United States District Court, S.D. New York
June 3, 2005.
LUCAS DECRAENE, Plaintiff,
NEUHAUS (U.S.A.), INC., NEUHAUS N.V., GUY PACQUOT, CLAUDE EMERY, CLEMENTINE LOEHMAN, WALTER SEROW, MARIE COLES, JOS LINKENS, MARLENE VONKEN, LUDO MANS, MAHBOUB BAKHTIARI, and VALERIE NAGLEY, Defendants.
The opinion of the court was delivered by: GERARD E. LYNCH, District Judge
ORDER AND OPINION
Plaintiff Lucas Decraene, proceeding pro se, brings suit
against his former employer, Neuhaus (U.S.A.), Inc. ("N-US"), its
parent company, Neuhaus N.V. ("N-NV"), and related defendants for
various torts, breach of contract, violation of the Fair Labor
Standards Act, 29 U.S.C. § 207 ("FLSA"), and mismanagement of a
publicly owned and traded company. Defendants N-US, N-NV, Claude
Emery, Walter Serow, Clementine Loehman, Marlene Vonken, Guy
Pacquot, Marie Coles, and Jos Linkens (collectively,
"defendants") now move to dismiss plaintiff's Amended Complaint in its entirety. As will be seen
below, defendants Mahboub Bakhtiari and Valerie Nagley are
dismissed from this action at plaintiff's request. The remaining
defendant, Ludo Mans, has not been served. Defendants' motion
will be granted in part and denied in part.
For purposes of this motion, the facts alleged in plaintiff's
Amended Complaint must be taken as true, and all reasonable
inferences must be drawn in the plaintiff's favor. Freedom
Holdings, Inc. v. Spitzer, 357 F.3d 205, 216 (2d Cir. 2004);
Bolt Elec. Inc. v. City of New York, 53 F.3d 465, 469 (2d Cir.
1995). Moreover, a pro se plaintiff's papers are to be read
"liberally and [interpreted so as to] raise the strongest
arguments that they suggest." Burgos v. Hopkins, 14 F.3d 787,
790 (2d Cir. 1994), citing Mikinberg v. Baltic S.S. Co.,
988 F.2d 327, 330 (2d Cir. 1993). Plaintiff has supplemented those
facts alleged in the Amended Complaint with an affirmation dated
September 8, 2004 and annexed to the Amended Complaint. On a
motion to dismiss, a court may properly consider documents
attached to the complaint as exhibits or incorporated in it by
reference, Brass v. American Film Techs., Inc., 987 F.2d 142,
150 (2d Cir. 1993), and where the plaintiff is proceeding pro se,
"courts may look to submissions beyond the complaint to determine
what claims are presented." Boguslarsky v. Kaplan,
159 F.3d 715, 719 (2d Cir. 1998).
Decraene, a Belgian citizen, was employed by N-US, a
fully-owned subsidiary of N-NV, a Belgian chocolatier, in its
retail store in Plano, Texas, between late summer 2001 and early
2002. Decraene claims that he was often required to work overtime
as a result of continual problems with the management and
staffing of the store, and that he was never compensated for this overtime. (Decraene Aff. ¶ 7.) In addition, Decraene claims
that defendant Ludo Mans, then-chief executive officer of N-US,
ordered him to fix the store's books and to create deposits in
N-US's accounts to mislead the Belgian parent company about the
performance of its United States subsidiary. (Id. ¶¶ 21-22.) In
actuality, Decraene claims, customers were not billed for certain
orders, and a large volume of corporate sales for the 2001-2002
holiday season (approximately three tons of boxed chocolates)
went unfilled after his termination, losing money for the company
and depriving Decraene of his commission on those orders. (Id.
¶¶ 16, 18.)
Decraene's employment was terminated on January 5, 2002. His
termination letter, signed by Mans and countersigned by Decraene,
indicated that he was being terminated because of his "theft from
our company and fraudulent activity involving our accounts."
(Compl. Ex. A, at 1.) These allegations appear to correspond to
the account doctoring and unbilled and/or unfilled orders
described above, for which Decraene claims he was not culpable.
