Koenig v. Granite City Food & Brewery, Ltd et al

REPLY BRIEF re: 12 Brief in Support of re Motion to Dismiss

W.D. Pa.December 21, 2016

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA CHELSEA KOENIG, on behalf of herself and all others similarly situated, Plaintiff, v. GRANITE CITY FOOD & BREWERY, LTD and DOE DEFENDANTS 1-10, Defendant. ) ) ) ) ) ) ) ) ) ) ) Case No. 2:16-cv-01396-MAK REPLY MEMORANDUM OF LAW IN SUPPORT OF GRANITE CITY FOOD & BREWERY, LTD’S MOTION TO DISMISS I. INTRODUCTION Plaintiff Chelsea Koenig attempts to evade dismissal of her Fair Labor Standards Act (“FLSA”) collective action allegations under the “first-to-file” rule by arguing that the legal theories she advances and the classes she purports to represent are distinct from the theories and classes in Greene v. Granite City Food & Brewery, Ltd., d/b/a Granite City Food and Brewery Case No. 0:16-cv-02834 (“Greene”).1 Alternatively, Ms. Koenig argues that the FLSA permits parties to maintain multiple concurrent collective actions against the same defendant. Ms. Koenig’s arguments are factually and legally incorrect and defendant Granite City Food & Brewery, LTD’s (“Granite City” or the “Company”) motion to dismiss should be granted. II. ARGUMENT A. Courts in the Third Circuit Only Require Cases to “Substantially Overlap” for the “First to File” Rule to Apply. Contrary to Ms. Koenig’s argument that courts in this circuit require cases be “truly duplicative of each other” for the “first to file” rule to apply (See ECF No. 24 at pp. 6-8), the 1 The Greene Complaint is attached to Granite City’s motion to dismiss as “Exhibit 1.” (See ECF No. 11). Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 1 of 9 2 correct test is whether the cases contain “substantial overlap” or “substantial similarities.” See Thompson v. Glob. Mktg. Research Servs., Inc., Civ. Action No. CV 15-3576, 2016 WL 233702, at *3 (E.D. Pa. Jan. 20, 2016) (finding that the “subject matter of the two cases is substantially the same” despite the class definitions differing); QVC, Inc. v. Patiomats.com, LLC, Civ. Action No. 12-3168, 2012 WL 3155471, at *3 (E.D. Pa. Aug. 3, 2012) (“the principles underlying the rule support its application where the subject matter of the later filed case substantially overlaps with that of the earlier one”); Nature's Benefit, Inc. v. NFI, Civ. No. 06-4836(GEB), 2007 WL 2462625, at *3 (D.N.J. Aug. 27, 2007) (“Neither identical parties nor identical issues are needed, only a substantial overlap”). B. Litigants May Not Maintain Multiple Collective Actions Against the Same Employer, Alleging the Same FLSA Violations, at the Same Time. Contrary to Ms. Koenig’s argument, courts do not permit parties to maintain FLSA collective actions which are duplicative of currently pending collective actions against the same defendant. See Medina v. Bros. Behrman Hwy., Inc., Civ. Action No. 13-4831, 2015 WL 3679534, at *3 (E.D. La. June 12, 2015) (“although the FLSA does not preclude plaintiff from maintaining an independent, individual action, plaintiff is not entitled to conditional certification of a class that is entirely duplicative of the conditionally certified class in [a previously filed action]”); Jones v. Qwest Comm. Intern., Inc., Civ. Nos. 07-2979, 06-3523, 2007 WL 4179385, at *4 (D. Minn. Nov. 20, 2007) (recognizing that plaintiffs have the right to maintain their own actions, but denying class certification because the claims were duplicative of an earlier filed FLSA collective action). Courts recognize this principle because allowing two classes to proceed would “cause undue confusion and duplication … [as] inevitably, some potential Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 2 of 9 3 plaintiffs will opt into both classes.”2 Qwest, 2007 WL 4179385, at *4. The confusion caused by competing notices and the resulting judicial waste is “contrary to the very