Kibodeaux v. A&D Interests, Inc. d/b/a Heartbreakers Gentleman's Club

Filing 93

OPINION AND ORDER granting 82 MOTION Plaintiffs' Motion for Conditional Certification and Issuance of Notice Pursuant to Section 216(B) of the FLSA (Signed by Magistrate Judge Andrew M Edison). Parties notified.(RubenCastroadi, 4)

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United States District Court
Southern District of Texas

ENTERED
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
GALVESTON DIVISION
STACEY KIBODEAUX, et al.,
Plaintiffs.
VS.
A&D INTERESTS, INC. d/b/a
HEARTBREAKERS GENTLEMAN’S
CLUB, et al.,
Defendants.

January 10, 2022
Nathan Ochsner, Clerk

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§ CIVIL ACTION NO. 3:20-cv-00008
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OPINION AND ORDER
Before me is Plaintiffs’ Motion for Certification and Issuance of Notice
Pursuant to Section 216(b) of the Fair Labor Standards Act. Dkt. 82. After carefully
reviewing the motion, the parties’ briefing, and the applicable law, and for the
reasons discussed below, I GRANT the motion and authorize class notice.
INTRODUCTION
Back in October 2020, I conditionally certified a collective action of exotic
dancers who worked at A&D Interests, Inc. d/b/a Heartbreakers Gentleman’s Club
(“Heartbreakers”) during a three-year period beginning in October 2017. See Dkt.
50. Since then, there has been a seismic shift in the Fifth Circuit regarding the
certification of collective actions. See Swales v. KLLM Transp. Servs., L.L.C., 985
F.3d 430 (5th Cir. 2021). Namely, Swales did away with conditional certification
altogether and, instead, requires that district courts apply a more rigorous, casespecific standard when considering whether the proposed class is sufficiently
similarly situated to proceed as a collective action. As part of this new standard,
district courts must consider “all available evidence” to determine “whether and to
whom notice should be issued.” Id. at 442.
In light of Swales, I vacated my conditional certification order and ordered
that the parties conduct preliminary discovery on the issue of similarity. Before me

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is Plaintiffs’ motion for certification and issuance of notice. 1 See Dkt. 82. Because
both the parties and Court are amply familiar with the facts of this case, I repeat
only those necessary to contextualize my decision.
BACKGROUND AND PROCEDURAL HISTORY
Stacey Kibodeaux (“Kibodeaux”) is a former exotic dancer who worked at
Heartbreakers in Dickinson, Texas in December 2019 and January 2020. During
her employment, Kibodeaux claims she was not compensated on an hourly basis
and, instead, received only tips from Heartbreakers’ customers.
On January 14, 2020, Kibodeaux sued Heartbreakers for alleged violations
of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201. et seq., on behalf of
herself and similarly situated dancers. Since filing suit, three former
Heartbreakers’ dancers have opted-in as plaintiffs: (1) Hailey Chapman
(“Chapman”), who worked there in July 2018; (2) Jean Hoffmeister
(“Hoffmeister”), who worked “from 2016–2018”; and (3) Roxanne Murillo
(“Murillo”), who worked “from 2018–2019.” For ease of reference, I collectively
refer to Kibodeaux and the opt-ins as “Plaintiffs.”
In March 2020, Plaintiffs amended their complaint, adding Heartbreakers’
owners, Mike Armstrong and Peggy Armstrong, as defendants (collectively
“Defendants”). Against all Defendants, Plaintiffs assert three causes of action
under the FLSA for the deprivation of income and two causes of action for
violations of related tipping regulations. 2 Plaintiffs only seek notice of their FLSA
claims.

Plaintiffs move for “conditional certification.” However, as mentioned, courts in this
Circuit no longer conditionally certify classes in FLSA collective actions. See Swales, 985
F.3d at 440 (“The FLSA, and § 216(b) in particular, says nothing about ‘conditional
certification’”).
1

Specifically, Plaintiffs assert claims for failure to pay minimum wages, failure to pay
overtime wages, unlawful taking of tips, taking illegal kickbacks, and forced tip sharing.
See Dkt. 18 at 18–24. The latter two causes of action do not arise under the FLSA. See 29
C.F.R. § 531.35.
2

