Summary
granting conditional collective action certification based on deposition testimony
Summary of this case from Lichy v. Centerline Commc'ns LLCOpinion
10 Civ. 3571 (ILG) (VVP)
10-10-2012
STEVENS, Plaintiff, v. HMSHOST CORPORATION, et al. Defendants.
MEMORANDUM AND ORDER :
Defendants object to Magistrate Judge Viktor V. Pohorelsky's Opinion & Order dated June 15, 2012 ("Order") (Dkt. No. 49) conditionally certifying a collective action under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 216(b), and directing the parties to submit proposed notice. For the reasons stated below, the Court rejects defendants' objections to Magistrate Judge Pohorelsky's Order.
I. FACTS & PROCEDURAL HISTORY
Plaintiffs are former assistant store managers ("ASMs") employed by HMSHost Corporation or its subsidiaries, Host International, Inc. and Host Services of New York, Inc. (collectively "Host" or "defendants"), which manage restaurants and concessions at a variety of travel facilities and shopping malls. They allege that they were illegally underpaid and bring claims against Host under the FLSA, 29 U.S.C. §§ 207(a)(1) and 215(a), and New York Labor Law §§ 2 and 651. On June 10, 2011, after limited initial collective action discovery, plaintiffs moved for conditional collective action certification, arguing that although they were classified as exempt from FLSA overtime requirements under Host's policies, their actual job duties did not fall within any exempt category. On June 15, 2012, Magistrate Judge Pohorelsky granted conditional collective action certification, directed the parties to submit proposed notice forms, and ordered the defendants to submit a list of names and contact information of potential opt-in plaintiffs. Order at 15-16. On June 29, 2012, defendants filed six timely objections to the Order. Defendants' Objections to the Magistrate Judge's June 15, 2012 Order dated June 29, 2012 ("Defs.' Objs.") (Dkt. No. 51). On July 13, 2012, plaintiffs filed their responses to defendants' objections, Plaintiff's Response to Defendant's Objections to Magistrate Judge Pohorelsky's June 15, 2012 Order dated July 13, 2012 ("Pl.'s Resp.") (Dkt. 53), and on July 20, 2012, defendants filed their reply. Defendant's Reply in Support of their Objections to the Magistrate Judge's June 15, 2012 Order dated July 20, 2012 ("Defs.' Reply") (Dkt. No. 55).
While Easton Stevens is the only plaintiff named in the complaint, eight additional former employees of Host have opted-in as plaintiffs in this action under the FLSA § 216(b) consent procedure.
The facts are discussed in greater detail in Magistrate Judge Pohorelsky's Order at 1-3, familiarity with which is assumed.
FLSA claims may not be brought as part of a Rule 23 class action but, rather, the FLSA provides for a special opt-in collective action procedure. See Alleyne v. Time Moving & Storage Inc., 264 F.R.D. 41, 45 (E.D.N.Y. 2010) ("FLSA claims are ineligible for certification under Rule 23 and can only be certified as 'collective actions' pursuant to 29 U.S.C. § 216(b).").
A magistrate judge has the authority to authorize an FLSA collective action. See Mazur v. Olek Lejbzon & Co., No. 05 Civ. 2194(RMB)DF, 2005 WL 3240472, at *2 n.1 (S.D.N.Y. Nov. 30, 2005).
II. DISCUSSION
A. Legal Standard
1. Standard of Review
Pursuant to Federal Rule of Civil Procedure 72 and the Federal Magistrate's Act, 28 U.S.C. §§ 631-639 (2006), a court reviews objections to a non-dispositive order of a magistrate judge and must "modify or set aside any part of the order that is clearly erroneous or is contrary to law." Fed. R. Civ. P. 72(a); see also 28 U.S.C. § 636(b)(1)(A). Clear error may be found if, "on the entire evidence" the Court is "left with the definite and firm conviction that a mistake has been committed." Easley v. Cromartie, 532 U.S. 234, 235 (2001) (internal quotation omitted). "This standard is highly deferential, imposes a heavy burden on the objecting party, and only permits reversal where the magistrate judge abused his discretion." Summa v. Hofstra Univ., 715 F. Supp. 2d 378, 384 (E.D.N.Y. 2010) (internal quotation omitted). "An order is contrary to law when it fails to apply or misapplies relevant statutes, case law or rules of procedure." MacNamara v. City of New York, 249 F.R.D. 70, 77 (S.D.N.Y. 2008) (internal citations and quotations omitted).
