Perez et al v. Fog River et al
ORDER finding as moot 21 Motion for Mediation; granting in part and denying in part 22 Motion for Partial Summary Judgment; denying 23 Motion to Amend/Correct; granting 27 Motion to Quash; denying 29 Motion for Extension of Time Under Rule 56(d). Signed by Magistrate Judge Paul M. Warner on 3/30/2017. (srs)
IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH
THOMAS E. PEREZ, SECRETARY OF
LABOR, UNITED STATES
DEPARTMENT OF LABOR,
Case No. 2:15-cv-500-PMW
FOG RIVER, LLC, a Utah limited liability
company; and JOHN BOWEN, an
Chief Magistrate Judge Paul M. Warner
On May 27, 2015, all parties consented to having Chief United States Magistrate Judge
Paul M. Warner conduct all proceedings in the case, including entry of final judgment, with
appeal to the United States Court of Appeals for the Tenth Circuit. 1 See 28 U.S.C. § 636(c);
Fed. R. Civ. P. 73. Before the court are the following motions: (1) Thomas E. Perez’s
(“Plaintiff”) Motion for Partial Summary Judgment; 2 (2) Fog River, LLC’s (“Fog River”) and
John Bowen’s (“Mr. Bowen”) (collectively, “Defendants”) Motion for Mediation; 3 (3)
Defendants’ Motion for Leave to Amend Answer; 4 (4) Defendants’ Motion for Extension of Time
Dkt. no. 13.
Dkt. no. 22.
Dkt. no. 21.
Dkt. no. 23.
under Rule 56(d); 5 and (5) Plaintiff’s Motion to Quash Defendants’ Notice of Rule 30(b)(6)
The court has carefully reviewed the written memoranda submitted by the parties.
Pursuant to civil rule 7-1(f) of the Rules of Practice for the United States District Court for the
District of Utah, the court has concluded that oral argument is not necessary and will determine
the motions on the basis of the written memoranda. See DUCivR 7-1(f).
Fog River is owned and operated by Mr. Bowen, his brother Kent Bowen, and Jeff Fort. 7
Fog River processes and distributes fish and seafood products from its facilities in Salt Lake
City, Utah. 8 Fish and shellfish from the sea, farms, and other locations are shipped to Fog River
where employees cut, process, and package it for distribution.9 Mr. Bowen performs general
manager functions and handles the day-to-day operations of the business, including making
decisions that affect the terms and working conditions of Fog River’s employees. 10
In October 2014, the Wage and Hour Division (“WHD”) of the Department of Labor
investigated Fog River for compliance with the provisions of the Fair Labor Standards Act
Dkt. no. 29.
Dkt. no. 27.
Dkt. no. 22-2 at ¶ 4.
Id. at ¶ 25.
Id. at ¶¶ 25-27.
Id. at ¶ 6.
(“FLSA”). 11 As the Secretary of the United States Department of Labor, Plaintiff is authorized
to enforce the provisions of the FLSA. See 29 U.S.C. §§ 201 to 219. In particular, Plaintiff may
recover back wages and liquidated damages, as well as seek injunctive relief, on behalf of
affected employees. Id. §§ 207, 211(c), 215(a)(2), 215(a)(5), 216(c), and 217.
At the time of the WHD investigation, Fog River employed approximately 13 employees
who were paid on an hourly basis. 12 In Mr. Bowen’s initial discussion with the WHD
Investigator, Sheffield Keith (“Investigator Keith”), Mr. Bowen admitted that Fog River only
paid employees their regular rates or “straight time” and not the required time and one-half rate
for hours worked in excess of 40 hours in a work week. 13 Mr. Bowen agreed to review Fog
River’s payroll information for its hourly employees and identify all hours worked in excess of
40 hours each week for a two year period. 14
On October 31, 2014, Investigator Keith emailed an Excel spreadsheet template to Mr.
