MEALS v. KEANE FRAC GP LLC et al
Filing
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MEMORANDUM OPINION indicating that, for reasons more fully stated within, Plaintiffs Motion for Conditional Certification 28 ) is granted. An appropriate Order follows. Signed by Judge Nora Barry Fischer on 6/6/17. (jg)
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IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
CHRISTOPHER MEALS, on behalf of himself
and all others similarly situated,
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Plaintiff,
v.
KEANE FRAC GP LLC et al.,
Defendants.
Civil Action No. 16-1674
Hon. Nora Barry Fischer
MEMORANDUM OPINION
I.
INTRODUCTION
This is a proposed class and collective action brought by Plaintiff Christopher Meals
(“Meals”) against Defendants Keane Frac GP LLC, Keane Frac LP, and Keane Group Holdings,
LLC, alleging that Defendants violated the Fair Labor Standards Act (“FLSA”) and the
Pennsylvania Minimum Wage Act (“PMWA”). Presently before the Court is a contested motion
filed by Meals seeking conditional certification of a proposed collective action to include “all
current and former Frac Supervisor Is and other like employees who work(ed) for Defendants in
the last three (3) years to the present.” (Docket No. 28 at 2). As the Motion has been fully
briefed, it is now ripe for disposition. (Docket Nos. 28, 29, 34, 40). After careful consideration
of the parties’ arguments, and for the following reasons, Plaintiffs’ Motion, (Docket No. [28]), is
granted.
II.
BACKGROUND
A. The Parties
Defendants constitute an oilfield services company that operates throughout the United
States, including Pennsylvania, West Virginia, Texas, and North Dakota. (Docket No. 1 at ¶ 18).
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Defendant Keane Frac GP LLC is a Delaware limited liability company; Defendant Kean Frac,
LP is a Pennsylvania limited partnership; and Defendant Keane Group Holdings, LLC is a
Delaware limited liability company. (Id. at ¶¶ 8-10).
Meals alleges that Defendants owe him and its other hourly, bonused employees back pay
at the rate of time and one-half for all hours worked over forty in a work week, liquidated
damages, attorneys’ fees, and court costs. (Id. at ¶ 1). He seeks to represent the following:
All current and former employees of Defendants who were paid on an
hourly basis with bonuses (the “FLSA Bonus Class”) within the last three
years. (Id. at ¶ 3).
All hourly paid employees who received bonuses and worked in
Pennsylvania (the “Pennsylvania Bonus Class”) within the last three years.
(Id. at ¶ 4).
All current and former Supervisor I employees who Defendants classified
as exempt (the “FLSA Supervisor I Class”) within the last three years.
(Id. at ¶ 5).
All Supervisor I employees Defendants employed in Pennsylvania (the
“Pennsylvania Supervisor I Class”) within the last three years. (Id. at ¶ 6).
B. Factual Background
Meals worked for Defendants as an SEO II in oilfields located in Pennsylvania from
March 2013 until April 2014. (Id. at ¶ 19). From April 2014 until November 2015, Meals
worked for Defendants as a Treater in Training. (Id. at ¶ 20). While working as an SEO II and a
Treater in Training, Meals earned an hourly rate and routinely worked more than forty hours per
week. (Id. at ¶ 21). In addition to an hourly rate, Defendants paid Meals, FLSA Bonus Class
Members, and Pennsylvania Bonus Class Members a job bonus. (Id. at ¶ 22). The job bonus,
which Defendants typically disbursed once per month, was a non-discretionary payment because
Defendants based the bonus amount on the number of completions an operator performed in the
field and the revenue Defendants earned from a job at an oil well. (Id. at ¶¶ 22-23). Because the
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bonus payments often were equal to or exceeded the amount that Defendants paid monthly for
hourly earnings, they represented a significant portion of the earnings made by Meals, FLSA
Bonus Class Members, and Pennsylvania Bonus Class Members. (Id. at ¶ 24). Meals alleges
that Defendants violated the FLSA and Pennsylvania law because they did not include the bonus
payments in the regular rate of pay for purposes of determining overtime compensation. (Id. at
¶¶ 25-26). Meals further avers that he, FLSA Bonus Class Members, and Pennsylvania Bonus
Class Members were required to work well in excess of forty hours per week and often worked
more than eighty hours per week. (Id. at ¶ 27). Meals alleges that he, FLSA Bonus Class
Members, and Pennsylvania Bonus Class Members are not exempt employees under the FLSA
or the PMWA and that Defendants classified them as non-exempt employees. (Id. at ¶¶ 28-29).
