, and
Facebook groups as well as through radio advertisements or public service announcements. The
parties additionally sought an extension of the deadline to May 27, 2019, for opt-in plaintiffs to file
consent to join forms. The court granted the parties’ motion.
Plaintiffs filed the instant motion on February 15, 2019, arguing that defendants have
engaged in wrongful conduct warranting the tolling of the statute of limitations under the FLSA for
potential opt-in plaintiffs. Defendants filed response in opposition in the following groupings:
1) defendants Solar Guys, Inc. and Jorge Ramos, (DE 128); 2) defendant ATS, (DE 130), and
defendants ECCS and Cesar Mendoza, (DE 131). Plaintiffs filed omnibus reply. (DE 133).
DISCUSSION
A.
Standard of Review
Unlike a class action under Federal Rule of Civil Procedure 23, where the filing of the
complaint tolls the statute of limitations for all of the class members, under the FLSA, the statute
of limitations continues running for each individual potential class member until he or she joins the
class. The statute of limitations is tolled as of the date that the consent to join form is filed, not the
date of the complaint. See 29 U.S.C. §§ 255, 256.
4
However, equitable tolling is available for claims under the FLSA under appropriate
circumstances, where “the plaintiffs were prevented from asserting their claims by some kind of
wrongful conduct on the part of the defendant [or where] extraordinary circumstances beyond
plaintiffs’ control made it impossible to file the claims on time.” Cruz v. Maypa, 773 F.3d 138, 146
(4th Cir. 2014) (citations omitted); see also Irwin v. Dep’t of Veterans Affairs, 498 U.S. 89, 96
(1990) (“Federal courts have typically extended equitable relief only sparingly. We have allowed
equitable tolling in situations where the claimant has actively pursued his judicial remedies by filing
a defective pleading during the statutory period, or where the complainant has been induced or
tricked by his adversary’s misconduct into allowing the filing deadline to pass.”). “Equitable tolling
is a rare remedy available only where the plaintiff has exercise[d] due diligence in preserving [her]
legal rights.” Cruz, 775 F.3d at 145 (citations omitted).
B.
Analysis
Plaintiffs allege that defendants have engaged in three instances of wrongful conduct that
have prevented the majority of potential collective actions members from filing consent to join forms
to join the conditionally certified collectives: 1) classifying workers and potential opt-in plaintiffs
jointly employed by defendants as non-employees; 2) failing to collect and maintain contact
information of the relevant workers; 3) misleading plaintiffs’ counsel about defendants’ ability to
provide adequate contact information.3 The court addresses each of these arguments in turn below,
holding that plaintiffs have failed to carry their burden in showing that potential opt-in plaintiffs
“were prevented from asserting their claims by some kind of wrongful conduct on the part of the
defendant.” Cruz, 773 F.3d at 146.
3
Plaintiffs do not allege any extraordinary circumstances beyond plaintiffs’ control that made it
impossible to file claims on time.
5
Regarding plaintiffs’ first argument, the court declines to reach the merits issues as to
whether defendants have incorrectly classified plaintiffs as non-employees until an evidentiary
record has been developed, particularly where, as here, only limited evidence is before the court
regarding this issue at this stage of the litigation.4 Regarding both plaintiffs’ first and second
arguments, if alleged FLSA violations, in and of themselves, justified equitable tolling, then
equitable tolling no longer would be a rare remedy, but would become frequent, if not automatic,
in FLSA cases.5 See Cruz, 773 F.3d at 146 (emphasis added) (“equitable tolling is available when
. . . the plaintiffs were prevented from asserting their claims by some kind of wrongful conduct on
the part of the defendant . . . . ”); see also Watson v. United States, 865 F.3d 123, 132 (2d Cir. 2017)
(citation omitted) (“[T]o secure equitable tolling, it is not enough for a party to show that he
experienced extraordinary circumstances. He must further demonstrate that those circumstances
caused him to miss the original filing deadline.”). For equitable tolling to apply, plaintiffs must
4
Plaintiffs do not dispute that “whether the Plaintiffs and their similarly-situated coworkers were
employees or not is a merits issue” and as such “it would be premature for the Court to decide” at this time;
notwithstanding, plaintiffs argue “[t]here is enough in the record now for the Court to conclude that the Plaintiffs and
their colleagues were, in fact, treated by Defendants as independent contractors,” in order to grant equitable tolling. (DE
133 at 8). Plaintiffs cite no case law in support of this argument. Additionally, as discussed above, that defendants may
have treated plaintiffs and potential opt-in plaintiffs as independent contractors is an insufficient basis for granting
plaintiffs’ motion for equitable tolling without further evidence that such treatment prevented potential opt-in plaintiffs
from being aware of their FLSA rights or from timely filing of consent to join forms.