Bowen to input hours worked and pay rate information for the subject employees. 15 On
December 2, 2014, Mr. Bowen emailed the completed spreadsheets to Investigator Keith. 16 The
spreadsheets included the hours worked, pay rate information, overtime hours worked, and the
Dkt. no. 22 at 3.
Dkt. no. 22-2 at ¶ 4.
Id. at ¶ 7.
Id. at ¶ 7.
Id. at ¶¶ 8 and 9.
Id. at ¶ 9.
amounts due for overtime for each employee. 17 On December 4, 2014, Investigator Keith went
to Fog River to confirm the back wage computations. 18 He spot checked the spreadsheets
against the payroll records and found that they matched. 19
Investigator Keith explained to Mr. Bowen that an amount equal to the amount of the
unpaid wages would be assessed as liquidated damages and asked Mr. Bowen to provide reasons
why they should not be assessed. 20 In response, Mr. Bowen stated that Fog River paid its
employees higher rates than the industry average, he did not believe the overtime premium
requirement applied because Utah was a “right to work” state, and Fog River’s employees
voluntarily worked overtime hours. 21 Mr. Bowen further indicated that if he had known, he
would have limited overtime worked and hired more employees. 22
Investigator Keith also determined that Fog River had improperly paid another employee,
David Antonio Granillos, a flat weekly rate and failed to maintain any record of the hours he
worked or pay him overtime compensation for hours he worked over 40 hours a week. 23 On
January 5, 2015, Investigator Keith emailed Mr. Bowen to request a back wage determination for
Mr. Granillos and explained that he would have to reconstruct Mr. Granillos’s hours worked if
Id. at ¶ 9.
Id. at ¶ 10.
Id. at ¶ 11.
Fog River did not have time records for him. 24 Mr. Bowen responded that unlike other
employees, Mr. Granillos worked 5 days per week and approximately 40 hours per work week. 25
On January 21, 2015, Investigator Keith met with Mr. Bowen at Fog River to review the
results of his investigation. 26 Investigator Keith explained that the WHD’s findings
demonstrated that Fog River violated provisions of the FLSA by failing to (1) pay 12 employees
the overtime rate for hours worked over 40 in a work week and (2) maintain records of hours
worked for Mr. Granillos. 27 Investigator Keith provided form WH-55 to Mr. Bowen that showed
a total amount of back wages due for the 12 employees as $65,352.38, including $5,562 for Mr.
Granillos. 28 He then further explained that an equal amount of back wages owed to each
employee had been assessed as liquidated damages. 29
While Mr. Bowen agreed to comply with the FLSA in the future, he did not agree to pay
the assessed back wages and liquidated damages and again stated that the violations were due to
lack of knowledge about the rules. 30 On February 17, 2015, Investigator Keith received written
Id. at ¶ 13.
Id. at ¶ 14.
Id. at ¶ 15.
correspondence from Mr. Bowen indicating that Defendants refused to pay all of the assessed
back wages and/or liquidated damages. 31
On February 26, 2015, Investigator Keith and his supervisor, Assistant District Director
Kathy Milton (“ADD Milton”), met with Mr. Bowen at Fog River. 32 ADD Milton explained that
Defendants were required to pay the assessed back wages and liquidated damages but she offered
to set up a payment plan for Defendants. 33 ADD Milton and Investigator Keith informed Mr.
Bowen that employees are due both back wages and liquidated damages under the FLSA unless
Defendants have a good faith reason for not complying with the FLSA. 34 Investigator Keith did
not find any evidence that Defendants attempted to comply with the FLSA. 35 While Mr. Bowen
indicated to Investigator Keith that Defendants had sought legal counsel through this process, he
never claimed that Fog River’s employees were exempt from the FLSA’s requirements. 36 On
March 2, 2015, Investigator Keith received written correspondence from Mr. Bowen indicating
that Defendants did not intend to pay liquidated damages in this matter. 37
Id. at ¶ 16.
Id. at ¶ 17.
Id. at ¶ 19.