purpose of Court- facilitated notice.” Id. Indeed, Atkins v. Worley Catastrophe Response, LLC, Civ. Action No. 12-2401, 2013 WL 1412371 (E.D. La. Apr. 8, 2013), a case relied upon by Ms. Koenig, recognized that “no purpose would be served by allowing two collective actions based on the same claims to proceed concurrently, with the attendant increased expense for defendants, the risk of confusing the group members about their legal options, the possibility of inconsistent rulings by two courts and the waste of judicial resources.” Id. at *9 (emphasis in original). The Atkins court only allowed the collective action claims to proceed because the case was “proceeding anew, at a time when no other collective action based on the same claims is pending.” Id. Unlike Atkins, here the Greene litigation is currently pending and allowing Ms. Koenig’s collective action claims to proceed is improper.3 C. Differences in the Legal Theories Asserted Does Not Preclude Application of the “First-to-File” Rule. Recognizing that her FLSA collective action claims are “substantially similar” to those asserted in Greene, Ms. Koenig attempts to walk back the allegations in her Complaint by stating that “her FLSA collective claim is premised on Defendant’s failure to notify Tipped Employees 2 The doctrine of “claim splitting … precludes a plaintiff from simultaneously maintaining two separate lawsuits involving the same subject matter, at the same time, against the same defendant.” Hebert v. MudTech Services, No. 15-cv-0933, 2015 WL 5602669, at *5 (W.D. Pa. Sept. 23, 2015). Thus, a plaintiff may not sue their employer for wage and hour violations at the same time, in two separate actions. See Id. at *6. 3 Arnold v. DirecTV, Inc., No. 4:10-CV-00352, 2011 WL 839636 (E.D. Mo. Mar. 7, 2011), another case relied upon by Ms. Koenig is also distinguishable from this matter because “the present case has a defendant … that is not a defendant in [the previously filed case] and [the previously filed case] has two defendants that are not defendants here.” Id. at *5. In contrast, Granite City is the defendant in this matter and the Greene litigation. Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 3 of 9 4 it was taking the tip credit.4” (ECF No. 24 at p. 2 n.4). The “first-to-file” rule, however, looks to the legal claims raised, not the legal theories pursued. See Chieftain Royalty Co. v. XTO Energy, Inc., No. CIV-11-29-FHS, 2011 WL 1533073, at *2 (E.D. Okla. Apr. 22, 2011) (“Although additional legal theories of recovery are asserted in the instant action, the underlying claims in both cases are centered on … underpaid royalties” and therefore “substantially similarity of the issues” is established). The difference between legal theories and legal claims is succinctly described in In re Orders of this Court Interpreting Sec. 215 of the Patriot Act, No. Misc. 13-02, 2013 WL 5460064 (Foreign Intel. Surv. Ct. Sept. 13, 2013) as follows: Finally, there is sufficient overlap between the issues in the two cases for the first- to-file rule to apply. Although the legal theories advanced by the ACLU in the two proceedings are different (statutory right-to-disclosure under FOIA rather than constitutional right-of-access under the First Amendment), substantially the same relief is sought in both cases: disclosure of the opinions with only such redactions as are necessary to protect intelligence sources and methods and other properly classified information. … The present motion thus asks the FISC to do the same thing that the ACLU is asking the District Court in New York to do in the FOIA litigation: ensure that the opinions are disclosed, with only properly classified information withheld. Having both courts proceed poses the risks of duplication of effort and inconsistent outcomes that the first-to-file rule is intended to avoid. Id. at *7 (emphasis added). Despite Ms. Koenig