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Chao v. Party Rental Enterprises

August 15, 2008

ELAINE L. CHAO, SECRETARY OF LABOR, UNITED STATES DEPARTMENT OF LABOR, PLAINTIFF,
v.
PARTY RENTAL ENTERPRISES, INC., A CORPORATION, D/B/A ABLE LINEN SERVICE AND DARYLE LOGUIDICE, INDIVIDUALLY AND AS CHIEF EXECUTIVE OFFICER, DEFENDANTS.



The opinion of the court was delivered by: Norman A. Mordue, Chief U.S. District Judge

MEMORANDUM-DECISION AND ORDER

I. INTRODUCTION

Plaintiff, the United States Department of Labor ("DOL"), commenced the above-referenced action on behalf of in an individual named Lisa Gilfus who alleges that she was discharged from the employ of defendants after causing or requesting the federal Occupational Safety and Health Administration ("OSHA") to conduct an on-site inspection of defendants' facility in Auburn , New York, on February 11, 2005. DOL alleges that defendants' termination of Gilfus occurred in violation of section 11(c) of the Occupational Safety and Health Act of 1970, as amended, ("the Act"), 29 U.S.C. § 651 et seq.. Said section prohibits discrimination and/or retaliation against employees who engage in protected activity under the Act, including "filing a complaint or insitut[ing] or caus[ing] to be instituted any proceeding under or related to this chapter." Defendants failed to answer the complaint or to oppose plaintiff's request for entry of default by the Clerk of the Court on July 20, 2007. Presently before the Court is plaintiff's motion for entry of default judgment against defendants and defendants' cross-motion to set aside their default and permit the filing of a late answer to plaintiff's claims.

II. FACTUAL BACKGROUND

On or about May 9, 2005, Joseph Crahan, a Regional Investigator employed by DOL and OSHA began an investigation of defendants Daryle Loguidice and Able Linen under section 11(c) of the Act as a result of a complaint by Lisa Gilfus. During the course of Crahan's investigation, he contacted Mr. Loguidice to obtain information. Mr. Crahan formally notified Loguidice of his investigation when he visited Loguidice's office in Cicero, New York. Sometime in May 2005, the manager of Able Linen, Ed O'Donnell, provided Crahan with "five pieces of paper" in connection with his request for information about the Gilfus complaint. On June 2, 2005, Daryle Loguidice told Mr. Crahan that it would take him "four to six weeks" to gather the information requested. Between June 2005 and January 2006, Crahan asked for additional documents in two certified letters and at least ten telephone calls to either Mr. Loguidice or Mr. O'Donnell. One of the letters which Crahan sent to defendants on June 21, 2005, by certified mail was returned as unclaimed. In a second letter, dated June 30, 2005, Mr. Crahan advised defendant Loguidice as follows:

This correspondence is being re-sent to you . . . pursuant to the above captioned OSHA Section 11(c) discrimination complaint filing, which I formally notified you of during my May 9, 2005, visit to your Cicero, NY office.

On June 2, 2005, during our telephone discussion regarding my request for information . . . you informed me that you would provide to me within . . . a very short period of time, a detailed written account of the facts and statement of your position with respect to the allegations that Complainant Lisa Gilfus has raised in her signed statement. . . .

As I have yet to receive the aforementioned information from you, I am requesting that you submit to me at the above address . . . [a] detailed written account of the facts and statement of your position with respect to each allegation that Lisa Gilfus has raised in her signed statement (which a copy has been provided to you), in which she subsequently alleges she was discharged from your employ on February 22, 2005, in reprisal for allegedly causing an onsite OSHA inspection at your Auburn facility, commencing on February 11, 2005.

I am requesting that the above information be submitted to me at the above address by the close of business, July 11, 2005, so that all information may be considered prior to my arriving at a decision in this matter. In the event that the information is not received by said date, a decision will be rendered in this matter without the benefit of my considering same. . . .

Crahan did not receive a response to "most of his phone calls" or the June 30, 2005, letter.

On August 7, 2005, Mr. Crahan served administrative subpoenas on Daryle Loguidice, Able Linen, Ed O"Donnell and an Able Linen employee, Denise Dixon. The subpoenas required these persons to appear with relevant papers and documents before Investigator Crahan at DOL, OSHA's office in North Syracuse, New York on August 17, 2006. No one appeared in response to the subpoenas or contacted Crahan to discuss them.

On March 22, 2007, plaintiff's counsel sent a letter to Nicholas J. DeMartino, Esq., an attorney at the law firm of Costello Cooney & Fearon, who had represented defendant Daryle Loguidice in another matter before the DOL. The letter stated as follows:

This is in reference to an investigation conducted by [OSHA] of the above-referenced employer as to the termination of Lisa Gilfus. The matter has been referred to this office for consideration of litigation. please advise this office as to whether you represent Party Rental Enterprises, Inc. and Daryl Loguidice. If so, I would like to discuss this matter with you.

Plaintiff's counsel received no response to the March 22, 2007, letter. On April 13, 2007, plaintiff's counsel sent a letter to defendant Loguidice which contained essentially the same information as the March 22, 2007, letter to Mr. DeMartino. In the April 13, 2007, letter, plaintiff's counsel advised Mr. Loguidice that he "would like to discuss this matter with you or your representative." Plaintiff's counsel received no response to the April 13, 2007, letter. On April 26, 2007, plaintiff DOL filed its complaint in this matter.

On April 27, 2007, plaintiff sent to each defendant a copy of the complaint and "Notice of Lawsuit and Request for Waiver of Service of Summons." Also on April 27, 2007, plaintiff's counsel sent to each defendant a letter enclosing a Notice which included the General Order #25 filing packet for the instant action. The packet included a filing order, a case management plan, case assignment and motion schedules along with a consent form allowing the assigned magistrate judge to conduct all proceedings in the litigation. The April 27, 2007, letters to defendants also advised them that an initial pre-trial conference was scheduled for October 24, 2007. Neither plaintiff nor its counsel received a response to these letters or notices from either defendant.

On May 31, 2007, Investigator Crahan served defendants personally with copies of the summons and complaint. Neither defendant responded to service of the summons and complaint nor filed an answer. On July 20, 2007, the Clerk of the Court entered default by defendants at plaintiff's request. Notice of plaintiff's request for entry of default was sent to both defendants on July 20, 2007. Neither defendant responded or objected to the Clerk's entry of default.

On July 23, 2007, plaintiff filed a Notice of Motion and Motion for Default Judgment and served said notice and motion papers on defendants. The Court scheduled the motion to be submitted as of September 5, 2007. On October 2, 2007, plaintiff's counsel re-sent the Notice forwarded to defendants on April 27, 2007, which included the Court's General Order #25 filing packet and again advised defendants that the Court's initial pre-trial conference was scheduled for October 24, 2007. In the letter, plaintiff's counsel asked defendants to "[p]lease advise [him] as soon as possible as to whether [each defendant] had retained counsel in this matter." Plaintiff's counsel received no response to these letters or notices from either defendant. On October 15, 2007, plaintiff's counsel wrote to defendants to advise them that the initial pre-trial conference with the Court had been cancelled. In the October 15, 2007, ...


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