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As mentioned, I previously vacated my conditional certification order and
set a discovery and briefing schedule to, once again, determine whether this case
should proceed on a collective basis. See Dkt. 77. On May 21, 2021, Plaintiffs filed
the instant motion for certification and issuance of notice, in which they seek
permission for this lawsuit to proceed as a collective action on behalf of all dancers
who have performed at Heartbreakers over a three-year period. Both parties have
extensively briefed their respective positions. See Dkts. 82–88.
The thrust of Plaintiffs’ argument remains unchanged—Heartbreakers
misclassified its dancers as independent contractors when they should have been
considered hourly employees. However, unlike the first go-round, the evidence
before me is not limited to the pleadings and Plaintiffs’ sworn declarations.
Instead, I now have the benefit of Plaintiffs’ deposition testimony, Heartbreakers’
timekeeping logs and financial records, and the deposition testimony of
Heartbreakers’ corporate representative (Peggy Armstrong) and four of its
managers.
As in their declarations, Plaintiffs testified at deposition that Heartbreakers
dictated how its dancers performed through a wide range of rules. Some of the
allegations are undisputed. For example, Defendants do not dispute that
Heartbreakers charged dancers a “house fee” (sometimes referred to as a “floor
fee”) for the opportunity to work a particular shift. It is also undisputed that
Heartbreakers charged dancers $20 to use its private booths, which are simply
curtained-off areas where dancers can perform private dances for customers.
Other allegations are hotly disputed, such as Plaintiffs’ claim that dancers were
fined $20 for each missed stage appearance or were required to share a portion of
their tips with Heartbreakers’ managers, DJs, bartenders, and waitresses.
Defendants adamantly contend that certification is inappropriate, given the
Fifth Circuit’s directive that district courts must “rigorously scrutinize the realm of
‘similarly situated’ workers” to ensure that “the requested opt-in notice will go to
those who are actually similar to the named plaintiffs.” Swales, 985 F.3d at 434. In
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their mind, Plaintiffs have only shown “some individual proof of their own
circumstances,” not that Heartbreakers’ dancers are similarly situated. Dkt. 85 at
29. On this point, Defendants continue, Plaintiffs’ divergent testimony about
“different experiences based on different interactions with different managers at
different times for different reasons” fails to show some common nexus of facts
that could unify their disparate experiences. Id.
LEGAL STANDARD
A.

FLSA COLLECTIVE ACTIONS
Under the FLSA, “no employer shall employ any of his employees . . . 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 law also mandates that “[e]very employer shall pay to each of his employees
who in any workweek is engaged in . . . or is employed in an enterprise [that is]
engaged in the production of goods for commerce” no less than the statutory
minimum wage. See id. § 206(a)(1)(C). The FLSA’s minimum-wage and overtimecompensation rules are a bit more nuanced for “tipped employees” 3—which

The statutory minimum wage for non-tipped employees is $7.25 per hour. See 29 U.S.C.
§ 206(a)(1)(C). Employees who customarily receive more than $30.00 per month in tips,
however, are considered “tipped employees” under the FLSA. Id. § 203(t). The FLSA
contains an exception that permits employers to pay less than the general minimum
wage—$2.13 per hour—to a tipped employee as long as the employee’s tips make up the
difference between the $2.13 minimum wage and the statutory minimum wage. See id. §
203(m). This is commonly referred to as a “tip credit.” Generally, an employer may not
claim a tip credit unless a tipped employee is permitted to retain all her tips. See id.
However, the statute provides a limited exception permitting “the pooling of tips among
employees who customarily and regularly receive tips.” Id. § 203(m)(2)(ii). But, “[w]here
a tipped employee is required to contribute to a tip pool that includes employees who do
not customarily and regularly receive tips, the employee is owed the full $7.25 minimum
wage and reimbursement of the amount of tips that were improperly utilized by the
employer.” See U.S. Dep’t of Labor, Wage and Hour Div., Fact Sheet # 15: Tipped
Employees Under the Fair Labor Standards Act (FLSA) (rev. April 2018), available at
https://www.dol.gov/sites/dolgov/files/WHD/legacy/files/whdfs15.pdf (last viewed
January 7, 2022).
3

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Plaintiffs claim to be. Any employer who violates the minimum-wage or
maximum-hours provisions in §§ 206 and 207 “shall be liable to the employee or
employees affected in the amount of their unpaid minimum wages, or their unpaid
overtime compensation, as the case may be, and in an additional equal amount as
liquidated damages.” Id. § 216(b). Once again, the rules differ slightly for “tipped
employees.” 4
The FLSA gives employees the right to bring an action on behalf of
themselves and “other employees similarly situated.” Id. Section 216(b) establishes
an opt-in scheme under which plaintiffs must affirmatively notify the court of their
intention to become parties to the suit. See Thrower v. UniversalPegasus, Int’l
Inc., 484 F. Supp. 3d 473, 479 (S.D. Tex. 2020). District courts have the
discretionary power to certify collective actions and order notice to putative class
members. See id.
While not required by the FLSA, collective actions allow “plaintiffs the
advantage of lower individual costs to vindicate rights by the pooling of resources.”
Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 170 (1989). Such actions also
benefit the judicial system by encouraging the “efficient resolution in one
proceeding of common issues of law and fact arising from the same alleged
discriminatory activity.” Id.
B.

