United States District Court, D. Nevada
February 5, 2015
Brooke Cardoza et al., Plaintiffs
Bloomin' Brands, Inc., et al., Defendants
ORDER [167, 169, 187]
JENNIFER A. DORSEY, District Judge.
On October 24, 2014, I conditionally certified this multi-state class action by Outback Steakhouse Restaurant employees who allege their employer refused to pay wages for required off-the-clock work, overtime, and minimum required wages to many thousands of minimum-wage employees, violating the Fair Labor Standards Act (FLSA) and various state employment laws. In the conditional certification order, I also approved the form of the notice and consent-to-join form and gave defendants 60 days to provide plaintiffs' counsel with all names and addresses of the putative class members.
Just before those 60 days ran, defendants filed a motion seeking a Rule 12(c) judgment on the pleadings or, alternatively, reconsideration of my July 2014 denial of their motion to dismiss. They also ask me to decertify the class and asked to stay the class-notice process while I considered this new motion. The premise of this multi-part motion is that the Ninth Circuit's November 12, 2014, opinion in Landers v. Quality Communications, Inc., adopted a new standard for "the degree of specificity required to state a claim for failure to pay minimum wages or overtime wages under the FLSA" post- Twombly and Iqbal.  Based on this representation, I granted the stay and scheduled the balance of the motion for oral argument on February 9, 2015. Defendants also move to supplement their motion with an amended version of Landers and an alphabet of exhibits.
Having reviewed the parties full briefs, the record, and Landers, I find that Landers changes nothing because it merely adopts the standard articulated by the Second Circuit in Lundy v. Catholic Health System of Long Island -the standard I already applied in denying defendants' motion to dismiss. I find these motions appropriate for disposition without oral argument, and I vacate the February 9, 2014, hearing. I grant the request for supplementation in part and deny the 12(c) motion and request for decertification.
I. Pending Matters in the Outback Defendants' Omnibus Motion and Supplement
The Outback defendants' motion for judgment on the pleadings is brought, in the alternative, as a motion for reconsideration. I therefore consider their motion under each of these standards.
A. Defendants' Rule 12(c) Motion for Judgment on the Pleadings
Federal Rule of Civil Procedure 12(c) provides that "after the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings." When a Rule 12(c) motion challenges a complaint for failure to state a claim, as this one does, "a motion for judgment on the pleadings faces the same test as a motion under Rule 12(b)(6)." Dismissal may be granted "only if it is clear" that no set of facts consistent with the allegations could support relief.
A motion to dismiss is converted into a motion for summary judgment when the court relies on materials outside the pleadings. District courts have discretion to exclude outside matters to avoid converting a motion to dismiss into one for summary judgment.
1. The Landers workweek
The Outback defendants' motion focuses on the Ninth Circuit's recent opinion in Landers v. Quality Communications, which was issued in November 2014, just one month after I granted conditional certification in this case. Circuit Judge Rawlinson writes a straightforward opinion that surveys other circuits' decisions on the sufficiency of FLSA pleadings, including the Second Circuit's recent decision in Lundy v. Catholic Health System of Long Island , and effectively adopts the standard presented in Lundy.  Landers holds that "a plaintiff asserting a claim to overtime payments must allege that she worked more than forty hours in a given workweek." Consistent with Rule 8, Landers specifically does not require detailed factual pleading; instead, it details multiple ways that plaintiffs can establish a plausible claim, e.g., estimating the length of an average workweek and the pay received in an average workweek; estimating the amount of overtime wages allegedly owed; and pleading "any other facts that will permit the court to find plausibility." "Mathematical precision" is not demanded. Nor is this a mandate to identify calendar dates. To survive a 12(b)(6) challenge, Landers simply requires an FLSA plaintiff to have alleged that actual overtime went unpaid.
The defendants rely on Landers and Lundy to argue that plaintiffs' FLSA claims are insufficiently pled because no plaintiff alleged that he worked a specific workweek and then went unpaid for that specific workweek and/or was not paid minimum wage. They rely on Landers to urge that the plaintiffs' state claims fail to satisfy the Iqbal and Twombly standards. As the plaintiffs observe, this is not the first time that the Outback defendants have raised the Lundy standard. Their motion to dismiss urged that "Plaintiffs never provide the degree of specificity' required to make their claims plausible." They contended that, under Lundy, plaintiffs failed to allege facts showing "a single workweek in which they worked at least 40 hours and also worked uncompensated time in excess of 40 hours." In addressing this argument, I quoted that exact language and ruled that "Plaintiffs have done so." In my July 30, 2014, order, I explained that the complaint alleges that (1) "[a]t least once during the past three years, [plaintiffs have] worked for Defendants more than forty (40) hours in a week without receiving premium overtime pay, and thus [have] worked unpaid compensable time" and (2) "[a]t least once during the past three years, [plaintiffs were] paid at the minimum wage rate per hour, and yet had worked unpaid compensable time." I then explicitly enumerated six supporting allegations that made the plaintiffs' claims plausible.
The defendants' arguments in this Rule 12(c) motion, when considered alongside their earlier Rule 12(b)(6) motion, are redundant. The pleadings have not changed; no amendment was filed. Neither has the Lundy standard, now adopted in the Ninth Circuit through Landers, changed from when I analyzed and applied it in July 2014. For the reasons stated in my July 2014 order and reiterated here, I continue to find these claims sufficiently pled, and I deny the defendants' motion for judgment on the pleadings as to the FLSA claims.
