Byard et al v. Verizon West Virginia, Inc. et al

Filing 49

MEMORANDUM OPINION AND ORDER; DENIES as to 26 Plaintiffs Motion to Remand; GRANTS as to 9 Verizon Communications, Inc Motion to Dismiss for Lack of Jurisdiction; DISMISSES Counts One and Two of the plaintiffs complaint (dkt. no. 1-1 at 32) WITH P REJUDICE. GRANTS the remaining defendants motions to dismiss for failure to state a claim dkt. nos. 11 , 12 , 13 , 17 . GRANTS-IN-PART as to 46 Plaintiffs Motion for Leave to File an amended complaint to the extent that the plaintiffs seek leav e to assert a claim arising under theFair Labor Standards Act, 29 U.S.C. § 201 et seq.; DENIES as MOOT as to 47 Defendants consent motion for an extension of time to respond. DIRECTS the plaintiffs to file an amended complaint consistent with these rulings within 30 days from the entry of this Order. Court directs Clerk to DISMISS the defendant Verizon Communications, Inc. WITHOUT PREJUDICE. Signed by District Judge Irene M. Keeley on 3/30/2012. (Copy counsel of record via CM/ECF)(jmm)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
CHARLES R. BYARD, DAVID M. BROSIUS,
KIMBERLY A. RAY, STEPHANIE SNOW-MCKISIC,
LISA M. THARP, and LYNET WHITE,
Plaintiffs,
v.

//

CIVIL ACTION NO. 1:11CV132
(Judge Keeley)

VERIZON WEST VIRGINIA, INC., FRONTIER
WEST VIRGINIA, INC., VERISON SERVICES
CORP., VERIZON COMMUNICATIONS, INC.,
JODI DENNIS, MARY FREDERICK, CODY
STEWART, BARBARA TERWILLINGER,
BOB ANDERSON, TAMMY MASON, DAWN
WATSON, MICHAEL HATHAWAY, and
CORBY MILLER,
Defendants.
MEMORANDUM OPINION AND ORDER
Before the Court are the defendants’ motions to dismiss and
the plaintiffs’ motion to remand this case to the Circuit Court of
Harrison County, West Virginia. For the reasons discussed below,
the Court DENIES the plaintiffs’ motion to remand (dkt. no. 26),
GRANTS the defendant Verizon Communications, Inc.’s (“VCI”) motion
to dismiss for lack of personal jurisdiction (dkt. no. 9), and
GRANTS the remaining defendants’ motions to dismiss for failure to
state a claim (dkt. nos. 11, 12, 13, 17).
I.
On July 22, 2011, the named plaintiffs, Charles R. Byard,
David M. Brosius, Kimberly A. Ray, Stephanie Snow-McKisic, Lisa M.
Tharp, and Lynet White (collectively “the plaintiffs”), filed this

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1:11CV132

MEMORANDUM OPINION AND ORDER
putative class action in the Circuit Court of Harrison County, West
Virginia.

The complaint alleges that the defendants, Verizon West

Virginia, Inc., Frontier West Virginia, Inc., Verizon Services
Corp., Verizon Communications, Inc., Jodi Dennis, Mary Frederick,
Cody Stewart, Corby Miller, Barbra Terwilliger, Bob Anderson, Tammy
Mason,

Dawn

Watson,

and

Michael

Hathaway

(collectively

“defendants”), failed to fully compensate the named plaintiffs and
a class of current and former employees for their “time worked” at
the Verizon call centers located in Charleston and Clarksburg, West
Virginia. Specifically, the plaintiffs allege that the defendants,
as their employers and supervisors, required them to engage in
certain “preliminary and post-liminary” work activities without
compensation.
The complaint contains two causes of action. Count One alleges
that the defendants violated W. Va. Code § 21-5-4 by failing to pay
the plaintiffs “for all hours worked” (dkt. no. 1-1 at 50 (emphasis
in original)). Count Two alleges that the defendants violated
W. Va. Code § 21-5-9 by “fail[ing] to keep accurate records of all
hours worked by Call Center employees” (dkt. no. 1-1 at 52).
On August 15, 2011, the defendants timely removed this case
under 28 U.S.C. §§ 1441 and 1446, invoking this Court’s federal
question jurisdiction pursuant to 28 U.S.C. § 1331. The defendants

2

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MEMORANDUM OPINION AND ORDER
argue that the Court has federal subject matter jurisdiction over
this case because the plaintiffs’ claims are completely preempted
by § 301 of the Labor Management Relations Act, 29 U.S.C. § 185(a).
The plaintiffs moved to remand (dkt. no. 26), VCI moved to dismiss
for lack of personal jurisdiction (dkt. no. 9), and the remaining
defendants moved to dismiss for failure to state a claim (dkt. no.
11, 12, 13, and 17). The Court will address each of these motions
in turn.
II.
The threshold question is whether the Court has federal
subject matter jurisdiction in this case.
A.
Federal district courts have original jurisdiction over “all
civil actions arising under the Constitution, laws, or treaties of
the United States.” 28 U.S.C. § 1331. Any state civil action which
satisfies this requirement “may be removed by the defendant or the
defendants, to the district court of the United States for the
district and division embracing the place where such action is
pending.” 28 U.S.C. § 1441(a). The party seeking removal bears the
burden of establishing federal jurisdiction, Mulcahey v. Columbia
Organic Chemicals Co., Inc., 29 F.3d 148, 151 (4th Cir. 1994), and
all doubts about the propriety of removal should be resolved in

3

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MEMORANDUM OPINION AND ORDER
favor of retaining state jurisdiction. Hartley v. CSX Transp.,
Inc., 187 F.3d 422, 425 (4th Cir. 1999).
Under the well-pleaded complaint rule, “federal jurisdiction
exists only when a federal question is presented on the face of the
plaintiff’s

properly

pleaded

complaint.”

Caterpillar

Inc.

v.

Williams, 482 U.S. 386, 392 (1987). Accordingly, federal question
jurisdiction may not rest on the assertion of a federal defense,
including the defense of preemption. Id. at 393. Rather, federal
district courts have jurisdiction over “‘only those cases in which
a

well-pleaded

complaint

establishes

either

that

federal

law

creates the cause of action or that the plaintiff’s right to relief
necessarily depends on resolution of a substantial question of
federal law.’” Interstate Petroleum Corp. v. Morgan, 249 F.3d 215,
219 (4th Cir. 2001) (quoting Franchise Tax Bd. v. Const. Laborers
Vacation Trust, 463 U.S. 1, 27 (1983)).
A

corollary

to

the

well-pleaded

complaint

rule

is

the

“complete preemption doctrine.” Under this doctrine, a complaint
“can be recharacterized as one ‘arising under’ federal law if the
law governing the complaint is exclusively federal.” Vaden v.
Discover Bank, 556 U.S. 49, 50 (2009) (citing Beneficial Nat. Bank
v. Anderson, 539 U.S. 1, 8 (2003)). This doctrine will apply to a
claim

when

“the

pre-emptive

force

4

of

a

statute

is

so

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MEMORANDUM OPINION AND ORDER
‘extraordinary’ that it ‘converts an ordinary state commonlaw
complaint into one stating a federal claim for purposes of the
well-pleaded

complaint

rule.’”

