Alston et al v. Directv Inc et al
Filing
33
OPINION AND ORDER denying 11 Motion to Dismiss for Failure to State a Claim. Signed by Honorable Mary G Lewis on 5/22/2015.(cbru, )
IN THE UNITED STATES DISTRICT COURT
FOR T HE DISTRICT OF SOUTH CAROLINA
COLUMBIA DIVISION
JAMES ALSTON, CARNELL BULLOCK, )
MARK HILTON, ZACHARY JENKINS, )
JAMES KILE, RHETT LINELY, JOHN
)
MCPHERSON, JESUS MORALES,
)
JEFFERY NAVES, MARK RAMSEY,
)
JOSEPH ROBINSON, CARL SIMON,
)
MICHAEL TURNER, KHEHADI
)
WATKINS, COREY GLEATON, NOLAN )
PEGUES, HOWARD POOLE, and ALAN )
RYMAN,
)
Plaintiffs,
)
)
v.
)
)
DIRECTV, INC., DIRECTV, LLC, and,
)
MASTEC NORTH AMERICA, INC.,
)
Defendants.
)
___________________________________ )
C.A. NO. 3:14-CV-04093
OPINION AND ORDER
This matter is before the Court on the motion to dismiss submitted by Defendants MasTec
North America, Inc. (“MasTec”), and DIRECTV, Inc. and DIRECTV, LLC1 (together,
“DIRECTV,”and collectively with MasTec, “Defendants”) pursuant to pursuant to Rule 12(b)(6) of
the Federal Rules of Civil Procedure. (ECF No. 11.) For the reasons set forth below, Defendants’
Motion to Dismiss is denied.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiffs James Alston, Carnell Bullock, Mark Hilton, Zachary Jenkins, James Kile, Rhett
Linley, John McPherson, Jesus Morales, Jeffrey Naves, Mark Ramsey, Joseph Robinson, Carl
Simon, Michael Turner, Khehadi Watkins, Corey Gleaton, Nolan Pegues, Howard Poole, and Alan
Ryman (“Plaintiffs”) filed this matter on October 20, 2014, alleging violations of the Fair Labor
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Defendants state that effective January 1, 2012, DIRECTV, Inc. merged into DIRECTV,
LLC, and thereby ceased to exist. (ECF No. 11 at 1.)
Standards Act of 1938 (“FLSA”), 29 U.S.C. §§ 201, et seq., by each Plaintiff individually against
Defendants, as joint-employers. (ECF No. 1.) Plaintiffs allege that Defendants violated the FLSA
by failing to pay all minimum and overtime wages due to Plaintiffs, failing to properly calculate
Plaintiffs’ regular rate of pay for determining the overtime premium pay owed, and improperly
deducting money from Plaintiffs’ pay. (ECF No. 1 at 25.) Plaintiffs allege that each Plaintiff
performed work for DIRECTV and “where applicable, the named Provider Defendant in South
Carolina.” (ECF No. 1 at 5.)
The Complaint alleges that Plaintiffs were technicians charged with installing and repairing
DIRECTV satellite television service for DIRECTV and MasTec, the Provider Defendant. Plaintiffs
claim that DIRECTV oversees a network of providers who supply DIRECTV with its workforce.
(ECF No. 1 at 5.) Plaintiffs allege that the providers (i.e., Home Service Providers), such as MasTec,
either serve as the technicians’ ostensible employer or subcontract with the technicians, but that
DIRECTV controls nearly ever facet of the technicians’ work in accordance with detailed agreements
between DIRECTV and each Home Service Provider and subcontractor. (ECF No. 1 at 6.)
Plaintiffs allege that the provider network was designed to allow DIRECTV to exercise the right of
control over the group of technicians while avoiding its obligation to comply with the requirements
of the FLSA. (ECF No. 1 at 8.) Plaintiffs claim that the net effect of Defendants’ policies and
practices is to willfully fail to pay minimum wage and overtime compensation due to Plaintiffs, and
to avoid keeping accurate time records in order to save on payroll costs. (ECF No. 1 at 10.)
Specifically, Plaintiffs claim that DIRECTV utilized a per-task (piece-rate) payment scheme which
denied Plaintiffs their due earned wages and overtime compensation in violation of the FLSA. (ECF
No. 1 at 12.) Plaintiffs bring their claims on an individual basis only and seek to hold DIRECTV
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and MasTec liable as “joint employers” under the FLSA.