From November 2015 until March 2016, Meals worked for Defendants as a Supervisor I.
(Id. at ¶ 30). Defendants paid Meals a salary, no matter how many hours he worked each week,
and a bonus. (Id. at ¶ 31). Defendants did not pay overtime compensation to Meals or to its
other Supervisor I employees. (Id. at ¶¶ 32-33). Meals, FLSA Supervisor I Class members, and
Pennsylvania Supervisor I Class Members regularly worked six to seven days per week without
overtime compensation. (Id. at ¶ 34). Defendants’ managers observed the employees working
early in the mornings until late in the evenings and on weekends. (Id. at ¶¶ 34-35). Meals
contends that because Defendants classified its Supervisor I employees as exempt, he, FLSA
Supervisor I Class members, and Pennsylvania Supervisor I Class Members were denied
overtime compensation to which they were entitled as non-exempt employees. (Id. at ¶¶ 36-38).
In support, Meals avers that he, FLSA Supervisor I Class members, and Pennsylvania Supervisor
I Class Members performed oil field manual production work, which is the same work
performed by non-exempt, hourly employees. (Id. at ¶ 39). He maintains that they did not
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perform duties that qualify for any “white collar” or other exemption because they: (1) did not
regularly supervise the work of two or more employees; (2) did not exercise discretion and
independent judgment as to matters of significance; (3) did not perform office work related to
Defendants’ general business operations or its customers; (4) had no advance knowledge in a
field of science or learning which required specialized instruction that was required to perform
the job; and (5) were not required to have a college degree. (Id. at ¶¶ 40-45). Meals maintains
that all Supervisor I employees are similarly situated because they share common job duties and
descriptions, Defendants treated them as exempt employees, and they all performed work
without overtime compensation. (Id. at ¶ 46). He asserts that because Defendants did not pay
him, FLSA Supervisor I Class members, and Pennsylvania Supervisor I Class Members for all
the hours that they worked, their wage statements are inaccurate and do not reflect the
compensation that Defendants were legally required to pay. (Id. at ¶¶ 47-49). Thus, Meals
contends that Defendants’ actions in this case were willful and made in bad faith. (Id. at ¶¶ 5051).
C. Relevant Procedural History
Meals filed his Complaint on November 4, 2016, wherein he sets out four claims against
Defendants:
A collective action claim against Defendants on behalf of himself and the
FLSA Bonus Class for Defendants’ failure to include non-discretionary
bonuses into the regular rate of pay for overtime calculation purposes. (Id.
at ¶¶ 52-57, 83-87).1
A collective action claim against Defendants on behalf of himself and the
FLSA Supervisor I Class for Defendants’ failure to pay overtime at a rate
not less than one and one-half times their regular rate for all hours worked
over forty. (Id. at ¶¶ 58-63, 88-91).
1
Meals does not seek conditional certification for their claim against Defendants on behalf of himself and the FLSA
Bonus Class. (See Docket Nos. 28, 28-1).
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A class action claim against Defendants on behalf of himself and the
Pennsylvania Bonus Class Members for Defendants’ failure to include all
remuneration in their regular rates by excluding their bonus payments.
(Id. at ¶¶ 64-72, 92-97).
A class action claim against Defendants on behalf of himself and the
Pennsylvania Supervisor I Class Members for Defendants’
misclassification of them and subsequent failure to pay them overtime
compensation at the appropriate regular rate of pay for all hours worked
over forty per week. (Id. at ¶¶ 73-82, 98-103).2
Defendants filed an Answer to the Complaint on November 30, 2016. (Docket No. 10). The
Court held a Case Management Conference on January 24, 2017. (Docket No. 24). On March 3,
2017, Dusty Walker filed his consent to opt in, joining the lawsuit. (Docket No. 27). Plaintiffs
filed a Motion to Certify the Class Conditionally Pursuant to the FLSA, supporting brief, and
exhibits on March 16, 2017. (Docket Nos. 28, 29). Defendants filed a Response to the Motion
on April 17, 2017, along with a Motion to Strike Plaintiffs’ Brief in Support of Motion to Certify
Class Conditionally and Sworn Statements in Support. (Docket Nos. 34, 35). On May 1, 2017,
Plaintiffs filed a Reply to Defendants’ Response and a Response to Defendants’ Motion to
Strike. (Docket Nos. 40, 41). On May 2, 2017, the Court denied, without prejudice, Defendants’
Motion to Strike Plaintiffs’ Brief in Support of Motion to Certify Class Conditionally and Sworn
Statements in Support. (Docket No. 42). Neither party requested oral argument. As the motion
is fully briefed, it is now ripe for disposition.
