Pontones v. San Jose Restaurant, Incorporated et al

Filing 77

ORDER the court GRANTS plaintiff's motion 66 for conditional class certification and court-authorized notice concerning plaintiff's FLSA claim and for conditional class certification concerning her NCWHA claim. The parties shall meet and confer concerning future proceedings, the contents of the proposed notice, and submit a proposed schedule no later than December 6, 2019.The parties also shall participate in a court-hosted settlement conference with United States Magistrate Judge Gates. Signed by District Judge James C. Dever III on 10/31/2019. (Sellers, N.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DMSION
No. 5:18-CV-219-D

LAURA PONTONES,
Plaintiff,

v.
SANJOSE RESTAURANT
INCORPORATED, et al.,

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ORDER

Defendants. )

On May 17, 2018, Laura Pontones ("Pontones" or ''plaintiff''}, on behalf of herself and

similarly situated plaintiffs, filed a complaint against a group of allegedly related Mexican
restaurants for violations of the Fair Labor Standards Act, 29 U.S.C. § 201, et~ ("FLSA"}, and
the North Carolina Wage and Hour Act, N.C. Gen. Stat. § 95-25.l, _et~ (''NCWHA") [D.E. 1].
On June 11, 2018, Pontones amended her complaint [D.E. 7]. On April 26, 2019, Pontones moved

for conditional class certification under section 216(b) ofthe FLSAand Rule 23 ofthe Federal Rules
of Civil Procedure [D.E. 66] and filed a memorandum in support [D.E. 67]. On May 17, 2019,
defendants responded in opposition [D.E. 68] and filed various exhibits [D.E. 69, 70]. On June 5,
2019, Pontones replied [D.E. 75] and filed additional declarations [D.E. 73, 74]. As explained
below, the court grants Pontones' s motion for conditional class certification concerning both claims.
I.

Pontones is a former server. See Am. Comp!. [D.E. 7], 1, 14.. She sues San Jose Restaurant
Incorporated; San Jose Management, Inc., d/b/a San Jose Mexican Restaurant ~d Sports Cantina;

San Jose MexicanRestaurant#2 of Lumberton, Inc.; San Jose Mexican Restaurant ofElizabethtown,
Inc.; San Jose Mexican Restaurant of N.C. Inc.; San Jose Mexican Restaurant of Pembroke, NC,
Inc.; San Jose Mexican Restaurant of Raleigh Inc.; San Jose Mexican~ Resta~t of Shallotte, Inc.;
San Jose of Rocky Mount #2 Inc., d/b/a San Jose Tacos and Tequila; San Jose of Zebulon, Inc.; San
Jose of Roanoke Rapids, Inc.; San Jose Wakefield, Inc., d/b/a San.Jose Mex and Tequila Bar; Plaza
Azteca Raleigh, Inc., d/b/a San Jose Tacos and Tequila; Hector Flores; Alberto Flores; Josue Flores;
Jose Perez; Vicente Perez; Pablo Meza; Edgardo Flores; and Edgar Flores (collectively,
"defendants") for unpaid minimum wages and overtime compensation. See id.
Defendants own and operate Mexican restaurants in North Carolina, Virginia, and South
Carolina. See id.~ 46. From about October 2, 2016, to January 22, 2017, Pontones worked as a
server at the Brier Creek location in Raleigh, North Carolina. See -.id.·.~ 47. From January 23, 2017,
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until April 2017 and again from July 2017 to August 2017, PontoD:esworked ~t the Triangle Town
Center Mall location in Raleigh, North Carolina. See id. Pontones did not supervise other
employees and performed the normal duties of a server. See id. ft 48-50. She worked Wednesday
to Sunday. See id.~ 51. On Wednesdays and Thursdays, Pontones worked from 10 a.m. to 10 p.m.
See id. On Fridays and Saturdays, Pontones worked from 10 a.m. to 11 p.m. See id. On Sundays,
she worked from 5 p.m. to 10 p.m. See id. Each work day except Sunday, Pontones would take a
two-hour unpaid break between shifts. See id. Pontones alleges that defendants controlled her work
schedule and rate of pay. See id.~ 52.
According to Pontones, she and others similarly situated ''were advised" that they would be
paid an hourly wage less than the minimum wage required under FLSA, plus tips. See id.~ 53. But
Pontones only received a check for her first week of training (at $8.00 per hour) and ''one to two"
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checks for $0.00. See id. Otherwise, Pontones alleges that she did not receive wages or check stubs
that documented the hours she worked or the wages she earned. See id. Pontones also claims that
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the defendants deducted a fixed percentage of all credit and cash purchases made by customers from
her earnings, usually about 3%, regardless ofwhether a customer paid in cash or by card. See id. W
54-55, 57. She alleges that defendants used this deduction to pay ~eir operating expenses. See id. ~
56. She also alleges that defendants did not operate a tip pool. See id. ~ 58.
From 2014 until 2016, the United States Department of Labor, Wage and Hour Division,
investigated defendants and found "numerous violations," includingfailure ~o.pay overtime pay,
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failing to pay minjmum wage by requiring waiters to work for tips alone, failing to maintain required
time and payroll records, and falsifying payroll documents. See id. ~ 59. }>ontones alleges that the
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defendants continued their practices after the federal investigation. See id. ~ 60. In 2006 and 2007,
and again from late 2017 until early 2018, the North Carolina Department ofLabor also investigated
defendants. See id.~ 61. The first investigation did not result in any-findings because defendants
did not comply. See id. The second investigation resulted in the assessment of civil penalties.