CERTIFYING AN FLSA COLLECTIVE IN THE FIFTH CIRCUIT
Until recently, few areas of the law were less settled than the test for

determining whether an FLSA case can proceed on a collective basis. Lacking the
Fifth Circuit’s guidance, district courts in this Circuit typically bifurcated the
certification process, applying (some form of) what is widely known as the Lusardi
test. See Lusardi v. Xerox Corp., 118 F.R.D. 351 (D.N.J. 1987). Earlier this year,
however, the Fifth Circuit rejected Lusardi’s two-step approach and, for the first

Any employer who violates § 203(m) is liable “in the amount of the sum of any tip credit
taken by the employer and all such tips unlawfully kept by the employer, and in an
additional equal amount as liquidated damages.” 29 U.S.C. § 216(b).
4

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time, adopted a standard for determining whether to certify a collective in an FLSA
lawsuit. See Swales, 985 F.3d 430. Given Swales’s novelty, not to mention the
pervasive imprint left by courts applying the now-defunct Lusardi approach for
over three decades, a brief discussion of how we got here is appropriate.
1.

Lusardi

Lusardi set forth a two-step process to determine whether prospective optin plaintiffs in a proposed collective are “similarly situated” enough to satisfy the
FLSA. Id. at 436. The two steps are commonly referred to as the “notice stage”
(sometimes the “conditional certification stage”) and the “decertification stage.”
See Thrower, 484 F. Supp. 3d at 479.
At the notice stage, district courts conducted an initial inquiry into whether
the proposed members of the collective action were sufficiently similar to merit
sending notice of the lawsuit to possible class members. See id. Critically, most
courts concluded that it was inappropriate to consider the underlying claim’s
merits or evidence of a merit-based defense (e.g., FLSA exemption) when deciding
whether to conditionally certify a collective action. See Rosales v. Indus. Sales &
Servs., LLC, No. 6:20-CV-00030, 2021 WL 4480747, at *6 (S.D. Tex. Sept. 30,
2021) (collecting cases). Instead, given the limited evidence available, courts
applying the Lusardi standard typically based their decision on the pleadings and
affidavits of the parties, requiring little more than substantial allegations that the
putative collective members were together the victims of a single decision, policy,
or plan. This lenient standard generally resulted in “conditional certification” of a
representative class. See Thrower, 484 F. Supp. 3d at 479.
If a collective action was conditionally certified, the parties proceeded with
discovery before moving to the second step—the decertification stage. Here, with
the benefit of full discovery, courts made a second and final determination,
utilizing a stricter standard, about whether the named plaintiffs and opt-ins were
“similarly situated” and could, therefore, proceed to trial as a collective action. See
Swales, 985 F.3d at 437. If the court found that the opt-ins were not sufficiently
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similar to the named plaintiffs, it had to dismiss the opt-in employees, leaving only
the named plaintiff’s original claims. See id. To help decide similarity, courts
considered the following factors: “(1) the disparate factual and employment
settings of the individual plaintiffs; (2) the various defenses available to the
defendant which appear to be individual to each plaintiff; and (3) fairness and
procedural considerations.” Id. (cleaned up).
2.

Swales

Over time, Lusardi and its progeny devolved into an “amorphous and adhoc test” that was inconsistently applied and “provide[d] little help in guiding
district courts in their notice-sending authority.” Id. at 440. Finding that Lusardi’s
unstructured approach “frustrates, rather than facilitates, the notice process,” id.
at 439, the Fifth Circuit in Swales disavowed the multi-step approach and, instead,
“provid[ed] a workable gatekeeping framework for assessing, at the outset of
litigation, before notice is sent to potential opt-ins, whether putative plaintiffs are
similarly situated—not abstractly but actually.” Id. at 433.
Swales eliminated the conditional certification stage and, instead, demands
that district courts now “rigorously scrutinize the realm of ‘similarly situated’
workers” before certifying a collective action to ensure that “the requested opt-in
notice will go to those who are actually similar to the named plaintiffs.” Id. at 434.
That is, courts must conduct a careful, fact-intensive similarity inquiry before the
issuance of notice and collective treatment. To that end, district courts must now
“consider all of the evidence”—even if that evidence is also relevant to the merits
of the underlying case—to ensure that collective adjudication of the putative class
members’ claims will not “devolve into a cacophony of individual actions.” Id. at
442. Put differently, district courts must ensure that proceeding as a collective
action will not require “a highly individualized inquiry into each potential opt-in’s
circumstances,” as that would detract from the FLSA’s overarching goal to
efficiently resolve in one proceeding issues of law and fact that are common to
members of the collective action. Id. at 442.
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Although the Fifth Circuit strove to promulgate a workable standard, it made
clear that no one-size-fits-all solution exists. In some cases, the appellate court
explained, notice might be justified when the pleadings and only preliminary
discovery show sufficient similarity between the plaintiff’s and potential opt-in
plaintiffs’ employment situations—e.g., when the plaintiffs all have the same job
description, and the allegations revolve around the same aspect of the job. See id.
at 441–42. In other cases, such as when the plaintiff and potential opt-in plaintiffs
have demonstrably different work experiences, courts will need more discovery to
determine whether notice is going out to those “similarly situated.” Id. at 442.
Ultimately, courts must exercise their “broad, litigation-management
discretion” to meet the needs of each case. Id. at 443. But it remains the plaintiff’s
burden to prove that the proposed class is similar enough to warrant the issuance
of notice to potential class members, and this burden is shaped by the scope and
nature of the claims at issue. See id. at 443 n.65 (holding that the burden to
establish that employees are similarly situated “follows from the general burden
that a plaintiff bears to prove her case”); Hebert v. TechnipFMC USA, Inc., No.
4:20-CV-2059, 2021 WL 1137256, at *2 (S.D. Tex. Feb. 5, 2021) (“The plaintiff has
the burden to establish that evidence exists, and courts are not required to sift
through discovery to find a similarity.”). Accordingly, my decision turns on
whether the evidence demonstrates sufficient similarity between Plaintiffs and the
potential opt-ins. See Swales, 985 F.3d at 442.
ANALYSIS
A.

