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Velu v. Velocity Express

September 30, 2009


The opinion of the court was delivered by: Seybert, District Judge


Pending before the Court is Defendant's motion and Plaintiff's cross-motion for summary judgment. For the reasons that follow, the Court GRANTS Defendant's motion in part and DENIES Plaintiff's motion in its entirety.


Velocity Express, Inc. ("Defendant" or "VEI") is an incorporated business in Delaware, with its principal place of business in Connecticut and conducts business in the State of New York, and provides delivery services for its clients. Since approximately 1998 or 1999, Plaintiff Trevor Velu ("Plaintiff" or "Velu") has performed work for VEI as a delivery driver. Clients contract with VEI to handle their shipping needs, and VEI provides drivers for these clients' deliveries. Plaintiff's duties involve picking up shipments from the offices of Canon USA in Lake Success, New York, and delivering those packages to the offices of Canon USA in Ridgefield Park, New Jersey and in Jamesburg, New Jersey; and also picking up packages from the offices of Canon USA in Ridgefield Park and Jamesburg, New Jersey and delivering those packages to Canon USA's offices in Lake Success, New York. (Def.'s 56.1 Stmt. ¶ 1.)

Under his contract, allegedly entitled "Independent Contractor Agreement for Transportation Services" ("Agreement")*fn2 and subject to the demands of the clients, Velu is free to make his own schedule, and may work for other delivery companies, but has thus far chosen not to. For example, each day, Velu sets his own schedule and decides which routes he will take to fulfill his deliveries; in the past, VEI has communicated to him that certain clients have time requirements for their deliveries, and thus, Velu routes his deliveries according to those schedules. For whatever reason, if Velu does not want to fulfill delivery requests, he has the discretion to decline them; in the past, he has exercised that discretion. Velu decides when, where, and how long to break for lunch, and he also decides the duration of his lunch break each day. (Id. ¶¶ 10.) Mr. Velu may make stops for personal reasons. Additionally, Plaintiff need not wear VEI uniforms, and does not wear a VEI hat, shirt, jacket, or clothing of any kind.*fn3 (Id. ¶¶ 3-5.) Velu's delivery van does not bear VEI signage, and Velu owns, insures, maintains, and services his delivery van without VEI's reimbursement or contribution. (Id. ¶¶ 6-7.) However, VEI requires all of its drivers, including Velu, to provide proof of commercial insurance and occupational accident insurance coverage. If the driver fails to provide proof of insurance, VEI deducts the cost of providing that insurance from any payments it makes to its drivers for deliveries completed.*fn4 (Pl.'s 56.1 Stmt. ¶¶ 16-19.)

Each day, Velu makes his deliveries without being required to report to VEI. Velu never visits VEI except to pick up his check. (Def.'s 56.1 Stmt. ¶ 8.) Velu has established a direct working relationship with Canon USA employees, and has provided his personal cellular telephone number to between four and nine Canon USA employees; they call Velu directly to arrange for him to pick up and deliver packages. (Id. ¶¶ 12-14.)

Under the Agreement, Velu earns more money if he carries extra boxes on his interstate delivery route. Notwithstanding the foregoing information, from the record so far, the Court has very little information regarding the nature of payments made by VEI to Velu because of his deliveries. On July 5, 2005, VEI issued a memorandum, addressed to its "Independent Contractors" regarding the V-Pay Initiative Update. On February 21, 2008, Defendant issued a separate document entitled "V-Pay 55 Instructions[.]" Both documents provide that Independent Contractors are to be paid 55% commission of actual revenue for all scheduled stops. Hence, Velu must report to VEI at some point after making his deliveries, either by phone or e-mail, though not on a daily basis, indicating the number of deliveries, so that VEI can calculate his payments. (Id. ¶ 15.) Velu does not contact VEI when he receives calls from Canon USA employees arranging for a delivery, but only informs VEI after he completes the delivery for payment purposes. (Id. ¶ 16.)

In approximately 2003, Canon USA issued an official identification card to Velu, and Velu has used and continues to use the card to pick up packages and make deliveries to Canon offices. (Id. ¶ 17.) To record each delivery he makes, Velu uses forms provided and required by Canon USA, not VEI. Velu never submits any forms to VEI, and stores copies of the forms in his home. (Id. ¶ 19.) Until several years ago, Velu recorded pick-ups and deliveries using VEI forms, and he returned carbon copies of the form to VEI. At some unspecified point, and for unspecified reasons, Velu made a decision to discontinue using the VEI receipts, and he did so without consulting with or seeking permission from VEI. (Id. ¶ 20.)