Mans and Claude Emery, an executive vice-president of N-US, filed
charges against Decraene with the Plano Police Department in
accordance with the allegations of theft and fraudulent
accounting in the termination letter. (Decraene Aff. ¶ 23.) Upon
investigation, the district attorney declined to bring a case
against Decraene, and a federal investigation into the
allegations was similarly dropped. (Id.)
Decraene commenced this action by filing his original Complaint
with the pro se office of this Court on February 13, 2004.
After his application to proceed in forma pauperis was granted,
the Complaint was filed with the Clerk of the Court on April 14,
2004. An Amended Complaint was filed on September 13, 2004. As
amended, the Complaint states seven causes of action in
connection with the events outlined above: (1) libel; (2)
slander; (3) intentional infliction of emotional distress; (4) breach of contract; (5) wrongful
discharge; (6) violation of the FLSA; and (7) mismanagement of a
publicly owned and traded company.
Defendants now move to dismiss the Amended Complaint in its
entirety, citing the Court's lack of personal jurisdiction over
defendants Vonken and N-NV and plaintiff's failure to state a
claim as to all causes of action.
In his response to this motion, Decraene concedes that his
first, second, third, and fifth causes of action should be
dismissed as against all defendants and that his fourth, sixth
and seventh causes of action should be dismissed as against
defendants Nagley and Bakhtiari. Accordingly, the plaintiff's
first (libel), second (slander), third (intentional infliction of
emotional distress), and fifth (wrongful discharge) causes of
action will be dismissed in their entirety, and his fourth
(breach of contract), sixth (FLSA violations), and seventh
(mismanagement of a publicly owned and traded company) causes of
action will be dismissed as to Nagley and Bakhtiari.
Decraene further requests that his seventh cause of action be
dismissed (presumably as to the remaining defendants) without
prejudice. Defendants have neither answered nor moved for summary
judgment, and, therefore, Decraene's right under Fed.R. Civ.
Pro. 41(a)(1) to dismiss the action without order of the court
and without prejudice by filing a notice of dismissal endures.
Kilpatrick v. Texas & P. Ry. Co., 166 F.2d 788, 792 (2d Cir.
1948). Although Decraene has not filed a formal notice of
dismissal, the Court accepts his response to this motion as the
equivalent and, accordingly, will dismiss his seventh cause of
action as to the defendants other than Nagley and Bakhtiari
without prejudice. Consequently, all that remains to be adjudicated on this motion is whether the Court has jurisdiction
over defendants Vonken and N-NV and whether Decraene's fourth and
sixth causes of action should be dismissed for failure to state a
I. Personal Jurisdiction
Defendants move under Fed.R. Civ. Pro. 12(b)(2) to dismiss
Decraene's claims against defendants Vonken, a Belgian citizen,
and N-NV, a Belgian corporation, for lack of personal
jurisdiction. On a motion to dismiss pursuant to Fed.R.Civ.P.
12(b)(2), the plaintiff bears the burden of establishing
jurisdiction. In re Magnetic Audiotape Antitrust Litigation,
334 F.3d 204, 206 (2d Cir. 2003). Where, as here, no
jurisdictional discovery has been conducted, allegations of
jurisdictional fact must be construed in the light most favorable
to the plaintiff, CutCo Indus., Inc. v. Naughton, 806 F.2d 361,
365 (2d Cir. 1986), and the motion must be denied if those
allegations suffice as a matter of law. In re Magnetic
Audiotape, 334 F.3d at 206; PDK Labs, Inc. v. Friedlander,
103 F.3d 1105, 1108 (2d Cir. 1997) ("A plaintiff facing a
Fed.R.Civ.P. 12(b)(2) motion to dismiss made before any discovery need
only allege facts constituting a prima facie showing of personal
jurisdiction[,]" and courts must "construe the pleadings and
affidavits in plaintiff's favor at this early stage."); see
also Metro. Life Ins. Co. v. Robertson-Ceco Corp.,
84 F.3d 560, 566 (2d Cir. 1996).
A federal court sitting in diversity may exercise jurisdiction
over a foreign defendant if, first, the defendant is amenable to
process under the law of the forum state, Omni Capital Int'l
Ltd. v. Rudolf Wolff & Co., 484 U.S. 97, 105 (1987); Metro.