On January 26, 2015, Defendants filed a motion to dismiss pursuant to Rule 12(b)(6) of the
Federal Rules of Civil Procedure. (ECF No. 11.) On February 9, 2015, this Court granted Plaintiffs’
Unopposed Motion for Extension of Time and to Stay Case staying the proceedings pending a
decision from the Judicial Panel on Multidistrict Litigation (“JPML”) based on Plaintiffs’ Motion
for Consolidation and Transfer of Related Action. The JPML denied the motion to transfer on
February 6, 2015 (ECF No. 26), and this Court lifted the stay on February 23, 2015 (ECF No. 28).
Plaintiffs filed their opposition on February 23, 2015, as well as a conditional motion for time to seek
to amend their complaint should the Court grant Defendants’ motion to dismiss.2 (ECF No. 29 & 30.)
Defendants filed their reply in support of the motion on March 16, 2015. (ECF No. 32.)
STANDARD OF REVIEW
“The purpose of a Rule 12(b)(6) motion is to test the sufficiency of a complaint.” Edwards
v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir.1999). To survive a motion to dismiss, the Federal
Rules of Civil Procedure require that a complaint contain “a short and plain statement of the claim
showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Although Rule 8(a) does not
require
“detailed
factual
allegations,”
it
requires
“more
than
an
unadorned,
the-defendant-unlawfully-harmed-me accusation,” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)), in order to “give the defendant fair
notice of what the . . . claim is and the grounds upon which it rests,” Twombly, 550 U.S. at 555. In
other words, “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim
2
Plaintiffs’ conditional motion for time within which to amend is rendered moot by this
order. (ECF No. 30.)
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to relief that is plausible on its face.’” Iqbal, 556 U.S. at 678. A claim is facially plausible “when
the plaintiff pleads factual content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Id. (quoting Twombly, 550 U.S. at 556).
In considering a motion to dismiss, a plaintiff’s well-pled allegations are taken as true, and
the complaint and all reasonable inferences are liberally construed in the plaintiff’s favor. Mylan
Laboratories, Inc. v. Matkari, 7 F.3d 1130 (4th Cir. 1993). The court may consider only the facts
alleged in the complaint, which may include any documents either attached to or incorporated in the
complaint, and matters of which the court may take judicial notice. Tellabs, Inc. v. Makor Issues &
Rights, Ltd., 551 U.S. 308, 322 (2007). Although the court must accept the plaintiff’s factual
allegations as true, any conclusory allegations are not entitled to an assumption of truth, and even
those allegations pled with factual support need only be accepted to the extent that “they plausibly
give rise to an entitlement to relief.” Iqbal, 556 U.S. at 679. In sum, factual allegations must be
enough to raise a right to relief above the speculative level, on the assumption that all the allegations
in the complaint are true (even if doubtful in fact). Twombly, 550 U.S. at 555.
DISCUSSION
Defendants move to dismiss Plaintiffs’ claims with prejudice under Rule 12(b)(6) on the
basis that each Plaintiffs’ minimum wage and overtime claims are generic, boilerplate, and
insufficiently pled. (ECF No. 11.) Defendants allege that Plaintiffs fail to plead facts sufficient to
support a plausible claim that any Plaintiff actually received less than the minimum wage, or was
denied overtime pay, with reference to work performed in any given workweek. Defendants argue
that Plaintiffs fail to plead sufficient facts sufficient to support a plausible inference of employment
by DIRECTV or MasTec, and made only conclusory allegations of “Joint Employment” to support
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their FLSA claims and theory of recovery. Defendants also maintain that some of Plaintiffs’ claims
are barred in whole or in part by the FLSA’s statute of limitations due to Plaintiffs’ failure to plead
facts sufficient to support a reasonable inference that Defendants engaged in willful misconduct
necessary to extend the standard two years limitations period. (ECF No. 11 at 19-20.).
In response, Plaintiffs state that their allegations exceed the minimum pleading requirement
of Rule 8 by carefully detailing Defendants’ allegedly noncompliant piece-rate system and its impact
on Plaintiffs’ wages. (ECF No. 29.)
Plaintiffs also argue that they have, despite Defendants’
contentions, sufficiently alleged an actionable employment relationship with DIRECTV and MasTec
under FLSA’s broad definition of “employer,” and based on the element of control exercised by
Defendants on the aspects of Plaintiffs’ work. Plaintiffs also reiterate the timeliness of their claims
based in part, on their allegations that the entire purpose of Defendants’ employment scheme was
a willful attempt to avoid their obligations to pay technicians in accordance with the FLSA..