limiting her FLSA collective action theories of liability to a “tip notification” theory, the underlying legal claim is the same as those asserted in Greene, i.e. a failure to pay the minimum wage. See Adoma v. Univ. of Phoenix, Inc., 711 F.Supp.2d 1142, 1148 (E.D. Cal. 2010) (despite the later filed action pursing different legal theories than those filed in the first-action “both … advance FLSA off-the-clock claims for unpaid overtime. The ultimate issue to be determined in both actions is whether … [plaintiffs] 4 Ms. Koenig is disingenuous to claim that her action is “largely predicated on Defendants’ failure to comply with the notification requirements of the tip credit.” (ECF No. 24 at p. 2). As Ms. Koenig’s opposition brief demonstrates, her original allegations included “customer walkout,” “improper tip pooling,” and “80/20” claims. (Id. at p. 2 n.2-4). Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 4 of 9 5 worked uncompensated overtime hours”). Further, the relief sought is identical as both cases seek the nexus between the tip credit claimed by Granite City and the applicable minimum wage. (See ECF No. 1 at “prayer for relief”); (Greene Complaint at ¶ 44 and “prayer for relief”). Ms. Koenig relies heavily on Martin v. Citizens Financial Group, Inc., Civ. Action No. 10-260, 2010 WL 3239187 (E.D. Pa. Aug 13, 2010) and Raya v. Amazon.com, LLC, No. C. 15- 2005, 2015 WL 4043247 (N.D. Cal. July 1, 2015) for her argument that the “first-to file” rule is inapplicable because the legal theory she advances is distinct from those in Greene. (ECF No. 24 at pp. 9-10). These cases, however, are distinguishable from this matter and are not persuasive authority. The Martin court ruled that the “first-to-file” rule was inapplicable because the defendants and the laws which were allegedly violated were not the same as those in the first- filed action. 2010 WL 3239187, at *2. Here, Ms. Koenig and the Greene litigation pursue FLSA minimum wage violations and the defendant is the same in both actions. The Amazon.com court reached its decision that the “first-to-file” rule was inapplicable because the legal theories advanced in the two actions were distinct, however, the court reached its conclusion with a sparse analysis of the issue and acknowledged that other courts have reached an opposite conclusion. 2015 WL 4043247, *2. As such, the opinion is not entitled to persuasive value. Ms. Koenig’s attempt to differentiate her FLSA collective action legal theories from those in Greene is also misplaced because under notice pleading standards Ms. Greene may pursue any minimum wage violation legal theory she wishes as the litigation advances, including a “tip notification” theory. See Hefferman v. Bass, 467 F.3d 596, 599 (7th Cir. 2006) (“The point of a notice pleading standard is that the plaintiff is not required to plead either facts or legal theories”). Further, Ms. Greene is free to amend her complaint to conform to the evidence, if she Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 5 of 9 6 discovers additional theories in support of her minimum wage claims. See Greygor v. Wexford Health Sources, Inc., Civ. Action No. 2:14-CV-1254, 2016 WL 772740, at *4 (W.D. Pa. Feb. 27, 2016) (“parties can always amend to conform to the evidence, even during or after trial”). As such, even considering Ms. Koenig’s “clarification” of the legal theory she wishes to pursue, this action and Greene ultimately pursue the same claims because both plead FLSA minimum wage violations. D. Granite City and Cadillac Ranch are Owned by Granite City Food & Brewery, LTD and Therefore the Collective Action Classes are the Same. Ms. Koenig acknowledges that “there are admittedly some members of Plaintiff’s proposed class who are potential members of Greene’s proposed class5,” but argues that Granite City employees who worked at Cadillac Ranch All American Bar & Grill (“Cadillac Ranch”) are excluded from the proposed collective action class in Greene. (ECF No. 24 at pp. 11-12). Ms. Koenig’s argument is defeated by her own Complaint which states that “Defendant Granite City Food & Brewery, Ltd. … owns and operates two restaurant brands in the United States. They are Granite City Food & Brewery … and Cadillac Ranch.” (ECF NO. 1 at ¶ 17). Thus, Granite City and Cadillac Ranch are merely trade names operated under the same employer. Further, the proposed FLSA collective action class in Greene includes “[a]ll individuals who are or have been employed by Defendant as servers and/or bartenders” which includes Cadillac Ranch employees and Ms. Koenig. (Greene Complaint at ¶ 38). Thus, Greene’s failure to make factual allegations directly related to Cadillac Ranch does not remove the restaurant’s servers and 5 Ms. Koenig’s acknowledgement that there is crossover between her proposed class and the proposed class in Greene is telling as “[i]n a collective action, the classes, and not the class representatives, are compared.” Adoma v. Univ. of Phoenix, Inc., 711 F.Supp.2d 1142, 1147 (E.D. Cal. 2010). Further, the class members need not perfectly align, provided there is “at least some portion” of the same class members in both classes. Kelley v. Kaiser Permanente, No. 3:13-cv-02120-BR, 2014 WL 2336083, at *5 (D. Or. May 29, 2014). Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 6 of 9 7 bartenders from the proposed collective action class because the employees are in fact Granite City employees. As such, the classes are “substantially similar.” III. CONCLUSION For all of the foregoing reasons, Granite City respectfully requests the Court dismiss Ms. Koenig’s FLSA minimum wage collective action claim with prejudice. Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 7 of 9 8 Date: December 21, 2016 Respectfully submitted, /s/ Brian M. Hentosz Christopher Michalski (PA #93236) cmichalski@littler.com Brian M. Hentosz, (PA #317176) bhentosz@littler.com LITTLER MENDELSON, P.C. 625 Liberty Avenue, 26th Floor Pittsburgh, PA 15222 (412) 201-7634 / 7676 (412) 291-1241 (facsimile) Kimberly Gost (admitted pro hac vice) kgost@littler.com LITTLER MENDELSON, P.C. Three Parkway 1601 Cherry Street, Suite 1400 Philadelphia, PA 19102-1321 267-402-3007 (phone) 267-402-3131 (facsimile) Andrew J. Voss (admitted pro hac vice) avoss@littler.com Littler Mendelson, P.C. 1300 IDS CENTER 80 South 8th Street Minneapolis, MN 55402-2136 Tel: (612) 313-7605 Fax: (651) 305-0987 Jonathan C. Wilson (admitted pro hac vice) jcwilson@littler.com Littler Mendelson, P.C. 2001 Ross Avenue Suite 1500, Lock Box 116 Dallas, TX 75201-2931 Tel: (214) 880-8174 Fax: (214) 594-5631 Attorneys for Defendant, Granite City Food & Brewery, Ltd. Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 8 of 9 CERTIFICATE OF SERVICE I hereby certify that on this 21st day of December 2016, a copy of the foregoing Reply Memorandum of Law in Support of Granite City Food & Brewery, LTD’s Motion to Dismiss was filed using the Western District of Pennsylvania’s ECF system, through which this document is available for viewing and downloading, causing a notice of electronic filing to be served upon the following counsel of record: CARLSON LYNCH SWEET KILPELA & CARPENTER, LLP Gary F. Lynch, Esq. Benjamin J. Sweet, Esq. Jamisen A. Etzel, Esq. 1133 Penn Avenue, 5th Floor Pittsburgh, PA 15222 glynch@carlsonlynch.com bsweet@carsonlynch.com jetzel@carsonlynch.com CONNOLLY WELLS & GRAY, LLP Gerald D. Wells, III, Esq. Robert J. Gray, Esq. 2200 Renaissance Boulevard, Suite 308 King of Prussia, PA 19406 gwells@cwg-law.com rgray@cwg-law.com KEHOE LAW FIRM, P.C. Michael K. Yarnoff, Esq. Two Penn Center Plaza 1500 JFK Boulevard, Suite 1020 Philadelphia, PA 19102 myarnoff@kehoelawfirm.com /s/ Brian M. Hentosz Brian M. Hentosz Case 2:16-cv-01396-MAK Document 33 Filed 12/21/16 Page 9 of 9