PLAINTIFFS’ OBJECTIONS
UNRELATED LAWSUITS

TO

DEPOSITION

TESTIMONY

FROM

Included with their response, Defendants have attached the deposition
testimony of two exotic dancers from unrelated FLSA collective actions against
different gentlemen’s clubs. See Dkts. 85-1 and 85-2. In those depositions, Casey
Nelson (“Nelson”) and Brandy Phillips (“Phillips”) briefly testified about their
experience working at Heartbreakers. See id. Plaintiffs argue the testimony is
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hearsay and inadmissible under Federal Rule of Civil Procedure 32. See Dkt. 87 at
19–20. See also FED. R. CIV. P. 32(a)(8) (authorizing the use of depositions taken
in an earlier action if the later action “involve[es] the same subject matter between
the same parties.”).
Defendants counter that Rule 32(a)(8) is primarily applied as a limitation
on the introduction of deposition testimony at trial, and that, in the summaryjudgment context, courts routinely find deposition testimony from a separate case
akin to affidavit testimony. Defendants also argue that the testimony is not hearsay
because it is not offered for the truth of the matters asserted but, instead, to show
that the facts and experiences vary significantly from dancer to dancer. Finally,
even if it is hearsay, Defendants argue the deposition testimony satisfies Federal
Rule of Evidence 807(a)’s residual hearsay exception because it is supported by
sufficient guarantees of trustworthiness. 5
Rule 32(a)(8) permits the use of prior deposition testimony in a later action
if: (1) the later action involved the same subject matter between the same parties,
or their representatives or successors in interest; or (2) it is otherwise allowed by
the Federal Rules of Evidence. See FED. R. CIV. P. 32(a)(8). Neither Defendants nor
Plaintiffs were parties to the lawsuits involving Nelson and Phillips—it appears the
only connection between those cases and the case at bar is defense counsel.
Moreover, since the lawsuits were brought against different gentlemen’s clubs, it
cannot be said that any party in either lawsuit shared Plaintiffs’ interest or motive
to develop the testimony. For this same reason, Federal Rule of Evidence
804(b)(1)’s hearsay exception for unavailable deponents is inapplicable. See FED.
R. EVID. 804(b)(1).
Rule 807(a) provides that “a hearsay statement is not excluded by the rule against
hearsay even if the statement is not admissible under a hearsay exception in Rule 803 or
804 [if]: (1) the statement is supported by sufficient guarantees of trustworthiness—after
considering the totality of circumstances under which it was made and evidence, if any,
corroborating the statement; and (2) it is more probative on the point for which it is
offered than any other evidence that the proponent can obtain through reasonable
efforts.” FED. R. EVID. 807(a).
5