Caterpillar,

482

U.S.

at

393

(quoting Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 65 (1987)).
The completely preempted state claim will thus be considered, “from
its inception, a federal claim,” and consequently “arises under”
federal law. Caterpillar, 482 U.S. at 393 (citing Franchise Tax
Bd., 463 U.S. at 24).
In order to remove an action on complete preemption grounds,
a defendant must show that “the plaintiff has a ‘discernible
federal [claim]’ and that ‘Congress intended [the federal claim] to
be the exclusive remedy for the alleged wrong.’” Pinney v. Nokia,
Inc., 402 F.3d 430, 449 (4th Cir. 2005) (alteration in original)
(quoting King v. Marriott Int’l, 337 F.3d 421, 425 (4th Cir.
2003)). Here, the defendants argue that the plaintiffs’ claims are
completely preempted by § 301 of the Labor Management Relations Act
(“LMRA”), 29 U.S.C. § 185, a statute in which the Supreme Court has
found a congressional intent to create an exclusively federal
remedy. See Avco Corp. v. Aero Lodge No. 735, Int’l Ass’n of
Machinists, 390 U.S. 557, 560 (1968).
Section 301 of the LMRA provides in pertinent part:
Suits for violation of contracts between an employer and
a labor organization representing employees in an
5

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MEMORANDUM OPINION AND ORDER
industry affecting commerce as defined in this chapter,
or between any such labor organizations, may be brought
in any district court of the United States having
jurisdiction of the parties, without respect to the
amount in controversy or without regard to the
citizenship of the parties.
29 U.S.C. § 185(a). This statute creates “a body of federal common
law” in order to secure uniform interpretation of labor contracts
and

“‘promot[e]

the

peaceable,

consistent

resolution

of

labor-management disputes.’” McCormick v. AT&T Tech., Inc., 934
F.2d 531, 534, 537 (4th Cir. 1991) (quoting Lingle v. Norge Div. of
Magic Chef, Inc., 486 U.S. 399, 404 (1988)).
Even though the preemptive effect of § 301 “is so powerful as
to displace entirely any state cause of action for violation of
contracts between an employer and a labor organization,” Franchise
Tax

Bd.,

463

U.S.

at

23,

“the

bare

fact

that

a

collective

bargaining agreement will be consulted in the course of state-law
litigation plainly does not require [preemption].” Livadas v.
Bradshaw, 512 U.S. 107, 124 (1994). Instead, a state law claim will
be completely preempted by § 301 only if resolution of the claim
“requires the interpretation of a collective-bargaining agreement,”
Lingle,

486

U.S.

at

413,

or

if

the

claim

is

“inextricably

intertwined with consideration of the terms of the labor contract.”
Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 213 (1985).

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MEMORANDUM OPINION AND ORDER
As discussed here, the “collective bargaining agreement”
consists of both the express provisions of the agreement itself and
the “‘industrial common law,’” the industry and shop practices that
provide the context for the written agreement. McCormick, 934 F.2d
at 536 (quoting United Steelworkers of America v. Warrior & Gulf
Nav. Co., 363 U.S. 574, 581-82 (1960)); see also Shiflet v. I.T.O.
Corp. Of Baltimore, No. 99-1379, 2000 WL 14214, at *3 (4th Cir.
Jan. 10, 2000). District courts must examine the prima facie
elements of a state law cause of action in order to determine
whether interpretation of a collective-bargaining agreement is
required in order to resolve the claim. Foy v. Pratt & Whitney Gr.,
127 F.3d 229, 233 (2d Cir. 1997) (citing Lingle, 486 U.S. at 407);
see also Arnold v. Cabot Corp., No. 1:99-75, 2000 WL 1283078, at *7
(N.D. W. Va. May 8 2000).
B.
In Count One, the plaintiffs allege that the defendants
violated the West Virginia Wage Payment and Collection Act, W. Va.
Code § 21-5-4,1 when they did not pay the plaintiffs “for all hours
worked.” (Dkt. No. 1-1 at 50 (emphasis in original)).

1

Although Count One only references W. Va. Code § 21-5-4, the plaintiffs
allege in their motion to remand that this Count includes a claim arising
under W. Va. Code 21-5-3. See (Dkt. No. 27 at 13 (“Count I contains a
straightforward claim for wages that have no been paid for all hours
worked in accordance with West Virginia Code Sections 21-5-3 and 21-54.”)).

7

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MEMORANDUM OPINION AND ORDER
1.
The West Virginia Wage Payment and Collection Act (“WPCA”),
W. Va. Code § 21-5-1 et. seq., “controls the manner in which
employees in West Virginia are paid wages.”

Gress v. Petersburg

Foods, LLC, 592 S.E.2d 811, 814 (W. Va. 2003). The statute is
“remedial in nature” and is designed to “protect working people and
assist them in the collection of compensation wrongly withheld.”
Meadows v. Wal-Mart Stores, 530 S.E.2d 676, 686 (W. Va. 1999)
(citing

Mullins

v.

Venable,

297

S.E.2d

866,

869

(1982)).

Accordingly, although “an employer is free to set the terms and
conditions of employment and compensation,” Meadows, 530 S.E.2d at
689, the WPCA mandates that it “must pay earned wages to its
employees.” Szturm v. Huntington Blizzard Hockey Assocs. Ltd.
P’ship, 516 S.E.2d 267, 273 (W. Va. 1999); see also W. Va. Code
§ 21-5-10.
To achieve this objective, the WPCA prescribes certain time
limits in which employers are required pay their employees’ wages.
For current employees, the WPCA requires employers to settle “at
least once in every two weeks . . . and pay them the wages due
. . . for their work or services.” W. Va. Code § 21-5-3(a). If an
employee quits or resigns, the WPCA requires employers to “pay the
employee’s wages no later than the next regular payday.” Id.

8

§ 21-

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MEMORANDUM OPINION AND ORDER
5-4(c). “Wages” are defined as “compensation for labor or services
rendered by an employee, whether the amount is determined on a
time, task, piece, commission or other basis of calculation.” Id.
§ 21-5-1(c). The WPCA permits an aggrieved employee to file suit in
order to “collect a claim” for his unpaid wages. Id. § 21-5-12.
Importantly, as a remedial statute, the WPCA “regulates the
timing and payment of wages” but does not “establish how or when
wages are earned.” Gregory v. Forest River, Inc., 369 F. App’x 464,
469 (4th Cir. 2010)(citing Saunders v. Tri-State Block Corp., 535
S.E.2d

215,

219

(W.

Va.

2000)).

Indeed,

the

WPCA

“does

not

establish a particular rate of pay,” Robertson v. Opequon Motors,
Inc., 519 S.E.2d 843, 849 (W. Va. 1999), nor any substantive
“entitlement[]

to

pay

or

wages.”

Barton

v.

Creasy

Co.

of

Clarksburg, No. 89-2170, 1990 WL 36773, at * 2 (4th Cir. 1990) (per
curiam); see also Meadows, 530 S.E.2d 688-690. Instead, it serves
as an enforcement mechanism for employees to recover “wages due”
pursuant to their employment contracts. W. Va. Code § 21-5-3(a).
Consequently, in order to establish a prima facie claim for wages
pursuant to the WPCA, a plaintiff must first “prove entitlement to
such pay.” Lowe v. Imperial Colliery Co., 377 S.E.2d 652, 657 (W.
Va.

1988)

(emphasis

added).

Whether

an

employee

is

actually

entitled to certain wages is a “matter[] for the employment

9

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
agreement.” Gregory, 369 F. App’x at 469 (citing Saunders, 535
S.E.2d at 219); see also Spano v. Metro. Life Ins. Co., No. 2:09cv-01243, 2011 WL 2180657, at *3 (S.D. W. Va. June 2, 2011) (“In
WPCA

cases,

courts

must

consider

the

specific

employment

agreement.”); Meadows, 530 S.E.2d at 688-690.
2.
State wage payment and collection claims generally fall into
one of two strands of § 301 preemption analysis. In the interest of
providing context for such claims, a brief discussion detailing
these categories follows.
i.
It is well established that § 301 will not completely preempt
a state law claim based on “the bare fact that a collective
bargaining agreement will be consulted in the course of state-law
litigation.” Livadas, 512 U.S. at 124. Accordingly, in the state
wage payment and collection context, § 301 will not preempt a claim
where “the meaning of contract terms is not the subject of dispute”
and the court merely needs to “‘look to’ the collective-bargaining
agreement for damages computation.” Livadas, 512 U.S. at 124, 125;
see generally Balcorta v. Twentieth Century Fox Film Corp., 208
F.3d 1102, 1111 (9th Cir. 2000) (finding no preemption where all

10

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MEMORANDUM OPINION AND ORDER
that was required to determine that an employer had violated state
law was “a clock or a calculator”).
In Stump v. Cyprus Kanawha Corp., for example, a WPCA claim
was not preempted where the plaintiffs sought to recover their
“final wages . . . following [their employer’s] cessation of
operations” and “a very simple appendix” in the CBA set out clearly
the amount of wages the plaintiffs were owed. 919 F. Supp. 221,
223, 224 (S.D. W. Va. 1995). The court determined that, as no part
of the CBA “needs to be interpreted in order to make a decision as
to the amount of damages to which the employees will be entitled,”
the WPCA claims were not completely preempted by § 301. Id. at 226;
cf. Ash v. Raven Metal Prod., Inc., 437 S.E.2d 254, 260 (W. Va.
1993) (no preemption where “no interpretation [of the CBA was]
required, only a calculation” of the employees’ withheld pay). But
see Lueck, 471 U.S. at 218 (section 301 preemption occurs where
“the right asserted” is “derive[d] from the contract”).
ii.
Section 301 does, however, completely preempt a state wage
payment and collection claim where the resolution of that claim
requires the Court to go beyond merely “refer[ing] to bargained-for
wage rates in computing the penalty,” Livadas, 512 U.S. at 125, and
instead necessitates “the interpretation of a collective-bargaining