III.
LEGAL STANDARD
Section 216(b) of the FLSA authorizes employees to bring an action on behalf of
themselves and others “similarly situated.” 29 U.S.C. § 216(b).
An action to recover the liability . . . may be maintained against any employer
(including a public agency) in any Federal or State court of competent jurisdiction
by any one or more employees for and in behalf of himself or themselves and
2
While Meals alleges violations of the PMWA in addition to the FLSA claims, his Motion pertains to the FLSA.
Thus, the Court will not discuss the PMWA Rule 23 class action portion of the lawsuit.
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other employees similarly situated. No employee shall be a party plaintiff to any
such action unless he gives his consent in writing to become such a party and such
consent is filed in the court in which such action is brought.
Id.
Courts follow a two-tiered analysis in determining whether a case may move forward as a
collective action. Symczyk v. Genesis HealthCare Corp., 656 F.3d 189, 192 (3d Cir. 2011), rev’d
on other grounds, 133 S. Ct. 1523 (2013). The first phase, or “notice” phase, requires that a
court “make[] a preliminary determination whether the employees enumerated in the complaint
can be provisionally categorized as similarly situated to the named plaintiff.” Id. If the plaintiff
carries this burden, the collective action is “conditionally certified” for purposes of notice and
discovery. Id. The second phase is addressed after all similarly situated employee members
have had an opportunity to opt in and further discovery has taken place. Zavala v. Wal-Mart
Stores, Inc., 691 F.3d 527, 534 (3d Cir. 2012). At this “more stringent” stage, the plaintiff must
show by a preponderance of the evidence that the class members are similarly situated. Id.
Articulating the differences in these two stages of the collective action certification analysis, the
Third Circuit has explained that the initial step of conditional certification asks whether similarly
situated plaintiffs do, in fact, exist; by contrast, the second stage asks whether the specific
plaintiffs who have opted-in are, in fact, similarly situated to the named plaintiffs. Id. at 536 n.4
(quoting Myers v. Hertz Corp., 624 F.3d 537, 555 (2d Cir. 2010)).
Conditional certification poses a lower threshold, requiring a “modest factual showing”
that the proposed plaintiffs are similarly situated. Symczyk, 656 F.3d at 192-93. This standard is
not particularly high—it merely calls for “some evidence, ‘beyond pure speculation,’ of a factual
nexus between the manner in which the employer’s alleged policy affected her and the manner in
which it affected the other employees.” Id. at 193 (quoting Smith v. Sovereign Bancorp, Inc.,
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No. 03-2420, 2003 U.S. Dist. LEXIS 21010, at *10 (E.D. Pa. Nov. 13, 2003)). Generally,
plaintiffs meet the standard by producing some evidence indicating common facts among the
parties’ claims, and/or a common policy affecting all the collective members. 7B Wright, Miller,
& Kane, Federal Practice and Procedure: Civil § 1807, at 489-90 (3d ed. 2005).
IV.
DISCUSSION
In support of their assertion that Defendants’ Supervisor I employees are similarly
situated, Plaintiffs rely upon declarations proffered by Meals, Walker, Daniel Slater, and Brian
Cales, as well as job postings for Supervisor I positions. (Docket Nos. 29-3, 29-4, 29-5, 29-6,
29-7, 29-8). They argue that the evidence establishes a factual nexus between the manner in
which Defendants’ policy affected them and the manner in which it affected other employees.
(Docket No. 29 at 10). Specifically, Plaintiffs contend that (1) Defendants had a policy of
classifying them as exempt and did not pay them overtime, even though they worked side-byside with hourly employees performing manual labor tasks; (2) Defendants denied them overtime
pay that they would have otherwise earned; and (3) Defendants’ policy impacted all Supervisor I
employees in a similar manner. (Id. at 11-14).
Defendants counter that Plaintiffs’ claims that they performed non-managerial duties are
evidence of the employees’ individual conduct rather than Defendants’ policy. (Docket No. 34
at 6-7). Similarly, Defendants maintain that the mere classification of a group of employees as
exempt under the FLSA is insufficient to demonstrate that all class members are similarly
situated. (Id. at 7-8). With respect to the job postings attached to Plaintiffs’ brief, Defendants
submit that the content of the position, not the position description, is determinative as to
whether employees are misclassified. (Id. at 8-10). Defendants argue that the declarations filed
by Plaintiffs are insufficient because they are based upon hearsay and contain identical,
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conclusory, and vague assertions. (Id. at 10-16). Finally, Defendants contend that Plaintiffs
have failed to demonstrate that any similarly situated employees desire to opt in to the lawsuit.
