DEAN v. CVS PHARMACY, INC. et al

Filing 57

ORDER THAT DEFENDANTS' MOTION TO DISMISS AND MOTION TO CERTIFY AN IMMEDIATE INTERLOCUTORY APPEAL WITH A STAY OF PROCEEDINGS ARE DENIED. SIGNED BY HONORABLE GERALD A. MCHUGH ON 7/21/15. 7/22/15 ENTERED AND COPIES E-MAILED.(mbh, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA

KEITH ROBERT DEAN, JR.,
ON BEHALF OF HIMSELF AND ALL
OTHERS SIMILARLY SITUATED,

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Plaintiffs,
v.
CVS PHARMECY, INC., et. al,
Defendants.

CIVIL ACTION

No. 14-2136

MEMORANDUM ORDER
This 21st day of July, 2015, upon consideration of Defendants’ Motion to Dismiss
Plaintiffs’ First Amended Class Action Complaint and Motion to Certify an Immediate
Interlocutory Appeal With a Stay of Proceedings, Plaintiffs’ Responses in Opposition thereto,
and Defendants’ respective Reply Briefs, it is ORDERED that Defendants’ Motions are
DENIED for the following reasons.
1. Defendants’ Motion to Dismiss Plaintiffs’ First Amended Class Action Complaint
In accepting all factual allegations as true, and construing all inferences in the light most
favorable to the non-moving party, I find Plaintiffs’ First Amended Complaint to contain
plausible claims for relief. The heightened pleading standard discussed in Davis v. Abington
Mem'l Hosp., 765 F.3d 236, 243 (3d Cir. 2014) and Lundy v. Catholic Health Sys. of Long
Island Inc., 711 F.3d 106 (2d Cir. 2013) is distinguishable, because both cases involved overtime
actions brought pursuant to the Fair Labor Standards Act (“FLSA”). Accordingly, the key issue
presented there was whether the allegations were specific enough to conclude that the plaintiffs
had worked any compensable overtime. In holding that the plaintiffs failed to state FLSA
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overtime claims, the Third Circuit specified, “[W]e do not hold that a plaintiff must identify the
exact dates and times that she worked overtime.” Davis, 765 F.3d at 243. The Davis Court went
on to give a clear example: “For instance, a plaintiff's claim that she ‘typically’ worked forty
hours per week, worked extra hours during such a forty-hour week, and was not compensated for
extra hours beyond forty hours he or she worked during one or more of those forty-hour weeks,
would suffice. But no such allegation is present in this case.” Id. Here, although I am not
convinced that it is even necessary to import a heightened pleading standard, Plaintiffs’
allegations are sufficient to meet the very level of specificity championed by Defendants. The
allegations in the First Amended Complaint, if true, give rise to plausible causes of action under
Pennsylvania, New Jersey, and Connecticut law. 1
I am similarly unpersuaded by Defendants’ arguments regarding gap-time claims under
Connecticut law. Neither party, nor the Court, located a Connecticut case directly addressing the
precise gap-time issue before me. Even Lundy, which held as a matter of first impression that
the FLSA does not provide for gap-time claims, recognized the important distinction between the
FLSA and state law remedies for wage claims. 711 F.3d at 116.
So long as an employee is being paid the minimum wage or more, FLSA does not
provide recourse for unpaid hours below the 40–hour threshold, even if the
employee also works overtime hours the same week. In this way federal law
supplements the hourly employment arrangement with features that may not be
guaranteed by state laws, without creating a federal remedy for all wage
disputes—of which the garden variety would be for payment of hours worked in a
40–hour work week. For such claims there seems to be no lack of a state remedy,
including a basic contract action.
Id. (internal citations omitted). Stated differently, the Court recognized that the federal statute
was promulgated to supplement the relief available to the average worker under state law, and
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Defendants’ Reply Brief emphasizes an alleged lack of notice that could hinder Defendants’ ability to defend this
action. However, Plaintiffs’ theory of relief is clear on the face of the First Amended Complaint, and Defendants
will of course have the opportunity to test the strength of that theory by pursuing specific documentation through
discovery.