Pontones provides evidence of the U.S. Department of Labor's investigations. See Ex. A
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[D.E. 67-1]. These investigations resulted in the assessment of si~cant back-wages against the
San Jose restaurants owed to approximately 125 employees. See id. at 167-69; Flores Dep. [D.E.
67-2] 14. Some of these employees were servers. See Flores Dep. [D.E. 67-2] 15.
On March 10, 2016, a group of plaintiffs filed a collective action under FLSA in this court

against defendants. See Galvan v. San.Jose Mexican.Rest. ofNC. Inc., No. 7:~6-CV-39-FL, 2016
WL 6205783, at* 1 (E.D.N.C. Oct. 24, 2016) (unpublished). The Galvan plaintiffs alleged mirroring
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FLSA claims, but did not allege any state law claims. See id. On OctOber 24, 2016, Judge Flanagan
granted plaintiffs' motion for conditional class certification under section 216(b) of the FLSA.
See id. at *3. OnMarch2, 2018, the parties settled the litigation. See Galvan v. San.Jose Mexican
Rest. ofN.C.• Inc., No. 7:16-CV-39-FL, [D.E. 46] (E.D.N.C. Mar. 2, 2018). Pontones claims that
defendants continued their unlawful wage practices after the settlement. See Api. Compl. [D.E. 7]
~63.

Pontones submits Hector Flores' s deposition ofDecemberl8, 2018. Flores testified that the
individual store managers essentially operate the different San JO~e. locations without much if any
oversight from the owners. See Flores Dep. [D.E. 67-2] 12-13. He also admitted that the
Department of Labor found that the San Jose restaurants had failed to pay servers anything besides
tips, which resulted in minimum wage and overtime violations like those that Pontones alleges. See
id. at 15. Flores, however, did not know what policies·and practices.existed at the restatirants. See
id. at 27, 29, 37-38. Flores also testified that he personally had· done nothing to remedy the
violations at the San Jose restaurants and that the. managers were

~esponsib~e

for bringing the

restaurants into compliance after the Department.of Labor's inveStigadons. See id. at 40.
Pontones seeks to bring a collective action under section 216(b) of FLSA for:
All current and/or former servers of Defendants whose primary duty is/was nonexempt work, who were not paid minimum wage and/or overthne, and who are/were
subjected to deductions of a ~ed percentage of all credit and cash pw::~hases made
by Defendants' customers, ... within the three (3) year period prior tO joining this
lawsuit under 29 U.S.C. § 216(b).
Compl. [D.E. 1] ~ 65(a). Pontones alleges that defendants did no~pay the putative members of the
FLSA collective action the legally required minimum wage or. overtime

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of time and that

defendants took deductions from their salaries improperly. See id. -U 66; Pontones Deel. [D.E. 73]
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~ 1 (naming specific individuals with whom Pon~nes worked). Ponton.es also offers evidence that

these policies applied to servers at other locations. See Enriquez Deel. [D.E. 74] mf 10--13.
Pontones also seeks to certify a class action under Rule 23 of the Federal Rules of Civil
Procedure on behalf of the following proposed class:
All current and/or former employees ofDefendants in North Carolina whose primary
duty is/was non-exempt work, who are/were not paid for all of their hours worked;
including promised regular and/or overtime wages, and who are/were subjected to
unlawful deductions of a fixed percentage of all credit and cash purchases made by
Defendants' customers, at any time within the two (2) year period prior to the filing
of this lawsuit.
Compl. [D.E. 1] ~ 73(a).
II.

The FLSArequires employers to pay non-exempt employets aminimu:m:wage and overtime
wage. See 29 U.S.C. §§ 206-07; Desmond v. PNGI Charles Town Gaming. L.L.C., 630 F.3d 351,
356-57 (4th Cir. 2011); Romero v. H.B. Auto. Grp.. Inc., No. 11Civ.386(CM), 2012WL1514810,
--.·,

at *5-7 (S.D.N.Y. May 1, 2012) (unpublished). Under the FLSA, employees can bring suit on behalf
of themselves and other similarly situated employees against employers for unpaid overtime and
other claims. See 29 U.S.C. § 216(b). This collective action pto~ss enables similarly situated
employees to poolresources and promote judicial efficiency. See, e.g.; Jackson.v. Bloomberg. L.P.,
298 F.RD. 152, 158 (S.D.N.Y. 2014); Faust v. Comcast Cabl~ Commc'ris Mglnt.. LLC, No.
WMN-10--2336, 2011 WL 5244421, at •2 (D. Md. Nov. 1, 2011) (unpublished). The FLSA is a
special form of collective action, separate from class_ actions under Rule 23. of the Fed~ Rules of
Civil Procedure. See 29 U.S.C. § 216(b). For example, unlike class actions ~derRule 23(b)(3),
in which class members are bound by the judgment unless they opt out ofthe cla,ss, collective FLSA

