IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND : Manuel Alvarez-Soto, et. al., : On behalf of themselves and all others : similarly situated : : Plaintiffs, : : v. : Case No. 8:15-CV-1120 (TDC) : B. FRANK JOY, LLC. et. al, : : Defendants. : : DEFENDANTS’ MOTION TO DISMISS THE INDIVIDUAL DEFENDANTS FROM PLAINTIFFS’ SECOND AMENDED COMPLAINT OR, IN THE ALTERNATIVE, FOR SUMMARY JUDGMENT Pursuant to Fed. R. Civ. P. 8(a)(2), 12(b)(6) and 56, Defendants through their undersigned counsel, respectfully submit their Motion to Dismiss T. Kenneth Joy and Kevin Joy (the Individual Defendants) from Plaintiffs’ Second Amended Putative Class and Collective Action Complaint, or, in the Alternative, for Summary Judgment, for failure to state a claim on which relief can be granted. In the alternative, the Court should grant summary judgment in favor of T. Kenneth Joy and Kevin Joy because there is no genuine issue of material fact that: (1) they were not Plaintiffs’ employer under any of the wage statutes or the sick and safe leave law (Counts I-VII); (2) they were not a party to Plaintiffs’ supposed oral contracts and did not confer any benefit onto them (Counts VIII-X), and (3) they have not discriminated against any of the Plaintiffs or had any involvement in the events relating to their race claims (Count XII). The Court’s attention is directed to Defendants’ Memorandum of Law in support of this Motion, the attached Declarations of the Individual Defendants, and Defendants’ Proposed Order. Case 8:15-cv-01120-TDC Document 86 Filed 02/27/17 Page 1 of 3 2. February 27, 2017 Respectfully submitted, B. FRANK JOY, LLC /s/ Maurice Baskin Maurice Baskin (Bar No. 04342) William F. Allen (Bar No. 16816) Steven E. Kaplan (Bar No. 16531) LITTLER MENDELSON, P.C. 815 Connecticut Avenue, NW, Suite 400, Washington, D.C. 20006 202.842.3400 Telephone 202.842.0011 Facsimile mbaskin@littler.com ballen@littler.com skaplan@littler.com Attorneys for Defendants Case 8:15-cv-01120-TDC Document 86 Filed 02/27/17 Page 2 of 3 CERTIFICATE OF SERVICE I, Steven Kaplan, an attorney for B. Frank Joy, LLC, T. Kenneth Joy, and Kevin Joy, hereby certify that I served Motion to Dismiss the Individual Defendants from Plaintiffs’ Second Amended Putative Class and Collective Action Complaint, or, in the Alternative, for Summary Judgment, Memorandum in Support, and Proposed Order through the ECF system upon: Christine A. Dixon C. Dixon Global Law, PLLC 1050 Connecticut Ave, NW 5th Floor Washington, 20036 Larry Strauss Willie Gary Law Offices of Gary, Williams, Parenti, Watson & Gary, PLLC 221 S.E. Osceola Street Stuart, FL 34994 /s/ Steven Kaplan Steven Kaplan Case 8:15-cv-01120-TDC Document 86 Filed 02/27/17 Page 3 of 3 1 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND : MANUEL ALVAREZ-SOTO, et. al., : : Plaintiffs, : : v. : Case No. 8:15-CV-1120 (TDC) : B. FRANK JOY, LLC. et. al, : : Defendants. : : DEFENDANTS’ MEMORANDUM IN SUPPORT OF THEIR MOTION TO DISMISS THE INDIVIDUAL DEFENDANTS FROM PLAINTIFFS’ SECOND AMENDED COMPLAINT OR, IN THE ALTERNATIVE, FOR SUMMARY JUDGMENT Defendants T. Kenneth Joy (“Ken Joy”), Kevin Joy (Kevin Joy”), and B. Frank Joy, LLC (“BFJ”), through their undersigned counsel, respectfully submit their Memorandum in Support of their Motion to Dismiss The Individual Defendants from Plaintiffs’ Second Amended Putative Class and Collective Action Complaint, or, in the Alternative, for Summary Judgment (hereinafter “Am. Compl.”). I. INTRODUCTION The Court should dismiss Ken Joy and Kevin Joy (hereafter collectively the “Individual Defendants”) entirely from the Second Amended Complaint.1 First, Plaintiffs have not and cannot truthfully state a plausible, fact-based claim that the Individual Defendants are Plaintiffs’ “employers” under the Fair Labor Standards Act (“FLSA”) 1 The Individual Defendants join Defendant BFJ’s January 31, 2017 partial motion to dismiss numerous counts of the Amended Complaint for failure to state a claim on which relief can be granted (ECF No. 79). Because Plaintiffs have filed no timely opposition to BFJ’s motion nor sought an extension of time, the Court should grant the partial motion to dismiss as to all Defendants. Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 1 of 21 2 (Counts I and II), the District of Columbia Minimum Wage Act (“DCMWA”) (Count III), the Maryland Wage and Hour Law (Count IV), the District of Columbia Wage Payment and Collection Law (“DCWPCL”) (Count V), and the Maryland Wage Payment and Collection Law (“MWPCL”) (Count VI). Second, the Court should dismiss Plaintiffs’ claim under the District of Columbia’s Accrued Sick and Safe Leave Act of 2008 (“Sick and Safe Leave Act”) (Count VII) because, unlike the wage statutes above, the Act does not impose individual liability at all. Third, the Court should dismiss the Individual Defendants from Plaintiffs’ breach of contract, quantum meruit, and unjust enrichment claims under Maryland and District of Columbia law (Counts VIII-XI) because Plaintiffs have not and cannot truthfully allege that: (a) the Individuals Defendants were a party to their supposed oral contracts; and (b) they conferred a benefit onto the Individual Defendants. Fourth, the Court should dismiss the Individual Defendants from Plaintiffs’ race and ethnicity discrimination claim under 42 U.S.C. § 1981 (Count XII) because they have not and cannot truthfully allege that the Individual Defendants themselves discriminated against any of the Plaintiffs or had any involvement in the events relating to their discrimination claims. Fifth, in the alternative, the Court should grant summary judgment in favor of Ken Joy and Kevin Joy because there is no genuine issue of material fact that: (1) they were not Plaintiffs’ employer under any of the wage statutes or the sick and safe leave law (Counts I-VII); (2) they were not a party to Plaintiffs’ supposed oral contracts and did not confer any benefit onto them (Counts VIII-X), and (3) they have not discriminated against any of the Plaintiffs or had any involvement in the events relating to their race claims (Count XII). Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 2 of 21 3 II. RELEVANT FACTS A. Alleged Facts Regarding the Individual Defendants in the Amended Complaint According to the Amended Complaint, Ken Joy allegedly serves as BFJ’s “President and CEO.” (Am. Compl. ¶ 13). Kevin Joy allegedly serves as BFJ’s “Vice President and manages the affiliated Go-Glass Joy, LLC” entity.2 (Id. ¶ 14). The Amended Complaint further alleges: “By virtue of their respective roles as Joy’s corporate officers and superior knowledge of Joy’s operations which was or should have been derived from these positions, Ken Joy and/or K. Joy authorized, assented to, were aware, or should have been aware of the violations of the Wage Laws and the work performed by the Class Plaintiffs and similarly-situated employees.” (Id. ¶¶ 72, 80, 87, 98, 106, 115, 124, 132, 139, 150, 157, and 168.)3 These are the sole allegations of purported facts referring to Ken or Kevin Joy in the Amended Complaint. B. Undisputed Facts Supporting Defendants’ Motion for Summary Judgment 1. Ken Joy Contrary to the unsupported allegation in the Complaint referenced above, Ken Joy is neither the President of BFJ nor its Chief Executive Officer, and has not held either of these positions since 2007. (Declaration of T. Kenneth Joy (“Ken. Joy Decl.”) ¶ 3, Exhibit 1). Ken 2 Since the Court denied Plaintiffs’ motion for leave to amend their Complaint to add Go-Glass Joy as a defendant (ECF No. 67), Kevin Joy’s alleged involvement with that entity has no bearing on any of the remaining issues in this case. 3 The only difference between these paragraphs is that Plaintiffs replaced the phrase “Wage Laws” with the following phrases: paragraphs 80 and 87 with “of the herein-described FLSA violations,” paragraph 98 with “of the herein-described DCMWA violations,” paragraph 106 with “of the herein-described MWHL violations,” paragraph 115 with “of the herein-described DCWPCL violations,” paragraph 124 with “of the herein-described MWPCL violations,” paragraph 132 with “of the herein-described Sick Leave Acts violations,”¶ 139 with “of the herein-described breach,” ¶ 150 with “of the herein-described unjust enrichment,” ¶ 157 with “of the herein described breach,” and ¶ 168 with “of the herein-described unjust enrichment.” Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 3 of 21 4 Joy also no longer has any ownership interest in BFJ. (Id. ¶ 5). Though he does serve as the Chairman of the Board of the Company, in this capacity he plays no role in the management of personnel policies or practices; rather, Ken Joy’s role is limited to advising BFJ management on business development and strategic acquisitions. (Id.). Moreover, Ken Joy: (1) does not personally know any of the Plaintiffs, Manuel Alvarez- Soto, Darryl Reid, or Charles Thomas; (2) has never had any discussions with any BFJ manager or employee specifically concerning Plaintiffs; (3) is not involved in employee payroll matters, such as setting classifications and exemptions, hours, schedules, rates of regular pay, rates of any overtime pay, and any benefits deductions; (4) is not responsible for maintaining employment records, including personnel records; (4) did not hire Plaintiffs or negotiate any contract with them; (5) was not responsible for creating or adjusting Plaintiffs’ work schedules or conditions of employment; (6) did not supervise Plaintiffs; (7) did not know that any of the Plaintiffs complained that they were not adequately paid overtime pay; (8) did not accept any benefits from Plaintiffs’ employment; (9) did not make any decision to deny Plaintiffs higher pay, overtime pay, promotions, sick pay, or any benefit; and (10) was not involved in any discussion to deny them these alleged benefits. (Id. ¶¶ 4-9). 2. Kevin Joy Again contrary to the Amended Complaint, Kevin Joy is not Vice President of either BFJ or Go-Glass. (Declaration of Kevin Joy (Kevin Joy Decl.”) ¶ 3, Exhibit 2). He serves as Secretary of the BFJ Board, but in this capacity he plays no role in the management of personnel policies or practices. (Id. ¶ 3). Like Ken Joy, Kevin Joy: (1) does not personally know any of the Plaintiffs, Manuel Alvarez-Soto, Darryl Reid, or Charles Thomas; (2) has never had any discussions with any BFJ manager or employee specifically concerning Plaintiffs; (3) is not Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 4 of 21 5 involved in employee payroll matters, such as setting classifications and exemptions, hours, schedules, rates of regular pay, rates of any overtime pay, and any benefits deductions; (4) is not responsible for maintaining employment records, including personnel records; (4) did not hire Plaintiffs or negotiate any contract with them; (5) was not responsible for creating or adjusting Plaintiffs’ work schedules or conditions of employment; (6) did not supervise Plaintiffs; (7) did not know that any of the Plaintiffs complained that they were not adequately paid overtime pay; (8) did not accept any benefits from Plaintiffs’ employment; (9) did not make any decision to deny Plaintiffs higher pay, overtime pay, promotions, sick pay, or any benefit; and (10) was not involved in any discussion to deny them these alleged benefits. (Id. ¶¶ 3-8). III. ARGUMENT A. The Standard for Dismissal under Fed. R. Civ. P. 8(a)(2) and 12(b)(6) Rule 8(a)(2) requires a “short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). That showing must consist of more than “a formulaic recitation of the elements of a cause of action” or “naked assertion[s] devoid of further factual enhancement.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). A pleading must give the court and defendant “fair notice of what the plaintiff’s claim is and the grounds upon which it rests.” Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512 (2002). Rule 12(b)(6) permits a defendant to move to dismiss a complaint because it fails to state a claim upon which relief can be granted. When ruling on a defendant’s motion to dismiss, “a judge must accept as true all of the factual allegations contained in the complaint.” Erikson v. Pardus, 551 U.S. 89, 93-4 (2007) (citations omitted). However, the United States Supreme Court has explained that “[w]hile a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff’s obligation to provide the ‘grounds’ of his Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 5 of 21 6 ‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). Rather, a complaint’s specific “[f]actual allegations must be enough to raise a right of relief above the speculative level,” and plaintiffs must allege “enough facts to state a claim to relief that is plausible on its face.” Id. at 555, 570. See also Iqbal, 556 U.S. at 678. Accordingly, the Court held that “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice,” and only a complaint that states a plausible claim for relief survives a motion to dismiss. Iqbal, 556 U.S. at 678-79. Indeed, “[a] court considering a motion to dismiss may begin by identifying allegations that, because they are mere conclusions, are not entitled to the assumption of truth.” Id. at 664. The Fourth Circuit has held that the Supreme Court’s decision in Twombly establishes a review that is “more favorable to dismissal of a complaint” at the earliest stages of a case. Giarratano v. Johnson, 521 F.3d 298, 304 n.3 (4th Cir. 2008). 1. The Standard for Summary Judgment under Fed. R. Civ. P. 56(c) Summary judgment is appropriate when there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(C). A principal purpose of summary judgment is to isolate and dispose of factually unsupported claims. Celotex Corp. v. Catrett, 477 U.S. 317, 323-324 (1986). The Supreme Court has stressed that summary judgment is “an integral part of the Federal Rules as a whole,” and not a “disfavored procedural shortcut.” Id. at 327. Once the moving party has shown that no genuine issue of material fact exists, the non- moving party must go beyond the pleadings and come forth with sufficient proof to establish the elements of the party’s case upon which that party bears the burden of proof. Id. at 323-24. The Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 6 of 21 7 mere existence of a minor factual dispute will not preclude summary judgment if there is no “genuine” issue of material fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-248 (1986). A plaintiff’s speculative testimony about the motive for an employer’s employment action is insufficient to create a triable issue of material fact. See Lujan v. National Wildlife Federation, 497 U.S. 871, 888 (1990) (conclusory allegations insufficient to defeat summary judgment motion). B. FLSA (Counts I and II), DCMWA (Count III), MWHL (Count IV), and DCWPCL (Count V) 1. Plaintiffs Have Failed to Plausibly Plead that the Individual Defendants Are or Were Their Statutory “Employer” In order to state a viable claim under the FLSA, DCMWA, MWHL, or DCWPCL a plaintiff must plead facts that, if true, establish that a defendant who allegedly owes them unpaid wages is actually their statutory employer. Plaintiffs’ Amended Complaint fails to meet this standard with respect to the Individual Defendants because it contains nothing more than threadbare recitals and conclusory allegations, which are insufficient as a matter of law to establish a plausible employment relationship between Plaintiffs and the Individual Defendants. Accordingly, under Twombly and its progeny, the Amended Complaint must be dismissed as to the Individual Defendants. To determine whether an individual is an “employer” for purposes of the FLSA, DCMWA, MWHL, or DCWPCL courts analyze the “economic reality” of the relationship between the parties. See Kerr v. Marshall Univ. Bd. of Governors, 824 F.3d 62, 83-4 (4th Cir. 2016) (affirming dismissal of FLSA claims against individual defendant). Under the “economic reality” test, courts examine whether the putative employer is someone who: (1) had authority to hire and fire the employee; (2) supervised and controlled employee work schedules or conditions Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 7 of 21 8 of employment; (3) determined the rate and method of payment; and (4) maintained employment records. Kerr, 824 F. 3d at 83; see also Avila v. Caring Hearts & Hands Assisted Living & Elder Care, LLC, 2016 U.S. Dist. LEXIS 100904, at *7-8 (D. Md. Aug. 1, 2016) (Chuang, J.) (citing Kerr). The MWHL is Maryland’s equivalent of the FLSA and defines “employer” in virtually the same way as the FLSA. See Md. Code, Lab. & Empl., § 3-401(b); McFeeley v. Jackson St. Entm’t, LLC, 47 F. Supp. 3d 260, 267 (D. Md. 2014) (The requirements under the MWHL are so closely linked to the FLSA that “[p]laintiffs’ claim under the MWHL stands or falls on the success of their claim under the FLSA.”) (citation omitted). The District of Columbia wage laws also define “employer” in the same manner as the FLSA. See Guevara v. Ischia, Inc., 47 F. Supp. 3d 23, 26 (D.D.C. 2014) (“For purposes of individual liability, the word ‘employer’ in the FLSA and the DCMWA is generally interpreted in the same way.”). Within this rubric, Plaintiffs must allege facts (as opposed to legal conclusions) that, if true, show that the Individual Defendants are their employers. Plaintiffs failed to do so. Instead, Plaintiffs simply make one sweeping, conclusory assertion that that the Individual Defendants are their “employer” under these statutes.4 Plaintiffs’ Amended Complaint contains no factual allegations showing that the Individual Defendants: (1) had authority to hire and fire them; (2) supervised and controlled their work schedules or conditions of employment; (3) determined the rate and method of payment; and (4) maintained employment records, as set forth above. Both Iqbal and Twombly necessitate that Plaintiffs provides “[f]actual allegations . . . enough to raise a right to relief above the speculative level,” and “enough facts to state a claim to relief that is 4 See Am. Compl. ¶ 19 (“The Defendants in general and Joy specifically, individually and/or collectively, are the Class Plaintiffs’ employers within the meaning of the FLSA, the DCMWA, the DCWPCL, the MWHL, and the MWPCL (collectively, ‘Wage Laws.’)).” Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 8 of 21 9 plausible on its face.” Twombly, 550 U.S. at 555, 570. Indeed, courts in this District have held that complaints attempting to attribute employer liability based solely on mere conclusions cannot withstand a motion to dismiss. Everett v. PP&G, Inc., No. 14-cv-0102, 2014 U.S. Dist. LEXIS 76522, at *7-8 (D. Md. June 5, 2014) (dismissing the plaintiffs’ FLSA and MWHL claims against an individual defendant and holding that the plaintiffs’ “vague generalizations provide no actual factual allegations as to [the individual defendant’s] conduct from which it could be inferred that he is liable to the Plaintiffs.”); see also Faty v. US Pack Logistics, LLC, Case No. JFM-16-3411 (D. Md. Feb. 17, 2017), Memo to Counsel, ECF No. 19 (dismissing individual defendants from the Complaint because there were no allegations made to satisfy the elements of the “economic reality” test) (attached as Exhibit 3); Tracy v. NVR, Inc., No. 04-cv- 6541, 2009 U.S. Dist. LEXIS 90778, at *21 (W.D.N.Y. Sept. 30, 2009) (plaintiff’s allegations and argument that: “Schar was Chairman and Saville was President of NVR, then each must have had authority to take the actions that comprise the ‘economic realities’ test, and that because each had the authority to take those actions, then each must have in fact taken those actions,” were insufficient to state a claim against the individual defendants under Twombly and Iqbal). By contrast, where this Court found an actionable claim against an individual defendant in Avila v. Caring Hearts & Hands Assisted Living, 2016 U.S. Dist. LEXIS 100904 (Chuang, J.), the plaintiff there specifically alleged that the individual defendant had the power to “hire, fire, suspend, and discipline” Plaintiff, “supervised Plaintiff,” “set and controlled Plaintiff’s work schedule,” and “set and determined the rate and method of Plaintiff’s pay . . . .” Id. at *8-10. Plaintiffs here have made no similar allegations and have therefore failed to state an actionable claim against either of the Individual Defendants. Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 9 of 21 10 Nor is this a situation where plaintiffs “frame[d] all allegations made in their Complaint in the plural” or lumped the individual defendants into the same allegations as the true employer (BFJ), which some Courts have also deemed minimally sufficient. Pearson v. Pro’l 50 States Prot., LLC, No. 09-cv-113859, 2010 U.S. Dist. LEXIS 113859, at *11-12 (D. Md. Oct. 26, 2010) (“this Court will presume that all allegations made against the Defendants also apply equally to Tillman in his individual capacity”); see also Caseres v. S&R Mgmt. Co., LLC, 12-cv-01358, 2012 U.S. Dist. LEXIS 152724, at *12 (D. Md. Oct. 24, 2012) (plaintiff pled a plausible claim that the individual was an “employer” because he alleged “all Defendants hired Plaintiff, paid him a salary, subjected him to a workweek longer than forty hours, and failed to provide overtime pay.”) (emphasis added).5 Accordingly, where, as here, Plaintiffs have not adequately pled “employer” status for either of the Individual Defendants in the context of the “economic reality” factors, Plaintiffs’ Amended Complaint with respect to the Individual Defendants must be dismissed. 2. The Court Should Grant Summary Judgment In Favor of the Individual Defendants Because They Did Not Have the Requisite Control over Plaintiff’s Working Conditions Assuming, arguendo, that the Court were to hold Plaintiffs have adequately pled that the Individual Defendants are statutory employers, the Court should nevertheless grant summary judgment in favor of the Individual Defendants because there is no genuine issue of material fact as to the following: (1) the Individual Defendants played no role in the hiring or firing of Plaintiffs; (2) The Individual Defendants did not supervise or control work schedules, 5 More recent court decisions have rejected the notion that plaintiffs can satisfy their burden of alleging facts showing individuals to be employers by simply lumping “all defendants” together. See Murphy v. Ajinomoto Windsor, Inc., No. 15-cv-120, 2016 U.S. Dist. LEXIS 55261, at *18 (E.D. Mo. Apr. 26, 2016) (dismissing individual defendants); Attai v. Delivery Dudes, LLC, No. 15-cv-62522, 2016 U.S. Dist. LEXIS 27298, at *14 (S.D. Fla. Mar. 2, 2016) (same). Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 10 of 21 11 responsibilities, or conditions of employment; (3) the Individual Defendants were not involved in employee payroll matters, such as setting classifications and exemptions, hours, schedules, rates of regular pay, rates of any overtime pay, and any benefits deductions; (4) the Individual Defendants were not responsible for maintaining employment records, including personnel records; (5) the Individual Defendants are not the owners of BFJ; and (6) the Individual Defendants do not know the Plaintiffs. (Ken Joy Decl. ¶¶ 4-9; Kevin Joy Decl. ¶¶ 4-8). Based upon these undisputed facts, the Individual Defendants are plainly not Plaintiffs’ statutory employers under the “economic reality” test. See Whyte v. PP&G, Inc., Nos. 13-2806; 13-cv-3706, 2015 U.S. Dist. LEXIS 68059, *8-12 (D. Md. May 26, 2015) (summary judgment granted to the individual defendant, notwithstanding her controlling ownership interest, because she did not exercise control over the putative employment relationship); Melgar Morataya v. Nancy’s Kitchen of Silver Spring, Inc., No. 13-cv-01888, 2015 U.S. Dist. LEXIS 4147, at *12-13 (D. Md. Jan. 12, 2015) (summary judgment granted because “[t]here is no evidence that Mrs. Barreto had the authority to hire and fire employees, had the authority to supervise or control work schedules or employment conditions, had the authority to determine employee wage rates or methods of payment, or maintained the employment records.”); Caseres, 2012 U.S. Dist. LEXIS 152724, at *13-18 (summary judgment granted because uncontested affidavits showed that the individual defendants were not plaintiff’s “employer” under the FLSA, MWHL, and MWPCL). Accordingly, the Court should grant summary judgment in favor of the Individual Defendants because the undisputed material facts establish that they are not Plaintiffs’ statutory employers as a matter of law. Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 11 of 21 12 3. The Court Should Grant Summary Judgment In Favor of the Individual Defendants Because They Did Not Know that Plaintiffs Engaged in Protected Activity under the FLSA (Count II) Moreover, the Court should grant summary judgment in favor of the Individual Defendants because there is no genuine issue of material fact that the Individual Defendants did not know that Plaintiffs engaged in protected activity under the FLSA. (Ken Joy Decl. ¶ 9; Kevin Joy Decl. ¶ 8). As such, without knowledge of their alleged protected activity, it is an impossibility that they took any adverse employment action as a result of Plaintiffs’ protected activity. See Dowe v. Total Action Against Poverty in Roanoke Valley, 145 F.3d 653, 657 (4th Cir. 1998) (“Since, by definition, an employer cannot take action because of a factor of which it is unaware, the employer’s knowledge that the plaintiff engaged in a protected activity is absolutely necessary to establish the third element of the prima facie case.”); Featherson v. Montgomery County Public Schools, 739 F. Supp. 1021, 1025-26 (D. Md. 1990) (“As a matter of logic and of fact, a person cannot make an adverse, retaliatory decision based upon information of which s/he is unaware.”). C. MWPCL (Count VI) 1. Plaintiffs Have Failed to Plausibly Plead That the Individual Defendants Were Their Statutory “Employer” under the MWPCL In contrast to the FLSA and MWHL, the MWPCL defines “employer” as “any person who employs an individual in the State or a successor of the person.” Md. Code, Lab. & Empl., § 3-501(b). This Court has found the MWPCL definition to be similar enough to the FLSA to apply the economic realities test. Avila, 2016 U.S. Dist. LEXIS 100904, at *10. While some other courts have applied a more restrictive definition of “employer” to the MWPCL,6 it is 6 Smith v. ABC Training Ctr. of Md., Inc., No. 13-cv-306, 2013 U.S. Dist. LEXIS 108088, at *35-36 (D. Md. Aug. 1, 2013) (“The definition of the term “employer” found in the MWPCL is Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 12 of 21 13 unnecessary to resolve that issue, because Plaintiffs have failed to make any different allegations of individual liability than they did in their FLSA claim. Thus, Plaintiffs’ MWPCL claim fails for the same reason that their FLSA and MWHL claims fail: Plaintiffs fail to present sufficient facts that, if true, establish that the Individual Defendants are “employers” under the economic reality test. Accordingly, the Court should dismiss Count VI. Alternatively, summary judgment should be granted in the Individual Defendants’ favor on this count based on the undisputed facts referred to above. D. DC’s Sick and Safe Leave Act (Count VII) 1. The Sick and Safe Leave Act Does Not Impose Individual Liability The Court should also dismiss Plaintiffs’ Sick and Safe Leave Act because there is no individual liability under this Act. In particular, “employer” is defined as: a legal entity (including a for-profit or nonprofit firm, partnership, proprietorship, sole proprietorship, limited liability company, association, or corporation), or any receiver or trustee of an entity (including the legal representative of a deceased individual or receiver or trustee of an individual), who directly or indirectly or through an agent or any other person, including through the services of a temporary services or staffing agency or similar entity, employs or exercises control over the wages, hours, or working conditions of an employee. § 32-131.01(3)(A) (emphasis added). By contrast, both the DCMWA and DCWPCL define “employer” as including an “individual” or “person.” See D.C. Code § 32-1002(3); D.C. Code § 32-1301(1). Because the Sick and Safe Leave Act, unlike the other D.C. wage laws, does not impose individual liability, this claim should be dismissed. more restrictive than the definition of ‘employer’ in the FLSA because ‘the MWPCL does not contain a provision that expands employer liability to those acting on behalf of the employer.” (quoting Caseres, 2012 U.S. Dist. LEXIS at *10); see also Robinson v. Empire Equity Grp., Inc., No. 09-cv-1603, 2014 U.S. Dist. LEXIS 164760 at *25 (D. Md. Nov. 24, 2014) (“‘Employer’ does not include supervisors, officers, or other agents who act on behalf of a corporate employer.”). Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 13 of 21 14 Moreover, even if individual liability was recognized under this statute, Plaintiffs’ claim fails for the same reason that his FLSA and MWHL claims fail: Plaintiffs fail to present sufficient facts that, if true, establish that the Individual Defendants are their employers under the economic reality test. Accordingly, the Court should dismiss Count VII. 2. The Court Should Grant Summary Judgment In Favor of the Individual Defendants Because They Did Not Exercise the Requisite Control over Plaintiff’s Working Conditions. If the Court denies the Individual Defendants motion to dismiss this count, the Court should grant summary judgment in favor of the Individual Defendants for the reasons set forth in Section III(B)(2), supra. E. Oral Employment Contract under D.C. or Maryland Law (Counts VIII and X) 1. Plaintiffs Fail to Plausibly Plead That the Individual Defendants Are Parties to Their Alleged Oral Contracts In Counts VIII and X, Plaintiffs allege that they “entered into binding oral contracts . . . [for] payment of wages for every hour of work performed.” (Am. Compl. ¶¶ 135, 153). Assuming the Court holds that Plaintiffs have alleged that they entered into a “contract,” as discussed in BFJ’s Motion to Partially Dismiss, the Court should dismiss Counts VIII and X against the Individual Defendants because Plaintiffs have not alleged that they are parties to the oral contracts. See Residential Warranty Corp. v. Bancroft Homes Greenspring Valley, Inc., 126 Md. App. 294, 316 (1999) (Under Maryland law, “a person cannot be held liable under a contract to which he was not a party. . . .”); Charlton v. Mond, 987 A.2d 436, 441 (D.C. 2010) (because non-parties “owe no contractual duty to the contracting parties, [ ] the trial court properly granted summary judgment to Mesquita with respect to the contract claim.”) Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 14 of 21 15 Macsherry, Jr. v. Sparrows Point, LLC, No. 15-cv-0002, 2015 U.S. Dist. LEXIS 144062 (D. Md. Oct. 23, 2015), is instructive because the court dismissed the breach of contract claim against the individual defendant since plaintiff failed to allege that he was a party to the alleged employment contract (even though plaintiff adequately alleged that the individual defendant/owner of the company was a statutory “employer” under the MWPCL). Id. at *25- 31.7 Accordingly, the Court should dismiss Counts VIII and X because Plaintiffs have not alleged that either of the Individual Defendants was a party to the alleged oral contracts. 2. The Court Should Grant Summary Judgment In Favor of the Individual Defendants Because They Did Not Enter Into Contracts with Plaintiffs Assuming, arguendo, the Court holds that Plaintiffs have adequately pled that the Individual Defendants were a party to their oral contracts, the Court should grant summary judgment in favor of the Individual Defendants because there is no genuine issue of material facts as to the following: they never knew the Plaintiffs, did not hire them, and did not negotiate any oral contracts with them. (Ken Joy Decl. ¶¶ 7-8; Kevin Joy Decl. ¶¶ 6-7). Accordingly, the Court should grant summary judgment in favor of the Individual Defendants because they are not parties to any contract. See Kurland v. ACE Am. Ins. Co., No. 15-cv-2668, 2017 U.S. Dist. LEXIS 10065, at *7 (D. Md. Jan. 23, 2017) (summary judgment granted to ACE because it was not a party to the contract); Tucker v. Specialized Loan Servicing, LLC, No. 14-cv-813, 2016 U.S. Dist. LEXIS 151689, at *26-27 (D. Md. Nov. 1, 2016) (summary 7 By contrast to the facts alleged here, in Macsherry, the Court held that plaintiff adequately alleged the individual defendant “had managerial duties” in the company, including supervising, hiring and firing, and controlling his employment. Macsherry, Jr., 2015 U.S. Dist. LEXIS 144062 at *24. Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 15 of 21 16 judgment granted to the defendant because it was not a party to the contract). F. Unjust Enrichment or Quantum Meruit under D.C. or Maryland Law (Counts IX and XI) In Counts IX and XI, Plaintiffs allege that BFJ failed to pay them additional “prevailing market wages” under some private or government contract and, in their view, the proper avenues for relief are claims for unjust enrichment and quantum meruit. (Am. Compl. ¶¶ 145, 163). Assuming these counts are not preempted, as argued in BFJ’s Motion, the Court should dismiss them because Plaintiffs have failed to adequately plead them against the Individual Defendants under the standards set forth in Twombly and Iqbal. 1. Plaintiffs Fail to Plausibly Plead That the Individual Defendants Are a Party to Their Oral Contracts or Accepted or Received Some Benefit from Them a. Quantum Meruit Under Maryland law, there are two forms of quantum meruit: quantum meruit based on an implied-in-fact contract and quantum meruit based on a quasi-contract. See Alternatives Unlimited, Inc. v. New Baltimore City Bd. of School Comm’rs, 155 Md. App. 415, 482-87, 843 A.2d 252 (2004). The latter is “identical to a charge of unjust enrichment.” Mohiuddin v. Doctors Billing & Mgmt. Solutions, 196 Md. App. 439, 447 (2010). With respect to the former, implied-in-fact contracts: are actual contracts: An implied-in-fact contract is a ‘true contract’ and ‘means that the parties had a contract that can be seen in their conduct rather than in an explicit set of words.’ Implied-in-fact contracts are ‘dependent on mutual agreement or consent, and on the intention of the parties; and a meeting of the minds is required.’ Id. at 448-449 (citing Mogavero v. Silverstein, 142 Md. App. 259 (2002). Similarly, to plead a quantum meruit claim under the District of Columbia law, a plaintiff must allege that defendant’s conduct “implied the existence of a contractual relationship by establishing: 1) valuable services Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 16 of 21 17 the plaintiffs rendered, 2) for the person from whom recovery is sought; 3) which services were accepted and enjoyed by that person, and 4) under circumstances which reasonably notified the person that the plaintiff, in performing such services, expected to be paid.” Plesha v. Ferguson, 725 F. Supp. 2d 106, 111 (D.D.C. 2010) (citing Jordan Keys v. Jessamy, LLP v. St. Paul Fire & Marine Ins. Co., 870 A.2d 58, 62 (D.C. 2005)). Simply, the Court should dismiss Plaintiffs’ quantum meruit theory under Maryland or the District of Columbia law for the same reason it should dismiss Plaintiffs’ breach of contract claim: Plaintiffs have not alleged that the Individual Defendants were a party to any contract. See Macsherry, 2015 U.S. Dist. LEXIS 144062 at *38-39 (plaintiff has not alleged that