11

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MEMORANDUM OPINION AND ORDER
agreement.” Lingle, 486 U.S. at 405; see

Elswick v. Daniels

Electric Inc., No. 2:10–01336, 2011 WL 1464875, at *3-4 (S.D.
W. Va. Apr. 15, 2011) (WPCA claim preempted where “more than mere
reference to the CBA” was required to resolve the plaintiff’s
claims); Arnold, 2000 WL 1283078, at *6 (WPCA claim preempted were
resolution of the claim required “interpretation . . . of the
industrial common law.”).
A

common

thread

in

this

second

strand

of

cases

is

the

existence of a genuine dispute between the parties as to whether
the CBA actually entitles the plaintiffs to the wages that they
seek.2 Such disagreements are, at their core, contract disputes,
almost invariably requiring the interpretation of the relevant

2

See Puccino v. SNET Info. Serv., Inc., No. 3:09–cv–1551, 2011 WL
4575937, at *6 (D. Conn. Sept. 30, 2011) (“the Court would be required
to interpret the language of those agreements to determine whether the
plaintiffs were entitled to the commissions in question and whether
SNET’s deductions from commissions for advancements were therefore
unlawful” (emphasis added)); Elswick, 2011 WL 1464875, at *4 (“whether
Elswick was entitled to the relief he seeks can be determined only by
interpreting the CBA” (emphasis added)); Buckner v. United Parcel Serv.,
Inc., No. 5:09-411, 2010 WL 2889586, at *3 (E.D.N.C. July 21, 2010)
(“determining whether Defendant violated the statute in this case would
require the court to interpret the CBA regarding entitlement to pay in
the first instance” (emphasis added)); Levy v. Verizon Info. Servs. Inc.,
498 F. Supp. 2d 586, 598 (E.D.N.Y. 2007) (“the court would have to
analyze the language of the agreements to decide whether incentive
compensation was actually earned before deciding if wages were
subsequently deducted in violation of state law” (emphasis added));
Arnold, 2000 WL 1283078, at *6 (“evaluat[ing] whether Arnold was entitled
to receive a full day’s pay . . . would require interpretation of the
custom and practice in the shop - the industrial common law” (emphasis
added)).

12

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MEMORANDUM OPINION AND ORDER
collective bargaining agreement. See, e.g., Baker v. Kingsley, 387
F.3d 649, 658-59 (7th Cir. 2004) (state wage claims “require[]
interpreting

the

contract,

unless,

perhaps,

the

particular

contractual provision is so clear as to preclude all possible
dispute over its meaning” (quoting Metalcrafters v. McNeil, 784
F.2d 817, 824 (7th Cir. 1986)); see also Ansol v. Espoto, 100 F.3d
1111, 117-18 (3d Cir. 1996) (state wage claim preempted where
“plaintiffs’ alleged entitlement to compensation . . . is disputed
and cannot be discerned without analyzing the terms of the CBA.”
(emphasis added)).
3.
Here, the plaintiffs claim they are entitled to remuneration
under the WPCA because
Defendants have required Plaintiffs to engage in
preliminary and post-liminary work activities such as
booting of computers and other work activities before or
after their scheduled start and end times and because
Defendants have required Plaintiffs to clock in to work
at any interval of time before or after their scheduled
start times and impermissibly rounded that time down.
(Dkt. No. 27 at 15). The plaintiffs contend that no interpretation
of the CBA is necessary to resolve this claim because “Defendants
have already determined Plaintiffs’ categorization and rates of pay
under the CBA, and Plaintiffs do not dispute these determinations.”

13

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MEMORANDUM OPINION AND ORDER
(Id. at 18). The actual analysis of this cause of action, however,
is not so simple.
At the outset, as a part of their prima facie case, the
plaintiffs must establish that their employment agreements entitle
them to the wages they seek to recover through the WPCA. See
Gregory, 369 F. App’x at 469; Lowe, 377 S.E.2d at 657. Accordingly,
to determine “how or when wages [were] earned” by the plaintiffs,
and consequently whether the defendants are in violation of the
WPCA for withholding those wages, it is necessary to examine the
relevant CBAs. Gregory, 369 F. App’x at 469 (citing Saunders, 535
S.E.2d at 219). The plaintiffs, however, have not identified any
provisions within the CBAs that would unambiguously entitle them to
be paid for their “preliminary and post-liminary work activities,”
and the defendants strenuously dispute whether the activities the
plaintiffs describe even count as compensable work.
This is not a case where mere “refer[ence] to bargained-for
wage rates” will resolve the plaintiffs’ claim. Livadas, 512 U.S.
at 125. Indeed, the crux of this dispute is not whether a sum
certain was simply not paid in a timely fashion, see Stump, 919
F. Supp at 226, but whether the defendants in this case have, for
a period of years, failed to pay the plaintiffs wages they believe
they should have earned. At bottom, there is no way to resolve the

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MEMORANDUM OPINION AND ORDER
underlying

dispute

concerning

the

plaintiffs’

entitlement to wages other than through the
parties’

employment

contracts

practices” of the industry.

and

the

substantive

interpretation of the
general

“customs

and

McCormick, 934 F.2d at 536. As noted,

under the WPCA, the plaintiffs’ right to these wages is derived
from the employment contract. Gregory, 369 F. App’x at 469. Where
the contours of this right are in dispute, there is simply nowhere
else to look.
In sum, the gravamen of the plaintiffs’ claim under the WPCA
is, and must be, that the defendants violated their contractual
obligations by paying the plaintiffs less than what they had
actually earned. As such a claim necessitates “the interpretation
of a collective-bargaining agreement,” it is completely preempted
by § 301 of the LMRA. See Lingle, 486 U.S. at 405. Consequently,
because this claim “arises under” federal law, Caterpillar, 482
U.S. at 393, the Court has subject matter jurisdiction in this case
pursuant to 28 U.S.C. § 1331, and DENIES the plaintiffs’ motion to
remand (dkt. no. 26).
C.
In Count Two, the plaintiffs allege that the defendants
violated the West Virginia Wage Payment and Collection Act, W. Va.

15

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MEMORANDUM OPINION AND ORDER
Code § 21-5-9, when they “failed to keep accurate records of all
hours worked by Call Center employees.” (Dkt. No. 1-1 at 53).
Federal courts have the discretion, in “appropriate case[s],”
to address a state claim on the merits before resolving the § 301
preemption inquiry. Washington v. Union Carbide Corp., 870 F.2d
957, 958 (4th Cir. 1989). Specifically, “if the state law claim is
‘patently without merit,’ the district court may dismiss the claim
on the merits without reaching the question of whether § 301
preempts the claim.” Owen v. Carpenters’ Dist. Council, 161 F.3d
767, 769 (4th Cir. 1998) (quoting Childers v. Chesapeake & Potomac
Tel. Co., 881 F.2d 1259, 1261 (4th Cir. 1989)). As this count fails
to state a claim under West Virginia law, it is unnecessary to
undertake the § 301 preemption inquiry. This claim may be addressed
solely in the context of the Fed. R. Civ. P. 12(b)(6) motions to
dismiss discussed below.
III.
The Court next turns to the second jurisdictional issue raised
by the pending motions, VCI’s motion to dismiss for lack of
personal jurisdiction (dkt. no. 9).
A.
When a defendant files a Fed. R. Civ. P. 12(b)(2) motion to
dismiss for lack of personal jurisdiction, the plaintiff generally

16

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MEMORANDUM OPINION AND ORDER
bears the ultimate burden of showing by a preponderance of the
evidence that jurisdiction exists. New Wellington Fin. Corp. v.
Flagship Resort Dev. Corp., 416 F.3d 290, 294 (4th Cir. 2005).
However, where a court makes a Rule 12(b)(2) determination without
a hearing and based only on the written record, as in the case
here, the plaintiff need only put forth a prima facie showing of
jurisdiction