5

actions require plaintiffs to give "consent in writing to become snch a party.;' Id. Thus, FLSA
collective-action plaintiffs must be "similarly situated" and opt in tO the class by filing consent with
the court. See id.; Sandoval-Zelaya v. A+ Tires. Brakes. Lubes. & Mufflers. Inc., No. 5: 13-CV-810D, 2017 WL4322404, at •4 (E.D.N.C. Sept. 28, 2017) (unpublished); Rosinbamn v. Flowers Foods.
Inc., 238 F. Supp. 3d 738, 743 (E.D.N.C. 2017); Jackson, 298 F.R.D. at 158.
Courts generally follow a two-stage process in determining whether to grant certification for
a collective action under section 216(b). See,

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Sandoval-Zela:Ya, 2017 WL 4322404, at *5;

Rosinba:um, 238 F. Supp. 3d at 743; Faust, 2011WL5244421, at•2; Williams v. XE Servs.• LLC,
No. 2:09--CV-59-D, 2011 WL 52353, at •2 (E.D.N.C. Jan. 4, 2011) (unpublished). "In the first
stage, sometimes referred to as the 'notice stage,' the court makes a threshold determination of
whether the plaintiffs have demonstrated that potential class members are 'similarly situated,' snch
that court-facilitated notice to the putative class members would be appropriate." Fa:!!fil, 2011 WL
5244421, at •2 (quotation omitted); see Sandoval-Zelaya, 2017 WL 4322404, at *5; Rosinba:um, 23 8
F. Supp. 3d at 743; McLaurin v. Prestage Foods. Inc., 271F.R.D.4~5, 469 (E.Q:N.C. 2010); Parker
v. Smithfield Packing Co., No. 7:07-CV-176-H, 2010 WL 11565605, at *3 .(E.D.N.C. Aug. 23,
2010) (unpublished), re.port and recommendation adopted by 2010 WL '11565686 (E.D.N.C. Sept.
27, 2010) (unpublished). The second stage generally oecurs after discovery .and requires the court
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to engage in a fact-intensive inquhy to determine whether the putative class is:"similarly situated"
and whether certification is appropriate. See, e.g., Sandoval-Zelaya; 2017 WL 4322404, at *5; ~
2011 WL 5244421, at •2. The defendant typically initiates
"decertification" of the class.

See,~

~e

_second stage by moving for

Fa:!!fil, 2011 WL 5244421;... •2.
at .
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The notice stage does not require a demanding evidentiary showi.D.g, but instead requires only
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"substantial allegations that the putative class members were together the, victims of a single
decision, policy, or plan." McLamin, 271 F.R.D. at 469.(quotatio~:<)Dii.tted); see Sandoval-Zelay~
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2017 WL 4322404, at *4-5; Rosinba:gm, 238 F. Supp. 3d at 743; Fayfil, 2011 WL 5244421, at *2.
The FLSA collective-action standard is considerably less stringent than the standard for class
certification under Federal Rule of Civil Procedure 23. See, e.g., Jackson, 298 F.R.D. at 158.
Plaintiffs may rely on pleadings, affidavits, and declarations to satisfy the FLSA collective-action
requirement. See, e.g., id.; Romero, 2012 WL 1514810, at *9; XE Servs., 201 l WL 52353, at *3.
Under the FLSA, ''plaintiffs must submit evidence establishing at le8st a colorable basis for their
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claim that a class of' similarly situated' plaintiffs exist." Faust 20.ll:WL 5244421, at •2 (quotation
omitted); see XE Servs., 2011 WL 52353, at *3; Purdham v. FaitfaX Cty. Pub~ ·sch., 629 F. Supp.
2d 544, 548-49 (E.D. Va. 2009).
Separate entities that share control over an individual worker can be joint employers. See,
~Schultz

v. Capital Int'l Sec.. Inc., 466 F.3d 298, 304-05 (4th C~. 2006).;;Luna-Reyes v. RFI