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As for Federal Rule of Evidence 807(a)’s residual hearsay exception, the
Fifth Circuit has cautioned that it “is to be used only rarely, in truly exceptional
cases.” United States v. Walker, 410 F.3d 754, 757 (5th Cir. 2005) (cleaned up).
Here, Defendants summarily argue that the deposition testimony is trustworthy
because both deponents testified under oath, were represented by counsel, and had
no reason to lie. This simply does not cut it. See United States v. Phillips, 219 F.3d
404, 426 n.23 (5th Cir. 2000) (“The proponent of the statement bears a heavy
burden to come forward with indicia of both trustworthiness and probative force.”
(quotation omitted)). 6
Defendants are correct, however, that, even where litigation does not involve
the same parties and subject matter, district courts have routinely allowed prior
deposition testimony at the summary-judgment stage, relying on two different
lines of reasoning. The most popular school of thought is that a deposition is at
least as good as an affidavit and, therefore, should be usable whenever an affidavit
would be permissible. See 8A C. Wright, A. Miller, & R. Marcus, Federal Practice
& Procedure § 2142 (3d ed.); Guarisco v. Boh Bros. Constr. Co., LLC, 421 F. Supp.
3d 367, 374 (E.D. La. 2019) (collecting cases). Alternatively, under Rule 56(c)(2),
“materials cited to support or dispute a fact [at summary judgment] need only be
capable of being ‘presented in a form that would be admissible in evidence’” at
trial, not that it actually be presented in an admissible form. LSR Consulting, LLC
v. Wells Fargo Bank, N.A., 835 F.3d 530, 534 (5th Cir. 2016) (quoting FED. R. CIV.
P. 56(c)(2)). Put differently, if the deponent could be deposed or produced at trial,
then deposition testimony from a prior proceeding is competent summaryjudgment evidence. See, e.g., Bingham v. Jefferson Cnty., No. 1:11-CV-48, 2013
WL 1312563, at *6 (E.D. Tex. March 1, 2013).
In addition, there has been no showing that Nelson or Phillips are unavailable or not
subject to subpoena, which suggests that their deposition testimony cannot, as Rule 807
requires, be considered “more probative on the point for which it is offered than any other
evidence that the proponent can obtain through reasonable efforts.” FED. R. EVID.
807(a)(2).
6

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Even if I found the deposition testimony admissible under the Defendants’
advocated-for summary-judgment standard, it does little, if anything, to move the
needle in Defendants’ favor. Indeed, Nelson did not work at Heartbreakers during
the relevant class period, see Dkt. 85-1 at 9 (testifying she worked at Heartbreakers
for a four-month period sometime between late-2015 and early-2017), and
Phillips’s testimony does not nail down when she worked at Heartbreakers, only
that she worked there for an unspecified period sometime before December 2017.
See Dkt. 85-2 at 3–4. Thus, even if taken at face value, testimony regarding their
respective experiences at Heartbreakers is of little probative value. Because it
ultimately makes no difference to my analysis, I will overrule Plaintiffs’ objections
to the deposition testimony from unrelated lawsuits.
B.

THE ARBITRATION ISSUE, ROUND 2
Before working at Heartbreakers, Plaintiffs executed independent

contractor agreements which contain an arbitration clause. I have already found
that the specific arbitration language at issue does not prohibit Plaintiffs or
potential opt-ins who have signed the same agreement from participating in a
collective action. See Kibodeaux v. A&D Ints., Inc., No. 3:20-CV-00008, 2020 WL
6292551, at *3–5 (S.D. Tex. Oct. 27, 2020).
Instead of restating my views here on why the relevant arbitration
agreements do not preclude notice from being sent to putative class members, I
simply incorporate my reasoning set forth in my prior opinion. See id. Without
explaining how Swales affects my previous analysis, Defendants recycle the same
arguments, adding only that the evidence establishes “Defendants have enforced
the arbitration agreement.” 7 Dkt. 85 at 27. My answer has not changed. But to be
7 The record contains evidence that Heartbreakers arbitrated similar FLSA claims brought

on an individual basis by another exotic dancer. See Dkt. 82-8. But whether Defendants
have “enforced the arbitration agreement” in an unrelated lawsuit is irrelevant; what
matters is that they have not attempted to do so in this case. See Kibodeaux, 2020 WL
6292551 at *5 (“Although the Plaintiffs have executed arbitration agreements, Defendants
have not moved to compel arbitration. . . . Because (i) the Defendants have failed to seek
arbitration; and (ii) the underlying agreements do not prevent employees from
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clear, I have carefully considered the Plaintiffs’ arbitration agreements. They bar
class action proceedings; they say nothing about collective actions. See Kibodeaux,
2020 WL 6292551, at *4. To cinch the matter, Defendants admit that
Heartbreakers has used “the same or substantially similar” independent contractor
agreements since 2014. Dkt. 37-2 at 1. It follows that any potential opt-in who
signed an independent contractor agreement is bound by the same arbitration
clause—meaning they too have not waived their right to proceed collectively.
C.

SIMILARLY SITUATED
Post-Swales, the question courts must answer when deciding whether to

certify a collective action is the same question it would ask at the second stage of
the Lusardi analysis: are Plaintiffs and opt-ins sufficiently “similarly situated” such
that this case should proceed on a collective basis? As mentioned, when deciding
similarity in this context, courts often consider three factors: (1) disparate factual
and employment settings of the individual plaintiffs; (2) the various defenses
available to the defendant which appear to be individual to each plaintiff; and (3)
fairness and procedural considerations. See Swales, 985 F.3d at 437.
The primary dispute in this matter is whether an employer-employee
relationship exists between Heartbreakers and its dancers, as only employees are
entitled to FLSA protections. See 29 U.S.C. § 152(3) (defining “employee” to
exclude, inter alia, “any individual having the status of an independent
contractor”). Courts in this Circuit use the economic-realities test to determine
whether a worker is an employee or an independent contractor for purposes of the
FLSA. See Herman v. Express Sixty-Minutes Delivery Serv., Inc., 161 F.3d 299,
303 (5th Cir. 1998) (“To determine employee status under the FLSA, we focus on
whether the alleged employee, as a matter of economic reality, is economically
dependent upon the business to which he or she renders his or her services.”).