2. Plaintiffs' third, sixth, tenth, and eleventh state-law claims
The Outback defendants' 12(c) challenge to the plaintiffs' third, sixth, tenth, and eleventh claims-which are pled under Illinois, Maryland, and Ohio law- are also based on the same Landers -related arguments. In their motion to dismiss, defendants urged that these claims failed to satisfy Twombly 's fair-notice requirement, and I have already ruled that the claims were pled with sufficient specificity. I deny judgment on these claims as well. I will separately consider, however, the defendants' request for judgment on the plaintiffs' fourth and fifth claims for relief.
3. Plaintiffs' fourth claim under the Illinois Minimum Wage Act
The defendants challenge plaintiffs' fourth claim, which is based on the Illinois Minimum Wage Act (IMWA), on two bases. First, they contend that gap-time compensation claims cannot be brought under the FLSA or IMWA. To support this argument, they cite one unreported decision from the Southern District of Illinois. This case defines gap time as "compensation for hours worked (1) before the employee reaches the forty-hour per week overtime threshold, so it cannot violate overtime compensation laws, and (2) at a rate that averages out to more than the applicable minimum wage, so it cannot violate minimum wage laws." It also distinguishes gap-time claims from minimum-wage claims; the latter are actionable under the FLSA and IMWA.
The plaintiffs' second amended complaint alleges that the Outback defendants failed to pay "the required minimum wage." There is no explanation from the defense why "minimum wage" should be read as "gap time." Given the Supreme Court's admonition to construe pleadings in the light most favorable to the plaintiffs at this nascent stage, I decline to eliminate a claim on this thin argument.
Second, the defendants argue that the only named Illinois plaintiff has conceded his lack of minimum-wage claims. They rely on the plaintiffs' response to their motion for summary judgment. That response falls outside the pleadings, and I exercise my discretion not to move outside the pleadings on a Rule 12(c) motion and thereby convert it into a Rule 56 motion, particularly when the same issue is apparently already addressed in the pending summary-judgment motion. I deny Rule 12(c) judgment on this issue without prejudice to any concessions the plaintiffs may have made or any arguments the defendants may have offered in their summary-judgment briefs.
4. Plaintiffs' fifth claim under the Maryland Wage Payment and Collection Law
The defense also seeks judgment on the plaintiffs' fifth claim, which is based on the Maryland Wage Payment and Collection Law. They quote a District of Maryland decision for the proposition that "[t]he MWPCL does not specifically address payment of overtime wages or provide a cause of action directed at employer's failure to pay overtime." The plaintiffs seek to avail themselves of the MWPCL provision that permits up to treble wage recovery when an employer fails to pay wages as required by the MWPCL. I recognize that MWPCL actions must challenge payment timing or mechanisms; they do not "establish entitlement to payment." But these plaintiffs do challenge whether the Outback defendants paid overtime on a regular basis. The second amended complaint alleges, for example, that Outback willfully failed to maintain accurate wage and overtime records and that employees were unable to clock in during mandatory staff meetings. I find that the plaintiffs have sufficiently stated an MWPCL claim at this time.
B. Defendants' Motion for Reconsideration
The defendants ask me, alternatively, to reconsider whether the plaintiffs identify a specific workweek and provide sufficient detail about that workweek under the new Landers standard. Motions for reconsideration are not expressly authorized in the Federal Rules of Civil Procedure, but district courts may grant them under Rule 59(e). Reconsideration is only warranted when: (1) the movant presents newly discovered evidence, (2) the district court committed clear error or the initial ruling was manifestly unjust, or (3) there is an intervening change in controlling law. Although reconsideration may also be warranted under other highly unusual circumstances, it is well recognized as an "extraordinary remedy, to be used sparingly in the interests of finality and conservation of judicial resources." This circuit disallows Rule 59(e) motions that are used to raise arguments or present evidence that a party could have reasonably raised earlier in the litigation-or already did.
I find no new evidence, clear error, manifest injustice, or intervening change in law that would warrant changing the outcome that the defendants now challenge. Although the Landers case is new, it directly adopts the Lundy standard, which I already applied. I thus deny the defendants' motion for reconsideration.
C. Defendants' Motion to Decertify
The defendants' omnibus motion also includes a request to decertify the potential class based on the alleged failure of plaintiffs' claims to satisfy Landers.  Because I reject the premise of this argument, I also deny the request to decertify the class.
D. Defendants' Motion to Supplement
The defense also filed a request to supplement the instant motion to: (1) notify me that the Landers opinion has been amended and (2) provide a stack of plaintiffs' responses to discovery requests. To the extent that the defense apprises me of the revision to the Landers opinion, I grant the supplementation request; it is denied in all other respects because I exercise my discretion not to consider matters outside the pleadings and convert this into a summary-judgment motion.
II. The Stay is Lifted
When I granted defendants' request for a stay of the class-notice procedures pending my full consideration of their omnibus motion, I "strongly cautioned" defendants "that they should continue preparing the class-member-contact information, which they should have nearly ready now. If and/or when the court lifts this stay, the defendants will have just one week to provide plaintiffs' counsel with the contact information." As I have now resolved these Landers -based issues, I also lift the stay. My order granting conditional certification and approving conditional class notice is back in full effect, albeit on a new timeline. Defendants have one week from today to provide plaintiffs' counsel with the contact information.
It is hereby ORDERED that the defendants' motions for judgment on the pleadings, reconsideration, and decertification [Docs. 167, 169] are DENIED;
It is further ORDERED that the defendants' motion to supplement [Doc. 187] is GRANTED in part and DENIED in part as stated in this order.
It is further ORDERED that the temporary stay entered on December 19, 2014, is LIFTED.
It is further ORDERED that the February 9, 2015, motion hearing in this case is VACATED.