Constr.. LLC, 109 F. Supp. 3d 744, 749 (M.D.N.C. 2015); 29 C.F.R. § 791.2(a)~ Joint employment
exists when "(1) two or more persons or entities share, agree
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allocate responsibility for, or
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otherwise codetermine the essential terms and con~tions of a ~~rker's: empJoym.ent and (2) the
worker is an 'employee' within the meaning of the FLSA." Salinas v. Commercial Interiors. Inc.,
848 F.3d 125, 140 n.8 (4th Cir. 2017). Step one of the analysis focuses on whether two or more
entities are ''not completely disassociated." Id. at 141-42; see 29 C.F.R. § 791.2(a). In, making this
determination, courts may consider six non-exhaustive factors:
1) Whether, formally or ~ a matter of practice, the putativejoint employers jointly
determine, share, or allocate the power to direct, control, or 'supervise. the worker,
whether by direct or indirect means;
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(2) Whether, formally or as a matter of practice, the putative joint employers jointly
determine, share, or allocate the power to----directly or indirectly-hire or fire the
worker or modify the terms or conditions of the worker's ~ployment;
(3) The degree of permanency and duration of the relationship betw~ the putative
· joint employers;
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(4) Whether, through shared management or a direct or indirect ownership interest,
one putative joint employer controls, is controlled by, or is under common control
·
with the other putative joint employer;
(5) Whether the work is performed on a premises ownedor·oontrolled bY one or more
ofthe putative joint employers, independently or in connection with one another; and
(6) Whether, formally or as a matter of practice, the putative joint employers jointly
determine, share, or allocate responsibility over functions ordinarily carried out by
an employer, such as handling payroll; providing workers' compensation insurance;
paying payroll taxes; or providing the facilities, equipment, tools, or materials
necessary to complete the work.

Salinas, 848 F.3d at 141-42. Although no factor is dispositive, one factor alone may be sufficient
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· to find either for or against a joint employment relationship. See. id: A court must assess joint
employment "based upon the circumstances of the whole activity." Id. at 142 (quotation omitted).
..:· ..-.· ...

As for Pontones' s motion for conditional class certification lJ.llder section 216(b), at this stage

the court need only make "a threshold determination ofwhether the plaintiffs haV:e demonstrated that
potential class members are 'similarly situated,' such that court-facjJitatednotice to the putative class
members would be appropriate." Faust, 2011 WL 5244421, at *2 (quotation omitted); see SandovalZelay~ 2017 WL 4322404, at *5; Rosinbaum, 238 F. Supp. 3d at 74~; McLaY:!ln., 271

F.R.D. at 469.

Thus, Pontones need only make "substantial allegations that the putative ciass members were
together the victims of a single decision, policy, or plan." McLal!!'.fil, 271 F.R.D. at 469; see
Sandoval-Zelaya, 2017 WL 4322404, at *4-5; Rosinbaum, 238 F..Supp.3d at743; Fayfil, 2011 WL
5244421, at *2. Pontones has met the standard required for court-facilitated notice to putative class
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members under the FLSA. See, e.g., XE Servs., 2011 WL 52353, at *3-4. Specifically, Pontones
has ''made a sufficient factual showing that the [San Jose] defendants subje_cted putative class

members to a common policy that violated FLSA" and raises "similar legal ·issues" under FLSA
"arising from a similar factual setting." Berber v. Hutchison Tree Serv., No. 5: 15-CV-143-D, 2018
.
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WL 3869980, at *3 (E.D.N.C. Aug. 14, 2018) (unpublished); see, e.g.~yelasquez-Monterrosa v. Mi
Casita Rests., No. 5:14-CV-448-BO, 2016 WL 1703351, at *2-3 (E.D.N.C. Apr. 27, 2016)
(unpublished). For example, Pontones claims that she worked with specific named individuals who
stated that the other San Jose restaurants had the same pay policies and ~ces. See Pontones
:Peel. [D.E. 73] ~ 1. Moreover, the opt-in plaintiff alleges similar claims. See Enriquez Deel. [D.E.
74]

w10--13.
In opposition to this conclusion, defendants

~ghlight

that Pontones is the only named

plaintiff. See [D.E. 68] 1. On June 5, 2019, however, Eduardo Torres ~nriquez("Enriquez") opted
,: ..
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in as a plaintiff and alleged that he ''was not paid for all

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comp~ble

including overtime. [D.E. 72-1] 1-2; see Enriqu~z Deel. [D.E.'·.74]

time.that [he] worked,"

mf 10--B. · Defendants also

challenge the sufficiency of Pontones's declaration. See [D.E. 68] 1. On June 5, 2019, Pontones
supplemented her declaration with further details, including names. See PontOnes Deel. [D.E. 73]
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Moreover, although defendants contest that they are joint employers, Pontones has made at least

a minimal showing that the San Jose restaurants operate as joint employers. See Berber, 2018 WL
3869980, at *3--6; see Roman v. Guapos Ill Inc., 970 F. Supp. 2d 497, 413-1~ (D. Md. 2013).
As for defendants' remaining arguments (e.g., that wages \Ve.r~ applied to offset taxes owed),

those arguments "appear to be attacking the merits of plaintiffs' c.labn.s rather than addressing the
similarly situated standard" under FLSA. Williams, 2011 WL 52353, at *4. Thus, the court rejects
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those arguments and grant Pontones's motion for certification and n~tice under FLSA. 1
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m.