2. Conditional Certification Standard
In Myers v. Hertz Corp., 624 F.3d 537, 554-55 (2d Cir. 2010), the Second Circuit set out a "two-step method" to determine whether to certify a collective action under FLSA § 216(b). "The first step involves the court making an initial determination to send notice to potential opt-in plaintiffs who may be 'similarly situated' to the named plaintiffs with respect to whether a FLSA violation has occurred." Id. at 555. To obtain conditional certification, plaintiffs must make "a modest factual showing that they and potential opt-in plaintiffs together were victims of a common policy or plan that violated the law." Id. (internal quotation omitted). "In a FLSA exemption case," such as this one, "plaintiffs accomplish this by making some showing that there are other employees who are similarly situated with respect to their job requirements and with regard to their pay provisions . . . who are classified as exempt pursuant to a common policy or scheme." Id. (internal quotation omitted). The standard of proof at this stage should remain "low," "because the purpose of this first stage is merely to determine whether 'similarly situated' plaintiffs do in fact exist." Id. (internal citation omitted). Only at the second step will the Court, "on a fuller record, determine whether a so-called 'collective action' may go forward by determining whether the plaintiffs who have opted in are in fact 'similarly situated' to the named plaintiffs." Id.
B. Defendants' Objections
In their first and second objections, defendants argue that the Order is contrary to law because Host's policies are not facially illegal, but, rather, track Department of Labor regulations defining the executive exemption to the FLSA. Defs.' Objs. at 1, 3, 9-11. Magistrate Judge Pohorelsky correctly notes that "plaintiffs do not assert that Host's policy is unlawful on its face, but that rather, in practice, Host's [ASMs] primarily performed non-exempt work for which they did not receive overtime compensation." Order at 7-8. "[I]t is irrelevant to the propriety of conditional classification" that Host's stated policies "are not themselves illegal. The relevant illegality charged against [Host] is that classifying ASMs as 'executive' exempt employees violated the FLSA." Zaniewski v. PRRC Inc., 848 F. Supp. 2d 213, 229 (D. Conn. 2012). The question of whether Host's classification of ASMs as exempt employees actually violates the FLSA is properly addressed at the second stage after discovery. See id. (collecting cases). "At this preliminary stage, the focus of the inquiry is not on whether there has been an actual violation of law[,] but rather on whether the proposed plaintiffs are 'similarly situated' under 29 U.S.C. § 216(b) with respect to their allegations that the law has been violated." Jacob v. Duane Reade, Inc., No. 11-cv-160 (JPO), 2012 WL 260230, at *4 (S.D.N.Y. Jan. 27, 2012).
Plaintiffs have met this burden by submitting evidence on identical job classification and training materials across all ASMs nationwide, and presenting testimony from former ASMs across the country regarding their actual job duties. Order at 5-6. Defendants argue that it is "settled" law that "assistant managers like those at Host perform exempt work," and cite to cases both inside and outside this circuit. Defs.' Objs. 17-19. However, all the cases cited by defendants made rulings after discovery had been completed and, therefore, are inapposite at the conditional certification stage. Conversely, in Alli v. Boston Market Co., No. 3:10-cv-4 (JCH), 2011 WL 40006691, at *3-5 (D. Conn. 2011), the court, applying Myers, found that restaurant assistant managers had met their modest burden of submitting evidence that they perform similar work across employer restaurants and are subject to a common policy based on corporate materials and testimony from plaintiffs. Accordingly, the Magistrate Judge's Order is not clearly erroneous or contrary to law, and the Court rejects defendants' first and second objections.
Defendants also rely on Amendola v. Bristol-Myers Squibb Co., 558 F. Supp. 2d 459, 467 n.9 (S.D.N.Y. 2008) for the proposition that courts may examine the merits at the conditional certification stage. However, Amendola has been soundly rejected within this circuit, see, e.g., Cunningham v. Elec. Data Sys. Corp., 754 F. Supp. 2d 638, 645-46 (S.D.N.Y. 2010), and is highly questionable after the Second Circuit's decision in Myers.