5
For the same reason as stated above, the court rejects plaintiffs’ argument that “[e]ven if the putative
collective action members were not truly employees, the IRS requires Defendants to collect W-9 forms from each of
them,” which require names and addresses, and the IRS “generally requires small business to keep tax records for three
years after their filings.” (DE 115 at 6-7). In order for the equitable tolling to be applied, plaintiffs must provide some
evidence that defendants’ alleged wrongful conduct prevented potential opt-in plaintiffs from being aware of their FLSA
rights or from timely filing of consent to join forms. See Cruz, 773 F.3d at 146.
6
demonstrate, not just argue, that the potential opt-in plaintiffs were prevented from learning of their
purported FLSA rights and taking appropriate legal action.6
In response to plaintiffs’ third argument, plaintiffs informed the court as early as June 19,
2018, in plaintiffs’ motion for conditional certification, that plaintiffs “believe that Defendants are
unlikely to have complete and accurate addresses for putative class member because the paystubs
provided to Plaintiffs by Defendants ECCS and Mendoza do not contain addresses.” (DE 50 at 13).
This awareness was reiterated by plaintiffs in the parties’ joint filing on August 3, 2018. (DE 64 ¶
3 (“The Parties further agree that, should the Defendants be unable to furnish the Plaintiffs with
contact information for a significant portion of the potential members of the collective, Plaintiffs will
retain the right to seek an extension of the opt-in period of up to two (2) additional months.”)).
Although plaintiffs argue that plaintiffs only were aware that defendants did not maintain
addresses or dates of birth for potential opt-in plaintiffs and that plaintiffs “did not learn until
December 2018 that no one was going to produce any phone numbers or e-mail addresses,” (DE 133
at 15-16), the above acknowledgments undercut plaintiffs’ current assertions that defendants have
misled plaintiffs. See Adami v. Cardo Windows, Inc., 299 F.R.D. 68, 83 (D.N.J. 2014) (internal
citations omitted) (“[G]ranting the remedy of equitable tolling any time the defendant fails to
provide contact information effectively would require that the statute of limitations for FLSA claims
6
Courts frequently permit class notice by publication or other methods directed at groups instead of
individuals, so long as the proposed notice method is reasonably tailored to the needs of the particular case. If
individualized notice was the only type of effective notice, plaintiffs would have had no good-faith basis to request the
court’s permission to publish the notice in this case via such methods as press releases, radio advertisements, and a
dedicated website. Plaintiffs argue that defendants failure to collect and maintain relevant contact information “has
prevented the majority of potential collective action members from learning about their opportunity to join this
litigation,” (DE 133 at 2), but do not address the potential impact of the notice provided that was not individually
targeted.
7
be tolled for all potential plaintiffs whenever plaintiff files the complaint . . . . Such a requirement
is contrary to the clear language of 29 U.S.C. § 256.”).
Additionally, cases cited by plaintiffs regarding this issue are inapposite where in those cases
defendants refused to answer discovery or to make any production of information within their
possession, custody, or control. See, e.g., Adams v. Inter-Con Sec. Sys., Inc., 242 F.R.D. 530, 543
(N.D. Cal. 2007) (“The potential plaintiffs in this case have yet to receive notice of the action due
to defendant’s refusal to supply potential plaintiffs’ contact information to the named plaintiffs.”).
Here, plaintiffs do not dispute that they have received from defendants those documents that
defendants are able to produce.