Id. at ¶ 23.
Id. at ¶¶ 23 and 24.
Id. at ¶ 18.
ADD Milton reviewed Investigator Keith’s back wage computations for Mr. Granillos
and instructed him to recalculate them. 38 His new calculation resulted in an adjusted amount of
$6,831.59, which he informed Mr. Bowen of by telephone. 39 In addition, prior to Plaintiff filing
the complaint in this matter on July 15, 2015, Investigator Keith modified the data in the
spreadsheets for each employee to reflect back wages starting from July 15, 2013, in order to
comply with the two year statute of limitations.40 One of the employees considered in the
original calculation actually worked outside the limitations period, thus resulting in a modified
calculation of $55,029.23 for the 11 hourly employees from July 15, 2013 to October 26, 2014,
the last date for which Plaintiff had Defendants’ payroll records. 41
Mr. Bowen states that Fog River was previously owned by Sysco Intermountain Food
Service and that he and the other owners of Fog River have never owned a business with hourly
employees. 42 Mr. Bowen indicates that when Fog River’s business increased, he offered the
extra hours to their employees rather than hiring additional employees. 43 Fog River’s employees
did not request overtime payment, nor did anyone else they consulted suggest that overtime
Id. at ¶ 20.
Id. at ¶ 30.
Id. at ¶¶ 10 and 30.
Dkt. no. 41-1 at ¶¶ 2 and 3.
Id. at ¶ 4.
payment was required. 44 Mr. Bowen states that Defendants were not aware of the requirements
of the FLSA. 45
Mr. Bowen contends that during the investigation, Investigator Keith stated that he
believed Defendants had in good faith tried to follow the law and that he would suggest to his
superiors that Defendants not be assessed liquidated damages. 46 Mr. Bowen asserts that
Investigator Keith later informed him that liquidated damages would be assessed because of
WHD policy by which WHD employees were evaluated based on the size of the awards they
were able to obtain. 47 Mr. Bowen states that Investigator Keith further noted that his position as
an investigator had changed from teaching employers how to comply with the FLSA to a
“hardcore” position. 48
Mr. Bowen asserts that based upon his observation of Mr. Granillos and his work, he
believes Mr. Granillos only worked an average of 40 hours per week, rather than the 46 hours
Investigator Keith calculated. Mr. Bowen asserts that since Defendants were informed that they
should be paying overtime, they have restructured their payroll system, paid at least $48,000 in
back wages to their employees, and installed a time clock to accurately track employees’ hours. 49
Id. at ¶ 5.
Id. at ¶ 12.
Id. at ¶¶ 8 and 20.
STANDARD OF REVIEW
Summary judgment “should be rendered if the pleadings, the discovery and disclosure
materials on file, and any affidavits show that there is no genuine issues as to any material fact
and that the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(c)(2). The
court examines “the factual record and reasonable inferences therefrom in the light most
favorable to the party opposing summary judgment.” Universal Money Ctrs., Inc. v. Am. Tel. &
Tel. Co., 22 F.3d 1527, 1529 (10th Cir. 1994). The burden of establishing the absence of a
genuine issue of material fact rests with the moving party. Celotex Corp. v. Catrett, 477 U.S.
317, 323 (1986). However, the moving party “need not negate the nonmovant’s claim, but need
only point out to the district court that there is an absence of evidence to support the nonmoving
party’s case.” Universal Money Ctrs., Inc., 22 F.3d at 1529. Once the moving party has met its
burden, the burden shifts to the nonmovant to designate “specific facts showing that there is a
genuine issue for trial as to those dispositive matters for which it carries the burden of proof.”
Id. (quotation and citation omitted). The court will consider a dispute to be genuine only when
“‘the evidence is such that a reasonable jury could return a verdict for the nonmoving party.’”
Kerber v. Qwest Group Life Ins. Plan, 647 F.3d 950, 959 (10th Cir. 2011) (quoting Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). The “mere existence of a scintilla of evidence”
in support of the nonmoving party’s position will not defeat a well-supported motion for
summary judgment. Anderson, 477 U.S. at 252.