Pontones moves for class certification of her NCWHA claim under Rule 23. The standard
required to meet the certification requirements of Federal Rule of Civil Procedure 23 is more .
stringent than the standard for conditional certification under the FLSA. See Callari v. Blackman
Plumbing Sup_ply. Inc., 307 F.RD. 67, 74 (E.D.N.Y. 2.015); Williams, 2011WL52353, at *2 n.2.
Indeed, when examining a motion for class certification under Rule ·23, the court may consider the
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merits of plaintiff's underlying claim to the extent such inquiry informs whether plaintiff satisfies
Rule 23 prerequisites. See Amgen Inc. v. Conn; Ret. Plans & Tr. Foods, 568 U.S. 455, 465--66

1

Defendants also appear to challenge Pontones' s standing under Article ill to sue all of the ·
San Jose restaurants. See [D.E. 68] 13-14. A class action plaintiff must have suffered injury
personally, and cannot predicate Article mstanding upon the injuries of putative class members.
See Hutton v. Nat'l Bd. ofExam'rs in Optometry. Inc., 892 F.3d 613, 619-20 (4th Cir. 2018); Beck
v. McDonald, 848 F.3d 262, 269-70 (4th Cir. 2017); Pashbyv. Delia, 709 F.3d 307, 316 (4th Cir.
2013); see also Warth v. Seldin, 422 U.S. 490, 502 (1975). Pontones alleges that defendants violated
her rights under FLSA and the NCWHA by not paying her minimUm. wage, by not paying her
overtime, and by illegally deducting amounts from her wages. · Tlius, Pontones has sufficiently
alleged an injury in fact for Article mpurposes, ~d has standing :to. bring this action as a collective
or class action plaintiff.
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The court acknowledges that some courts have held that
~llective action plaintiffs
lack Article m standing to sue defendants who did not employ them. See,~ Crumbling v. Miyabi
Murrells Inlet. LLC, 192 F. Supp. 3d 640, 646-47 (D. S.C. 2016); Roman, 970 F. Supp. 2d at
413-16. However, because Pontones has plausibly alleged thatthe San.Jose restaurants operate as
joint employers under Salinas, these cases are distinguishable. Cf. Crumbling; 192 F. Supp. 3d at
646-47 ("Here, Plaintiffs have not alleged any kind of joint employment theory that would confer
standing against all of the defendants."). Moreover, it is unclear whether "d~ whether a
defendant is an 'employer' under the FLSA is a jurisdictional fact," rather than simply an element
of aFLSA claim. Luna-Reyes v. RFI Const.. LLC, 57 F. Supp. 3d 495, 500--01(M.D.N.C.2014);
see also Fort Bend Cty. v. Davis, 139 S. Ct. 1843, 1848-50 (2019); Arbaughv. Y & H Cor,p., 546
U.S. 500, 516 (2006)., In any event, Pontones has Article ill· ~ding to sue the San Jose
restaurants.

FLSA

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(2013); Wal-Mart Stores. Inc. v. Dukes, 564 U.S. 338, 351-52 (2011).
Under Federal Rule of Civil Procedure 23(a), class certification is appropriate if:
(1) the class is so numerous that joinder of all members is b:Dpracticable~ (2) there
are questions of law or fact common to the class; (3) the claims or defenses of the
representative parties are typical of the claims or defenses_o(the class; and (4) the
representative parties will fairly and adequately protect the interests of the class.
Fed. R. Civ. P. 23(a). If a plaintiff has satisfied the Rule 23(a) prerequisites, the plaintiff then also
must' show that "class certification is proper under one of the subdivisions of Rule 23(b)."
McLaurin, 271 F.R.D. at 475; see Am.chem Prods .• Inc. v. Windsor, 521 U.S. 591, 614 (1997).
Pontones seeks to certify a Rule 23(b)(3) class. Rule 23(b)(3) allows a class action to be
maintained if ''the court finds that the questions of law or fact -common to class members
''

predominate over any questions affecting only individual members, .aJ;ld that a class action is superior
.... ~-" . .

to other available methods for fairly and efficiently adjudicating the controversy." Fed. R. Civ. P.
23(b)(3). If Pontones satisfies the requirements of Rule 23(a), she also m~ then satisfy the two
components of Rule 23(b)(3): (1) predominance and (2) superiority. See Thom v. Jefferson-Pilot
Life Ins. Co., 445 F.3d 311, 319 (4th Cir. 2006).
A.
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As for numerosity, "[t]here is no mechanical test for deteniiinfug whether in a particular case

the requirement of numerosity has been satisfied." Kelley v. Norfoilr & W~ Ry.,584 F.2d 34, 35 (4th
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Cir. 1978) (per curiam.). "The issue is one primarily for the Distric(Court, to be resolved in light of
the facts and circumstances of the particular case." Id.; see Holsey v. Armour~ Co., 743 F.2d 199,
217 (4th Cir. 1984). Pontones alleges that there are at least 100 putatiye class members. Defendants
argue that, while Pontones could "theoretically'' satisfy this requirement, she has not presented

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sufficient evidence to do so. The court disagrees. See, e.g., Cypress v. Newport News & Gen. &
Nonsectarian Hosp. Ass'n, 375 F.2d 648, 653 (4th Cir. 1967) (en bane); Velasquez-Monterrosa,
2016 WL 1703351, at *4-5; McLaurin, 271 F.R.D. at 475. Thus, Pontones has satis:fiednumerosity.