Finally, plaintiffs heavily rely on cases where the courts found dispositive that defendants
in those cases had failed to post the required FLSA notice at the jobsites.7 See Cruz, 773. F.3d at
146-47 (holding failure to post at the jobsite required notice explaining the FLSA constitutes
wrongful conduct sufficient to apply equitable tolling); Kim v. Dongbu Tour & Travel, Inc., No.
2:12-CV-1136 WHW, 2013 WL 5674395, at *4 (D.N.J. Oct. 16, 2013) (citation omitted) (“Failure
to post such notice, along with Defendants’ misleading of Plaintiffs as to their employment status
as independent contractors, is a clear example of where the employer’s own acts or omissions have
lulled the plaintiff into foregoing prompt attempts to vindicate his rights.”); see also Rosales v. Heb
Grocery Co., LP, No. H-14-3187, 2016 WL 3458214, at *4 (S.D. Tex. June 24, 2016) (court
declined to grant equitable tolling based on failure to post the FLSA notice because of evidence on
record that defendant did post the necessary notice); Ayala v. Tito Contractors, Inc., 82 F. Supp. 3d
7
“Every employer employing any employees subject to the [FLSA’s] minimum wage provisions shall
post and keep posted a notice explaining the [FLSA] . . . in conspicuous places in every establishment where such
employees are employed so as to permit them to observe readily a copy.” 29 C.F.R. § 516.4.
8
279, 291 (D.D.C. 2015) (holding genuine issue of material fact remained whether employer posted
required notices of rights under the FLSA at jobsite thus precluding summary judgment on equitable
tolling claim).
Plaintiffs expressly allege in operative complaint that “[u]pon information and belief,
Defendants disclosed to Plaintiffs and their similarly situated co-workers that the promised wage
for the work they were to perform would be at least 1 ½ times the regular hourly rate, by posting this
information in the mobile office and/or other locations on the jobsite.” (DE 81 ¶ 113). In
memorandum of support of the instant motion, plaintiffs do not address the posting of the required
FLSA notice. (See DE 115). It is not until plaintiffs’ reply that plaintiffs note inconclusive evidence
on record regarding the presence, or lack thereof, regarding the required FLSA notice.8 (See DE 133
at 10-11). Plaintiffs argue “[r]egardless of whether further discovery reveals conclusively whether
there was a poster at this jobsite, the Fourth Circuit’s reasoning for extending equitable tolling for
failure to post the FLSA notice applies equally here” as in Cruz, arguing “both the likely absence
of the FLSA poster and the Defendants’ wrongful conduct of informing potential opt-ins that they
were not covered by the FLSA mean tolling is warranted.” (Id. at 11-12).
The court has addressed and rejected plaintiffs’ argument regarding defendants’ alleged
wrongful conduct of misclassifying plaintiffs above. The court declines to grant relief, relief that
is to be granted “sparingly,” based on plaintiffs’ argument as to the “likely absence of the FLSA
8
Defendants Mendoza and ECCS stated in their answer, “[u]pon information and belief, it is admitted
that a minimum wage poster was posted on the jobsite, although ECCS does not recall the contents of the poster.” (DE
92 ¶ 113). When asked about the poster at the deposition of defendant ECCS, defendant Mendoza, as corporate designee
for ECCS, responded: “I can’t recall where it was, but it had to be in one of the job trailers,” (DE 113-1 at 86:20-21),
testifying also that he did not personally put up the poster or ask anyone to put it up, (id. at 86:22-87:1).
9
poster” where plaintiffs allege defendants did so post and where plaintiffs did not move to equitably
toll the FLSA statute of limitations based on this ground. See Irwin, 498 U.S. at 96.
In sum, plaintiffs have failed to meet their burden that equitable tolling of the FLSA statute
of limitations is warranted in the present case at this time.9
CONCLUSION
Based on the foregoing, plaintiffs’ motion to equitably toll the FLSA statue of limitations
is DENIED.
SO ORDERED, this the 6th day of August, 2019.
_____________________________
LOUISE W. FLANAGAN
United States District Judge
9
Based on the above, it is unnecessary for the court to address the parties’ arguments as to whether
plaintiffs have diligently pursued the purported rights of the absent opt-in plaintiffs, whether granting plaintiffs’ motion
would result in prejudice to defendants, or issues concerning joint-employer liability.
10
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