Pfoutz v. Alliance Inspection Management, Llc.

BRIEF in Support re Motion to Dismiss

W.D. Pa.October 3, 2016

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA CHRISTOPHER PFOUTZ, in BOTH his individual and Class Representative capacity, Plaintiff, v. ALLIANCE INSPECTION MANAGEMENT LLC, Defendant. ) ) ) ) ) ) ) ) ) ) ) ) Civil Action No. 2:16-cv-00785-NBF Judge Nora Barry Fischer ELECTRONICALLY FILED MEMORANDUM OF LAW IN SUPPORT OF DEFENDANT’S MOTION TO DISMISS AMENDED COMPLAINT Defendant, Alliance Inspection Management, LLC (“AIM” or “Defendant”), by and through its undersigned counsel, Ogletree, Deakins, Nash, Smoak & Stewart P.C., and pursuant to Federal Rule of Civil Procedure 12(b)(6), files this Memorandum of Law in Support of its Motion to Dismiss the Amended Complaint. I. INTRODUCTION On June 13, 2016, Plaintiff Christopher Pfoutz (“Plaintiff”) filed a Complaint (Doc. No. 1) against AIM, alleging individual and putative class and collective action claims for violations of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq., and the Pennsylvania Wage Payment and Collection Law (“WPCL”), 43 P.S. § 260.1 et seq. Specifically, Plaintiff alleged claims for the payment overtime for off-the-clock work and retaliation due to the settlement of a previous lawsuit filed against AIM. However, Plaintiff failed to plead facts sufficient to support his allegations and, therefore, on August 26, 2016, AIM moved to dismiss the Complaint on the basis that Plaintiff failed to Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 1 of 15 -2- state claims upon which relief could be granted. (Doc No. 7). Rather than oppose AIM’s Motion, Plaintiff filed an Amended Complaint on September 14, 2016. (Doc No. 13). Unfortunately for Plaintiff, the Amended Complaint fails to correct the pleading deficiencies previously identified, as it is nearly identical to his initial Complaint.1 Plaintiff’s Amended Complaint should be dismissed because Plaintiff previously agreed as part of a settlement of a prior case to a general release of all claims he had or may have had against AIM, including, specifically, claims arising under the FLSA and the WPCL that arose on or before December 31, 2014. Indeed, as discussed below, Plaintiff’s act of filing the Complaint and the Amended Complaint constitutes a breach of contract. The Amended Complaint should also be dismissed because Plaintiff failed to plead facts sufficient to prove class and/or collective action claims as a matter of law. Plaintiff pleads individual facts relating to his employment with AIM. To attempt to fix his pleading deficiencies, Plaintiff then adds the rejoinder that his experiences are “similar to all FSMs throughout AIM including but not limited to Josh Klein and Troy Brisbine,” but fails to provide any factual support for this contention. See Am. Compl. ¶¶ 9-13, 16-17, 20, 22-25, 27-28. Such conclusory allegations are not supported by any facts and are not worthy of belief as a matter of law. For example, Plaintiff alleges that his supervisor required him to perform off the clock work, prohibited him from recording his overtime hours, and issued him a written warning for “stealing company time,” all the while failing to acknowledge that facts relating solely to an 1 Plaintiff made two substantive changes to the Amended Complaint, but failed to plead any new facts to support his claims. First, he changed the time period for the claim alleging retaliation under the FLSA at Count II. Compare Am. Compl., ¶ 19 with Compl., ¶ 19. The second substantive change was for Plaintiff to add repeatedly the phrase “including but not limited to Josh Klein and Troy Brisbine” 14 times throughout the Amended Complaint. See Am. Compl., ¶¶ 4, 9, 10, 11, 12, 13, 16, 17, 20, 22, 23, 25, 27, and 28. Plaintiff fails to describe Mr. Klein or Mr. Brisbane, the location where they supposedly worked for AIM, or the time period during which they worked. Instead, he only mentions their names repeatedly, as though doing so in and of itself satisfies his pleading obligations. Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 2 of 15 -3- individual’s employment, including individual disciplinary decisions, do not establish a basis for a class claim. See Am. Compl. ¶¶ 11-12, 23. Moreover, Plaintiff’s individual experiences -such as individualized experiences with a solitary supervisory or a disciplinary notice-are so narrowly focused-and not part of any established policy or practice-that they do not establish a basis for class relief as a matter of law. As such, Plaintiff’s attempt to recast individual causes of action as class and collective claims is unavailing and insufficient as a matter of law. II. FACTUAL BACKGROUND Plaintiff has been employed by AIM as an FSM since 2013. Am. Compl. ¶ 2.2 In a prior proceeding at Civil Action No. 2:13-cv-01662-NBF-CRE (the “Jones Lawsuit”), Plaintiff consented to joining a class and collective action against AIM for the payment of overtime. (Jones Lawsuit, Doc. No. 32). The Jones Lawsuit was settled, pursuant to this Court’s approval, on March 31, 2015. (Jones Lawsuit, Doc. No. 56; Order granted by Fischer, J.). A copy of the approved Settlement Agreement is attached to AIM’s Motion as Exhibit A.3 Plaintiff knowingly agreed to the settlement terms contained in the Settlement Agreement and a copy of Plaintiff’s Acceptance and Verification of Settlement is attached to AIM’s Motion 2 AIM relies upon the averments contained in the Amended Complaint, treating them as true for purposes of this Motion only, and in conformity with the standard for a motion to dismiss, pursuant to Fed. R. Civ. P. 12(b)(6). Defendant’s adoption of Plaintiff’s alleged facts in submissions relating to this Motion to Dismiss is not an admission as to their truth. 3 Although, as a general rule, “a district court ruling on a motion to dismiss may not consider matters extraneous to the pleadings … an exception to the general rule is that a document integral or explicitly relied upon in the complaint may be considered, without converting the motion to dismiss into one for summary judgment.” In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997); see also Davila v. N. Reg'l Joint Police Bd., 2013 WL 5724939, *14 (W.D. Pa. Oct. 21, 2013) (holding that a court may incorporate by reference and consider an undisputedly authentic document that a defendant attaches as an exhibit to a motion to dismiss if the plaintiff's claims are based on that document and even where the plaintiff does not explicitly allege the contents of the document in the complaint); see also Blakely v. Allegheny Cnty. Airport Auth., 2007 WL 1599008, at *2 (W.D. Pa. June 4, 2007); Pension Ben. Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). Plaintiff makes reference to the Settlement Agreement and the Jones Lawsuit throughout his Amended Complaint, both directly and indirectly. See Am. Compl. ¶¶ 2-3, 6, 10, 15, 20-22. As such, the Court may consider the Settlement Agreement when ruling on this Motion without converting it to a motion for summary judgment. Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 3 of 15 -4- as Exhibit B. Among other terms, Plaintiff agreed to a general release of all claims against AIM that arose on or before December 31, 2014, including claims arising under the FLSA.4 (Exhibit A, Subsection 7). Pursuant to Subsection 7.4 of the Settlement Agreement, Plaintiff agreed to never institute any such claim, or to actively join, participate in, or consent to opt into any suit where such a claim had been asserted. (Exhibit A, Subsection 7.4). Notwithstanding the foregoing, Plaintiff purports to set forth putative class and collective action claims arising under the FLSA and WPCL for AIM’s alleged failure to pay him, and other similarly situated FSMs, overtime for a period of three years preceding the filing of the instant action, from June 13, 2013 through June 13, 2016. See Am. Compl. ¶¶ 15, 26. To support his putative class and collective action claims, Plaintiff asserts a generalized claim that AIM requires its FSMs to perform off-the-clock work and baldly alleges that AIM’s failure to compensate him for all of the compensable work he performed “is similar to all FSMs throughout AIM including but not limited to Josh Klein and Troy Brisbine,” which he repeats on refrain on several occasions. See Am. Compl. ¶¶ 9-13, 16-17, 20, 22-25, 27-28. Plaintiff does not, however, plead any facts to support his allegation that AIM has a policy or practice of failing and/or refusing to provide overtime compensation to its FSMs who worked in excess of 40 hours per any given week, nor does he plead any facts to support his contention that Josh Klein and Troy Brisbine were treated similarly to him by AIM. In fact, Plaintiff does not plead Mr. Klein’s or Mr. Brisbine’s dates of employment, locations of employment, or other facts to support his allegations. Plaintiff also alleges that AIM retaliated against all FSMs by reclassifying them as hourly employees following the Jones Lawsuit, and alleges that he received a written warning after 4 As a result of this release of claims, Plaintiff cannot fairly and adequately protect the interests of the putative class members. See generally, Fed. R. Civ. P. 23(a)(4). Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 4 of 15 -5- complaining to his supervisor about AIM’s pay policies. Am. Compl. ¶¶ 20-23. However, AIM’s decision to reclassify FSMs as hourly employees, absent proof of retaliatory animus, is per se lawful, and Plaintiff cannot rely on an individual disciplinary action taken against him to support an actionable class claim for relief. III. LEGAL STANDARD Rule 8(a)(2) of the Federal Rules of Civil Procedure requires that a pleading contain “a short and plain statement of the claim showing that the pleader is entitled to relief. …” Fed. R. Civ. P. 8(a)(2). A motion to dismiss pursuant to Rule 12(b)(6) examines the legal sufficiency of a complaint. “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2008)). Following Iqbal, “threadbare recitals of the elements of a cause of action supported by mere conclusory statements do not suffice” to satisfy Rule 8(a)(2) and will not defeat a Rule 12(b)(6) motion to dismiss. Id. The United States Court of Appeals for the Third Circuit applied the principles of Iqbal in Malleus v. George, 641 F.3d 560 (3d Cir. 2011), developing a three-part analysis that district courts in this Circuit must conduct in evaluating whether allegations in a complaint are sufficient to survive a motion to dismiss. First, a court in the Third Circuit must “‘tak[e] note of the elements a plaintiff must plead to state a claim.’” Id. at 563 (quoting Iqbal, 129 S. Ct. at 1947). Second, a court “should identify allegations that, ‘because they are no more than conclusions, are not entitled to the assumption of truth.’” Id. (quoting Iqbal, 129 S. Ct. at 1950). “Third, ‘whe[n] there are well pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement for relief.’” Id. The Court of Appeals explained that a Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 5 of 15 -6- court’s review of a complaint must be “broken into three parts: (1) identifying the elements of the claim, (2) reviewing the complaint to strike conclusory allegations, and (3) looking at the well-pleaded components of the complaint and evaluating whether all of the elements identified in part one of the inquiry are sufficiently alleged.” Id. The determination of whether a complainant has pled a claim sufficiently “is a context- specific task that requires the reviewing court to draw on its judicial experience and common sense.” Iqbal, 129 S. Ct. at 1950, citing Twombly, 550 U.S. at 556; see also Fowler v. UPMC Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009) (holding that in light of Iqbal, a district court should first separate the factual and legal elements of a claim and then, accepting the “well pleaded facts as true,” the district court “must determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a ‘plausible claim for relief.’”). Ultimately, to survive a motion to dismiss, a plaintiff must plead “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550 U.S. at 556) (emphasis added); see also Phillips v. County of Allegheny, 515 F.3d 224, 234-35 (3d Cir. 2008) (holding that, to survive a motion to dismiss, a complaint must show an entitlement to relief through its facts). However, a court will not accept bald assertions, unwarranted inferences, or sweeping legal conclusions as factual allegations. Maio v. Aetna, 221 F.3d 472, 482 (3d Cir. 2000). Indeed, a complaint that contains “no more than conclusions … [is] not entitled to the assumption of truth” otherwise applicable to complaints in the context of a motion to dismiss. Iqbal, 556 U.S. at 679. Based on the foregoing, Defendant respectfully requests that Plaintiff’s Amended Complaint be dismissed with prejudice. Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 6 of 15 -7- IV. LEGAL ARGUMENT The Amended Complaint should be dismissed because Plaintiff has asserted claims that he previously released in exchange for a settlement payment as part of a court approved settlement in the Jones Lawsuit. The Amended Complaint should also be dismissed because Plaintiff has failed to plead particular facts sufficient to establish a plausible class or collective action claim under the FLSA or WPCL as a matter of law. A. Plaintiff cannot assert an actionable claim against AIM for any alleged violations of the law committed on or before December 31, 2014. On March 31, 2015, Plaintiff entered into a Settlement Agreement with AIM. See Exhibit A. Per the terms of this Settlement Agreement, which were approved by this Court, Plaintiff knowingly agreed to a general release of all claims he had or may have against AIM that arose on or before December 31, 2014, including but not limited to any claim arising under the FLSA. Plaintiff further promised never to institute or file any claims or to actively join, participate in, or consent to opt into any lawsuit against AIM in which such claims had been asserted.5 Incredibly, Plaintiff’s Amended Complaint purports to assert class and collective claims for AIM’s alleged violations of the FLSA and WPCL that occurred “within three years of the preceding United States Department of Labor’s investigation finding that FSMs were non- exempt employees who were not fully compensated for their work under the law.” Am. Compl. ¶¶ 15, 26. Plaintiff continues to assert these claims-as he did in the Complaint-even though AIM previously raised the issue of his release of them in its Motion to Dismiss and in its Motion to Enforce Settlement Agreement. Moreover, while Plaintiff modified his claim for retaliation at 5 The Settlement Agreement further provides that, if Plaintiff violates its terms by filing such claims against AIM, then he shall be liable to AIM for attorneys’ fees and costs in defending against such claims. See Settlement Agreement, Section 7.9. AIM has filed a Motion seeking to enforce the Settlement Agreement. See Defendant’s Motion to Enforce Settlement Agreement and for Sanctions (Doc No. 10). Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 7 of 15 -8- Count II by changing the dates of his alleged claims, compare Am. Compl., ¶ 19 with Compl., ¶ 19, he still refuses to do so as to Counts I and II. See Am. Compl., ¶¶ 15, 26. By and through the filing of the claims alleged in the Amended Complaint, Plaintiff has knowingly breached his contractual promises to AIM, which this Court endorsed and entered as an Order of Court. As such, the claims at Counts I and III of the Amended Complaint must be dismissed. See, e.g., PPG Indust., Inc. v. Generon IGS, Inc., 760 F. Supp. 2d 520 (W.D. Pa. 2011) (McVerry, J.) (explaining that the law of this Circuit permits an affirmative defense, including release, to be raised by a motion under Rule 12(b)(6)); Cuchara v. Gai-Tronics Corp., Civil Action No. 03-6573, 2004 U.S. Dist. LEXIS 11334, at *4-*5 (E.D. Pa. Apr. 7, 2004) (considering agreement and general release on 12(b)(6) motion where “Plaintiff’s allegations, as set forth in the Complaint, are heavily based on the Agreement and General Release”); Three Rivers Motors Co. v. Ford Motor Co., 522 F.2d 885, 897 (3d Cir. 1975) (reversing district court’s denial of motion to dismiss on release defense). B. The Amended Complaint fails to plead facts sufficient to establish a collective claim under the FLSA for the payment of overtime. Plaintiff’s FLSA putative collective action claim for unpaid overtime must be dismissed because Plaintiff has failed to plead facts sufficient to support his allegation that AIM has a practice or policy of requiring its FSMs to perform off-the-clock work. See Am. Compl. ¶¶ 11, 16. Instead, Plaintiff pleads facts that relate solely to his employment with AIM, such as alleging that his supervisor required him to perform work before “clocking in,” forbid him from documenting the time he spent on mandatory training exercises and performing company car care, and prohibited him from recording his overtime hours. Am. Compl. ¶¶ 11, 16. Moreover, Plaintiff’s conclusory statement that this “is similar for all FSMs including but not limited to Josh Klein and Troy Brisbine,” absent supporting facts, is insufficient to