“by

pointing

to

affidavits

or

other

relevant

evidence.” Henderson v. Metlife Bank, N.A., No. 3:11-cv-20, 2011 WL
1897427, at *6 (N.D. W. Va. May 18, 2011); see also New Wellington
Fin. Corp., 416 F.3d at 294. The Court must then “construe all
relevant pleading allegations in the light most favorable to the
plaintiff,

assume

credibility,

and

draw

the

most

favorable

inferences for the existence of jurisdiction.” New Wellington Fin.
Corp., 416 F.3d at 294; see also 5B Wright & Miller, Federal
Practice and Procedure § 1351 (3rd. ed.).
Under Fed. R. Civ. Pro. 4(k)(1)(A), a federal district court
may exercise personal jurisdiction over a defendant to the same
degree that a counterpart state court could do so. See Diamond
Healthcare of Ohio, Inc. v. Humility of Mary Health Partners, 229
F.3d 448, 450 (4th Cir. 2000). As a result, for a district court to
have jurisdiction over a nonresident defendant, the exercise of
jurisdiction (1) must be authorized under the state’s long-arm

17

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MEMORANDUM OPINION AND ORDER
statute, and (2) must comport with the due process requirements of
the Fourteenth Amendment. Carefirst of Md., Inc. v. Carefirst
Pregnancy Ctrs., Inc., 334 F.3d 390, 396 (4th Cir. 2003) (citing
Christian Sci. Bd. of Dirs. of the First Church of Christ v. Nolan,
259 F.3d 209, 215 (4th Cir. 2001)). As West Virginia’s long-arm
statute provides jurisdiction to the full extent allowable under
the United States Constitution, see W. Va. Code § 56-3-33, the
Court

need

only

consider

whether

the

exercise

of

personal

jurisdiction would comport with the Due Process Clause.
In order for a court to assert jurisdiction over a nonresident
defendant within the confines of due process, the defendant must
have “minimum contacts” with the forum state such that it is
consistent with “fair play and substantial justice” to hold it to
account there. Int’l Shoe Co. v. Washington, 326 U.S. 310, 316
(1945). Whether a defendant possesses such minimum contacts is
analyzed by looking to whether the plaintiff seeks to establish
“specific” or “general” jurisdiction. Specific jurisdiction occurs
when the defendant’s contacts with the forum state form the basis
of the suit. Carefirst, 334 F.3d at 397. In contrast, where the
defendant’s contacts are unrelated to the basis of the suit, a
court must look to the requirements of general jurisdiction. Id.

18

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MEMORANDUM OPINION AND ORDER
Here, the plaintiffs allege that VCI, a Delaware corporation
with a principal place of business in New York, has sufficient
contacts with West Virginia so as to justify the Court’s exercise
of both general and specific jurisdiction. See (Dkt. No. 28 at 8
(“This

Court

has

personal

jurisdiction

because

Verizon

Communications, Inc. has continuous and systematic contacts with
West Virginia, and specifically because it is a joint employer of
Plaintiffs for the purposes of the WPCA.”)).3
B.
The standard for finding the existence of general jurisdiction
is high: the defendant must have “continuous and systematic”
contacts with the forum state. Helicopteros Nacionales de Colombia,
S.A. v. Hall, 466 U.S. 408, 416 (1984); see also ESAB Group, Inc.
v. Centricut, 126 F.3d 617, 623 (4th Cir. 1997) (“[T]he threshold
level of minimum contacts sufficient to confer general jurisdiction
is significantly higher than for specific jurisdiction.”). The
hallmark of general jurisdiction is that the defendant’s contacts
with the forum state are so extensive that it should reasonably

3

As an initial matter, the Court does not credit the plaintiffs’ argument
that VCI, by virtue of its prior appearances in this district, should be
judicially estopped from denying personal jurisdiction in this case; as
the defendants correctly note, “prior appearance does not necessarily
waive the personal jurisdiction requirement in future actions, nor
constitute related business conduct within the jurisdiction.” Rozenblat
v. Sandia Corp., No. 05-1556, 2006 WL 678923, at *3 (Fed. Cir. Mar. 17,
2006).

19

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
foresee being haled into court there. World-Wide Volkswagon Corp.
v. Woodson, 444 U.S. 286, 297 (1980).
The plaintiffs’ proffered evidence is aimed at establishing
two separate grounds for general jurisdiction: (1) VCI’s own
“continuous

and

systematic”

contacts

with

West

Virginia;

and

(2) VCI’s exercise of “alter ego” control over the subsidiary
defendants Verizon Services, Corp., and Verizon West Virginia, Inc.
The Court will address each of these issues in turn.
1.
Turning to the first issue, the plaintiffs begin argue that
the Court should exercise general jurisdiction over VCI by virtue
of its direct contacts with the forum state, namely, “conduct[ing]
much business – and much business in West Virginia.” (Dkt. No. 28
at

8).

VCI,

however,

flatly

denies

the

plaintiffs’

broad

characterization of its business activities.
VCI maintains that it is a mere holding company4 engaged
primarily in managing the stock of its subsidiaries, including the
defendants Verizon Services Corp. and Verizon West Virginia, Inc.
(Dkt. No. 10 at 1-2).

As a consequence of its limited corporate

4

The primary business of a holding company is generally “‘the ownership
and management of investment assets such as debt or equities.’” Columbia
Gas Transmission Corp. v. Burdette Realty Imp., Inc., 102 F. Supp. 2d
673, 676 (S.D. W. Va. 2000) (quoting Peterson v. Cooley, 142 F.3d 181,
184 (4th Cir. 1998)); see also Merriam-Webster’s Collegiate Dictionary
(10th ed. 1999).

20

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MEMORANDUM OPINION AND ORDER
role, VCI contends that it has no relevant contacts whatsoever with
the state of West Virginia. (Dkt. No. 10 at 2-3). Specifically,
through the affidavit of its corporate secretary, Jane Schapker,
VCI claims that it neither conducts nor solicits business in West
Virginia, is not licensed to do business in West Virginia, has no
registered agent in West Virginia, has no employees or real
property in West Virginia, has no facilities or bank accounts in
West

Virginia,

and

is

not

otherwise

a

party

to

any

of

the

collective bargaining agreements giving rise to the claims in this
case. (Id.).
In an attempt to discredit Ms. Schapker’s affidavit, the
plaintiffs point to several promotional websites and other unsworn
documents

which,

they

argue,

discuss

VCI’s

sizeable

business

activities in West Virginia and elsewhere. See generally (Dkt No.
28-1).

The

forum-specific

evidence

offered

by

the

plaintiffs

consists primarily of selected excerpts from “Verizon’s” corporate
website,5

letters

written

by

VCI’s

5

subsidiaries

concerning

To the extent that the plaintiffs point to Verizon’s commercial website
for the proposition that VCI claims itself to be a “global leader in
delivering innovation in communications, information, and entertainment,”
(dkt. no. 28 at 9 (emphasis in original)), such statements are irrelevant
to the plaintiffs’ burden to establish VCI’s contacts with West Virginia.
See, e.g., Johnson v. Verizon Comm. Inc., No. 2011 WL 1343390, at *3
(N.D. Tex. April 7, 2011) (“[The plaintiff] fails to demonstrate that VCI
has a business presence in Texas other than VCI’s ownership of a
subsidiary in Texas, and VCI’s proclaimed national presence on its
website. This falls short of meeting the stringent general jurisdiction
standard.”).

21

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MEMORANDUM OPINION AND ORDER
“Verizon’s”

activities

in

West

Virginia,

newspaper

articles

documenting “Verizon’s” in-state philanthropic contributions, and
a printout identifying three in-state lobbyists registered to
“Verizon Communications.” Id. Notably, save for the identification
of

the

three

lobbyists,

the

plaintiffs’

evidence

is

wholly

anecdotal and fails to directly attribute any activities within
West Virginia to VCI itself, as an entity separate from its
subsidiaries.
As a general rule, a subsidiary and its parent are separate
entities for jurisdictional purposes, Billiter v. Kellogg, Brown,
& Root Servs., Inc., No. 5:09-cv-119, 2010 WL 2901618, at *6 (N.D.
W. Va. July 21, 2010), and their contacts “must be assessed
individually” for the purposes of analyzing jurisdiction. Keeton v.
Hustler Magazine, Inc., 465 U.S. 770, 781 n. 13 (1984); see also
United States v. Bestfoods, 524 U.S. 51, 61 (1998) (“It is a
general

principle

of

corporate

law

deeply

‘ingrained

in

our

economic and legal systems’ that a parent corporation . . . is not
liable for the acts of its subsidiaries.” (citation omitted)).
Although it is undisputed that numerous subsidiaries of VCI use the
trademark “Verizon” as part of their names, the plaintiffs have
nevertheless
exclusively

rested
on

their

documents

jurisdictional

using

22

generic

arguments

terminology

almost

that,

put

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
bluntly, “play[s] fast and loose with the term ‘Verizon.’” NegronTorres v. Verizon Commc’s, Inc., 478 F.3d 19, 26 (1st Cir. 2007).
The

plaintiffs’

evidence,

for

example,

includes

unsworn

letters penned by a VCI subsidiary which state that “Verizon . . .
employs over 2,145 people [in West Virginia],” (Dkt. No. 28 at 13
(emphasis added)), a newspaper article detailing how West Virginia
received a “Verizon grant” from the “Verizon Foundation” (dkt. no.
28-1 at 74, 73 (emphasis added)), and a website excerpt discussing
“Verizon[’s] . . . spinoff of wireline businesses” in West Virginia
(dkt. no. 28-1 at 8 (emphasis added)). These documents fail to
illuminate the appropriate “Verizon” entity to which they refer, or
even

identify

VCI’s

involvement

with

the

same.