B.
As for the second and third Rule 23(a) factors, "[t]he requirements for typicalify and
commonality often merge." Romero v. Mountaire Farms. Inc., 796 F. Supp. 2d 700, 714 (E.D.N.C.
2011) (quotation omitted); see Gen. Tel. Co. of Sw. v. Falcon, 45TU.S. 147, 157 n.13 (1982);
Kidwell v. Transp. Commc'ns Int'l Union, 946 F.2d 283,

30~,,(4th

Cir. 1991). Under the

"commonality'' requirement ofRule 23(a)(2), at least one common question oflaw or fact must exist
among class members. See EQT Prod. Co. v. Adair, 764 F.3d 347, 360 (4th Cir. 2014); Brown v.
NucorCorp.,576F.3d 149, 153 (4thCir.2009);Haywoodv. Barnes, 109F.R.D. 568,577 (E.D.N.C.
1986).

What matters to class certification, however, "is not the raising of common

'questions'--even in droves-but rather, the capacity of a class-:wide proceeding to generate
common answers apt to drive the resolution of the litigation." Wal-Mart Stores. Inc~, 564 U.S. at
350 (quotation and emphasis omitted). Typicality exists if"the c~~ttjis of the representative parties
[are] typical of the claims of the class." Haywood, 109 F.R.D. at 578; see Soutter v. :e<Iuifax Info.
Servs.• LLC, 498 F. App'x 260, 264-65 (4th Cir. 2012) (unpublished); Deiterv. Microsoft Corp.,
436 F.3d 461, 466 (4th Cir. 2006). A claim is typical if"it arises from the same event or practice
or course of conduct that gives rise to the claims of other class members, and ifhis or her claims are
based on the same legal theory." Beattie v. CentuzyTel. Inc., 511 f.3d 554, 561 (6th Cir. 2007)
(quotation omitted); see Romero, 796 F. Supp. 2d at 714. This requirement .is "c~ptured by the
notion that as goes the claim of the named plaintiff, so go the claims.of the class." Deiter, 436 F.3d
.,_:.
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at466 (quotation omitted); see Soutter, 498 F. App'x at264--65; Broussard v. Meineke Disc. Mu:ffier
Shops. Inc., 155 F.3d 331, 340 (4th Cir. 1998).
As for typicality and commonality, Pontones alleges that defendants violated the NCWHA
by taking unlawful deductions of a fixed percentage of all credit and cash purchases from employees'

paychecks and by not paying regular or overtime wages to employees. See Compl. [D.E. 1] ~ 15.
Defendants respond that Pontones "is mistaken about most of the facts" and "offers nothing more
than the bare assertion" that her alleged experiences were typical and common. [D.E. 68] 23.

A district court reviewing a motion for class certification ~,~Y consider ~e merits of a class
action plaintiff's underlying claims insofar as necessary to decide whether the plaintiff has met Rule
23(a)'s prerequisites. See Am.gen Inc., 568 U.S. at 465-66; Wal-Mart Stor~s. Inc., 564 U.S. at
351-52. "Commonality requires the plaintiff to demonstrate that the class m~bers have suffered
the same injury." Wal-Mart Stores. Inc., 564 U.S. at 349--50 (emphasis added)(quotation omitted).
"Rule 23 does not set forth a mere pleading standard[,]" but rather, "[a]. party seeking class
certification must affirmatively demonstrate his compliance" with Rule 23. Id. at 350. Unlike WalMart Stores. Inc., however, ''this case involves a uniform policy c;>r practice. of compensating

employees" that defendants allegedly follow and that allegedly viobites the NCWHA. Mitchell v.
SmithfieldPackingCo.,No.4:08-CV-182-H(l),2011 WL4442973,at*3(E.D.N.C.Sept.23,2011)
(unpublished); see,~ Berber, 2018 WL 3869980, at *7. This fact remains tt:ue even if, at a later
stage, defendants ultimately prevail on the joint-employer issue. "Moreover, [Pontones's] and
putative class members' claims are based on the same legal theory, a violation ~f N.C. Gen. Stat. §
95-25.6." Berber, 2018 WL 3869980, at *7; see Velasquez-Monterrosa, 2016 WL 1703351, at *5.
Thus, Pontones has satisfied the commonality and typicality requirements.
13

.