Life Ins. Co., 84 F.3d at 567, and second, the exercise of
personal jurisdiction comports with due process under
International Shoe Co. v. Washington, 326 U.S. 310 (1945), and
its progeny. See Arrowsmith v. United Press Int'l, 320 F.2d 219, 223 (2d Cir. 1963) (en banc) ("[T]he amenability
of a foreign corporation to suit in a federal court in a
diversity action is determined in accordance with the law of the
state where the court sits, with `federal law' entering the
picture only for the purpose of deciding whether a state's
assertion of jurisdiction contravenes a constitutional
guarantee."); see also Clarendon Nat'l Ins. Co. v. Lan,
152 F. Supp. 2d 506, 515 (S.D.N.Y. 2001).
New York law authorizes both general and specific exercises of
personal jurisdiction over foreign defendants. N.Y.C.P.L.R. §§
301-302; see generally Metro. Life Ins. Co.,
84 F.3d at 567-68 (explaining distinction between general and specific
jurisdiction). General jurisdiction under N.Y.C.P.L.R. § 301 is
established where a foreign corporation or individual "engages in
a continuous and systematic course of doing business in New
York." Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55,
58 (2d Cir. 1985) (corporations); ABKCO Indus., Inc. v. Lennon,
377 N.Y.S.2d 362, 367 (Sup.Ct. N.Y. County 1975), modified
384 N.Y.S.2d 781, 784 (1st Dep't 1976) (individuals). To determine
whether an entity is "doing business" in New York, courts look to
"a traditional set of indicia: for example, whether the company
has an office in the state, whether it has any bank accounts or
other property in the state, whether it has a phone listing in
the state, whether it does public relations work there, and
whether it has individuals permanently located in the state to
promote its interests." Wiwa v. Royal Dutch Petroleum Co.,
226 F.3d 88, 98 (2d Cir. 2000).
Decraene has alleged no way in which Vonken, a Belgian citizen
and resident and formerly the chief executive officer, chief
operating officer, and chairman of the board of directors for
N-NV (Vonken Aff. ¶¶ 2-3) and, Decraene alleges, a director of
N-US (Am. Compl. ¶ 9) could be considered to be "doing
business" in New York. The extension of personal jurisdiction under N.Y.C.P.L.R. § 301 to Vonken would
clearly be inappropriate.
As to defendant N-NV, Decraene alleges that N-NV is the one
hundred percent owner of its United States subsidiary, N-US; that
N-NV has covered the operating losses of N-US; that "[N-NV]
asserts that it employs 650 people in the `Neuhaus Group' which
includes [N-US];" that an unspecified member of N-NV's board of
directors is involved in the daily operations of N-US); and that
one employee of N-NV, Erna Duts, was assigned to the corporate
headquarters of N-US. (Id. ¶ 2; Decraene Aff. ¶ 11.) The
Amended Complaint further alleges that Guy Pacquot, whom Decraene
identifies as N-US's president, is the chairman of N-NV's board
and is involved in the daily operations of both companies (Am.
Compl. ¶ 3); that Claude Emery, an executive vice-president of
N-US sits on N-NV's board; and that Vonken was, and defendant Jos
Linkens now is, a director of N-US, in addition to holding
positions within N-NV. (Id. ¶¶ 8, 9.) In effect, Decraene
relies entirely on the parent-subsidiary relationship between
N-NV and N-US, the latter of which concededly does business in
New York, for jurisdiction over the former, and alleges no direct
way in which N-NV itself is "doing business" in New York.
But a parent-subsidiary relationship alone is insufficient for
this Court to acquire jurisdiction over the parent company.
Instead, "[f]or New York courts to have personal jurisdiction . . .
the subsidiary must be either an `agent' or a `mere department'
of the foreign parent." Jazini v. Nissan Motor Co., Ltd.,
148 F.3d 181, 184 (2d Cir. 1998). The "agent" standard requires that
the subsidiary do "all the business which [the parent
corporation] could do were it here by its own officials."
Frummer v. Hilton Hotels Int'l Inc., 19 N.Y.2d 533, 537 (1967).