the individual defendant/owner of the company entered into an “express contract” or that he “created an implied contract.”). b. Unjust Enrichment Three elements must be established to prevail on a claim of unjust enrichment (or quantum meruit based on a quasi-contract) under Maryland law: (1) a benefit conferred upon the defendant by the plaintiff; (2) an appreciation or knowledge by the defendant of the benefit; and (3) the acceptance or retention by the defendant of the benefit under such circumstances as to make it inequitable for the defendant to retain the benefit without the payment of its value. Mohiuddin v. Doctors Billing & Mgmt. Solutions, 196 Md. App. 439, 449 (2010); see also Plesha, 725 F. Supp. at 111 (D.D.C. 2010) (same elements in D.C.) Like the plaintiff in Macsherry, plaintiff has not alleged that the Individuals Defendants accepted or received some benefit or, if they did, that it was inequitable to have done so. See Macsherry, 2015 U.S. Dist. LEXIS 144062 at *39 (dismissing unjust enrichment claim against individual defendant/owner). Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 17 of 21 18 2. The Court Should Grant Summary Judgment In Favor of the Individual Defendants Because They Did Not Enter Into Contracts with Plaintiffs or Accept or Receive Some Benefit from Them a. Quantum Meruit The Court should grant summary judgment in favor of the Individual Defendants because, as explained above, a quantum meruit claim stems from an implied-in-fact contract (i.e., an actual contract) and there is no genuine issue of material fact that the Individual Defendants were not parties to any contract.8 Kurland, 2017 U.S. Dist. LEXIS at *7; Tucker, 2016 U.S. Dist. LEXIS at *26-27. b. Unjust Enrichment The Court should grant summary judgment in favor of the Individual Defendants because there is no genuine issue of material fact the Plaintiffs did not confer a benefit upon the Individual Defendants.9 See Orteck Int’l, Inc. v. Transpacific Tire & Wheel, Inc., 704 F. Supp. 2d 499, 517-518 (D. Md. 2010) (summary judgment granted to defendants because plaintiffs could not demonstrate that they conferred a benefit upon the defendants). G. 42 U.S.C. § 1981 (Count XII) 1. Plaintiffs Fail to Plausibly Plead That the Individual Defendants Discriminated Against Them The Court should dismiss Plaintiffs’ Section 1981 claim against the Individual Defendants because they have not alleged that the Individual Defendants themselves discriminated against them or had any involvement in the events relating to their race claims. Indeed, as the United States Court of Appeals for the Fourth Circuit explained: 8 See Ken Joy Decl. ¶ 8; Kevin Joy ¶ 7. (“I not hire any of the Plaintiffs or negotiate any contract with them”) 9 See Ken Joy Decl. ¶ 9; Kevin Joy ¶ 8 (“I did not accept any benefits from Plaintiffs’ employment”). Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 18 of 21 19 Section 1981 guarantees to all persons in the United States ‘the same right . . . to make and enforce contracts . . . as is enjoyed by white citizens.’ Section 1981 ‘can be violated only by purposeful discrimination,’ and ‘must be founded on purposeful, racially discriminatory actions.’ ‘[T]o make out a claim for individual liability under § 1981, a plaintiff must demonstrate some affirmative link to causally connect the actor with the discriminatory action,’ and the claim ‘must be predicated on the actor’s personal involvement.’ Hawthorne v. Va. State Univ., No. 13-2237, 2014 U.S. App. LEXIS 7619, at *3 (4th Cir. Apr. 23, 2014) (internal citations omitted). Plainly, Plaintiffs have not alleged that the Individual Defendants committed any “affirmative” act or were otherwise involved in their alleged adverse employment actions. Rather, they simply allege that the Individual Defendants “knew or should have known” about certain managers’ comments or actions by virtue of their job titles as corporate officers. (Am. Compl. ¶¶ 175-176). These allegations are plainly insufficient to state a claim for individual liability under Section 1981. See Brown v. Balt. Police Dep’t, No. 11-cv-00136, 2011 U.S. Dist. LEXIS 147219, at *22 (D. Md. Dec. 21, 2011) (“In this case, the Plaintiff has failed to adequately allege the Commissioner’s involvement in the events relating to his claims. Moreover, based on the facts as alleged in the Complaint, there is no plausible claim that the Commissioner intentionally and personally participated in Plaintiff’s deprivation of rights”); Benjamin v. Sparks, 173 F. Supp. 3d 272, 283-284 (E.D.N.C. 2016) (dismissing plaintiff’s section 1981 race discrimination claim against individual defendants, because he “has not plausibly alleged that these individual Board members . . . intentionally acted to impair his employment contract.”); Wright v. StoneMor Partners LLP, No. 12-cv-380, 2012 U.S. Dist. LEXIS 129593, at *4 (W.D.N.C. Sept. 12, 2012) (“Plaintiff failed to allege that any of the Individual Defendants are his supervisor. Plaintiff also failed to allege that the Individual Defendants engaged in any intentional act causing StoneMor to infringe upon Plaintiff’s Section Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 19 of 21 20 1981 rights. Thus, the Court dismisses Plaintiff’s Section 1981 claim against the Individual Defendants.”).10 2. The Court Should Grant Summary Judgment In Favor of the Individual Defendants Because They Did Not Discriminate Against Plaintiffs Assuming, arguendo, the Court holds that Plaintiffs have adequately pled that the Individual Defendants committed an “affirmative” act or were otherwise involved in their alleged adverse employment actions, the Court should grant summary judgment in favor of the Individual Defendants because there is no genuine issue of material fact as to the following: they did not know the Plaintiffs, they have not had discussions with any BFJ manager or employee specifically about the Plaintiffs, they did not make any