.· .
.:-,··

.·

c.
As for the fourth requirement, "a class representative must be part of the class and possess

the same interest and suffer the same injury as the class members."

Am.ch~

521 U.S. at 625-26

(alteration and quotation omitted); see In re Red Hat Inc. Sec. Litig.,- 261 F.R.D. 83, 87 (E.D.N.C.
2009). The adequacy inquiry also "serves to uncover conflicts ofinterest between named parties and
the class they seek to represent."

Am.ch~ 521

U.S. at 625; see Beattie, 511 F.3d at 562. A conflict

must be considered ''fundamental" to defeat the adequacy requirement. Dewey v. Volkswagen
Aktiengesellschaft, 681F.3d170, 184 (3d Cir. 2012); see Sharp Farms v. Speaks, 917 F.3d 276,
294-98 (4th Cir. 2019); Ward v. Dixie Nat'l Life Ins. Co., 595 F._3d 164, 180 (4th Cir. 2010);
Gunnells v. Health.plan Servs.. Inc., 348 F.3d 417, 430-31 (4th Cir. 2003).."A conflict is not
fundamental when ... class members share common objectives and the sam,e factual and legal
positions and have the same interest in establishing the liability ofd~fendants.'' Ward, 595 F.3d at
180 (quotation and alteration omitted); see Gunnells, 348 F.3d at 430-31. Moreover, in assessing
the representative's adequacy, courts may consider several factors including "honesty,
conscientiousness, and other affirmative personal qualities." Shiring v. Tier Techs.. Inc., 244 F.R.D.
307, 315 (E.D. Va. 2007) (quotation omitted); see In re Red Hat, 261 F.R.D. a~ 87.
As for adequacy, defendants argue that Pontones' s status as an illegal alien who lacks work

authorization andher ''false statements concerning wages, hours, tips, andrecordkeeping'' disqualify
her as an adequate class representative. [D.E. 68] 27. Pontones res~.o~ds that her immigration status
is irrelevant under the NCWHA and that defendants do not identify any conflict. See [D.E. 75]
13-14.

14

Defendants concedethatPontones's immigration status does not~ se render her inadequate
under Rule 23(a). See [D.E. 68] 27; Montoya v. S.C.C.P. Painting Contractors. Inc., 530 F. Supp.
2d 746, 750 (D. Md. 2008); cf. N.C. Gen. Stat. § 95-25.2(4) (de~g an "employee" in terms.
materially identical to the definition in FLSA). Moreover, defendants do not identify a fundamental
conflict or explain why Pontones's possible false statements amount to a ~damental conflict.
Furthermore, the interests of Pontones and the putative class members do not conflict. See,
~Zelaya v. A+ Tires. Brakes. Lubes.

& Mufflers, No. 5:13-CV-810-F, 2015 WL 5703569, at •5

(E.D.N.C. Sept. 28, 2015) (unpublished). Thus, Pontones has satisfied the adequacy requirement.

D.
As for predominance, the predominance requirement is

.:

''f~

!

more derµanding than Rule

23(a)'s commonality requirement and tests whether proposed classes are sufficiently cohesive to
warrant adjudication by representation." Gariety v. Grant Thornton. LLP, 368 F.3d 356, 362 (4th
Cir. 2004) (quotation omitted); see Am.ch~ 521 U.S. at 623-24; Gray v. Hearst Commc'ns, 444
F. App'x 698, 700--01 (4th Cir. 2011) (unpublished); Thom, 445 F.3d at 319; The predominance
inquiry focuses on the balance between individual and common issues. See Brown v. Nucor Corp.,
785 F.3d 895, 917-21 (4th Cir. 2015); Myers v. Hertz Corp., 624 F.3d 537, 549 (2d Cir. 2010).
Common issues of law and fact have been held to predo~te ''where the san;ie evidence
would resolve the question of liabilityJor all class members." Be.~Ulieu v. EQ_ Indus. Servs.. Inc.,
No. 5:06-CV-00400-BR, 2009 WL 2208131, at *20 (E.D.N.C. July 22, 2009) (unpublished); see
Stillmock v. Weis Mkts.. Inc., 385 F. App'x 267, 273 (4th Cir. 2010) (unpublished); Gunnells, 348
F.3d at 428; Smilow v. Sw. Bell Mobile Sys.. Inc., 323 F.3d 32, 40 (1st Cir. 2003). The
predominance inquiry focuses on whether "common, aggregation-enabling, issues in the case are
15

more prevalent or uhportantthan the non-common, aggregation-defeating, individual issues." Tyson
Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1045 (2016) (quotation omitted). Individualized
damages alone do not defeat predominance.