participating in collective actions, the Plaintiffs can, at least for the time being, continue
to proceed with this case in federal court.”).
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Simply stated, the economic-realities test asks “whether the individual is, as
a matter of economic reality, in business for himself or herself.” Id. To aid in this
determination, courts consider five non-exhaustive factors: (1) the degree of
control exercised by the alleged employer; (2) the extent of the relative investments
of the worker and alleged employer; (3) the degree to which the worker’s
opportunity for profit and loss is determined by the alleged employer; (4) the skill
and initiative required in performing the job; and (5) the permanency of the
relationship. See id. No single factor is determinative. See id. Rather, the
determinative question is whether the totality of the circumstances “establishes the
personnel are so dependent upon the business with which they are connected that
they come within the protection of [the] FLSA or are sufficiently independent to lie
outside its ambit.” Usery v. Pilgrim Equip. Co., 527 F.2d 1308, 1311–12 (5th Cir.
1976).
1.

Disparate Factual and
Individual Plaintiffs

Employment

Settings

of

the

Whether individual plaintiffs have disparate factual and employment
settings may involve a variety of considerations, including: (1) whether the
plaintiffs all held the same job title; (2) whether they worked in the same
geographic location; (3) whether the alleged violations occurred during the same
time period; (4) whether the plaintiffs were subjected to the same policies and
practices; (5) whether these policies and practices were established in the same
manner and by the same decision-maker; and (6) the extent to which the actions
that constitute the claimed violations are similar. See Smith v. Tradesmen Int’l,
Inc., 289 F. Supp. 2d 1369, 1372 (S.D. Fla. 2003).
This one is an easy call. The case involves one job position at a single business
location. The dancers were all classified as independent contractors, 8 had

8 Heartbreakers did give dancers the option of

signing an “employment agreement” rather
than the “independent contractor agreement.” See Dkt. 37-2 at 1; Dkt. 85-17 at 17.
However, nothing in the record so much as hints that any dancer ever opted for the
employment agreement. To the contrary, it appears that no dancer ever chose to sign the
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significantly similar duties and responsibilities, worked under the same
management, and were subject to the same pay practices. Although Plaintiffs did
not all work at Heartbreakers at the same time, they all worked there during the
relevant class period. Moreover, they consistently testified that Heartbreakers
management unlawfully took their tips, whether through the imposition of fines
(e.g., $20 per missed stage appearance) or as part of the alleged tip-sharing
requirement.
Admittedly, Plaintiffs’ recollections do not align perfectly. For example,
Plaintiffs offered conflicting testimony about how the alleged tip-sharing scheme
worked, whether participation was mandatory or more of a “suggestion” coupled
with the fear of retribution, 9 and who at Heartbreakers benefited from it. 10
Nevertheless, the gist of their testimony is that they were required to pay back a
portion of the tips and that money was distributed among some combination of

employment agreement. See Dkt. 85-17 at 17 (“To my knowledge, they all option [sic] for
the [independent contractor agreement] because it’s more lucrative to them.”).
See Dkt. 82-1 at 44–45 (testifying other dancers, not management, told her about the
tip-sharing requirement); id. at 135 (testifying if she didn’t tip the DJ, he would either
leave her off the rotation or pick “the most awful music to dance to”); Dkt. 82-3 at 86–87
(testifying management would directly ask dancers to share their tips); Dkt. 85-6 at 10
(testifying she was required to pay managers for an assortment of reasons, including
performance-related punishment); Dkt. 82-2 at 40 (“[Tip sharing] was just an obligation.
You know, if you don’t do it, you were frowned upon. It was just one of those things that
was just understood. You just did it because everyone else did it and you didn’t want to be
the one that didn’t do it.”).
9

Dkt. 82-2 at 39–40 (testifying she was told by management to tip the DJs but
understood that she was also supposed to share her tips with the bartenders); Dkt. 82-1
at 43–44, 140–41 (testifying she was forced to tip waitresses, bartenders, and DJs, and
that she tipped managers “indirectly” because DJs split their tips with the managers); Dkt.
82-3 at 86–87 (testifying managers would directly ask dancers to share their tips); id. at
127–29 (testifying Heartbreakers’ management imposed fees and fines “for various
violations of different kinds of rules” which were then distributed among Heartbreakers’
staff); Dkt. 85-6 at 8–9 (“My managers expected me to pay them. . . . [I]f I skipped a song,
I have to pay. If I come in late, I have to pay. If I leave early, I have to pay. If I – if I wanted
anything, you have to pay.”).
10

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Heartbreakers’ staff—e.g., managers, DJs, bartenders, waitresses, and, according
to Kibodeaux, even the “house mom” got a piece of the action.
Even so, Defendants have not explained how these or any other differences
in Plaintiffs’ work experiences will preclude me from deciding the dancers’
employment status on a class-wide basis. See Tolentino v. C&J Spec-Rent Servs.,
Inc., 716 F. Supp. 2d 642, 647 (S.D. Tex. 2010) (“the court need not find uniformity
in each and every aspect of employment to determine that a class of employees is
similarly situated” (cleaned up)); Thrower, 484 F. Supp 3d at 485 (“a plaintiff must
show that potential class members are similarly situated in relevant respects given
the claims and defenses asserted” (cleaned up)).
2.