Plaintiff’s Motion for Summary Judgment
Plaintiff moves this court to enter an order granting partial summary judgment on each of
Plaintiff’s claims for the time period of July 15, 2013 through the pay period ending October 26,
2014. Specifically, Plaintiff seeks an order: (1) requiring Defendants to pay the uncompensated
wages due to employees in the amount of $55,029.23; (2) granting liquidated damages in the
amount of $55,029.23 pursuant to § 216(c) of the FLSA; and (3) permanently restraining
Defendants from continuing the violations alleged in Plaintiff’s Complaint pursuant to § 217 of
Defendants concede that they are employers and that Fog River is an enterprise engaged
in commerce for purposes of the FLSA. See generally 29 U.S.C. ¶ 203. Defendants argue,
however, that they have already paid at least $48,000 in back wages to their employees. Thus,
Defendants contend, assuming their employees are not exempt and Defendants are liable for
back wages, the amount they owe would be significantly less than what Plaintiff alleges.
Defendants urge this court to conclude that because the amounts sought by Plaintiff and the
amounts already paid by Defendants are different, there are issues of material fact precluding
summary judgment. In addition, Defendants argue that liquidated damages should not be
imposed because they acted in good faith. Finally, Defendants contend that an injunction is
unnecessary as Defendants have demonstrated that they have changed their business practices in
order to comply with the FLSA.
A. Liability under the FLSA
Under the FLSA, an employer is forbidden from employing
any of his employees who in any workweek is engaged in commerce or in the production
of goods for commerce, or is employed in an enterprise engaged in commerce or in the
production of goods for commerce, 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
Id. § 207(a)(1). Thus, to establish that Defendants are liable to pay their employees overtime
back wages, Plaintiff must show that: (1) an employment relationship exists; (2) Fog River is an
“enterprise” engaged in commerce; (3) Defendants failed to pay their employees overtime as
required by the FLSA; and (4) there exists a reasonable estimate of the amount and extent of the
work for which the employees were not paid. See 29 U.S.C. §§ 207(a); see also Anderson v. Mt.
Clemens Pottery Co., 328 U.S. 680, 687 (1946) (holding that an employee “has carried out his
burden [under the FLSA] if he proves that he has in fact performed work for which he was
improperly compensated and if he produces sufficient evidence to show the amount and extent of
that work as a matter of just and reasonable inference”), superseded by statute on other grounds,
Portal–to–Portal Act of 1947, Pub. L. No. 80–49, 61 Stat. 84.
As noted above, it is undisputed that Mr. Bowen, who acts as the general manager of Fog
River and controls its day-to-day operations, is an “employer” under the FLSA. 50 See 29 U.S.C.
§ 203(d). It is also undisputed that Fog River is an “[e]nterprise engaged in commerce” under
the FLSA as Defendants have “employees engaged in commerce or in the production of goods
for commerce” and their annual gross volume of sales is above $500,000. 51 Id. § 203(s)(1).
Thus, as Defendants concede, the first two elements have been met.
Dkt. no. 41 at ¶ 8.
Id. at ¶¶ II and B.
While Defendants acknowledge that they failed to pay their employees overtime under
the FLSA, they argue that their employees should be deemed exempt. Specifically, Defendants
assert that Plaintiff has published regulations governing a repealed section of the FLSA, which
exempted from overtime pay “any employee employed in the canning, processing, marketing,
freezing, curing, storing, packing for shipment, or distributing of any kind of fish shellfish, or
other aquatic forms of animal or vegetable life, or any byproduct thereof.” 29 U.S.C. § 213(b)(4)
(repealed 1974, effective 1976). Defendants contend that this repealed portion of the FLSA
describes the type of work their employees perform. Defendants argue that because Plaintiff has
continued to publish regulations in the Code of Federal Regulations that govern this repealed
portion of the FLSA, Defendants’ employees should be deemed exempt from overtime pay as if
that portion of the FLSA were still in effect. 52
The court finds Defendants’ argument to be unpersuasive. Defendants do not argue that
they relied upon those regulations in determining that their employees were exempt. 29 C.F.R.
