Watson v. Jimmy John's, LLC et al
Filing
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ORDER granting 13 Motion to Dismiss, transfer, or stay and TRANSFERS this case to the United States District Court for the Northern District of Illinois. Signed by Judge Gregory L. Frost on 7/8/15. (kn)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
SCOTT WATSON,
Plaintiff,
Case No. 2:15-cv-768
JUDGE GREGORY L. FROST
Magistrate Judge Norah McCann King
v.
JIMMY JOHN’S, LLC, et al.,
Defendants.
OPINION AND ORDER
This matter is before the Court for consideration of Defendants’ motion to dismiss,
transfer, or stay (ECF No. 13), Plaintiffs’ memorandum in opposition (ECF No. 24), Defendants’
reply memorandum (ECF No. 34), Plaintiffs’ supplemental brief filed without leave of court
(ECF No. 36), and Defendants’ supplemental brief filed without leave of court (ECF No. 37).
For the following reasons, the Court GRANTS Defendants’ motion to transfer the case to
the United States District Court for the Northern District of Illinois.
I.
Background
On July 18, 2014, in the United States District Court for the Northern District of Illinois,
Emily Brunner filed a lawsuit under the Fair Labor Standards Act, 29 U.S.C. § 201 et seq.
(“FLSA”), against multiple defendants, including those in the instant case. (ECF No. 13, at Page
ID # 148.) Brunner, a Second Assistant Store Manager (“2nd ASM”) at a Jimmy John’s
franchisee, seeks to certify a class of all current and former, similarly situated employees at all
Jimmy John’s franchisee- and franchisor-owned locations. Brunner’s first complaint indicated
that 2nd ASMs are subordinate to Assistant Store Managers (“ASMs”). She contends that the
putative class members’ work is over 90% manual labor that is typically performed by non-
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exempt employees and that the putative class members are therefore entitled to relief such as
unpaid overtime compensation. (Id., at Page ID # 149.) Brunner also alleges violations of the
Illinois wage law (“IWL”).
Subsequently, in the Northern District of Illinois, another plaintiff brought an action
advancing substantially the same claims, on behalf of a substantially similar class of plaintiffs,
and against substantially similar defendants. That court consolidated the two cases.
The operative complaint in that litigation includes the following counts: (1) an FLSA
claim brought by the plaintiffs individually and on behalf of a nationwide putative class; (2) an
IWL claim brought by the plaintiffs individually; and (3) three individual claims brought against
unrelated defendants. Currently, the parties are engaged in discovery on an isolated issue that
the court has determined will “drive the case” – the plaintiffs’ joint employer theory against
Defendants. (Id. at Page ID # 540.) The Brunner court allowed discovery on the joint employer
issue because the plaintiffs must prove that Defendants exercised substantial or near complete
control over all franchisees. Only then can the plaintiffs’ claims against Defendants, based on a
joint employer theory, survive.
On January 5, 2015, in the United States District Court for the Middle District of
Florida, Plaintiffs Rodriguez, Kavanagh, and Womack filed a suit against Defendants. On
March 2, 2015, Plaintiff Watson filed the present action. Subsequently, Plaintiffs Rodriguez,
Kavanagh, and Womack voluntarily dismissed their suit and opted-in to the present action, along
with opt-in Plaintiff Ladd.
In the present action, Plaintiffs filed suit individually and on behalf of all ASMs.
Plaintiffs describe the putative class as “current and former [ASMs] and similarly-situated
current and former employees holding comparable positions but different titles.” (ECF No. 1, at
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Page ID # 1.) Plaintiffs allege that, in defiance of state and federal law, Defendants misclassified
the putative class as exempt employees. Their day-to-day duties primarily included manual labor
consistent with the work relegated to non-exempt employees. Therefore, Plaintiffs argue, they
are entitled to unpaid overtime compensation. Each defendant here is also a defendant in the
Brunner case. Plaintiffs’ claims are as follows: (1) an FLSA claim on behalf of themselves and a
nationwide class for unpaid overtime; (2) an Ohio wage law claim (“OWL”) under Federal Rule
of Civil Procedure 23 on behalf of themselves and an Ohio class for unpaid overtime; and (3) an
OWL claim on behalf of themselves and an Ohio sub-class for failure to keep records of hours
worked. (Id. at Page ID # 9-12.) As in Brunner, Plaintiffs base their case on a theory of joint
employer liability; allegedly, Defendants exercised significant control over the operations of
Jimmy John’s franchisees. Defendants filed a motion to transfer this case to the Northern
District of Illinois, stay the case until the Brunner court decides the issue of joint employment, or
dismiss the case.