Magistrate Judge Pohorelsky's Order relies primarily upon Ravenell v. Avis Budget Car Rental, LLC, No. 08-CV-2113, 2010 WL 2921508 (E.D.N.Y. July 19, 2010) and Cano v. Four M Food Corp., No. 08-CV-3005, 2009 WL 5710143 (E.D.N.Y. Feb. 3, 2009) for the same holding. Defendants attempt to distinguish these cases by focusing on factual differences in the type of work performed, which is not appropriate at the conditional certification stage. --------
In their third, fourth, and fifth objections, defendants claim that plaintiffs are not similarly situated to other ASMs because they present too little evidence of misclassification to generalize across the diversity of ASMs, so certification will require fact-intensive determinations with respect to each position. Defs.' Objs. at 1-2. Defendants argue that "[t]he disparate allegations of four former assistant managers" who "constituted less than two-tenths of one percent of the class" cannot be extrapolated to all ASMs nationwide. Defs.' Objs. at 8-9, 13. However, the cases upon which the defendants rely are distinguishable. While courts have refused to certify national collective actions based solely on an individual's deposition, see Jenkins v. TJK Cos. Inc., --- F. Supp. 2d ----, 2012 WL 1099964, at *5-6 (E.D.N.Y. Mar. 31, 2012), or even based on several geographically clustered plaintiffs' depositions, see Guillen v. Marshals of MA, Inc., 841 F. Supp. 2d 797, 800-02 (S.D.N.Y. 2012), here, plaintiffs have offered depositions from plaintiffs who worked at Host locations in New York, Minneapolis, Milwaukee, and Orlando. Order at 5. Courts regularly conditionally certify collective actions based on nationwide deposition testimony. See Winfield v. Citibank, N.A., 843 F. Supp. 2d 397, 403-04 (S.D.N.Y. 2012) (finding that plaintiffs "are similarly situated to one another and to potential opt-in plaintiffs" based on several depositions and declarations); Ravenell, 2010 WL 2921508, at *5 (certifying collective action based on deposition testimony of multiple opt-in plaintiffs).
Defendants, relying almost entirely on cases outside of this circuit, next argue that conditional certification should be denied because the "determination of exempt status will require a fact-intensive inquiry into the duties performed by each individual employee." Defs.' Objs. at 15-16. However, courts within this circuit have rejected the cases upon which defendants rely. See Cohen v. Gerson Lehrman Grp., Inc., 686 F. Supp. 2d 317, 329-30 (S.D.N.Y. 2010) (collecting cases). Under Myers, "a fact-intensive inquiry is inappropriate at the notice stage, as Plaintiffs are seeking only conditional certification. The Defendant[s] will have an opportunity to argue that individual inquiries predominate over common issues, based on discovery, at the second phase." Zaniewski, 848 F. Supp. 2d at 220-21 (citing Salomon v. Adderley Indus., Inc., 847 F. Supp. 2d 561, 564-65 (S.D.N.Y. 2012)). Therefore, claims of factual differences or complexity do not nullify plaintiffs' "modest factual showing that they and other employees were victims of a common policy or plan." Zaniewski, 848 F. Supp. 2d at 220 (citing Salomon, 847 F. Supp. 2d at 563-64). Nonetheless, defendants attempt to bolster their argument by providing declarations of current Host employees, whose day-to-day managerial experiences differ from plaintiffs'. Defs.' Objs. at 20-25. "However, such evidence cannot be used to undermine a plaintiff's initial showing because doing so would require a court to weigh evidence and determine credibility," which is not appropriate until the second stage after discovery. Ferreira v. Modell's Sporting Goods, Inc., No. 11 Civ. 2395(DAB), 2012 WL 2952922, at *3 (S.D.N.Y. July 16, 2012); see Lujan v. Cabana Mgmt., Inc., No. 10-CV-755 (ILG), 2011 WL 317984, at *7 (E.D.N.Y. Feb. 1, 2011).
Finally, in their sixth objection, defendants argue that sending notice to employees who worked at Host within the past three years is inappropriate because plaintiffs have not demonstrated that Host's alleged FLSA violations were willful. Defs.' Objs. at 2. At the conditional certification stage, prior to discovery on the issue of willfulness, courts ordinarily refuse to determine willfulness and authorize notice to cover the past three years. See, e.g., Jason v. Falcon Data Com., Inc. No. 09-CV-3990 (JG)(ALC), 2011 WL 2837488, at *7 (E.D.N.Y. July 18, 2011). In the cases cited by defendants that found FLSA violations not to be willful, discovery had been completed. Defs.' Objs. at 26-27. For the reasons stated above, the Court finds that Magistrate Judge Pohorelsky's Order is not clearly erroneous or contrary to law, and the defendants' objections are rejected.
III. CONCLUSION
For the foregoing reasons, defendants' objections to Magistrate Judge Pohorelsky's Order are OVERRULED.
SO ORDERED. Dated: Brooklyn, New York
October 10, 2012
/s/ ILG
I. Leo Glasser
Senior United States District Judge