Determining whether a subsidiary is a mere department, by
contrast, involves consideration of "(1) common ownership and the
presence of an interlocking directorate and executive staff; (2) financial dependency of the subsidiary on
the parent; (3) the degree to which the parent interferes in the
selection and assignment of the subsidiary's executive personnel
and fails to observe corporate formalities; and (4) the degree of
the parent's control of the subsidiary's marketing and
operational policies." Porter v. LSB Indus., Inc.,
600 N.Y.S.2d 867, 873 (4th Dep't 1993), citing Volkswagenwerk
Aktiengesellschaft v. Beech Aircraft Corp., 751 F.2d 117,
120-122 (2d Cir. 1984).
Decraene has not alleged, nor do the pleadings construed in the
light most favorable to him give rise to an inference of, an
agency relationship. Decraene does not dispute that N-US acts as
the importer, distributor, and seller of chocolate and
confectionary products manufactured by N-NV. (Reydams Aff. ¶¶
2-3.) Although under certain circumstances a separately
incorporated subsidiary may be no more than a sales agent of its
foreign parent, see Taca Int'l Airlines, S.A. v. Rolls-Royce
of England, Ltd., 15 N.Y.2d 97 (1965), domestic sale of the
products of a foreign manufacturer standing alone is insufficient
to establish agency. See Jazini, 148 F.3d at 184 ("A foreign
car manufacturer is not `present' in New York simply because it
sells cars through a New York distributor."). Nor has Decraene
alleged facts sufficient to show that N-US is no more than a mere
department of N-NV. Decraene has not contested the sworn
affidavits submitted by various officers and directors of N-NV
and N-US averring that N-US is, and always has been, an
"independently operating and independently managed company" with
"its own officers and employees," incorporated under the laws of
the state of New York. (Reydams Aff. ¶ 3; see also Vonken
Aff. ¶ 4; Emery Aff. ¶ 3 (noting N-US "has its own offices,
telephone numbers, facsimile numbers, bank accounts, retail
outlets and distribution system").) The facts Decraene has alleged, moreover, are insufficient to
show the pervasive control required under the "mere department"
standard. That the two corporations shared certain directors and
that one employee of the parent company was assigned to the
corporate headquarters of the subsidiary are not dispositive.
See Porter, 600 N.Y.S.2d at 873 ("There is complete stock
control, and the directors and officers of the two entities
overlap to an extent, but those factors are intrinsic to the
parent-subsidiary relationship and, by themselves, not
determinative."). Nor does Decraene's allegation that N-NV
included N-US's employees in its tallying of "Neuhaus Group"
employees suffice. See Bellomo v. Pennsylvania Life Co.,
488 F. Supp. 744, 745 (S.D.N.Y. 1980) (portrayal of affiliate as part
of unitary enterprise insufficient to confer jurisdiction on
parent). Decraene's additional allegations that a director of the
parent company was "involved" in the daily operations of N-US and
that the parent company covered certain of N-US's operating
losses are likewise insufficient; it is only "when the activities
of the parent show a disregard for the separate corporate
existence of the subsidiary, [that] New York jurisdiction may be
asserted." Beech, 751 F.2d at 120. Although Decraene's
allegations are fact-specific and not merely legal conclusions,
cf. Jazini, 184 F.3d at 185, they do not amount to a prima
facie showing of the control required to assert jurisdiction on
the basis of the "mere department" test. Compare Taca Int'l
Airlines, S.A., 15 N.Y.2d at 100-102 (subsidiary a mere
department where sole business was sale and service of goods
manufactured by parent corporation and, inter alia, subsidiary
employees were trained by the parent, sales literature was
produced by the parent, the subsidiary owned no inventory, but
merely placed orders with the parent once a sale was made, and
subsidiary was paid a fixed annual fee by parent to service
manufactured goods under warranty) with Palmieri v. Estefan,
793 F.Supp. 1182, 1188-89 (S.D.N.Y. 1992) (affiliates, though commonly owned, were not mere
departments even where jurisdictional discovery showed that
parent approved major financial decisions, reviewed budget,
controlled key personnel decisions, and guaranteed financial
obligations of at least one affiliate). Accordingly, Decraene has
failed to allege facts giving rise to the inference that N-US is
either an agent or mere department of N-NV such that this Court
could assert personal jurisdiction over the latter under
N.Y.C.P.L.R. § 301.