(Id. at 16-19). In reply, Plaintiffs insist that the declarations are based upon personal knowledge
and that they are not required to establish that any similarly situated employees desire to opt in to
the lawsuit. (Docket No. 40 at 5-6).
As an initial matter, the Court notes that in denying, without prejudice, Defendants’
Motion to Strike Plaintiffs’ Brief in Support of Motion to Certify Class Conditionally and Sworn
Statements in Support, it accepted Plaintiffs’ declarations and rejected Defendants’ requests that
it make credibility determinations. (Docket No. 42 at 2). The Court further concluded that “the
declarants’ statements are in line with Federal Rules of Evidence 602 and 701, the latter to the
extent that they are providing opinions as to their personal observations.” (Id. at 2-3 (citing FED.
R. EVID. 602 advisory committee’s note; FED. R. EVID. 701)). To the extent that Defendants
argue that Mr. Cales’ declaration is based upon hearsay, they fail to identify any statement
contained in same that constitutes hearsay. (See Docket No. 34 at 11-12). Further, the United
States Court of Appeals for the Third Circuit has not directly addressed whether declarations
containing hearsay are admissible for purposes of conditional certification. See, e.g., Jones v.
Alliance Insp. Mgmt., LLC, No. 13-1662, 2014 U.S. Dist. LEXIS 57257, at *8 (W.D. Pa. Apr.
24, 2014) (“This Court is not persuaded that courts impose a blanket prohibition against
consideration of hearsay or other arguably inadmissible-at-trial evidence in a conditional
certification determination.”); Bredbenner v. Liberty Travel, Inc., No. 09-CV-905, 2009 U.S.
Dist. LEXIS 67122, at *5-6 n.1 (D.N.J. July 31, 2009) (explaining that “courts outside this
jurisdiction are split as to whether plaintiffs’ supporting declarations need to meet the same
standard articulated in Rule 56(e)” and considering affidavits because “[t]he standard for
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conditional certifications is lenient and does not address the merits of the case”). Thus, the Court
will consider Plaintiffs’ declarations, and Defendants will have another opportunity to object to
class certification following further discovery. Bredbenner, 2009 U.S. Dist. LEXIS 67122, at *6
n.1.
Moving on, the Court finds that Plaintiffs have made a “modest factual showing,”
satisfying the “fairly lenient standard” that Supervisor I employees are similarly situated.
Zavala, 691 F.3d at 535. To this end, Defendants’ common business policies and compensation
practices are set out through four declarations and through job postings for Supervisor I
positions. (Docket Nos. 29-3, 29-4, 29-5, 29-6, 29-7, 29-8). Specifically, the declarations
provide that Supervisor I employees, who were hired as exempt employees, worked over forty
hours each week but were not paid overtime compensation. (Docket Nos. 29-3 at 2; 29-4 at 2;
29-5 at 2; 29-6 at 2). The primary duty of Supervisor I employees was not management.
(Docket Nos. 29-3 at 2; 29-4 at 2; 29-5 at 2; 29-6 at 2). Rather, they worked alongside other
hourly employees and performed manual labor tasks, such as working on hydraulic fracking
pumps and rigging up and down. (Docket Nos. 29-3 at 2; 29-4 at 2; 29-5 at 2; 29-6 at 2). They
did not hire or fire employees, recommend the hiring or firing of employees, promote or demote
any employees, set employee pay or benefits, or set any budget. (Docket Nos. 29-3 at 2; 29-4 at
2; 29-5 at 2; 29-6 at 2). A field service manager closely monitored the work of Supervisor I
employees to ensure that it complied with company standards. (Docket Nos. 29-3 at 2; 29-4 at 2;
29-5 at 2; 29-6 at 2).