The Various Defenses Available to Defendants Which
Appear to be Individual to Each Plaintiff
i.

The Economic-Realities Test Can Be Applied on a
Collective Basis

Defendants’ primary defense is that Heartbreakers’ dancers are independent
contractors. While this defense certainly requires application of the economicrealities test, it is important to remember that I am not asked to decide, right here
and now, whether Heartbreakers’ dancers are employees or independent
contractors. Instead, my focus is on whether this question can be answered
collectively. See Swales, 985 F.3d at 442 (“Considering, early in the case, whether
merits questions can be answered collectively has nothing to do with endorsing the
merits.”). To be sure, part of this inquiry does require me to consider, for example,
the degree of control Defendants exercised over Heartbreakers’ dancers. But it
does not demand a full-blown application of the economic-realities test.
Otherwise, certification in cases such as this would be the functional equivalent of
summary judgment. Instead, my focus is on whether the evidence shows a
sufficient similarity between Plaintiffs’ and the potential opt-in plaintiffs’
employment situations that will allow me to apply the economic-realities test on a
class-wide basis.

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I have carefully reviewed all the evidence submitted by the parties. While I
agree with Defendants that Plaintiffs’ testimony is not entirely consistent on all
fronts, to put it bluntly, “there are some occupations for which all of us in society
have a basic understanding.” Kibodeaux, 2020 WL 6292551, at *5. Moreover, I find
it significant that dozens of district courts across the country, when asked to
consider whether exotic dancers are employees under the FLSA, have had no
difficulty addressing the question on a class-wide basis. See Degidio v. Crazy
Horse Saloon & Rest., Inc., No. 4:13-CV-02136-BHH, 2015 WL 5834280, at *7
(D.S.C. Sept. 30, 2015) (collecting cases). Even so, each case must be decided on
its own facts.
Here, there is no asserted defense that is unique to any of the Plaintiffs or
potential opt-ins. Moreover, Defendants do not argue any other FLSA exemption
applies should I find that the dancers are, in fact, employees. That is, in this case,
misclassification is a zero-sum game—Heartbreakers’ dancers are either
employees entitled to FLSA protections or they are not. Accordingly, I find that
Plaintiffs have shown a sufficient similarity between themselves and potential optins such that application of the economic-realities test will not require a “highly
individualized inquiry into each potential opt-in’s circumstances.” Swales, 985
F.3d at 442.
ii.

Individualized Determinations as to Each Plaintiff’s
Damages

To varying degrees, Plaintiffs all characterize Heartbreakers’ timekeeping
records as unreliable or untrustworthy. However, when pressed at deposition,
Plaintiffs could not identify any workweek where they worked over 40 hours. Given
the vague testimony, Defendants argue that calculating damages—particularly for
unpaid overtime—will require such a highly individualized inquiry that precludes
certification. See Dkt. 85 at 27–28 (describing the “Amounts & Measures of
Damages” as “Dispositive Merits Issues”).

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Admittedly, calculating damages may present some difficulties if we reach
that point. But “[t]he need for individual plaintiffs to establish the amount of
uncompensated time does not defeat certification.” Maynor v. Dow Chem. Co., 671
F. Supp. 2d 902, 935 (S.D. Tex. 2009). See also Metcalfe v. Revention, Inc., No.
4:10-CV-3515, 2012 WL 3930319, at *6 (S.D. Tex. Sept. 10, 2012) (“Whether
individualized determinations are necessary to define the extent of Plaintiffs’
damages, if any, does not weigh against efficiently establishing Defendants’ classwide liability.”).
3.

