Opinion
Civil Action No. 2:04-1295-CWH.
May 11, 2006
ORDER
The plaintiffs are former employees of LL Services, LLC ("LL") and WLL, LLC ("WLL"), which were owned and operated by Lawton Limehouse, Sr and Lawton Limehouse, Jr. LL and WLL provided temporary labor to other businesses.
The plaintiffs allege that to obtain cheap labor, the defendants hired unauthorized aliens and then exploited them under the threat of deportation. In the third amended complaint, the plaintiffs raise the following causes of action:
1. Violation of the Racketeer Influenced and Corrupt Organizations Act ("RICO")
2. Violation of the Fair Labor Standards Act ("FLSA")
3. Violation of South Carolina's Payment of Wages Act
4. Breach of contract
5. Unjust enrichment and disgorgement of profits
6. Civil Conspiracy
7. Accounting
The plaintiffs have withdrawn the civil conspiracy claim. On July 22, 2005, the defendants filed a motion for summary judgment in favor of dismissing the action. The defendants also filed a motion to dismiss Maximino Flores, Maximina Flores, and Isaias Flores Lagunes for failing to answer questions relating to their immigration status. On August 12, 2005, the plaintiffs responded to the motion for summary judgment. On October 6, 2005, the Court heard the pending motions. At the hearing, the Court advised the plaintiffs that the defendants needed answers to questions regarding the plaintiffs' immigration status and directed the defendants to file a supplemental brief listing the questions that the plaintiffs refused to answer. On October 21, 2005, the defendants filed the list.
On January 26, 2006, the Court ordered the plaintiffs to answer the defendants' questions regarding their immigration status. The plaintiffs did so, and on March 27, 2006, the defendants filed a supplemental motion for summary judgment. On April 10, 2006, the plaintiffs responded. This matter is now ready for disposition.
I. Motion to dismiss Maximina Flores, Maximino Flores, and Isaias Flores Lagunes.
The defendants filed a motion to dismiss the plaintiffs' claims for failing to respond to discovery requests regarding their immigration status. The plaintiffs have now complied with the defendants discovery requests. Consequently, the Court denies the motion to dismiss.
II. Motion for summary judgment.
To grant a motion for summary judgment, this Court must find that the documents filed in support thereof establish that there are no genuine issues of material fact, and that the moving party is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56. The moving party bears the initial burden of specifying the basis for its motion and identifying that portion of the record which demonstrates the absence of a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Once the moving party satisfies this burden, the non-moving party then must produce specific facts demonstrating a genuine issue of material fact for trial. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). If the non-moving party cannot do so, the court must grant the motion.
1. Hoffman Plastics Compounds, Inc. v. Nat'l Labor Relations Bd.
In the response to the Court's January 27, 2006, order, the plaintiffs provided the defendants information regarding their immigration status. All three plaintiffs admitted that they are unauthorized aliens and submitted false employment documents to the Social Security Administration. Upon receiving these admissions, the defendants filed a supplemental brief contending that the Supreme Court's decision in Hoffman Plastics Compounds, Inc. v. Nat'l Labor Relations Bd. bars the plaintiffs' claims in this action. 535 U.S. 137 (2002).
In Hoffman Plastics Compounds, Inc. v. Nat'l Labor Relations Bd., the National Labor Relations Board ("NLRB") found that Hoffman Plastics Compounds, Inc. ("Hoffman") had violated the National Labor Relations Act ("NLRA") by terminating an employee, who was an unauthorized alien, for engaging in protected union activities. 535 U.S. 137, 141-142 (2002). The NLRB awarded the unauthorized alien wages he would have earned had Hoffman not terminated him. Id. The Supreme Court reversed the decision holding that the NLRB abused its discretion by awarding back pay to the unauthorized alien because such an award contravened express congressional policies set forth in the Immigration Reform and Control Act ("IRCA") prohibiting the use of forged employment documents to gain employment. Id at 151-152.