Even where there is no jurisdiction under N.Y.C.P.L.R. § 301,
however, jurisdiction may be proper under § 302(a), which
authorizes New York courts to exercise jurisdiction over
nondomiciliaries as to causes of action that arise from certain
enumerated acts performed in New York, whether carried out
personally or by agents, including the transaction of business.
Id. § 302(a)(1). Again, Decraene does not allege any way in
which either Vonken or N-NV transacted business in New York,
apart from the parent-subsidiary relationship with N-US. But
"[p]ersonal jurisdiction over a parent corporation whose
subsidiary has transacted business in New York exists when the
nondomiciliary parent corporation knew of and consented to the
acts of its in-state subsidiary that gave rise to the cause of
action, and `exercised some control over [the subsidiary] in the
matter."' EFCO Corp. v. Nortek, Inc., No. 99-7660, 2000 WL
254047, at *1 (2d Cir. 2000) (unpublished opinion), citing
Kreutter v. McFadden Oil Corp., 71 N.Y.2d 460, 467 (1988).
Decraene has not alleged any involvement of either Vonken or N-NV
in the facts underlying his surviving causes of action for breach
of contract and unpaid compensation, let alone knowledge and
control of those matters. Therefore, N.Y.C.P.L.R. § 302 is
inapplicable. Since jurisdiction over these defendants cannot be
maintained under either the general or specific prongs of New
York's personal jurisdiction statute, the Amended Complaint must
be dismissed as to defendants Vonken and N-NV.
II. Breach of Contract
Defendants move under Fed.R.Civ.Pro. 12(b)(6) to dismiss
Decraene's fourth cause of action common law breach of contract
for failure to state a claim. This Court may only dismiss a
complaint if "it appears beyond doubt that the plaintiff can
prove no set of facts in support of his claim which would entitle
him to relief." Patel v. Searles, 305 F.3d 130, 135 (2d Cir.
2002) (internal quotation marks omitted). Decraene alleges that
by terminating his employment without cause and failing to
compensate him for accrued overtime, commission, and bonuses,
defendants breached their contract of continuous employment. (Am.
Compl. ¶¶ 25-26.) Defendants argue that Decraene's claim should
be dismissed because Decraene was an employee-at-will, and, thus,
defendants were entitled to terminate his employment with or
As a federal court sitting in diversity, this Court's
determination of which jurisdiction's laws govern the claims
asserted in the complaint is itself governed by New York's choice
of law rules. See Klaxon Co. v. Stentor Electric Mfg. Co.,
313 U.S. 487, 496 (1941). With regard to contract claims, New
York employs a "center of gravity" or "grouping of contacts"
analysis which aims to identify the state with "the most
significant relationship to the transaction and the parties;"
factors to be considered are the places of contracting,
negotiation, and performance; the location of the subject matter;
and the domicile or place of business of the contracting parties.
See Zurich Ins. Co. v. Shearson Lehman Hutton, Inc.,
84 N.Y.2d 309, 317 (1994), citing Restatement (Second) of Conflict
of Laws § 188(1) (1971). But where New York is the forum state
and there is no material conflict between the substantive law of
the relevant states, that is, there are no differences that would affect the outcome at trial,
"[a] court is free to bypass the choice of law analysis and apply
New York law." Simon v. Philip Morris Inc., 124 F. Supp. 2d 46,
70 (E.D.N.Y. 2000), citing Curley v. AMR Corp., 153 F.3d 5, 12
(2d Cir. 1998).