Given

this

ambiguity, the references to the trademark “Verizon” within the
plaintiffs’
specific

conduct

plaintiffs
evidence”

proffered

have
that

to

evidence
VCI,

presented
would

are

insufficient

particularly
no

where,

“affidavits

unequivocally

or

to
as

attribute

other

here,

contradict

the

relevant

VCI’s

sworn

declarations. Henderson, 2011 WL 1897427, at *6; see also NegronTorres, 478 F.3d at 26 (“[M]ere use of a trademark or logo” by a
subsidiary “does not suffice to establish the requisite minimum
contacts” of the parent. (citing Gonzalez v. Walgreens Co., 878
F.2d 560, 561-62 (1st Cir. 1989)).

23

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MEMORANDUM OPINION AND ORDER
Indeed, the plaintiffs have identified only one direct contact
between

VCI

and

West

Virginia:

the

existence

of

registered

lobbyists for “Verizon Communications” within the state. See (Dkt.
No. 28-1 at 128). However, even putting aside the question of
whether

a

lobbying

presence

is

appropriately

considered

when

evaluating personal jurisdiction,6 the plaintiffs have provided no
evidence concerning the scope or extent, if any, of VCI’s alleged
lobbying

activity.

The

sole

information

the

plaintiffs

have

provided in this regard is a website printout which lists the three
lobbyists’
lobbyists

names.
within

(Id.)
the

Quite

forum

simply,

state,

the

bare

standing

existence

alone,

does

of
not

establish the sort of “continuous and systematic” contacts that
would subject VCI to general jurisdiction in West Virginia. See,
e.g., Herman v. Yellowpages.com, LLC, 780 F. Supp. 2d 1028, 1034
(S.D.

Cal

2011)

insufficient

(holding

evidence

that

to

lobbying

support

activity

jurisdiction

alone

“is

over

the

defendant.”).
The plaintiffs’ evidence fails to identify any “continuous and
systematic”

contacts

between

VCI,

6

as

differentiated

from

its

There is a split of authority on this issue. Compare Shepherd Invs.
Intern., Ltd. v. Verizon Commc’ns Inc., 373 F. Supp. 2d 853, 866 (E.D.
Wis. 2005) (lobbying activity should be considered) with Hollar v. Philip
Morris Inc., 43 F. Supp. 2d 794, 801-02 n.6 (N.D. Ohio 1998) (lobbying
activity should not be considered).

24

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MEMORANDUM OPINION AND ORDER
subsidiaries, and West Virginia. Helicopteros Nacionales, 466 U.S.
at 416. Accordingly, the plaintiff has failed to establish a prima
facie case for exercising general jurisdiction over VCI based upon
its own contacts with the forum state.
2.
As to the second issue, the plaintiffs argue that the Court
should exercise general jurisdiction over VCI because, despite
protestations to the contrary, it actually “vertically manages
through business units or divisions aligned with product groups
rather than corporate boundaries,” i.e., exercises “alter ego”
control over its various subsidiaries. (Dkt. No. 28 at 18). In
essence, the plaintiffs seek to pierce the corporate veil between
VCI, Verizon Services Corp., and Verizon West Virginia, Inc., in
order to impute the subsidiaries’ West Virginia contacts to their
parent. See Billiter, 2010 WL 2901618, at *6; see also S. Elec.
Supply Co. v. Raleigh Cty. Nat’l Bank, 320 S.E.2d 515, 521-22
(W. Va. 1984) (discussing alter ego doctrine). Accordingly, as it
is relevant to the jurisdictional inquiry, it is necessary to look
to the substantive requirements for piercing the corporate veil
under

West

Virginia

law.

Billiter,

2010

WL

2901618,

at

*6

(analyzing West Virginia’s alter ego doctrine in the context of
determining personal jurisdiction over a parent corporation); see

25

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MEMORANDUM OPINION AND ORDER
also Geiser v. Simplicity, Inc. No. 5:10-cv-21, 2011 WL 843663, at
*3-4 (N.D. W. Va. March 8, 2011) (same).
As separately incorporated businesses, VCI, Verizon Services,
Corp., and Verizon West Virginia, Inc., are presumed to be separate
entities. S. Elec. Supply Co., 320 S.E.2d at 523; see also (Dkt.
No. 10 at 3-4 (discussing the corporate structure of the Verizon
defendants)). However, “‘when the corporate form is interposed to
perpetrate

an

plaintiff

may

intentional
overcome

wrong,

this

fraud

or

presumption

illegality,’”

by

“[p]iercing

a
the

corporate veil through the alter ego doctrine.’” Billiter, 2010 WL
2901618, at *6 (quoting S. Elec. Supply Co., 320 S.E.2d at 521-22).
The Court may then disregard the corporate structure in order to
“make a corporation liable for behavior of another corporation
within its total control.” S. Elec. Supply Co., 320 S.E.2d at 522
(emphasis added); cf. syl. pt. 2, Norfolk S. Ry. Co. v. Maynard,
437 S.E.2d 277 (W. Va. 1993) (“[I]f the parent and its subsidiary
operate as one entity, their formal separate corporate structures
will

not

prevent

the

assertion

of

jurisdiction

over

the

establishing

the

non-resident corporation.”).
The

plaintiffs

applicability

of

this

bear

the

doctrine

burden
based

of
on

the

facts

of

their

individual case, with a focus on the following relevant factors:

26

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
inadequacy of capital structures[;] . . . total control
and dominance of one corporation by another or a
shareholder; existence of a dummy corporation with no
business activity or purpose; violation of law or public
policy; a unity of interest and ownership that causes one
party or entity to be indistinguishable from another;
common shareholders, common officers and employees and
common facilities.
S. Elec. Supply Co., 320 S.E.2d at 523 (emphasis in original)
(citations omitted). These facts must be analyzed “‘in conjunction
with evidence that a corporation attempted to use its corporate
structure to perpetrate a fraud or do grave injustice on an
innocent third party.’”

Billiter, 2010 WL 2901618, at *6 (quoting

S. Elec. Supply Co., 320 S.E.2d at 523)).
In

her

declaration,

Ms.

Schapker

maintains

that

VCI is

incorporated separately from Verizon Services, Corp., and Verizon
West Virginia, Inc.; that each corporate defendant follows the
corporate formalities of the respective state under which it is
organized; and that each corporate defendant “is responsible for
its own day-to-day activities and business decisions.” (Dkt. No. 10
at 3, 4).
To overcome the presumption that the defendants are separate
entities, the plaintiffs argue that VCI dominates its subsidiaries
through

“vertical[]

promulgation

of

manage[ment]”

uniform

of

corporate

certain
policies,

business
and

units,

inadequate

capitalization. (Dkt. No. 28 at 18). According to the plaintiffs,
27

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
in

derogation

of

its

corporate

boundaries,

VCI

controls

or

“vertically manages” its subsidiaries “through units and divisions
aligned with product groups.” Id.; see, e.g., In re Chocolate
Confectionary Antitrust Litig., 674 F. Supp. 2d 580, 614 (M.D. Pa.
2009)

(finding

corporation

evidence

“vertically

of

alter

ego

control

where

manag[ed]”

its

subsidiaries

parent

“through

business units”). In support of this proposition, the plaintiffs
offer a letter written by a representative of Verizon Business, a
subsidiary of VCI, in response to a bidding invitation issued by
the state of West Virginia. (Dkt. No. 28 at 14). This letter
describes “Verizon Business” as “a unit” of VCI and states that VCI
“operates

through

three

divisions

–

Telecom,

Business,

and

Wireless.” Id. (emphasis in original). Importantly, however, these
quotations simply refer to the existence of business units and do
not otherwise establish whether, or to what degree, VCI actually
“vertically manages” those units. See In re Chocolate Confectionary
Antitrust

Litig.,

674

F.