II.
Standard
Under the first-to-file rule, an action involving similar parties and issues filed
previously in another federal court should generally proceed to judgment and the latter-filed suit
should be stayed, dismissed, or transferred. Zide Sport Shop of Ohio, Inc. v. Ed Tobergte
Assocs., Inc., 16 F. App’x 443, 437 (6th Cir. 2001). This rule exists to promote principles of
judicial comity and economy. See Certified Restoration Dry Cleaning Network, LLC v. Tenke
Corp., 511 F.3d 535, 551 (6th Cir. 2007); Greene v. Ab Coaster Holdings, Inc., Nos. 2:10–cv–38
& 2:10–cv–234, 2010 WL 3119399, at *3 (S.D. Ohio Aug. 6, 2010).
In applying this rule, a court considers three factors: (1) the chronology of the actions;
(2) the parties involved; and (3) the similarity of the issues in each case. Dewhurst v. Century
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Aluminum Co., No. C2:09–cv–1033, 2009 WL 5205353, at *2 (S.D. Ohio Dec. 23, 2009). When
both the parties and issues involved in the case “substantially overlap,” the court hearing the
later-filed suit should generally allow the first-filed suit to proceed to judgment. BSI Indust. v.
Q.B. Johnson Mfg., No. C2–08–276, 2009 WL 349143, at *2 (S.D. Ohio Feb. 6, 2009). Courts
may decline to enforce the first-to-file rule, however, “where equity so demands,” such as when
the record contains evidence of forum shopping, bad faith, or inequitable conduct. Zide Sport
Shop, 16 F. App’x at 437. The court hearing the first-filed case “should determine whether an
exception [to the first-to-file rule] applies.” AluChem, Inc. v. Sherwin Alumina L.P., No. C-1-06263, 2006 WL 1281887, at *1 (S.D. Ohio May 10, 2006).
III.
Discussion
Plaintiffs argue that 28 U.S.C. § 1404(a) is the proper statute under which this Court
should decide a motion for transfer of venue. The Court’s primary consideration under § 1404(a)
is convenience. However, a motion to transfer venue under § 1404(a) is a separate action from a
motion to transfer under the first-to-file doctrine. NCR Corp. v. First Fin. Computer Servs., Inc.,
492 F. Supp. 2d 864, 868 (S.D. Ohio 2007) (“The former type of motion asks a court to transfer a
proceeding for the convenience of the parties, whereas the latter is a doctrine rooted in judicial
comity.”). A court ruling on a motion to transfer under the first-to-file doctrine can consider
convenience in its decision, but it should most value comity and economy between courts with
cases that have substantially similar issues. Id. 28 U.S.C. § 1404(a) is a separate venue transfer
action. The Court will analyze the motion under the first-filed rule.
This Court now addresses each factor of the first-to-file doctrine in turn.
First, the case chronology shows that Brunner filed first in July 2014, while Plaintiffs did
not file until March 2015. Plaintiffs argue that Brunner did not file her “operative” amended
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complaint until May 2015, two months after Plaintiffs filed their operative complaint on March
2, 2015. This argument finds no basis in law. An action commences upon filing. Fed. R. Civ. P.
3; American Modern Home Ins. v. Insured Accounts Co., 704 F. Supp. 128, 130 (S.D. Ohio
1988). The Sixth Circuit has held that “[f]or purposes of first-to-file chronology, the date that an
original complaint is filed controls.” Zide Sport Shop, 16 F. App’x at 437. The first-to-file rule
gives preference to the first commenced action over a later commenced action. American
Modern Home, 704 F. Supp. at 130. The filing of a suit is the appropriate “touchstone for
determining chronological preference of cases.” Id. The Brunner case is the first-filed.
Second, the Court must determine whether the parties are substantially similar. This
Court concludes they are. Defendants in this case are substantially similar to those in Brunner.