Here, although New York and Texas are both employment-at-will
jurisdictions, in which "employment for an indefinite or
unspecified term is at will and may be freely terminated by
either party at any time without cause or notice," Horn v. New
York Times, 100 N.Y.2d 85, 90 (2003), citing Martin v. New York
Life Ins. Co., 148 N.Y. 117, 121 (1895); see also East Line
& R.R.R. Co. v. Smith, 10 S.W. 99, 102 (Tex. 1888), the two
jurisdictions have recognized different exceptions to the
traditional rule. Compare Horn, 100 N.Y.2d at 96 (the only
two exceptions recognized by the New York Court of Appeals are
express, unilateral promise by employer on which employee relied,
Weiner v. McGraw-Hill, Inc., 57 N.Y.2d 458 (1982), and parties'
mutual undertaking to practice law in accordance with a
particular ethical standard, central to their common professional
enterprise, Weider v. Skala, 80 N.Y.2d 628 (1992)), with
Miksch v. Exxon Corp., 979 S.W.2d 700, 703 (Tex.App. 1998)
(valid agreement altering employment-at-will status must be (1)
expressed rather than implied, and (2) clear and specific). Since
the variation in these exceptions to employment-at-will could
lead to different outcomes, the Court must engage in
That analysis, however, is easy enough. Defendants urge the
application of Texas law (D. Mem. 17), and it is clear that Texas
is the state with "the most significant relationship to the
transaction and the parties." Although N-US's corporate
headquarters are located in Port Washington, New York, and many
of the named defendants are employed there, Decraene resided in
Texas, was interviewed and hired by N-US in Texas, and carried
out his job responsibilities for defendants, the subject matter of the
alleged contract, almost exclusively in Texas, apart from one
visit to defendants' corporate headquarters.
Under Texas law, where no definite term of employment is
specified, the employment is presumed to be at will. That is,
"either party . . . may put an end to it at will, and so without
cause." East Line & R.R.R. Co., 10 S.W. at 102. Decraene does
not allege that he was hired for a specific term, and,
accordingly, his employment was prima facie at will.
Employment-at-will status may be altered under Texas law,
however, where there is an express, clear and specific agreement
to do so that manifests the employer's "definite intent to be
bound not to terminate the employee except under clearly
specified circumstances." Montgomery Co. Hosp. Dist. v. Brown,
965 S.W.2d 501, 502 (Tex. 1998).
Contrary to defendants' assertion that Decraene failed to
allege any "written contract, employment manual, oral agreement
or other limitation on defendants' ability to terminate his
employment" (D.Mem. 19), Decraene has alleged that defendants
promised him "continuous employment and long-term profit sharing
and other bonuses and company benefits so long as he should
perform and meet his sales quotas and objectives." (Decraene Aff.
¶ 24.) This alleged promise of continued employment contingent on
meeting clearly-identified particular performance standards,
i.e., sales quotas and objectives, can fairly be understood to
evidence an expressed intention not to terminate Decraene except
under "clearly specified circumstances," i.e., failure to meet
those quotas and objectives. Compare Brown, 965 S.W.2d at 502
("[G]eneral comments that an employee will not be discharged as
long as his work is satisfactory do not in themselves manifest
such an intent."), with Miksch, 979 S.W.2d at 705
(supervisor's oral assurance that "the leasing and operation of
[a competing dealership by plaintiff's spouse, which would otherwise have violated the employer's conflict of
interests policy] would not be a problem at all" for plaintiff's
continued employment was sufficiently "specific and definite" to
create a material issue as to whether plaintiff's
employment-at-will status had been altered by oral agreement). As
in Miksch, defendants' alleged promise does not "contain
ambiguous terminology or require one to speculate as to the
parameters of the parties' purported agreement."
979 S.W.2d at 705. Defendants' alleged promise is sufficiently clear and
specific to permit the inference that defendants intended to
modify Decraene's employment-at-will status, and defendants have
not challenged this cause of action on any other basis. In any
event, even if Decraene was employed-at-will, his claim for
unpaid accrued pay and benefits states a claim for breach of
contract. Accordingly, defendants' motion to dismiss Decraene's
fourth cause of action for failure to state a claim is denied.
III. Fair Labor Standards Act
Defendants move to dismiss as untimely Decraene's sixth cause
of action, brought under the FLSA to recover compensation
Decraene claims is owed to him for "eight hundred and ten hours
worked in overtime between August 23, 2001 and January 4, 2002."
(Am. Compl. ¶ 31.)