Because Velu is not provided with any supplies from VEI, he maintains a computer, printer, and desk at home with which he conducts business. Velu purchased these items without reimbursement, and uses the computer to compose work-related email and other documents. Although Velu pays the expense of highway and bridge tolls and gasoline used in making deliveries for Canon USA, VEI does not reimburse any of these expenses. Instead, Velu keeps records of his gasoline expenses and mileage, and he provides that information to his accountant who prepares his tax returns. (Id. ¶¶ 23-24.) Velu seeks to minimize expenses by considering shorter routes, and testing those routes. (Id. ¶ 26.)

On a typical day of work, Velu earns approximately $200 and incurs approximately $45 to $50 in expenses in New York and New Jersey. Velu's earnings are based on the stops he makes in his deliveries for Canon USA at their New York and New Jersey offices. (Id. ¶¶ 25, 27.)

On December 7, 2006, Plaintiff commenced this action alleging six causes of action all surrounding a dispute over the amount he received in payments from VEI. The Complaint alleges violation of the (1) Fair Labor Standards Act, 29 U.S.C. § 206(a), 29 U.S.C. § 207(a)(I); (2) New York Labor Law 592(1), 191(1)(a) and (3); (3) New York Labor §§ 650 et seq.; 12 NYCRR § 142-2.2, 2.4; (4) New York Labor Law 191 (i)(a) and 29 CFR 516.2 and New York Labor Law 195(4) and 12 NYCRR § 137-2.1; and (5) breach of contract. Specifically, Claims One and Two assert that Defendant willfully failed to pay Plaintiff, an employee, overtime and minimum wages under the FSLA and New York Labor Law, respectively. In Plaintiffs Third Claim, he alleges that, as an employee, he was entitled to and did not receive timely payment of wages pursuant to New York Labor Law. Claim Four alleges that Defendant deliberately, knowingly and intentionally, violated New York Labor Law by failing to maintain adequate and written employment records for hours worked and wages earned by Plaintiff in order to facilitate the exploitation of his labor. In Plaintiff's Fifth Claim he argues that, as an independent contractor, he is entitled to and did not receive all amounts owed to him pursuant to his Independent Contractor Agreements for Transportation Services.*fn5

Although Defendant concedes that Velu is owed some money, Velu disputes the underpayments based upon his allegation that he is also owed a percentage of a fuel surcharge billed by Defendant to Canon USA and Dime Savings Bank ("Fuel Surcharge"), for whom Plaintiff has made interstate deliveries. Finally, in Plaintiff's Sixth Claim, Velu asserts that through quantum meruit, he is entitled to a percentage of the Fuel Surcharge.

On November 4, 2008, both Defendant and Plaintiff filed motions for summary judgment. For the reasons that follow, the Court GRANTS in part and DENIES in part Defendant's motion for summary judgment, and DENIES Plaintiff's motion for summary judgment in its entirety.


I. Rule 56 Standard for Granting Summary Judgment

"Summary judgment is appropriate where there are no genuine disputes concerning any material facts, and where the moving party is entitled to judgment as a matter of law." Harvis Trien & Beck, P.C. v. Fed. Home Loan Mortgage Corp. (In re Blackwood Assocs., L.P.), 153 F.3d 61, 67 (2d Cir. 1998) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed. 2d 265 (1986); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed. 2d 202 (1986).

"The burden of showing the absence of any genuine dispute as to a material fact rests on the party seeking summary judgment." McLee v. Chrysler Corp., 109 F.3d 130, 134 (2d Cir. 1997); see also Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 26 L.Ed. 2d 142 (1970). "In assessing the record to determine whether there is a genuine issue to be tried as to any material fact, the court is required to resolve all ambiguities and draw all permissible factual inferences in favor of the party against whom summary judgment is sought." McLee, 109 F.3d at 134. But while the moving party bears the initial burden, "once such a showing is made, the non-movant must 'set forth specific facts showing that there is a genuine issue for trial.'" Weinstock v. Columbia Univ., 224 F.3d 33, 41 (2d Cir. 2000). "Mere ...

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