establish class or Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 8 of 15 -9- collective claims for relief. See, e.g., Schwartz v. Victory Security Agency, LP, Civil Action No. 11-0489, 2011 U.S. Dist. LEXIS 62919 (W.D. Pa. June 14, 2011) (dismissing the complaint because it did not contain any factual, non-conclusory averments to support plaintiffs’ claim that the defendant enforced a policy or practice that required its employees to perform pre-shift and post-shift work for which they were not paid); Deleon v. Time Warner Cable, LLC, Civil Action No. 09-2438, 2009 U.S. Dist. LEXIS 74345 (C.D. Ca. July 17, 2009) (dismissing plaintiff’s complaint where plaintiff simply “slavishly repeated the statutory language as the purported factual allegations” and did not “plead sufficient factual content to allow the court to make a reasonable inference that [d]efendants [were] liable for the claims alleged ….”); see generally, Iqbal, 556 U.S. at 679 (explaining that conclusions are not entitled to the assumption of truth). As such, Plaintiff’s collective action claims for unpaid overtime must be dismissed because the facts of the Amended Complaint are specific to Plaintiff’s employment with AIM and, therefore, inherently individual in nature.6 C. The Amended Complaint fails to plead facts sufficient to establish a collective action claim for retaliation under the FLSA. Plaintiff’s collective action claim for FLSA retaliation must be dismissed because Plaintiff has failed to plead facts sufficient to establish a prima facie case of retaliation as a matter of law. “To survive a motion to dismiss a claim of unlawful discriminatory retaliation under the FLSA, [a plaintiff] must plead the elements of such a claim: (1) he engaged in a protected activity …; (2) the employer took adverse action against him either contemporaneously with or subsequent to the protected activity; and (3) a causal connection existed between the activity and the employer’s action.” Vargas v. Gen. Nutrition Centers, Inc., Civil Action No. 10- 6 As noted, the only modification made by Plaintiff to address the lack of facts to support his FLSA claim was to add the phrase “including but not limited to Josh Klein and Troy Brisbine” to various paragraphs throughout the Amended Complaint. But this type of conclusory and generalized statement is not entitled to an assumption of truth and is insufficient to establish a collective action claim as a matter of law. See Iqbal, 556 U.S. at 679 Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 9 of 15 -10- 867, 2011 U.S. Dist. LEXIS 1155, at *4 (W.D. Pa. Jan. 6, 2011) (citing Wildi v. Alle-Kiski Med. Ctr., 659 F.Supp.2d 640, 664 (W.D. Pa. 2009)); see also Preobrazhenskaya v. Mercy Hall Infirmary, 71 Fed. Appx. 936, 939 (3d Cir. 2003); Kachmar v. Sungard Data Sys., Inc., 109 F.3d 173, 177 (3d Cir. 1997). In the Amended Complaint, Plaintiff fails to allege that the putative plaintiffs engaged in activity protected by the FLSA, and does not articulate any adverse employment action to which they were purportedly subjected as a result thereof. See generally Florida-Kaclik v. SSPC, 124 Fed. Appx. 707, 709 (3d Cir. 2005) (affirming district court’s grant of employer’s motion to dismiss on the basis that the employee “could not state a legally cognizable claim for retaliation under the FLSA because she had not alleged that she was involved in any FLSA proceeding or engaged in any other activity protected by the FLSA.”). Instead, Plaintiff alleges that he received a written warning because he complained to his supervisor about AIM’s alleged pay practices, and baselessly claims that AIM’s reclassification of FSMs from salaried to hourly employees was unlawful.7 Am. Compl. ¶¶ 11-12. However, neither allegation, even if true, is sufficient for purposes of establishing a collective claim for relief under the FLSA’s anti- retaliation provision. As a result, Plaintiff’s collective action claim for FLSA retaliation must be dismissed. 7 Although Plaintiff also alleges that AIM retaliated against FSMs by instructing its supervisors to “manipulate employee time records to avoid paying overtime wages,” this allegation is so far removed from the framework of an FLSA retaliation claim-and superficially pled-that it does not warrant being addressed. Am. Compl. ¶ 23. Among other reasons, this is because the submission of time records does not constitute an activity that is protected by the FLSA. See 29 U.S.C. § 215(a)(3). Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 10 of 15 -11- 1. Plaintiff’s receipt of a written warning does not support a collective claim for FLSA retaliation. Plaintiff does not plead facts sufficient to establish that the putative plaintiffs engaged in any conduct protected by the FLSA. See Vargas, 2011 U.S. Dist. LEXIS at *21 (explaining that, in order for an action to constitute a protected activity, an employee must engage in “some overt form of protest ….”). Instead, Plaintiff alleges only that he personally “made numerous complaints to his manager … in regards to the [purported] disparities in his pay,” which resulted in him receiving a written warning, and that “all FSMs throughout AIM” complained similarly. See Am. Compl. ¶ 11. However, individual disciplinary decisions cannot give rise to a collective claim for relief. See generally, Hay v. GMAC Mortg. Corp., Civil Action No. 01-1030, 2003 U.S. Dist. LEXIS 16550, at *18 (E.D. Pa. Sept. 11, 2003) (“In order to constitute an adverse employment action, a reprimand must effect a material change in the terms or conditions of [an employee's] employment ...”) (citing Weston v. Pennsylvania, 251 F.3d 420, 430-31 (3d Cir. 2001) (analyzing retaliation claims under the framework of Title VII)). Plaintiff has not, and cannot, allege that the written warning he received from his supervisor altered the terms or conditions of employment of all FSMs. Indeed, Plaintiff has not even pled facts that support a finding that the written warning altered the terms of his employment. As such, Plaintiff fails to plead a plausible claim for collective relief based on his alleged receipt of a written warning.8 8 As an illustration of Plaintiff’s sloppy attempts to plead an FLSA retaliation claim, he claims in Paragraph 23 of the Amended Complaint that he was issued a written warning for stealing company time and that his pay records were altered by his supervisor even though he did not take a lunch break, then baldly claims that these particular and individual circumstances are “similar” to Josh Klein and Troy Brisbine, despite the fact that Plaintiff fails to plead whether either individual actually received a written warning for stealing company time or were subject to modified time records. Plaintiff simply includes references to Mr. Klein and Mr. Brisbine without any factual support for doing so. Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 11 of 15 -12- 2. AIM’s decision to reclassify its FSMs as hourly employees does not support a claim for FLSA retaliation. In the Amended Complaint, Plaintiff attempts to allege that AIM converted its FSMs from salaried to hourly employees following the resolution of the Jones Lawsuit in retaliation for the filing of that case. These allegations, without more, do not establish a claim for retaliation under the FLSA. This is so because it is well settled that “[a]n employer may reorganize its affairs and take other necessary employment actions in order to manage the impact of compliance with the outcomes produced by a protected activity so long as it does so for legitimate reasons and not in reprisal for the fact of an employee's participation.” Blackie v. State of Maine, 75 F.3d 716, 723 (1st Cir. 1996); see, e.g., York v. City of Wichita Falls, 48 F.3d 919, 920-21 (5th Cir. 1995) (finding no retaliation under the FLSA when city restructured compensation arrangements to comply with the FLSA and existing budgetary constraints"); Adams v. City of McMinnville, 890 F.2d 836, 839 (6th Cir. 1989) (explaining that the employer’s decision to reduce employee hours was not retaliatory because it was made in response to a legitimate budgetary restriction). In Blackie, the United States Court of Appeals for the First Circuit explained that a “contrary rule would mummify the status quo and prevent an employer from complying with a court order in the manner that it deems most compatible with the lawful operation of its business,” which would be a “grotesque result.” Id. (emphasis added). In this case, Plaintiff alleges that AIM reclassified him and all other FSMs as hourly employees following the resolution of the Jones Lawsuit. See Am. Compl. ¶¶ 2, 5-6, 10, 20. However, as explained in Blackie, there is nothing unlawful about an employer altering its pay structure in order to come into compliance with the FLSA, and Plaintiff does not allege any facts that could support a finding that AIM reclassified its FSMs in reprisal for their role in initiating or participating in the Jones Lawsuit. Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 12 of 15 -13- Moreover, even if AIM’s reclassification of FSMs was in reprisal for them having engaged in protected activity, which AIM vehemently denies, Plaintiff has not articulated how this constitutes an adverse employment action. Indeed, as a result of his reclassification from a salaried exempt to an hourly employee, Plaintiff alleges that he went from earning an annual salary of $30,000 to being paid $15.00 per hour. Am. Compl. ¶ 2. Although Plaintiff claims that the reclassification resulted in his pay and the pay of all other FSMs being reduced by 10%, this allegation unequivocally lacks merit and is not worthy of belief. See Am. Compl. ¶¶ 5, 20. In fact, working a full-time schedule of 40 hours per week at an hourly rate of $15.00 would result in Plaintiff earning a weekly income of $600, which equals approximately $31,200 per year. This amount exceeds the compensation Plaintiff previously earned while classified as a salaried exempt employee and, therefore, cannot constitute an adverse employment action. Further, Plaintiff’s Amended Complaint is devoid of any facts that could support a finding to the contrary, particularly because he alleges claims for the payment of overtime, meaning that he claims he works more than 40 hours in a week. D. Plaintiff’s WPCL claim is derivative of his FLSA collective action claims and should be dismissed. Plaintiff’s putative WPCL class action claim must also be dismissed because Plaintiff’s underlying FLSA claims are without merit. The WPCL “does not create a substantive right of compensation.” Slieman v. DHL Express, Civil Action No. 09-0414, 2009 U.S. Dist. LEXIS 35812, at *17 (E.D. Pa. April 27, 2009). Instead, it “only provides a remedy where an employee violated an independent contractual obligation to pay wages.” Id.; see also Sendi v. NCR Comten, Inc., 619 F. Supp. 1577, 1579 (E.D. Pa. 1985) (explaining that the WPCL does not create any independent right to compensation). As such, and for the reasons set forth above, Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 13 of 15 -14- Plaintiff’s WPCL class action claim, which is dependent upon and derivative of his FLSA collective claims, cannot survive independently. Plaintiff’s WPCL class claim must also be dismissed because Plaintiff alleges that the putative size of the WPCL class is approximately twenty individuals. See Am. Compl. ¶ 26. Rule 23(a) provides that class treatment is only appropriate where putative members are “‘so numerous that joinder … is impracticable.’” Ripley v. Sunoco, Inc., 287 F.R.D. 300, 307 (E.D. Pa. 2012) (quoting Fed. R. Civ. P. 23(a)(1)). Although there is no set minimum, numerosity is generally satisfied where the number of potential plaintiffs exceeds forty. Id.; see Stewart v. Abraham, 275 F.3d 220, 226-27 (3d Cir. 2001) (finding that the numerosity requirement will generally be satisfied “if the named plaintiff demonstrates that the potential number of plaintiffs exceeds 40.”). As such, Plaintiff has failed to plead that the size of the proposed WPCL class is sufficient as a matter of law to comply with the numerosity requirement of Rule 23(a). V. CONCLUSION WHEREFORE, Defendant Alliance Inspection Management, LLC respectfully requests that Plaintiff’s Amended Complaint be dismissed with prejudice pursuant to Federal Rule of Civil Procedure 12 (b)(6). Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 14 of 15 -15- Dated: October 3, 2016 Respectfully submitted, OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. By: /s/ Cory E. Ridenour Cory E. Ridenour PA ID No. 311974 cory.ridenour@ogletreedeakins.com Philip K. Kontul, Esq. PA ID No. 94156 philip.kontul@ogletreedeakins.com Ashley R. Hileman PA ID No. 316887 ashley.hileman@ogletreedeakins.com One PPG Place, Suite 1900 Pittsburgh, PA 15222 Telephone: (412) 394-3333 Facsimile: (412) 232-1799 Attorneys for Defendant 26339135.3 Case 2:16-cv-00785-NBF Document 18 Filed 10/03/16 Page 15 of 15