BUGLAK v. WELLS FARGO BANK, N.A.

Filing 51

MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE BERLE M. SCHILLER ON 7/21/17. 7/21/17 ENTERED AND COPIES E-MAILED.(mbh, )

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IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
ROBERT JOSEPH BUGLAK, JR.
Individually and on behalf of other
employees similarly situated,
Plaintiffs,
v.
WELLS FARGO BANK, N.A.,
Defendant.

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CIVIL ACTION

No. 16-4546

MEMORANDUM
Schiller, J.

July 21, 2017

Robert Buglak and John Silano sold residential loans for Wells Fargo Bank. According to
Buglak and Silano, Wells Fargo violated the Fair Labor Standards Act (“FLSA”) by failing to
pay them overtime. Wells Fargo counters by claiming that Plaintiffs are exempt from the FLSA’s
overtime requirements under the “outside sales exemption.” Wells Fargo filed a motion for
partial summary judgment on April 18, 2017. Plaintiffs filed their response 17 days past the
deadline and Wells Fargo subsequently filed a motion to strike Plaintiff’s untimely response.
Because the Court finds that Buglak and Silano fall within the outside sales exemption, the Court
will grant Wells Fargo’s motion for partial summary judgment, and deny its motion to strike as
moot.

I.

BACKGROUND
Buglak and Silano worked as mortgage officers to sell residential loans in Wells Fargo’s

Bensalem, Pennsylvania office. (Def’s Mot. Partial Summ. J. Ex. A, [hereinafter “Buglak Dep.”]
at 19:9–12; id. Ex. B, [hereinafter “Silano Dep.”] at 63:6–10.) Buglak and Silano did not have
fixed work schedules; for example, Buglak’s schedule varied from week to week, and Silano was

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generally free to arrive at the office when he wished. (Buglak Dep. 84:8–23; Silano Dep. 93:3–
16.)
Buglak consistently spent time outside of the office at open houses to meet with realtors
and customers. (Buglak Dep. 118:3–9.) Throughout the course of his employment with Wells
Fargo, he attended an average of three open houses per week, usually on Sundays, for an average
of three hours total. (Buglak Dep. 118:3–9; 125:4–6.) The purpose of attending these open
houses was to generate business. (Buglak Dep. 118:13–16.) Buglak would follow up one to three
times per week with the realtors who he met at these open houses, and estimated that each
meeting lasted between 25 minutes and three hours. (Buglak Dep. 120:2–22.) Buglak also
attended an average of one closing per week, which occurred outside of the office, to ensure that
problems did not arise with deals and to solicit business referrals. (Buglak Dep. 121:8–122:4;
Def.’s Mot. Partial Summ. J. Ex. C, at ¶¶ 4–6.) Buglak also visited the homes of customers
approximately five times per week to obtain loan documentation. (Buglak Dep. 173:3–21.)
Silano also consistently spent time outside the office. He attended an average of three to
four open houses each Sunday, with the hope of earning referrals from realtors. (Silano Dep.
190:8–17; 193:21–194:6.) He spent anywhere from fifteen minutes to an hour and a half at these
events. (Silano Dep. 194:20–23.) Silano also attended approximately one closing per month,
which typically took place at a realtor’s, attorney’s, or a title company’s office. (Silano Dep.
191:8–24.) He also made “cold calls,” during which he would show up at a realtor’s office and
try to establish a business relationship. (Silano Dep. 189:4–11; 194:24–195:7.) These occurred
two to three times per week, and would last between one minute and an hour. (Silano Dep.
189:22–190:1; 195:20–196:5.)

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II.