The content of the job postings further establishes that management is not the primary
duty of Supervisor I employees, as the focus is on manual labor tasks. (Docket Nos. 29-7 at 1;
29-8 at 2, 4, 6, 9). The job postings do not provide that Supervisor I employees perform duties
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such as hiring or firing employees; promoting employees or demoting employees; interviewing
employees; setting employee pay or benefits; or setting any budgets. (See Docket Nos. 29-7, 298). Similarly, the skills and experience; qualifications; and education, certifications, licenses,
and registrations required for a Supervisor I position do not include prior management
experience. (See Docket Nos. 29-7 at 1-2; 29-8 at 2, 4-7, 9). The job postings are uniform for
the following locations: Mansfield and Mount Pleasant, Pennsylvania; Midland, Texas; Odessa,
Texas; and Williston, North Dakota. (See Docket Nos. 29-7, 29-8).
Having carefully reviewed the record in this matter, the evidence offered by Plaintiffs
suffices at this first stage of certification to demonstrate that Supervisor I employees are similarly
situated. See, e.g., Carr v. Flowers Foods, Inc., No. 15-6391, 2017 U.S. Dist. LEXIS 11347, at
*10-11 (E.D. Pa. Jan. 9, 2017) (granting conditional certification where the plaintiffs shared the
same jobs titles, responsibilities, training, and performance standards; worked more than forty
hours per week; and were not paid overtime for excess hours); Rocha v. Gateway Funding
Diversified Mortg. Servs., L.P., No. 15-CV-482, 2016 U.S. Dist. LEXIS 71494, at *29 (E.D. Pa.
June 1, 2016) (noting that the plaintiffs “need not adduce evidence from employees located in
every state in which [the defendant] operates” and concluding that they satisfied their burden to
show that there were similarly situated persons who may desire to opt into the litigation); Vasil v.
Dunham’s Athleisure Corp., No. 14-CV-690, 2015 U.S. Dist. LEXIS 162872, at *11 (W.D. Pa.
Dec. 4, 2015) (granting conditional certification because there was “some evidence that a
number of employees working under a facial classification of exempt employees within
defendant’s workforce might have been required to work under circumstances that violated the
FLSA and in a manner that will support a finding that the employees were similarly situated”);
Lucke v. PPG Indus., No. 13-CV-966, 2013 U.S. Dist. LEXIS 176293, at *10 (W.D. Pa. Dec. 16,
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2013) (holding that the plaintiff’s single affidavit “sets forth sufficient facts to show that there
are similarly situated employees with regard to job requirements, job titles, hours of work and
pay structures”); Hively v. Allis-Chalmers Energy, Inc., No. 13-CV-106, 2013 U.S. Dist. LEXIS
158415, at *14 (W.D. Pa. Nov. 5, 2013) (granting conditional certification because the plaintiffs’
declarations established the defendants’ common business policies and compensation practices).
The Court further finds that the cases upon which Defendants rely in support of their
motion are distinguishable. Within the United States Court of Appeals for the Third Circuit,
Defendants primarily rely upon Bramble v. Wal-Mart Stores, Inc., No. 09-CV-4932, 2011 U.S.
Dist. LEXIS 39457 (E.D. Pa. Apr. 12, 2011), and Moore v. PNC Bank, N.A., No. 12-CV-1135,
2013 U.S. Dist. LEXIS 74845 (W.D. Pa. May 29, 2013). (See Docket No. 34 at 6-8, 11-13, 15,
19). This Court has previously concluded that Bramble and Moore are inapplicable to cases such
as the instant one because they both involved plaintiffs who had proffered little evidence to
support certifying classes of thousand. Hively, 2013 U.S. Dist. LEXIS 158415, at *15-19. Here,
as in Hively, Plaintiffs have supplied evidence that shows uniform business practices and goes
beyond mere allegations that the class is similarly situated. See id. Indeed, Plaintiffs have
provided declarations from individuals who have worked in Pennsylvania, West Virginia, Texas,
New Mexico, and North Dakota, as well as job postings for Pennsylvania, Texas, and North
Dakota. (Docket Nos. 29-3 at ¶ 3, 29-4 at ¶ 3, 29-5 at ¶ 3, 29-6 at ¶ 4, 29-7, 29-8). Accordingly,
Plaintiffs’ Motion for Conditional Certification will be granted. Given the Court’s ruling, the
Court will order the parties to meet and confer in an effort to finalize the content and form of an
appropriate notice in accordance with this decision and to submit a joint proposal for the Court’s
consideration.
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V.
CONCLUSION
Based on the foregoing, Plaintiffs’ Motion for Conditional Certification, (Docket No.
[28]), is GRANTED. An appropriate Order follows.
s/Nora Barry Fischer
Nora Barry Fischer
U.S. District Judge
Date: June 6, 2017
cc/ecf: All counsel of record.
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