§§ 784.136 to 784.156. Nor do the affidavits submitted in this matter establish that Defendants
even read, let alone relied upon, the interpretive provisions of the repealed statute contained in
In his motion for partial summary judgment, Plaintiff discusses at length another section of the
FLSA currently in force. Specifically, section 29 U.S.C. § 213(a)(5) exempts from overtime
employees who are employed “in the catching, taking propagating, harvesting, cultivating, or
farming of any kind of fish, shellfish, crustacea, sponges, seaweeds, or other aquatic forms of
animal and vegetable life, or in the first processing, canning or packing of such marine products
at sea as an incident to or in conjunction with, such fishing operations, including the going to and
returning from work and loading and unloading when performed by any such employee.” Id.
§ 213(a)(5) (emphasis added). Plaintiff argues that Defendants’ employees are not engaged in
this type of “first processing” of marine products. However, in their opposition memorandum,
Defendants concede that their employees are not exempt under this section but argue their
employees should be deemed exempt based on the continued publication of 29 C.F.R.
§§ 784.136 to 784.156.
the Code of Federal Regulations. Rather, Defendants assert that it is inequitable to permit
Plaintiff to “tell the world that people doing this [job] are exempt from the overtime requirements
of the FLSA and then sue [their employer] for violating the Act.” 53 However, the fact that the
Code of Federal Regulations has not been updated to reflect that a portion of the FLSA has been
repealed does not justify Defendants’ failure to abide by the current version of the FLSA. As
noted by the Fifth Circuit, Defendants cannot “blindly operate a business without making any
investigation as to their responsibilities under the labor laws. Apathetic ignorance is never the
basis of a reasonable belief.” Barcellona v. Tiffany English Pub. Inc., 597 F.2d 464, 469 (5th Cir.
1979). Had Defendants’ sought legal counsel, any competent attorney would have informed
Defendants that reliance on 29 U.S.C. § 213(b)(4) would be in error. Defendants’ argument is
undoubtedly a post hoc rationalization for failing to pay their employees overtime wages in
accordance with the FLSA. Ignorance of a law does not provide a reasonable defense for failing
to follow it. Accordingly, this court concludes that Defendants’ employees are not exempted
from overtime and Defendants have violated the FLSA by failing to pay their employees
Plaintiff has provided a reasonable estimation of the amount of back wages owed to
Defendants’ employees from July 15, 2013 (two years preceding the filing of the Complaint)
through October 26, 2014 (the last pay period for which Plaintiff has records). Fog River kept a
record of the number of hours worked for the employees at issue, except for Mr. Granillos. With
respect to the employees for which Fog River kept records of hours worked, there are no factual
disputes relative to the number of hours worked. Investigator Keith obtained the records he used
Dkt. no 41 at 18.
to calculate the overtime wages owed to each of those employees from Fog River. Thus, there
are no material facts in dispute with regard to the 10 hourly employees and summary judgment is
The Supreme Court has held that when an employer does not keep accurate records of the
hours its employees worked, as in Mr. Granillos’s case, a plaintiff in a FLSA action can meet his
if he proves that [the employee] has in fact performed work for which he was improperly
compensated and if he produces sufficient evidence to show the amount and extent of that
work as a matter of just and reasonable inference. The burden then shifts to the employer
to come forward with evidence of the precise amount of work performed or with
evidence to [negate] the reasonableness of the inference to be drawn from the employee’s
evidence. If the employer fails to produce such evidence, the court may then award
damages to the employee, even though the result be only approximate.