After reviewing the record in this case, accepting all well-pleaded allegations in Plaintiffs’
complaint as true, and drawing all reasonable factual inferences from those facts in Plaintiffs’ favor,
the Court will deny Defendants’ motion. At this stage of the litigation, it is premature to decide that
no relief could be granted under any set of facts that could be proven consistent with the allegations.
The allegations of the complaint do state a plausible FLSA claim for relief under the pleading
standards set forth in Iqbal and Twombly.
The FLSA provides that a covered employer shall not employ any employee “for a workweek
longer than forty hours unless such employee receives compensation for his employment in excess
of the hours above specified at a rate not less than one and one-half times the regular rate at which
he is employed.” 29 U.S.C. § 207(a)(1). The FLSA defines “employer” as “any person acting
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directly or indirectly in the interest of an employer in relation to an employee.” 29 U.S.C. § 203(d).
Courts have further noted that the definition of “employer” is not limited in the common law sense,
but is interpreted expansively to account for those who exercise control over the nature, structure,
and economics of the employment relationship. Lambert v. Ackerley, 180 F.3d 997, 1012 (9th
Cir.1999). Additionally, the FLSA recognizes the concept of “joint employment,” when separate
persons or entities share control over an individual employee. See 29 C.F.R. 791.2; Schultz v.
Capital Intern. Sec., Inc., 466 F.3d 298, 305-306 (4th Cir. 2006). The FLSA provides a remedy for
employees who have not been paid overtime compensation. FLSA claims are generally subject to
a two-year statute of limitations, but this period is extended to three years for “cause[s] of action
arising out of a willful violation.” 29 U.S.C. § 255(a).
In the Complaint, Plaintiffs assert that Defendants’ policy and practice of imposing
“chargebacks,” failing to compensate Plaintiffs for all hours worked, and failing to reimburse
Plaintiffs’ necessary business expenses, resulted in Plaintiffs routinely working more than forty hours
in a work week while being denied overtime pay and being subjected to an effective wage rate below
that required by applicable law. (ECF No. 1 at 12.) The Complaint sets forth a time frame for
employment as well as an approximate amount of time each Plaintiff spent each week performing
tasks for the benefit of Defendants, as technicians for DIRECTV and MasTec in the state of South
Carolina. Plaintiffs also allege that DIRECTV, through its network providers, “exerted control over
Plaintiffs sufficient to establish that they employed Plaintiffs,” and thus constitute employers subject
to liability under the FLSA. (ECF No. 1 at 9.) Factually, to support this claim, Plaintiffs detail
Defendants’ system of Provider Agreements, as well as policies and procedures. Plaintiffs also detail
DIRECTV’s involvement in and systemic control of Plaintiffs’ day-to-day work assignments,
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training, credentialing, and appearance. Plaintiffs also claim that Defendants acted willfully and
knew or showed reckless disregard in their violation of the FLSA, triggering a three year statute of
limitations under FLSA and periods of equitable tolling. (ECF No. 1 at 25.)
On this record, the Court finds that Plaintiffs have alleged sufficient facts to support a FLSA
claim resting on an employment relationship with Defendants and for minimum wage and overtime
violations such that Plaintiffs’ claim survives the motion to dismiss. Plaintiffs have also alleged that
Defendants willfully violated the FLSA and have offered more than general, conclusory allegations
of willfulness. Additionally, further facts relevant to the nature of the employment and work
relationships, and alleged willfulness will likely be elicited during the course of discovery.
Accordingly, this Court cannot find that Plaintiffs’ claims are subject to dismissal for having been
filed outside of the statute of limitations.
In sum, Plaintiffs have done more than provide a
barebones recitation of legal conclusions. Based on Plaintiffs’ allegations that they routinely worked
over forty hours per week and on behalf of Defendants, who substantially controlled Plaintiffs’ work,
as well as their allegations that many of those hours were unpaid and they were not paid overtime
compensation, Plaintiff has satisfied the applicable pleading requirements.
CONCLUSION
For the above-stated reasons, Defendants’ Motion to Dismiss is DENIED. (ECF No. 11).
IT IS SO ORDERED.
s/ Mary G. Lewis
United States District Judge
Columbia, South Carolina
May 22, 2015
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