Supp.

2d

at

606

(plaintiffs

are

“preclud[ed] . . . from invoking [business units] as a conduit of
corporate control” in the absence of evidence that the parent
company managed the units); see also (Dkt. No. 10 at 3, 4)
(averring that VCI “does not control the day-to-day activities of”
Verizon

Services

Corp.

or

Verizon

28

West

Virginia,

Inc.).

The

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
plaintiffs’ evidence thus fails to establish that VCI controls its
subsidiaries through the management of business units.
As

further

evidence

of

VCI’s

purported

dominance,

the

plaintiffs emphasize the existence of a “Code of Conduct” outlining
general corporate policy, which was “approved by the Verizon Board
of Directors” and issued to all “Verizon” employees. (Dkt. No. 28
at 9-10). Such policies, however, are hallmarks of an ordinary
parent-subsidiary relationship and, without more, cannot justify
piercing the corporate veil or establishing personal jurisdiction
over a parent corporation. See Moody v. Charming Shoppes of Del.,
Inc., No. C01-06073, 2008 WL 2128955, at *5 (N.D. Cal. May 20,
2008) (“a subsidiary’s use of policies and handbooks created by the
parent is insufficient to establish personal jurisdiction”); Arce
v. Aramark Corp., 239 F.Supp.2d 153, 172 (D. Puerto Rico 2003)
(same); Torres v. Liberto Mfg. Co., No. 3–01–CV1888–H, 2002 WL
2014426, at *5 (N.D. Tex. Aug. 30, 2002) (same); Hvide Marine
Int’l,

Inc.

v.

Emp’rs

Ins.

of

WAUSAU,

724

F.Supp.

180,

187

(S.D.N.Y. 1989) (same). Thus, the rather ordinary Code of Conduct
utilized by the Verizon companies fails to demonstrate that the
subsidiary corporations are “so organized and controlled as to be
a mere adjunct[s] or instrumentalit[ies]” of VCI, as would justify

29

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MEMORANDUM OPINION AND ORDER
piercing the corporate veil. S. Elec. Supply Co., 320 S.E.2d at
522.
Finally, the plaintiffs suggest that “serious questions about
whether Verizon-WV was adequately capitalized” (dkt. no. 28 at 17)
provide justification for piercing the corporate veil. See Laya v.
Erin Homes, Inc., 352 S.E.2d 93, 101 (W. Va. 1986) (noting that
inadequate capitalization is “a very important factor, as an
element of the fairness prong, in determining whether to pierce the
corporate

veil”)).

As

evidence

of

undercapitalization,

the

plaintiffs point to a Joint Petition initiated by the Consumer
Advocate Division and Commission Staff of the Public Service
Commission of West Virginia (“Commission”) on May 12, 2008, which
requested that the Commission investigate the quality of Verizon
West Virginia, Inc.’s in-state telephone services. (Dkt. No. 28 at
15-17). The Joint Petition alleged that, in the years preceding the
filing of the petition, Verizon West Virginia, Inc. regularly
relinquished

more

funds

to

VCI

than

it

invested

in

its

own

infrastructure and, as a result, “largely depleted the equity
capital previously invested in [West Virginia].” Id. at 16. This
petition,

the

plaintiffs

argue,

raises

grave

Verizon West Virginia, Inc.’s capitalization.

30

questions

about

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MEMORANDUM OPINION AND ORDER
Even taking the allegations in the Joint Petition as true, see
New Wellington Fin. Corp., 416 F.3d at 294, they nevertheless fail
to demonstrate that Verizon West Virginia, Inc., is “grossly
undercapitalized” such that it would be “inequitable” to treat its
acts “as those of the corporation alone.” Laya, 352 S.E.2d at 99,
101 (citation omitted) (discussing “fairness prong” of alter ego
test). A corporation is inadequately capitalized when it “carries
on a business without substantial capital in such a way that the
corporation is likely to have insufficient assets available to meet
its debts.” Id. at 101, n.7 (citation omitted). The Joint Petition,
in contrast, is primarily concerned with the equity capital that
Verizon West Virginia, Inc., invested in its local infrastructure;
it does not otherwise indicate that the corporation is underfunded
or lacking in assets. See (Dkt. No. 28-1 at 81-106). Moreover, as
VCI points out, Verizon West Virginia, Inc., placed $72.4 million
dollars in an escrow account to address these infrastructure issues
upon the disposition of the Joint Petition, thus “meet[ing] its
debts.” Laya, 352 S.E.2d at 101, n.7; see (Dkt. No. 37 at 11). As
such, the plaintiffs have failed to show that the Court should
“disregard [the defendants’] separate corporate structure” and hold
VCI to account for Verizon West Virginia, Inc.’s actions. S. Elec.
Supply Co., 320 S.E.2d at 522 (citation omitted).

31

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MEMORANDUM OPINION AND ORDER
For the reasons discussed, the plaintiffs have failed to
present a prima facie case of alter ego control justifying piercing
the

subsidiaries’

corporate

veil

in

order

to

find

general

jurisdiction over VCI.
C.
To

determine

if

VCI’s

contacts

support

the

exercise

of

specific jurisdiction in this case, the Court must consider “(1)
the extent to which the defendant ‘purposefully avail[ed]’ itself
of the privilege of conducting activities in the State; (2) whether
the plaintiffs’ claims arise out of those activities directed at
the State; and (3) whether the exercise of personal jurisdiction
would be constitutionally ‘reasonable.’” Carefirst, 334 F.3d at
397. Each element must be present to support specific jurisdiction.
Id. At bottom, this inquiry focuses on “the quality and nature of
[VCI’s] contacts.” Id. (internal citations omitted).
The plaintiffs argue that the Court has specific jurisdiction
over VCI because “it is a joint employer of Plaintiffs for purposes
of liability under the WPCA.” (Dkt. No. 28 at 8); see Saunders, 535
S.E.2d at 219 (“[T]he fact that an individual was an employee of
one ‘employer’ [does] not preclude him from pursuing a claim under
[the WPCA] against another individual or secondary ‘employer’ for
whom he did work for wages.” (citing Rowe v. Grapevine Corp., 456

32

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MEMORANDUM OPINION AND ORDER
S.E.2d 1, 4 (W. Va. 1995)). Through Ms. Schapker’s affidavit, VCI
responds that it “has only seven employees, none of whom are
located in West Virginia. Verizon Communications, Inc. has never
employed . . . the Plaintiffs in this case.” (Dkt. No. 10 at 2).
The plaintiffs rest their “joint employer” theory on the same
“Verizon”-branded evidence that they utilized in the context of
their general jurisdiction arguments. Specifically, they point to
various documents containing the “Verizon” trademark, including
news articles, press releases, and website excerpts, and contend,
based on these documents, that they “reasonably believe[d]” they
were

employed

by

VCI.

(Dkt.

No.

28

at

11).

The

plaintiffs’

argument, however, fails on both commonlaw and statutory grounds.
Pursuant to the principles of limited corporate liability, a
corporate parent is considered an employer of its subsidiaries’
employees “only if it ‘exercises a degree of control that exceeds
the control normally exercised by the parent corporation.’” Johnson
v. Flowers Indus., Inc., 814 F.2d 978, 980, 981 (4th Cir. 1987)
(quoting Armbruster v. Quinn, 711 F.2d 1332, 1338 (6th Cir. 1983));
see also S. Elec. Supply Co., 320 S.E.2d at 523. Consequently,
courts “have found parent companies to be employers only in
extraordinary circumstances.” Johnson, 814 F.2d at 981 (emphasis
added); see also Frank v. U.S. West, Inc., 3 F.3d 1357, 1362 (10th

33

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
Cir. 1993). Here, as discussed earlier, there is no evidence that
VCI exercised any control over Verizon Services, Corp., or Verizon
West Virginia, Inc. beyond that which is standard in ordinary
parent-subsidiary relationships. Accordingly, the plaintiffs have
not established the “extraordinary circumstances” necessary to find
that VCI operated as their employer. Johnson, 814 F.2d at 981.
Moreover, the WPCA itself defines an “employer” as “any
person, firm or corporation employing any employee,” W. Va. Code
21-5-1(m), a definition which “designate[s] those responsible for
the payment of employee wages.” Mullins v. Venable, 297 S.E.2d 866,
869 (W. Va. 1982) (emphasis added). As evinced by the plaintiffs’
pay stubs, the entity responsible for paying their wages was
Verizon West Virginia., Inc., not VCI. See (Dkt. Nos. 37-1, 37-2).
There is no indication on the record that VCI had any involvement
with Verizon West Virginia, Inc.’s wage practices; rather, the only
relevant evidence is VCI’s sworn declaration that Verizon West
Virginia,

Inc.

controlled

its

own

“day-to-day

activities

and

business decisions.” (Dkt. No. 10 at 4). As such, VCI cannot be
subject to liability as the plaintiffs’ employer under the WPCA.
As the plaintiffs have failed to offer sufficient evidence
establishing that VCI is their employer, the Court lacks specific
personal jurisdiction over this defendant. See Carefirst, 334 F.3d

34

BYARD, ET AL. v. VERIZON WV, ET AL.