The defendants contend that Hoffman applies in this case to bar recovery by the plaintiffs. However, in Hoffman, the Supreme Court applied a long standing rule that the NLRB does not have authority to award back pay to employees found guilty of serious illegal conduct in connection with their employment.Hoffman, 535 U.S. at 143. Finding the unauthorized alien's conduct violated IRCA, the Supreme Court reversed the NLRB's decision. Id at 152. The Supreme Court did not hold that IRCA precludes district courts from awarding unauthorized aliens damages provided under federal or state law. See Riveria v. NIBCO, Inc., 364 F.3d 1057, 1068-1069 (9th Cir. 2004). Therefore, the Court must make its own determination of whether IRCA prohibits the plaintiffs from bringing this action.
In 1986, Congress enacted IRCA, which is a comprehensive scheme prohibiting the employment of unauthorized aliens in the United States. Hoffman, 535 U.S. at 147. "The general purpose of IRCA is to diminish the attractive force of employment which, like a `magnet' pulls illegal immigrants towards the United States."Hoffman, 535 U.S. at 155 (Breyer, J., dissenting).
Allowing an employer to escape liability arising from violations of federal and state labor laws provides incentives to hire unauthorized aliens thereby defeating IRCA's purpose of reducing employment opportunities for unauthorized aliens. See Patel v. Quality Inn South, 846 F.2d 700, 704-705 (11th Cir. 1988); see also Hoffman, 535 U.S. at 155-156 (Breyer, J., dissenting). Moreover, a House of Representatives Judiciary Committee Report indicates that IRCA was not intended to limit the enforcement of labor laws. H.R. Rep. 99-682, at 58 (1986),reprinted in 1986 U.S.C.C.A.N. 5649, 5662. Therefore, the Court holds that IRCA does not preclude the plaintiffs from bringing suit under federal or state labor laws.
In addition, IRCA does not prohibit an unauthorized alien from bringing a claim under RICO. The plaintiffs' RICO claim is based on the defendants' alleged pattern of immigration law violations. The enforcement of federal immigration laws is in accordance with IRCA. Moreover, any person who "is capable of holding a legal or beneficial interest in property" may bring an action under RICO. 18 U.S.C. §§ 1961(3) and 1964(c). The plaintiffs' alleged injuries are lost wages. Unauthorized aliens are entitled to minimum and overtime wages under the FLSA. See Patel, 846 F.2d at 706. The plaintiffs have a legal interest in these wages and may bring an action under RICO to recover the same. IRCA does not preclude the plaintiffs from bringing the federal and state law claims for withheld wages or the RICO claim.
The Supreme Court has also held that unauthorized aliens are "employees" covered under the NLRA. Sure-Tan, Inc. v. Nat'l Labor Relations Bd., 467 U.S. 883, 893 (1984).
2. RICO
Maximino Flores states that LL sold him immigration documents and collected the purchase price through deductions to his pay check. Isaias Flores Lagunes states that LL provided employment documents to him. The defendants provided company housing to the plaintiffs. The plaintiffs have testified that agents of LL threatened them with deportation when they complained of withheld wages or inadequate housing. A genuine issue of material fact exists as to whether the defendants damaged the plaintiffs through a pattern of immigration law violations. Consequently, the defendants' motion for summary judgment in favor of dismissing the RICO claim is denied.
3. Wrongfully withheld wages.
The plaintiffs have testified that the defendants owe them hourly wages and overtime wages. The defendants have not demonstrated the absence of a genuine issue of material fact concerning the plaintiffs' lost wages. Consequently, the defendants' motion for summary judgment in favor of dismissing the claims under the FLSA, Payment of Wages Act, breach of contract, and other equitable remedies is denied.
III. Class certification
The plaintiffs seek to represent a class consisting of other employees of LL and WLL who did not receive hourly wages and overtime wages in accordance with federal and state law. The plaintiffs are directed to file a motion supporting their claim of class certification within thirty-days of the filing of this order. The defendants then have thirty-days to respond.
The defendants' motion to dismiss is denied. The plaintiffs have withdrawn the civil conspiracy claim. The defendants' motion for summary judgment in favor of dismissing the remaining claims is denied.
AND IT IS SO ORDERED.