STANDARD OF REVIEW
Summary judgment is appropriate when the record discloses no genuine issue of material

fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a); see
also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48 (1986). The moving party bears the
burden of showing that the record reveals no genuine issue as to any material fact. See Fed. R.
Civ. P. 56(a); Anderson, 477 U.S. at 247. Once this burden is met, the nonmoving party must go
beyond the pleadings to set forth specific facts in the record showing that there is a genuine issue
for trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 585–86 (1986). In
reviewing the record, “a court must view the facts in the light most favorable to the nonmoving
party and draw all inferences in that party’s favor.” Armbruster v. Unisys Corp., 32 F.3d 768,
777 (3d Cir. 1994). A court may not consider the credibility or weight of the evidence in
deciding a motion for summary judgment. See Reeves v. Sanderson Plumbing Prods., 530 U.S.
133, 150 (2000); Goodman v. Pa. Tpk. Comm’n, 293 F.3d 655, 665 (3d Cir. 2002).

III.

DISCUSSION
A.

Plaintiffs’ Untimely Response to Wells Fargo’s Motion for Partial Summary
Judgment

Plaintiffs’ failure to file a timely response to Wells Fargo’s motion for partial summary
judgment “does not alter the traditional summary judgment standard, [but] it [does require] that
the Court account for the lack of a response in its analysis.” Reynolds v. Rick’s Mushroom Serv.,
Inc., 246 F. Supp. 2d 449, 453 (E.D. Pa. 2003). “By failing to file a response within the time
specified by the local rule, the nonmoving party waives the right to respond to or to controvert
the facts asserted in the summary judgment motion.” Id. (quoting Reed v. Nellcor Puritan
Bennett, 312 F.3d 1190, 1195 (10th Cir. 2002)). That said, a party’s failure to file a timely

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response in compliance with local rules, by itself, does not require summary judgment. Id.; Fed.
R. Civ. P. 56(e)(3). A court must still determine whether the moving party’s alleged facts
warrant summary judgment. Reynolds, 246 F. Supp. 2d at 453.
Wells Fargo filed its summary judgment motion on April 18, 2017. Local rules require a
non-moving party to respond to a summary judgment motion within fourteen days. E.D. Pa. Civ.
R. 7.1(c). Plaintiffs responded on May 19, 2017, seventeen days late. Due to their noncompliance with local rules, the Court will not consider Plaintiffs’ response. 1 Pursuant to Rule
56(e)(3), the court will consider all facts presented by Wells Fargo as undisputed in analyzing its
motion for partial summary judgment.
B.

Wells Fargo’s Motion for Partial Summary Judgment

The FLSA requires increased compensation to employees for any time worked in excess
of forty hours per week. 29 U.S.C. § 207(a)(1). However, “outside salesmen” are exempt from
this requirement. 29 U.S.C. § 213(a)(1). The FLSA defines an “outside salesman” as an
employee:
1)

2)

Whose primary duty is:
i)
making sales within the meaning of section 3(k) of the [FLSA], or
ii)
obtaining orders or contracts for services or for the use of facilities
for which a consideration will be paid by the client or customer;
and
Who is customarily and regularly engaged away from the employer’s
place or places of business in performing such primary duty.

29 C.F.R. § 541.500; see also Levitt v. Tech. Educ. Servs., Inc., Civ. A. No. 10-6823, 2012 WL
3205490, at *5 (E.D. Pa. Aug. 7, 2012).

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Wells Fargo characterized their June 5, 2017 filing as a motion to strike Plaintiffs’ response as
untimely. Regardless of the label, the Court will disregard Plaintiffs’ response for a violation of
the local rules and then follow Rule 56(e)(3), which reaches essentially the same conclusion. The
Court will not consider Plaintiffs’ responses because of their failure to comply with local rules,
and deny Wells Fargo’s motion to strike as moot.
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i.