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MEMORANDUM OPINION AND ORDER
at 397. Having neither general nor specific jurisdiction over VCI,
it GRANTS VCI’s motion to dismiss (dkt. no. 9).
IV.
All antecedent jurisdictional issues having been resolved, it
is necessary to address the Fed. R. Civ. P. 12(b)(6) motions to
dismiss filed by the remaining defendants. (Dkt. Nos. 11, 12, 13,
and 17).
A.
To survive a motion to dismiss filed pursuant to Fed. R. Civ.
P.

12(b)(6),

a

complaint

must

contain

factual

allegations

sufficient to state a plausible claim for relief. Ashcroft v.
Iqbal, 129 S. Ct. 1937, 1949 (2009); Bell Atl. Corp. v. Twombly,
550 U.S. 544, 557 (2007). All well-pled factual allegations in a
complaint are taken as true and construed in the light most
favorable

to

the

plaintiff.

Nemet

Chevrolet,

Ltd.

v.

Consumeraffairs.com, Inc., 519 F.3d 250, 253 (4th Cir. 2009). Facts
derived from sources beyond the four corners of the complaint also
may be considered, including documents attached to the complaint,
documents attached to the motion to dismiss “so long as they are
integral to the complaint and authentic,” and facts subject to
judicial notice under Fed. R. Evid. 201. Philips v. Pitt Cty. Mem’l
Hosp., 572 F.3d 176, 180 (citing Blankenship v. Manchin, 471 F.3d

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523, 526 n. 1 (4th Cir. 2006)); see also Katyle v. Penn Nat.
Gaming, Inc., 637 F.3d 462, 466 (4th Cir. 2011).
B.
Because Count One of the plaintiffs’ complaint is completely
preempted by § 301 of the LMRA, the question presented is whether
the plaintiffs have stated a claim under the federal statute. See
Lueck, 471 U.S. at 220 (“[The preempted] claim must either be
treated as a § 301 claim . . . or dismissed as preempted by federal
labor-contract law.”); see also Caterpillar, 482 U.S. at 393 (the
preempted claim “is considered, from its inception, a federal
claim”).
The defendants contend that dismissal is appropriate because,
having inexcusably failed to exhaust their administrative remedies
under the CBA, the plaintiffs’ claims are barred by the statute of
limitations, and their complaint fails to allege the necessary
elements of a § 301 claim against an employer. The plaintiffs did
not respond to these arguments.
1.
Section 301 of the LMRA contemplates suits between labor
organizations, employers, and individual employees for “violation
of contract[],” 29 U.S.C. § 185(a), including those suits “seeking
to vindicate ‘uniquely personal’ rights of employees such as

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MEMORANDUM OPINION AND ORDER
wages.” Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 562
(1976) (quoting Smith v. Evening News Ass’n, 371 U.S. 195, 198–200
(1962)). Where an individual employee seeks to file a § 301 suit
against

his

employer,

however,

“a

union

must

be

given

the

opportunity to act on behalf of its member before he may proceed on
his own.” Amburgey v. Consol. Coal Co., 923 F.2d 27, 29 (4th Cir.
1991) (citing Republic Steel Corp. v. Maddox, 379 U.S. 650 (1965)).
Accordingly, the Fourth Circuit has held that “[a] cause of action
will only lie against an employer if the union has breached its
duty of fair representation of the employee.” Amburgey, 923 F.2d at
29 (emphasis added) (citing Vaca v. Sipes, 386 U.S. 171 (1967));
see also Thompson v. Aluminum Co. of America, 276 F.3d 651, 656-57
(4th Cir. 2002). These suits are referred to as “hybrid” § 301
actions because the § 301 claim against the employer and the fair
representation

claim

against

the

union

are

“inextricably

interdependent” upon one another. United Parcel Service, Inc. v.
Mitchell, 451 U.S. 56, 66 (1981); see also DelCostello v. Int’l
Brotherhood of Teamsters, 462 U.S. 151, 164 (2002).
The plaintiff’s burden in a hybrid § 301 action remains
constant, whether he chooses to bring suit against the employer,
the union, or both parties. See DelCostello, 462 U.S. at 165 (“the
case [the plaintiff] must prove is the same whether he sues one,

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MEMORANDUM OPINION AND ORDER
the other, or both”). Regardless of the parties’ posture, in order
to prevail on the merits as against either the employer or the
union, “an employee must prove both 1) that the union breached its
duty of fair representation and 2) that his employer violated the
collective

bargaining

agreement.”

Thompson,

276

F.3d

at

656

(emphasis in original). A meritorious fair representation claim
against the union is an “indispensable predicate” to suit against
an employer, Mitchell, 451 U.S. at 62, such that “an employee must
‘prevail upon his unfair representation claim before he may even
litigate the merits of his § 301 claim against the employer.’”
Thompson, 276 F.3d at 656-57 (quoting Mitchell, 451 U.S. at 67
(Stewart, J., concurring)); see also Martin v. Potter, 69 F. App’x.
108, 111 (4th Cir. 2003) (per curiam) (“[F]ederal court review of
allegations against employers for breach of collective bargaining
agreements is called for only when an employee has first proved
that

the

Union

representing

him

breached

its

duty

of

fair

representation.”).
2.
In light of these principles, Count One of the plaintiffs’
complaint, directed as it is against the defendants as employers,
is properly characterized as a “hybrid” § 301 claim. See Thompson,
276 F.3d at 656-57; Amburgey, 923 F.2d at 29. Thus, in order to

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MEMORANDUM OPINION AND ORDER
proceed, the plaintiffs must establish “both 1) that the union
breached its duty of fair representation and 2) that his employer
violated the collective bargaining agreement.” Thompson, 276 F.3d
at 657 (emphasis in original); see also Amburgey, 923 F.2d at 29
(“A cause of action will only lie against an employer if the union
has breached its duty of fair representation of the employee.”
(citation omitted)). Here, their claim necessarily fails; the
complaint

contains

no

fair

representation

claim

against

the

appropriate union, which is an “indispensable predicate” for the
plaintiffs’ suit. Mitchell, 451 U.S. at 62.7
Because Count One of the plaintiffs’ complaint cannot survive
as a § 301 claim, it must instead be “dismissed as preempted by
federal labor contract-law.” Lueck, 471 U.S. at 220. The Court
therefore GRANTS the defendants’ motions to dismiss (dkt. nos. 11,
12, 13, and 17) Count One.
C.
Count Two of the complaint asserts a cause of action arising
from the defendants’ “fail[ure] to keep accurate records of all
hours worked by Call center employees” in violation of W. Va. Code
§ 21-5-9. (Dkt. No. 1-1 at 52). Although the parties devoted

7

As Count One falls on this ground, the Court declines to address the
defendants’ alternative arguments concerning the statute of limitations
and the failure to exhaust.

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MEMORANDUM OPINION AND ORDER
minimal briefing to this count, several of the defendants argued
that the plaintiffs are not entitled to pursue a private cause of
action for the violation of this statutory provision.
1.
The enforcement scheme created by the WPCA provides for a
combination

of

administrative

and

private

remedies.

On

the

administrative side, the Commissioner of the West Virginia Division
of Labor is charged with the full administrative enforcement of the
WPCA. See W. Va. Code § 21-5-11; W. Va. C.S.R. § 42-5-3. The
Commissioner is authorized to investigate any “matters as they may
deem appropriate” in order to determine whether “any provision” of
the

WPCA

has

been

violated.

W.

Va.

Code

§

21-5-11(a).