Anderson, 328 U.S. at 687-88. Because Fog River did not keep hourly records for Mr. Granillos,
Investigator Keith estimated that he worked an average of 46 hours per week from information
obtained in his investigation, including comparing the number of overtime hours worked by
other fish cutters. For example, fish cutters Martin Chacon and Martin Teran Torres worked
significantly more than 46 hours per week on a regular basis. When the 46-hour estimate is
compared to overtime hours other fish cutters worked, the court concludes that this amount was
just and reasonable. Other than Mr. Bowen’s self-serving affidavit stating that he “believe[s] that
[Mr. Granillos] worked 40 hours per week based on [his] observation of him and his work,” 54
Defendants have failed to provide any “evidence of the precise amount of work performed” or
otherwise challenge the reasonableness of Plaintiff’s estimate. Anderson, 328 U.S. at 687-88.
Id. at ¶ 13.
Because Defendants have failed to rebut Plaintiff’s estimate, the court concludes that Defendants
must pay the amount of overtime damages owed to Mr. Granillos as set forth by Plaintiff.
Based on the foregoing, this court concludes that Defendants violated the FLSA by
failing to pay overtime wages. As such, this portion of Plaintiff’s motion for partial summary
judgment is GRANTED. Accordingly, Defendants must pay the uncompensated wages due to
employees in the amount of $55,029.23 for the time period of July 15, 2013 to October 26, 2014,
offset by any payments paid to those employees since the inception of this case.
B. Liquidated Damages
Under the FLSA, “any employer who violates [the minimum wage or overtime
provisions] 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.” 29 U.S.C. § 216(b). However, the FLSA also provides
that “if the employer can establish that his conduct was both in good faith and based on a
reasonable belief that his conduct was not in violation of the FLSA, the court may, in its
discretion, award less or no liquidated damages.” Mumby v. Pure Energy Servs (USA), Inc., 636
F.3d 1266, 1272 (10th Cir. 2011); see also 29 U.S.C. § 260. “While the reasonableness
requirement is an objective standard, the good-faith inquiry is subjective, requiring an ‘honest
intention to ascertain and follow the dictates’ of the FLSA.” Id. (quoting Dep’t of Labor v. City
of Salupa, Okla., 30 F.3d 1285, 1289 (10th Cir. 1994)). Defendants bear the “‘difficult’ burden
of proving both subjective good faith and objective reasonableness, ‘with double damages being
the norm and single damages the exception.’” Alvarez v. IBP, Inc., 339 F.3d 894, 910 (9th Cir.
2003) (quoting Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132, 142 (2d Cir. 1999)).
Defendants argue that they acted in good faith because (1) the requirements of the FLSA
are not “common knowledge among the general population,” (2) they adhered to the obligations
of which they were aware and changed their policies upon learning of their violations, and (3)
they pay higher than average market wages. 55 Defendants also argue that Investigator Keith’s
statement to Mr. Bowen that he would recommend to his superiors that no liquidated damages be
imposed warrants the denial of summary judgment on this issue.
The court finds that there are no material facts in dispute regarding the liquidated
damages provision of the FLSA. The court concludes that Defendants have met their burden of
establishing that they acted in good faith and with reasonableness. Accordingly, the court elects
to exercise its discretion and reduces liquidated damages to $1.00 per employee. See Mumby,
636 F.3d at 1272. Thus, this portion of Plaintiff’s motion is GRANTED IN PART AND
DENIED IN PART.
C. Injunctive Relief
Plaintiff moves this court for a permanent injunction barring Defendants from future
violations of the FLSA. Defendants respond by arguing that no injunction is necessary to ensure
their future compliance with the FLSA. Specifically, Defendants contend that once they were
made aware of their obligations under the FLSA, they changed their practices in order to comply
District courts are authorized to award injunctive relief against violations of the FLSA.