Primary Duty is Making Sales

“Primary duty” is defined as “the principal, main, major or most important duty that the
employee performs.” 29 C.F.R. § 541.700(a). This is a fact specific inquiry, but “the major
emphasis [is] on the character of the employee’s job as a whole.” Id. While the amount of time
spent performing exempt work is illustrative, it is not dispositive. § 541.700(b). “Time alone . . .
is not the sole test, and nothing in this section requires that exempt employees spend more than
50 percent of their time performing exempt work.” Id. “[W]ork performed incidental to and in
conjunction with the employee’s own outside sales or solicitations, including incidental
deliveries and collections, shall be regarded as exempt outside sales work.” § 541.500(b). A
“sale” is defined in the FLSA as “any sale, exchange, contract to sell, consignment for sale,
shipment for sale, or other disposition.” 29 U.S.C. § 203(k).
In their Complaint, Plaintiffs admit that the duty of mortgage officers was to sell
residential mortgage loans to customers. (First Am. Compl. ¶ 16.) In their depositions, both
Buglak and Silano admitted that their foremost responsibility as mortgage loan officers was to
sell residential loans. (Buglak Dep. 45:4–9; Silano Dep. 43:10–15.) Based on this, both Buglak
and Silano’s primary duty was making sales.
ii.

Customarily and Regularly Away from the Office

The outside sales exemption requires that the employee be “customarily and regularly”
engaged away from the employer’s office. 29 C.F.R. § 541.502. “The phrase ‘customarily and
regularly’ means a frequency that must be greater than occasional but which . . . may be less than
constant.” § 541.701. “Tasks or work performed ‘customarily and regularly’ include work
normally and recurrently performed every workweek; it does not include isolated or one-time
tasks.” Id. Further, “[p]romotional work that is actually performed incidental to and in

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conjunction with an employee’s own outside sales or solicitations is exempt work.” § 541.503(a).
The Department of Labor has stated that an employee can satisfy the “customarily and regularly”
requirement by performing sales-related activity outside the office “one or two hours a day, one
or two times a week.” U.S. Dep’t of Labor, Wage & Hour Div., Opinion Letter on Fair Labor
Standards Act, 3 (Jan. 25, 2007); see also Hartman v. Prospect Mortg., LLC, 11 F. Supp. 3d 597,
602 (E.D. Va. 2014) (explaining that sales activity occurring one or two hours a day, one or two
times a week satisfies the “customarily and regularly” requirement). The determinative factor is
not that sales are made outside of the office, but that on more than an occasional basis the
employee performs tasks away from the office that are crucial to the sales process. U.S. Dep’t of
Labor, Wage & Hour Div., Opinion Letter on Fair Labor Standards Act, 3 (Jan. 25, 2007); see
also Hantz v. Prospect Mortg., LLC, 11 F. Supp. 3d 612, 620 (E.D. Va. 2014) (stating that sales
activities must be performed away from the office on more than an occasional basis).
Both Buglak and Silano performed sales activity away from the office on more than an
occasional basis. In fact, their deposition testimony demonstrates that they regularly worked
away from the office. To generate business with realtors, Buglak regularly attended open houses
on Sundays for an average of three hours. (Buglak Dep. 118:3–16; 125:4–6.) He would then
follow up with the realtors as many as three times per week, with each meeting lasting anywhere
from 25 minutes to three hours. (Buglak Dep. 120:2–22.) He left the office to attend the closings
for sales that he made once per week, and visited customer homes approximately five times per
week to obtain loan documentation. (Buglak Dep. 121:8–11; 121:12–122:4; 173:3–21.)
Similarly, Silano spent anywhere from fifteen minutes to an hour each at three to four open
houses every Sunday. (Silano Dep. 190:8–17; 193:21–194:23.) He also conducted “cold call”

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visits at realtors’ offices up to three times per week, which would last up to an hour. (Silano Dep.
189:4–190:1; 194:25–195:7; 195:20–196:5.)
These customary and regular sales activities exceed the threshold of “one or two hours a
day, one or two times a week.” Based on this, Buglak and Silano customarily and regularly
performed sales activities away from their employer’s place of business. Therefore, Buglak and
Silano are exempt from the FLSA overtime requirement.

IV.

CONCLUSION
For the foregoing reasons, Defendant’s motion for partial summary judgment is granted.

An Order consistent with this Memorandum will be docketed separately.

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