The

Commissioner is further empowered to issue subpoenas and compel the
attendance of witnesses in proceedings under the WPCA, see id.
§ 21-5-11(b), proceedings which include “an investigation, an
initial meeting with the parties, a hearing before a hearing
examiner and the entry of an order appealable to circuit court.”
Beichler v. W. Va. Univ. at Parkersburg, 700 S.E.2d 532, 535 (W.
Va.

2010).

These

proceedings

are

subject

to

the

State

Administrative Procedures Act and the Code of State Regulations.
Id.; see W. Va. Code § 29A-1-1; W. Va. C.S.R. §§ 42-5-1, 42-20-1.

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Notably, “‘[t]he general rule is that where an administrative
remedy is provided by statute or by rules and regulations having
the force and effect of law, relief must be sought from the
administrative body, and such remedy must be exhausted before the
courts will act.’” Beichler, 700 S.E.2d at 535 (quoting Syl. Pt. 1,
Daurelle v. Traders Fed. Sav. & Loan Ass’n., 104 S.E.2d 320 (W. Va.
1958)). The Supreme Court of Appeals of West Virginia has, however,
recognized an “exception to [this] well-settled principle” in the
context of the private remedy provision of the WPCA, thus allowing
certain claims to be brought directly in state court. Beichler, 700
S.E.2d at 535; see W. Va. Code § 21-5-12(a). This section provides:
Any person whose wages have not been paid in accord with
this article, or the commissioner or his designated
representative, upon the request of such person, may
bring any legal action necessary to collect a claim under
this article. With the consent of the employee, the
commissioner shall have the power to settle and adjust
any claim to the same extent as might the employee.
W. Va. Code § 21-5-12(a)(emphasis added); see also Beichler, 700
S.E.2d at 535 (noting the “clear and unambiguous language” of the
phrase “any legal action necessary.”). As such, “a person whose
wages have not been paid in accord with the [WPCA] may initiate a
claim for the unpaid wages either through the administrative
remedies provided under the Act or by filing a complaint for the
unpaid wages directly in circuit court,” without the condition

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MEMORANDUM OPINION AND ORDER
precedent of exhausting administrative remedies. Beichler, 700
S.E.2d at 536 (emphasis added).
The provision of the WPCA that serves as the basis for the
plaintiffs’ second cause of action, however, does not directly
concern

“unpaid

wages.”

Id.

Rather,

this

provision

directs

employers to
[m]ake such records of the persons employed by him,
including wage and hour records, preserve such records
for such periods of time, and make such reports therefrom
to the commissioner, as the commissioner shall prescribe
by regulation as necessary or appropriate for the
enforcement of the provisions of this article.
W. Va. Code § 21-5-9(6); see also W. Va. C.S.R. § 42-5-4.2 (records
must include “[h]ours worked each workday and total hours worked
each workweek”). These records, which an employer must retain for
at least five years, “shall be open to the Division [of Labor] for
inspection,

examining,

copying,

photographing

or

otherwise

reproducing, in order to ensure compliance with the Act.” W. Va.
C.S.R. §§ 42-5-7, 42-5-4.1. Upon request, an employer must make
these records available to the Commissioner. Id. § 42-5-7.
2.
The plaintiffs argue that “the claim in Count II for failure
to maintain payroll records arises directly under Section 21-5-9,
and is enforceable through 21-5-12.” (Dkt. No. 30 at 20). The
plaintiffs offer two cases in support of this argument, which, they
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MEMORANDUM OPINION AND ORDER
contend, show that “[t]he West Virginia Supreme Court of Appeals
has recognized claims under Section 21-5-9.” Id. In Isaacs v.
Bonner, the plaintiffs’ first case, an employee appealed a circuit
court’s

determination

that

she

had

fraudulently

filed

an

administrative wage claim against her employer. 694 S.E.2d 302, 303
(W. Va. 2010) (per curiam). In the course of its discussion, the
court took note of the employer’s “inaccurate manner of keeping
records of accrued leave”:
Although the paid leave policy was unambiguous concerning
appellant [employees]’ right, upon leaving the practice,
to be paid in units of time for her unused, accrued paid
leave, [the employer] failed, throughout the period of
the appellant’s employment, to comply with the
requirements of the Wage and Hour Act for providing
accurate information concerning fringe benefits to his
employees. The appellant was entitled to an accurate pay
stub.
Id.

at

308

(emphasis

added).

Although

this

case

arguably

establishes that an employer’s compliance with W. Va. Code § 21-5-9
can be a relevant consideration in a WPCA action, it does not
illuminate whether an employee has a right to sue directly for an
employer’s recordkeeping violation pursuant to W. Va. Code § 21-512(a).
Similarly unhelpful is the second case on which the plaintiffs
rely. See Shaffer v. Ft. Henry Surg. Assocs. Inc., 599 S.E.2d 876,
880 (W. Va. 2004) (answering certified question “is a physician,

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MEMORANDUM OPINION AND ORDER
whose employment status is solely as an employee, an ‘employee’
within [the WPCA]”). Indeed, it appears there is no case in West
Virginia that has imbued an employee with a private cause of action
arising

under

W.

Va.

Code

§

21-5-12(a)

for

his

employer’s

recordkeeping violations.
By its terms, the WPCA limits private causes of action under
the statute, and the accompanying right to file directly in state
court, to employees who seek to “collect a claim” for unpaid wages.
See

W.

Va.

Code

§

21-5-12(a);

Beichler,

700

S.E.2d

at

536.

Importantly, violations of W. Va. Code §§ 21-5-3 and 21-5-4, wage
provisions clearly enforceable by employees through W. Va. Code
§ 21-5-12, have “clearly-defined” statutory remedies, which include
damages for these unpaid wages. Atchison v. Novartis Pharm. Corp.,
No. 3:11-cv-0039, 2012 WL 851114, at *2 (S.D. W. Va. March 13,
2012); see W. Va. Code 21-5-4(e) (remedy for violation of § 21-54); id. at 21-5-6 (remedy for violation of § 21-5-3). Violations of
W. Va. Code § 21-5-9, in contrast, have no identified remedy or
damages.
The plain language of the WPCA and accompanying regulations
place administration and enforcement of W. Va. Code § 21-5-9
squarely within the purview of the Commissioner. To the extent the
plaintiffs have any sort of claim arising under this provision, a

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MEMORANDUM OPINION AND ORDER
fact far from clear, it is not one that they are entitled to
privately enforce or bring to court in the first instance. See
W. Va. Code § 21-5-12(a).
Accordingly, because the plaintiffs have failed to state a
plausible

claim

for

relief

on

the

basis

of

the

defendants’

purported violations of the WPCA’s recordkeeping provisions, the
Court GRANTS the defendants’ motions to dismiss (dkt. nos. 11, 12,
13, and 17) Count Two.
V.
In conclusion, for the reasons discussed, the Court:
1.

DENIES the plaintiffs’ motion to remand (dkt. no. 26);

2.

GRANTS Verizon Communications, Inc.’s motion to dismiss
for lack of personal jurisdiction (dkt. no. 9);

3.

DISMISSES Counts One and Two of the plaintiffs’ complaint
(dkt. no. 1-1 at 32) WITH PREJUDICE, thereby GRANTING the
motions

to

dismiss

filed

by

the

defendants

Mary

Frederick, Tammy Mason, Cody Stewart, Barbra Terwilliger,
and Dawn Watson (dkt no. 11); Verizon Services Corp.
(dkt. no. 12); Bob Anderson, Jodi Dennis, Frontier West
Virginia, Inc., and Michael Hathaway (dkt
Corby Miller (dkt. no. 17);

45

no. 13); and

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MEMORANDUM OPINION AND ORDER
4.

GRANTS-IN-PART the plaintiffs’ motion for leave to file
an amended complaint (dkt. no. 46) to the extent that the
plaintiffs seek leave to assert a claim arising under the
Fair Labor Standards Act, 29 U.S.C. § 201 et seq.;

5.

DENIES AS MOOT the defendants’ consent motion for an
extension of time to respond to the plaintiffs’ motion
for leave to file an amended complaint (dkt. no. 47); and

6.

DIRECTS the plaintiffs to file an amended complaint
consistent with these rulings within 30 days from the
entry of this Order.

It is so ORDERED.
The Court directs the Clerk of Court to transmit copies of
this Memorandum Opinion and Order to counsel of record and to
DISMISS

the

defendant

Verizon

Communications,

Inc.

PREJUDICE.
DATED: March 30, 2012.
/s/ Irene M. Keeley
IRENE M. KEELEY
UNITED STATES DISTRICT JUDGE

46

WITHOUT