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focused upon specific circumstances, as opposed to providing a general federal remedy for
“garden variety” failure to pay cases. In turn, the Circuit’s decision—that gap-time claims are
not available under FLSA—does not compel the conclusion that gap-time claims are not
available under the corresponding state law. If anything, FLSA’s lack of available relief for gaptime claims makes it more likely that there is a remedy under state law, as clearly explained by
the Second Circuit in Lundy. Thus, at this early juncture, I will decline to dismiss Count II of the
First Amended Complaint, without prejudice to Defendants’ right to reassert this argument at
summary judgment.
Defendants withdrew their Motion to Compel Arbitration of Pressley’s claims without
prejudice to their right to renew the Motion at a later stage of these proceedings. Accordingly, I
do not need to address their Motion to Compel at this time. Finally, as I already stayed the class
certification issue pending discovery, I am still not prepared to rule on the merits of class
certification, particularly in light of the fact that this issue will not even be fully briefed until
January 15, 2016 under the current Stipulated Case Management Order.
2. Defendants’ Motion to Certify an Immediate Interlocutory Appeal
As explained in the Court’s May 26, 2015 Memorandum Order, the active controversy
regarding the sufficiency of Defendants’ Offer, including the ongoing dispute over the proper
interpretation of the Pennsylvania Wage Payment and Collection Law (WPCL), defeats
Defendant’ general suggestion that an unaccepted offer of judgment could deprive this Court of
subject matter jurisdiction. Consequently, Defendants’ Motion to Certify focuses on the wrong
legal issues. The questions Defendants have moved to certify for interlocutory review would not
impact my previous analysis, because they do not speak to the ultimate legal inquiry at the heart

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of these issues: whether the active controversy between the parties was mooted by Defendants’
Rule 68 Offer.
Although Defendants have persuaded the Court that substantial grounds for difference of
opinion exist—both in regards to (1) the proper interpretation of the liquidated damages
provision in the WPCL and (2) the impact of an unaccepted offer of judgment under Fed. R. Civ.
P. 68 —neither of these questions is currently before the Court. The substantive merits of
Defendants’ arguments as to the WPCL may become an issue downstream, but those arguments
as to damages are premature. Similarly, I already ruled that an active controversy over the
sufficiency of the Offer itself prevents a finding of mootness, and Defendants have not raised any
new evidence or arguments to the contrary.
Plaintiffs’ February 11, 2015 Opposition to Defendants’ Motion for Reconsideration
aptly summarized the legal paradox facing the Court: “Defendants’ motion is tautological, as it
depends on the Court first asserting subject matter jurisdiction to decide a question of statutory
interpretation, which, in turn (according to Defendants), would result in the Court being deprived
of subject matter jurisdiction.” Here, this Court has already answered the controlling question
regarding Defendants’ Rule 68 Offer. I have ruled—twice, in fact—that the unaccepted offer of
judgment did not moot the active controversy between the parties due to the ongoing dispute
over the sufficiency of the Offer. Thus, certifying the Rule 68 question to the Third Circuit, or
staying this case in light of the Supreme Court’s May 18, 2015 grant of certiorari in CampbellEwald Co. v. Gomez, 135 S. Ct. 2311 (2015), would not materially advance the ultimate
termination of this litigation, as neither decision has the potential to alter my previous rulings. 2
Plaintiffs’ specific legal and factual challenge to the adequacy of the Offer is distinguishable
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I am literally repeating myself. See Memorandum Order dated May 26, 2015 at 3 (“[A]s stated during oral
argument, I am not persuaded that the Third Circuit’s forthcoming decision in Weitzner will control this case to the
degree Defendants have suggested.”).

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from the broad legal question of whether an unaccepted (but sufficient) offer of judgment, which
is served prior to a motion for class certification, moots a plaintiff’s claims, including claims
asserted on behalf of the putative class.
Similarly, as I already ruled that a live controversy over an issue of first impression under
Pennsylvania law effectively precludes a finding of mootness, there is no reason to expedite
review on the merits of the WPCL question. The relevant inquiry for purposes of Rule 68 is
whether the Offer mooted the controversy between the parties at the time the Offer was made.
See Memorandum Order dated May 26, 2015 at 3. However reasonable Defendants’ Offer may
prove to be in light of my future, still undefined interpretation of Pennsylvania law, Defendants’
prospects of success on the merits are not pertinent to the mootness inquiry. Id. Thus, although
there is substantial ground for difference of opinion as to the WPCL question, certifying that
question for interlocutory appeal simply would not materially advance the ultimate termination
of this litigation.
Moreover, given the unusual posture of this case and Defendants’ relentless litigation
tactics, my Order denying Defendants’ Motion to Dismiss for Lack of Subject Matter
Jurisdiction is no longer subject to renewal. The Court has now had ample opportunity to
consider and rule on this legal issue. Therefore, Defendants must seek leave of Court before
applying for relief regarding issues already litigated and decided in this matter.

/s/ Gerald Austin McHugh
United States District Court Judge

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