See,~ Brown v. Electrolux Home Prods .. Inc.,
"

817

F.3d 1225, 1232, 1239 (11th Cir. 2016); Gunnells, 348 F.3dat427-28; Smilow, 323 F.3dat40; Hart
v. Louisiana-Pac. Com., No. 2:08-CV-47-B0,2013 WL1214317l:,at*2(E.D.N.C. Mar. 29,2013)
(unpublished). Rather, a court may certify a class under Rule 23(b)(3) "even though other important
matters will have to be tried separately, such as damages or some ~tive defenses peculiar to
some individual class members." Tyson Foods. Inc., 136 S. Ct. at 104:5 (quotation omitted); see
Crutchfield v. Sewerage & Water Bd., 829 F.3d 370, 376 (5th Cir. 2016).
Defendants highlight the differences among the San Jose re~urants, such as the existence
of tip pools, different records, and different managers, and argue that there is "simply no
.
.
',

cohesiveness in this proposed class." [D.E. 68] 28. Generally, ho'Y~ver, when~ plaintiff challenges
- . . .
~

-, .

his employer's policy concerning overtime pay, ''the validity of that policy.predominates over
individual issues and class certification is appropriate." Dorman v. DHL E;mress (USA). Inc., No.
09-cv-99-bbc, 2010 WL446071, at *3 (W.D. Wis. Feb. 3, 2010) (unpublished) (quotation omitted);
see,~

Rossini v. Ogilyy & Mather. Inc., 798 F.2d 590, 598-99 (24 Cir... 1986); Ramirez v.

Riverbay Com., 39 F. Supp. 3d 354, 368-69 (S.D.N.Y. 2014).

Mor~over,

defendants'. arguments

ignore Pontones's joint employer allegations. ''Neither the Fourth.C~cuit nor the North Carolina
Supreme Court has examined whether the jointemploymentdoctrin~ app),ies for.- purposes ofliability
.
..· :· ...
under the NCWHA." Lima v. MH & WH. LLC, No. 5:14-CV-896-FL, 2019.WL 2602142, at *14
(E.D.N.C. Mar. 8, 2019) (unpublished). However, as the Lima co~ held, the NCWHA contains

16

"identical definitions of 'employer' and 'employee."' Id. Accordingiy, despite some differences
among the San Jose restaurants, Pontones has satisfied Rule 23(b)(3Ys predominance requirement.

E.
As for the superiority requirement, Pontones must demonstrate that proCeeding as a class "is

superior to other available methods for fairly and efficiently adjudicating the controversy." Fed. R.
Civ. P. 23(b)(3); see Thom, 445 F.3d at 319. In assessing superiority, courts should consider:
. (A) the class members' interests in individually controlling the prosecution or
defense of separate actions; (B) the extent and nature of any litigation concerning the
controversy already begun by or against cl~s members; (C) the des~ility or
undesirability of concentrating the litigation of the claims hlthe particular forum; and
(D) the likely difficulties in managing a class action.
. .,_..,'
.

.·~

Fed. R. Civ. P. 23(b)(3); see Thom, 445 F.3dat319. Courts also shouldconsider''whetherRule23
is sufficiently effective to justify the expenditure of the judicial time and energy.that is necessary to
adjudicate a class action and to assume the risk of prejudice to the rights of those :who are not
directly before the court." Stillmock, 385 F. App'x at 274 (quotation omitted)_.
The Rule 23(b)(3) factors support the conclusion that a class action is a, superior method of
·:.'

-

.

; __

adjudicating this dispute. See Fed. R. Civ. P. 23(b)(3); Thom, 445 . F.3d at 319; Berber, 2018 WL
.
.
-··
.

'

··,

3869980, at *9--10; Velasquez-Monterrosa, 2016WL1703351, at *6-7; Zelaya, 2015 WL 5703569,
,:c

.•

-

at *5-6. The first factor (i.e., the burden and expense of indivi~ual litigation, and the legal and
practical difficulty of proving individual claims) makes it unlikely that individual class members
could obtain the relief sought if they were forced to proceed on their own. As for the second factor,
no individual claims are pending. As for the third factor, this court presents a. desirable forum for
litigating these claims. The claims arose in the Eastem District ofNorth Carolina and many of the
.

)

relevant records are in the Eastem District of North Carolina. See;,·e.g~, Zelay~ ~015 WL 5703569,
17

at *5-6; Iglesias-Mendoza v. La Belle Fa.nJb Inc., 239 F.R.D. 363, 373

(S.D.~J,.Y.

2007). Finally,

this court perceives no difficulty in managing this class action. Thus, Pontones has met the
superiority requirement, and the court grants her motion for class certification concerning her
NCWHA claim.
IV.

In sum, the court GRANTS plaintiff's motion [D.E. 66] for eonditional class certification and
court.:.authorized notice concerning plaintiff's FLSA claim and for· conditional class certification
concerning her NCWHA claim. The parties shall meet and confer concerning future proceedings,
the contents ofthe proposed notice, and submit a proposed schedule no later than December 6, 2019.
The parties also shall participate in a court-hosted settlement conference '-'1th United States
Magistrate Judge Gates.
SO ORDERED. This _il_ day of October 2019.

J~P~m

United S~tes Districf: Judge

18