Fairness and Procedural Considerations

The FLSA is designed to be a remedial statute and should be given a broad
reading in favor of coverage. See Mitchell v. Lublin, McGaughy & Assocs., 358 U.S.
207, 211 (1959) (“the [FLSA] has been construed liberally to apply to the furthest
reaches consistent with congressional direction”). Fairness and procedural
considerations direct the court to consider the primary objectives of FLSA
collective actions: (1) to lower costs to the plaintiffs through the pooling of
resources; and (2) to limit the controversy to one proceeding which efficiently
resolves common issues of law and fact that arise from the same alleged activity.
See Hoffmann-LaRoche Inc., 493 U.S. at 170. Thus, I must balance these benefits
with any potential detriment to Defendants and the potential for judicial
inefficiency as a result of collective treatment.
Plaintiffs have met their burden and demonstrated they are sufficiently
similarly situated to benefit from the advantages of a collective action. And
Defendants have failed to present any argument of merit which convinces me that
I will not be able to manage this case in “a manner that will not prejudice any party
or be particularly burdensome on a jury.” Reyes v. Texas Ezpawn, L.P., No. CIV.A.
V-03-128, 2007 WL 101808, at *6 (S.D. Tex. Jan. 8, 2007). Thus, given the facts of
this case, the (relatively speaking) limited possible number of opt-in plaintiffs, and
the extensive factual similarities among them, I find that fairness and procedural
concerns do not weigh against certification.
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***
At this time, I must only decide whether Plaintiffs have shown that the
potential class members are similarly situated and that applying the economicrealities test on a collective basis will not require a highly individualized inquiry
into each potential opt-in’s circumstances. See Swales, 985 F.3d at 442. I find that
Plaintiffs have satisfied their burden. Accordingly, I certify the following class:
Anyone who has worked as a dancer at Heartbreakers during the
three-year period beginning October 27, 2017, through October 27,
2020.
D.

NOTICE
Notice is particularly important for FLSA collective actions as potential

plaintiffs’ statutes of limitations continue to run unless and until a plaintiff “gives
his consent in writing to become a party and such consent is filed in the court in
which such action is brought.” 29 U.S.C. § 216(b).
Both parties recycle the same notice-related arguments I addressed in the
previous iteration of this certification saga. Once again, my answers have not
changed. See Kibodeaux, 2020 WL 6292551, at *6–7. I believe that mail, e-mail,
and text-message notice will all help facilitate the FLSA’s overarching goal of
providing potential class members the opportunity to join the case and, therefore,
will allow all three forms of notice. I will not, however, require Heartbreakers to
post notice near its public entrance nor on the company’s social media sites.
Finally, Plaintiffs’ request that I order posted notice of the lawsuit in
Heartbreakers’ dressing room is granted; however, the sign shall not exceed 8.5 by
11 inches (the size of a standard piece of notebook paper). I trust that the parties
can agree on the sign’s color.
Plaintiffs have not attached a proposed class notice to their underlying
motion. Given that their notice-related arguments have not changed, I will assume
Plaintiffs’ references to “Exhibits 1 and 2” refer to exhibits attached to their initial
motion for conditional certification. See Dkt. 34-2 (Exhibit 1) and Dkt. 34-3
(Exhibit 2). To the extent Defendants raise the same objections to the wording of
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the proposed notice submitted by Plaintiffs, 11 I expect the parties to get together to
iron out the notice that will be sent to potential class members. To assist the parties
in crafting such a notice, I have prepared a form FLSA Notice and Consent to Join.
These

forms

are

available

on

my

website:

https://www.txs.uscourts.gov/page/united-states-magistrate-judge-andrew-medison. The parties are highly encouraged to utilize my Notice and Consent to Join
forms in preparing the ultimate documents that will be distributed to potential
plaintiffs, especially since those forms address many of the wording disputes at
issue here.
CONCLUSION
Based on an exhaustive review of the record and the extensive briefing of the
parties, I find that Plaintiffs have shown that the putative class satisfies the FLSA’s
similarity requirement. As such, Plaintiffs’ Motion for Certification and Issuance
of Notice (Dkt. 82) is GRANTED for a class defined as follows:
Anyone who has worked as a dancer at Heartbreakers during the
three-year period beginning October 27, 2017, through October 27,
2020.
It is further ORDERED that parties confer and file an agreed Proposed
Notice and an agreed Proposed Consent to Join Form by January 21, 2022.
It is further ORDERED that Defendants provide Plaintiffs with a list of all
individuals fitting the description of the certified class in a usable electronic format
by January 21, 2022. This list shall include each individual’s full name, last known
mailing address, e-mail address (if known), cell phone number (if known), and
date(s) of employment as a dancer at Heartbreakers.
Plaintiffs shall have fourteen (14) days from the receipt of the necessary
contact information to send notice to potential class members by first-class mail,
e-mail, and text message. The opt-in period shall be sixty (60) days from the date
Defendants’ briefing on the notice issue consists of a single sentence in which they
“reiterate and incorporate their objections in their prior response.” Dkt. 85 at 29 (citing
Dkt. 37 at 15–23).
11

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the notice is sent. A reminder notice may be sent to the putative class members by
first-class mail, e-mail, and text message. Heartbreakers is also required to post
the notice and consent form in Heartbreakers’ employee common space. The
posting shall be made on the date notice is sent and continue for the full 60-day
opt-in period.
Signed on this 10th day of January 2022.
______________________________
ANDREW M. EDISON
UNITED STATES MAGISTRATE JUDGE

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