29 U.S.C. § 217. The purpose of permanent prospective injunctions is remedial in nature rather
than punitive. Metzler v. IBP, Inc., 127 F.3d 959, 963 (10th Cir. 1997). Plaintiff bears the burden
Id. at 16.
of demonstrating that an injunction is necessary. See id. Courts weigh various factors when
deciding whether to grant an injunction, “including the employer’s previous conduct, its current
conduct, and the reliability of its promises of future compliance.” Id. When a past violation of
the FLSA is found, “courts balance that finding against factors indicating a reasonable likelihood
that the violation will not recur, such as the employer’s intent to comply, extraordinary efforts
taken to prevent recurrence, the absence of repetitive violations, and the absence of bad faith.”
Id. at 963-64.
As noted by the Tenth Circuit, “[p]rospective injunctions are an essential tool to
effectuate the policy of the FLSA because the cost of compliance is placed on the employer
rather than the employee or the government.” Id. at 963 (citing Brock v. Big Bear Market No. 3,
825 F.2d 1381, 1383 (9th Cir. 1987)). Prospective injunctions do not impose an undue hardship
on employers because they merely require employers to comply with the FLSA, which they are
required to do anyway. Id.
During the investigation, Mr. Bowen acknowledged Defendants’ overtime compensation
violations and agreed comply with the FLSA in the future. The court concludes that this
agreement, however, is questionable. Defendants did not make efforts to pay their employees
back wages until after Plaintiff filed this lawsuit. While Defendants argue that they have taken
steps to comply with the FLSA and are now in compliance with it, “current compliance alone,
particularly when achieved by direct scrutiny of the government, is not sufficient ground for
denying injunctive relief.” Id. (quoting Big Bear Market, 825 F.2d at 1383). Accordingly, this
court concludes that Defendants’ conduct necessitates a permanent injunction to ensure
compliance with and to prevent future violations of the FLSA and summary judgment on this
issue is appropriate.
Defendants’ Motion for Mediation
Defendants seek an order referring this case to mediation on the grounds that it is
inequitable for Plaintiff to have filed this lawsuit when it continues to publish regulations in the
Code of Federal Regulations that govern the repealed portion of the FLSA discussed above.
Because the court has granted partial summary judgment on the issue Defendants seek to
mediate, Defendants’ motion for mediation has been rendered MOOT.
Defendants’ Motion for Leave to Amend Answer
Defendants move this court for leave to amend their answer to add the following defense:
Plaintiff publishes and has published regulations in the Code of Federal Regulations at 28
[sic] CFR Part 784 stating that the work performed by the Defendants’ employees is
exempt from the overtime provisions of the Fair Labor Standards Act and it is inequitable
to allow the Plaintiff to publicly state that said work is exempt and then allow Plaintiff to
sue the Defendants for the same work. 56
However, as already decided by the court, this defense fails as a matter of law. While Rule
15(a)(2) states that leave to amend shall be freely given when justice requires, leave to amend
may be denied upon a showing that amendment would be futile. Frank v. U.S. West, Inc., 3 F.3d
1357, 1365 (10th Cir. 1993). Because Defendants’ proposed amended answer would be futile,
this court DENIES Defendants’ motion for leave to amend answer.
Defendants’ Motion for Extension of Time Under Rule 56(d)
Defendants seek an order under Rule 56(d) of the Federal Rules of Civil Procedure
allowing additional time for discovery regarding the calculation of their employee’s overtime and
Dkt. no. 23 at 7.
the request for liquidated damages as argued in Plaintiff’s motion for partial summary judgment.
In response, Plaintiff asserts that Defendants have not demonstrated that additional discovery is
necessary for them to adequately oppose Plaintiff’s motion for partial summary judgment.
Under Rule 56(d), the nonmovant must show “by affidavit or declaration that, for
specified reasons, it cannot present facts essential to justify its opposition” to a motion for
summary judgment. Fed. R. Civ. P. 56(d). Summary judgment should not be entered “where the
nonmoving party has not had the opportunity to discover information that is essential to his
opposition.” Anderson, 477 U.S. at 250 n.5. However, in seeking protection under Rule 56(d),
the nonmoving party must provide an affidavit or declaration “stating with specificity how the
desired time would enable [the nonmoving party] to meet its burden in opposing summary
judgment.” Guthrie v. Sawyer, 970 F.2d 733, 738 (10th Cir. 1992) (citation omitted).