decision to deny Plaintiffs higher pay, overtime pay, any promotion, sick pay, or any benefit, and they were not involved in any discussion to deny them these benefits.11 See Waters v. Md. DOT, No. 08-cv-0396, 2009 U.S. Dist. LEXIS 75998, at *13-14 (D. Md. Aug. 26, 2009) (summary judgment granted because the undisputed evidence demonstrated that the individual defendant “was not involved in the decision to terminate” plaintiff); Carson v. Giant Food, Inc., 187 F. Supp. 2d 462, 483-484 (D. Md. 2002) (“Here, Plaintiffs have only alleged that the individual defendants were aware of racial problems and graffiti in the workplace after they occurred and did not respond properly. There is no evidence that any of the individual defendants directed, participated in or even approved of intentional discrimination. Since there is no direct or circumstantial evidence of 10 Cf. Tibbs v. Balt. City Police Dep’t, No. 11-cv-1335, 2012 U.S. Dist. LEXIS 119629 (D. Md. Aug. 23, 2012) (Section 1981 “only applies where the act or omission resulting in the infringement of rights was intentionally caused by the supervisor and where the Plaintiff makes an affirmative showing of that fact.” 11 See Ken Joy Decl. ¶¶ 5-9; Kevin Joy ¶¶ 5-8. Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 20 of 21 21 intentional discrimination, I will grant summary judgment on the section 1981 claims against the individual defendants.”) Accordingly, the Court should grant summary judgment in favor of the Individual Defendants because the undisputed evidence demonstrates that they did not discriminated against Plaintiffs in violation of Section 1981. IV. CONCLUSION For the reasons stated above, the Defendants respectfully request that the Court enter an Order entirely dismissing the Individual Defendants from this case pursuant to Rule 12(b)(6), or, in the alternative grant them summary judgment pursuant to Rule 56, as described in the attached proposed Order. Dated: February 27, 2017 Respectfully submitted, LITTLER MENDELSON, P.C. By: /s/Maurice Baskin Maurice Baskin (Bar No. 04342) William F. Allen (Bar No. 16816) Steven E. Kaplan (Bar No. 16531) Littler Mendelson, P.C. 815 Connecticut Avenue, NW Suite 400 Washington, D.C. 20006 202.842.3400 Telephone 202.842.0011 Facsimile mbaskin@littler.com ballen@littler.com skaplan@littler.com Attorneys for Defendants T. Kenneth Joy, Kevin Joy, and B. Frank Joy, LLC Case 8:15-cv-01120-TDC Document 86-1 Filed 02/27/17 Page 21 of 21 EXHIBIT 1 Case 8:15-cv-01120-TDC Document 86-2 Filed 02/27/17 Page 1 of 4 Case 8:15-cv-01120-TDC Document 86-2 Filed 02/27/17 Page 2 of 4 Case 8:15-cv-01120-TDC Document 86-2 Filed 02/27/17 Page 3 of 4 Case 8:15-cv-01120-TDC Document 86-2 Filed 02/27/17 Page 4 of 4 EXHIBIT 2 Case 8:15-cv-01120-TDC Document 86-3 Filed 02/27/17 Page 1 of 4 Case 8:15-cv-01120-TDC Document 86-3 Filed 02/27/17 Page 2 of 4 Case 8:15-cv-01120-TDC Document 86-3 Filed 02/27/17 Page 3 of 4 Case 8:15-cv-01120-TDC Document 86-3 Filed 02/27/17 Page 4 of 4 EXHIBIT 3 Case 8:15-cv-01120-TDC Document 86-4 Filed 02/27/17 Page 1 of 2 UNITED STATES DISTRICT COURT DISTRICT OF MARYLAND CHAMBERS OF J. FREDERICK MOTZ UNITED STATES DISTRICT JUDGE 101 WEST LOMBARD STREET BALTIMORE, MARYLAND 21201 (410) 962-0782 (410) 962-2698 FAX February 17, 2017 MEMO TO COUNSEL RE: Mariam Faty v. US Pack Logistics, LLC Civil No. JFM-16-3411 Dear Counsel: Plaintiff has brought this action under the Fair Labor Standards Act, the Maryland Wage & Hour Law, the Maryland Wage Payment and Collection Law. The case is being transferred to me from Judge Hollander because of a temporary imbalance in caseload. Defendants have filed a motion to dismiss and strike plaintiffs’ complaint. The motion (document 11) will be granted in part and denied in part. 1. The motion is granted insofar as the attempts to state a claim against Paul Glazman and Mark Glazman. The allegations made against the Glazmans are that they are the owners of US Pack Logistrics, LLC. There are no allegations made to satisfy the elements of the “economic reality” test established by Bonnette v. Cal. Health & Welfare Agency, 704 F.2d 1465, 1470 (9th Cir. 1981). 2. The motion is granted to the extent that the complaint attempts to state claims prior to September 8, 2015 - the date that plaintiffs first to work for US Pack - and April 2016 - the month that they’ve alleged that plaintiffs stopped working for US Pack. 3. The motion is denied to the extent that it seeks to strike plaintiffs’ Maryland Wage & Hour Law class claims and the Maryland Wage Payment and Collection Law claim. 4. Plaintiff is given leave to correct the “transcription error” noted in footnote 2 of its opposition memorandum. A conference call will be held on March 13, 2017 at 4:15 p.m. to discuss the appropriate schedule in this case. I ask counsel for plaintiff to initiate the call. Despite the informal nature of this ruling, it shall constitute an Order of Court, and the Clerk is directed to docket it accordingly. Very truly yours, /s/ J. Frederick Motz United States District Judge Case 1:16-cv-03411-JFM Document 19 Filed 02/17/17 Page 1 of 1Case 8:15-cv-01120-TDC Document 86-4 Filed 02/27/17 Page 2 of 2 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND : MANUEL ALVAREZ-SOTO, et. al., : : Plaintiffs, : : v. : Case No. 8:15-CV-1120 (TDC) : B. FRANK JOY, LLC. et. al, : : Defendants. : : ORDER Upon consideration of Defendants’ Motion to Dismiss the Individual Defendants from Plaintiffs’ Second Amended Putative Class and Collective Action Complaint, or, in the Alternative, for Summary Judgment, any Opposition thereto and any Reply, it is hereby: ORDERED, Defendants’ Motion is GRANTED; and ORDERED, Defendants T. Kenneth Joy and Kevin Joy are Dismissed from the Complaint, with prejudice. Date: __________________, 2017 __________________________________ The Honorable Theodore D. Chuang United States District Judge Case 8:15-cv-01120-TDC Document 86-5 Filed 02/27/17 Page 1 of 1