FLSA claims are subject to the limitation period set forth in
29 U.S.C. § 255(1)(a), which provides that all causes of action
accruing under the FLSA on or after May 14, 1947, must be
commenced "within two years after the cause of action accrued,
except that a cause of action arising out of a willful violation
may be commenced within three years after the cause of action
accrued." A cause of action under the FLSA for "unpaid overtime
compensation" accrues "when an employer fails to pay required
compensation for any workweek at the regular payday for the
period in which the workweek ends." 29 C.F.R. § 790.21(b).
Accordingly, a separate cause of action accrued to Decraene on each regular pay day for a pay
period in which his overtime work went uncompensated. See
Shandelman v. Schuman, 92 F. Supp. 334, 335 (E.D. Pa. 1950).
Decraene filed his Complaint with the pro se office on
February 13, 2004. See Chira v. Columbia Univ.,
289 F. Supp. 2d 477, 484 (S.D.N.Y. 2003) (filing of complaint with pro se
office, not docketing of the complaint, is the relevant date for
determining whether claims are time-barred). Thus, to the extent
plaintiff alleges only non-willful violations of the FLSA, any
claims accruing prior to February 12, 2002, are time-barred.
Decraene's last day of employment was January 4, 2002, and
defendants therefore assert that Decraene's claims were
time-barred as of January 5, 2004, over a month before
plaintiff's Complaint was filed with the pro se office. (D.
Mem. 11.) This is not strictly accurate; since the cause of
action accrues when an employee is due to be paid, Decraene's
final pay day presumably occurred on some date after January 4,
2002. The Complaint, however, does not provide any information on
how often plaintiff was paid, or when his last regular pay day
occurred. Assuming Decraene was paid on a biweekly or monthly
basis, it is highly likely that his last regular pay day did
occur prior to February 12, 2002, and that his FLSA claims of
nonwillful violations are time-barred.
Regardless, defendants have entirely ignored the three-year
statute of limitations for willful violations of the FLSA. The
earliest date reached in the instant case for willful violations
is February 12, 2001, some six months before plaintiff began his
employment, and, thus, to the extent plaintiff has alleged
willful violations, his claims under the FLSA fall entirely
within the time period prescribed by the statute of limitations.
A violation of the FLSA is willful if the "employer either knew
or showed reckless disregard for the matter of whether its
conduct was prohibited by the [FLSA] statute." McLaughlin v.
Richland Shoe Co., 486 U.S. 128, 133 (1988) (adopting the standard of willfulness from Trans World Airlines
v. Thurston, 469 U.S. 111 (1985)). Decraene alleges that
defendants violated the FLSA "deliberately," in that [defendants]
knew that [Decraene] ought to have been paid at the rate of one
and one half times his forty hours weekly wage for all work
performed over forty hours during any one work week." (Am. Compl.
¶ 40.) He also alleges that he submitted monthly statements to
defendants detailing the amount of overtime he had worked, that
despite receiving these statements, defendants never compensated
him for that overtime, and that the Texas Workforce Commission
later found that he was entitled to overtime pay. (Am. Compl. ¶
31; Decraene Aff. ¶¶ 25-26.) The Amended Complaint thus clearly
states a timely claim for willful violations of the FLSA. See
Damassia v. Duane Reade, Inc., No. 04 Civ. 8819, 2005 WL
1214337, at *1-*3 (S.D.N.Y. May 20, 2005). Accordingly,
defendants' motion to dismiss plaintiff's sixth cause of action
All causes of action against defendants Nagley and Bakhtiari
are dismissed on consent. All causes of action against defendants
Vonken and Neuhaus, N.V. are dismissed for lack of personal
Plaintiff's first (libel), second (slander), third (intentional
infliction of emotional distress), and fifth (wrongful discharge)
causes of action are dismissed on consent as against all
remaining defendants. Plaintiff's seventh causes of action
(mismanagement of a publicly owned and traded company) is
dismissed without prejudice at plaintiff's request.
Defendants' motion to dismiss plaintiff's fourth (breach of
contract) and sixth (FLSA violations) causes of action is denied.
This matter remains referred to United States Magistrate Judge
Ellis for further pretrial proceedings. SO ORDERED.
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