Defendants have provided declarations identifying deposition topics but Defendants fail
to adequately explain how this requested discovery is essential to opposing Plaintiff’s motion. In
particular, Defendants seek discovery regarding (1) Investigator Keith’s recommendation that
Defendants not be required to pay liquidated damages, (2) the Excel spreadsheet Defendants
completed showing the number of hours worked by their employees, (3) Fog River’s employees’
rounding errors on their timesheets, and (4) the difference in the amounts sought by Plaintiff
during the investigation and the amounts sought in this action. The court will address each topic
First, Investigator Keith’s subjective recommendation to his supervisors regarding
liquidated damages is irrelevant. The burden is on Defendants to present their own facts, not
testimony by Investigator Keith, establishing their efforts to ascertain and follow the
requirements of the FLSA were made in good faith. Defendants have not shown how
Investigator Keith’s testimony will help them oppose Plaintiff’s motion for partial summary
Second, the data contained in the Excel spreadsheet was input by Defendants. The
amount of back wages due is premised on the information Defendants provided using their own
payroll data. Investigator Keith checked Fog River’s payroll records against the spreadsheet to
verify that they matched. Defendants have not specified any facts they need regarding the Excel
spreadsheet that Plaintiff could provide to them in order to adequately oppose Plaintiff’s motion.
Essentially, Defendants want a second bite at the apple.
Third, whether Defendants’ employees rounded their hours when submitting their
timesheets is irrelevant. Even assuming Defendants’ records are not accurate, this information is
immaterial to Plaintiff’s motion unless Defendants have records of the correct hours that were
not disclosed during the investigation. This is the first time Defendants have raised this issue
and they have not explained how discovery from Plaintiff regarding it would help in opposing
Finally, Defendants have failed to explain what additional discovery they need regarding
the difference in the amount sought by Plaintiff after the investigation and the amount Plaintiff
seeks in this action. The discrepancy was explained in detail in Investigator Keith’s affidavit and
Defendants have not specified how additional facts from Plaintiff would aid them in opposing
Based on the foregoing, Defendants’ Rule 56(d) motion is DENIED.
Plaintiff’s Motion to Quash Defendants’ Notice of Deposition
Plaintiff seeks an order quashing Defendants’ notice of Rule 30(b)(6) deposition or an
order requiring Defendants to show cause why the deposition is necessary before this court rules
on Plaintiff’s motion for partial summary judgment. Defendants seek to depose Investigator
Keith regarding the topics discussed above. Because the court has ruled on these issues,
Investigator Keith’s deposition is unnecessary. As such, Plaintiff’s motion to quash is
Based on the foregoing, IT IS HEREBY ORDERED that:
(1) Plaintiff’s motion for partial summary judgment 57 is GRANTED IN PART AND
DENIED IN PART:
a. Defendants must pay the uncompensated wages due to employees in the
amount of $55,029.23 for the time period of July 15, 2013 to October 26,
2014, offset by any payments paid to those employees since the inception of
b. Defendants must also pay liquidated damages of $1.00 to each employee; and
c. Defendants are permanently enjoined from future violations of the FLSA;
(2) Defendants’ motion for mediation 58 has been rendered MOOT;
(3) Defendants’ motion for leave to amend their answer 59 is DENIED;
Dkt. no. 22.
Dkt. no. 21.
Dkt. no. 23.
(4) Defendants’ motion for an extension of time under Rule 56(d) 60 is DENIED; and
(5) Plaintiff’s motion to quash 61 is GRANTED.
IT IS SO ORDERED.
DATED this 30th day of March, 2017.
BY THE COURT:
PAUL M. WARNER
Chief United States Magistrate Judge
Dkt. no. 29.
Dkt. no. 27.
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