Each of the defendants here is also a Brunner defendant. Further, although the named plaintiffs
in each case differ, the first-to-file rule in a class action suit only requires that the Court compare
the proposed classes, not the named plaintiffs. See Siegfried v. Takeda Pharm. N. Am., Inc., No.
10-cv-02713, 2011 WL 1430333, at *5 (N.D. Ohio Apr. 14, 2011).
The class that Plaintiffs seek to represent is substantially similar to the class in the firstfiled case. The Court recognizes that, in Brunner’s first complaint, the stated title of the putative
class was 2nd ASMs, while the present case case contemplates a class of ASMs. The Court also
acknowledges that 2nd ASMs are subordinate to ASMs. (ECF No. 13, at Page ID # 149.) After
reviewing the Brunner record, the Court notes that Brunner subsequently refers to the putative
class as “ASMs” in recent, amended complaints: “ ‘[a]ll individuals who are currently or were
formerly employed by Defendants . . . as salaried ASMs.’ ” (See, e.g., id. at Page ID # 194
(quoting amended complaint).) Additionally, in each of Brunner’s complaints, the duties
performed by the putative class remained the same: employees spent 90% of their time
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“performing ‘non-exempt’ work such as taking orders, checking out customers at the cash
register, making sandwiches, baking bread, stocking, cleaning and a host of other manual labor
tasks.” (ECF No. 13, at Page ID # 14.) To this Court, it is unclear just how broad the Brunner
putative class is. However, even in its narrowest construction including only the 2nd ASMs, the
class is substantially similar to the putative class in the present case, described below.
Plaintiff Watson filed a collective action complaint “on behalf of himself and other
current and former assistant store managers and similarly-situated current and former employees
holding comparable positions but different titles (‘ASMs’), employed by Defendants.” (ECF No.
1, at Page ID # 1.) Plaintiff alleges that the primary job duties of ASMs, making up a majority of
their working hours, were the types of duties typically performed by non-exempt employees,
including “bussing tables; cleaning the restaurant; checking to make sure that supplies were
properly shelved; checking inventory; cooking; and helping customers.” (Id. at Page ID # 6.)
The alleged primary duties of this class are substantially similar to the duties described in
Brunner. The putative classes are substantially similar. At the very least, the class in the present
case would likely include 2nd ASMs under its umbrella. Accordingly, the Court concludes that
the parties are substantially similar.
Third, despite additional claims in each suit, the Court concludes that the issues
substantially overlap. Despite the claims that differ between the two suits, the core claim is the
same—an unpaid overtime FLSA action brought individually by plaintiffs and on behalf of a
nationwide class. Defendants are correct that the core issue in determining Defendant’s liability
for all claims in both cases will be whether Defendants are joint employers. The joint employer
discovery that is ongoing in Brunner would likely occur in the instant case as well. Further, the
job duties and misclassification alleged in both suits are nearly identical. Although there may be
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differences between the two actions, the Court cannot ignore the substantial overlap. Thus, “a
decision from this Court would not only tend to frustrate the legitimate aim of preserving judicial
economy, as substantially the same evidence would be presented in both actions . . . but also it
poses the possibility of inconsistent opinions.” Buffalo Wild Wings, Inc. v. BW Rings, LLC, No.
2:10-cv-335, 2010 WL 4919759, at *3 (S.D. Ohio Nov. 29, 2010). This Court, hearing the latterfiled action, has a duty to avoid a ruling that would “entrench upon or inconsistently decide
overlapping issues being addressed by another federal court.” Id. The Court recognizes that
transfer would add to the Brunner suit, but judicial consistency, economy, and comity support
the transfer.
Finally, Plaintiffs advanced several arguments in an attempt to avoid the application of
the first-to-file doctrine, such as considerations regarding conditional classification and
Defendants’ alleged delay tactics. However, the first-filed court should determine whether an
exception to the first-filed doctrine applies. AluChem, Inc., 2006 WL 1281887, at *1. This
Court does not consider those arguments and makes no decision regarding their merits.
IV.
Conclusion
For the foregoing reasons, this Court GRANTS Defendants’ motion to transfer and
TRANSFERS this case to the United States District Court for the Northern District of Illinois.
(ECF No. 13.)
IT IS SO ORDERED.
/s/ Gregory L. Frost
GREGORY L. FROST
UNITED STATES DISTRICT JUDGE
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