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Guaman v. 5" M" Corp.

United States District Court, Second Circuit

October 22, 2013

JORGE GUAMAN, Plaintiff,


LORNA G. SCHOFIELD, District Judge.

Before the Court is Plaintiff's motion for conditional collective certification and for Court facilitation of notice pursuant to 29 U.S.C. § 216(b). For the reasons stated below, Plaintiff's motion is granted in part and denied in part.

I. Background

Plaintiff Jorge Guaman, on behalf of himself and others similarly situated, brings claims under the Fair Labor Standards Act, as amended, 29 U.S.C. §§ 201 et. seq. ("FLSA") and the New York Labor Law ("NYLL"). Plaintiff asserts claims for violations of these statutes against two individual defendants - Milan Licul and Dennis Turcinovic; and four corporate defendants - Five "M" Corp., Balarini Restaurant Corp., Ocinomled, Ltd., and 50/50 Restaurant Corp. (collectively, "Defendants"). Defendants are in the restaurant business: Five "M" Corp. operated Murano Ristorante until October 2012, and now operates Delmonico's Kitchen; Balarini Restaurant Corp. operates Arno Ristorante; Ocinomled, Ltd. operates Delmonico's Restaurant, and 50/50 Restaurant Corp. operates Scaletta Ristorante. Plaintiff seeks collective certification of and Court-authorized notice to "all non-exempt employees, including cooks, line-cooks, dishwashers, food preparers, porters, runners, bussers, waiters, barbacks and bartenders" employed at (1) Murano Ristorante/Delmonico Kitchen; (2) Arno Ristorante; (3) Delmonico's Restaurant and (4) Scaletta Ristorante within six years from the filing of the Complaint.

Plaintiff Jorge Guaman worked as a cook at Murano Ristorante, later Delmonico Kitchen, from August 21, 2006 until February 15, 2013. Delmonico Kitchen reopened in the same location as Murano Ristorante with the same employees a few weeks after Murano Ristorante closed in October 2012. Plaintiff states that during his employment at Murano Ristorante from August 21, 2006, until approximately October 1, 2012, he typically worked five days each week, eleven hours per day, and was paid $575.00 in cash weekly, regardless of hours worked. Along with weekly cash payments, he received a wage statement that falsely stated his hours and pay. Plaintiff names other Murano employees, who similarly received fraudulent wage statements and were not paid for overtime, consisting of five "kitchen staff, " three waiters, two busboys and one runner.

When Murano restaurant reopened as Delmonico's Kitchen, in late-October 2012, Plaintiff states that he began to be paid on an hourly basis, but that his wage statements were still fraudulent because he was required to "clock out" for an hour-long meal break, even though he continued to work during this time. Plaintiff identifies the same five kitchen staff, three waiters, two busboys and one runner, who he states also worked at Delmonico's Kitchen and were required to clock out for a hour-long meal even though they continued to work during the break.

Plaintiff declares that the four restaurants-Murano Ristorante/Delmonico Kitchen, Arno Ristorante, Delmonico's Restaurant and Scaletta Ristorante-share common ownership and management and that the individual Defendants control and operate the four restaurants as a common enterprise. Plaintiff states that he personally delivered food from Delmonico Kitchen to Arno Ristorante. He declares that he learned through conversations with an employee from Arno Ristorante and an employee from Scaletta Ristorante that all four restaurants followed the same wage and hour policies.

Defendants, in turn, maintain that they are separate corporate entities with separate strategic operations, identities, employees and management. Defendants submitted affidavits from the four general managers at the respective restaurants, attesting to the fact that each restaurant is separately managed and operated and that the general manager at each restaurant is responsible for the payment of their respective employees. In opposition to the motion, Defendants argue: (1) that Plaintiff has failed to demonstrate a common policy or practice in existence at the four restaurants; (2) that the employees in Plaintiff's proposed class are not similarly situated and (3) that the six-year proposed notice period exceeds the FLSA statute of limitations.

II. Legal Standard

In a collective action under FLSA, unlike a class action under the Federal Rules of Civil Procedure, only plaintiffs who affirmatively opt into the case can benefit from the judgment or be bound by it. Damassia v. Duane Reade, Inc., No. 04 Civ. 8819, 2006 WL 2853971, at *2 (S.D.N.Y. Oct 5, 2006) (Lynch, J.). Although orders facilitating notice are often referred to as orders "certifying" a collective action, the FLSA does not contain a certification provision. Id. "Certification" is simply "the district court's exercise of the discretionary power... to facilitate the sending of notice to potential class members." Myers v. Hertz Corp., 624 F.3d 537, 555 n. 10 (2d Cir. 2010). Section 216(b) of the FLSA provides that an action "may be maintained against any employer... in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated." 29 U.S.C. § 216(b). Although the term "similarly situated" is not defined by the FLSA or its implementing regulations, "district courts in this Circuit consistently follow a two-stage method-recently endorsed by the Second Circuit-in determining whether potential opt-in plaintiffs are indeed similarly situated.'" Khan v. Airport Mgmt. Servs., LLC, No. 10 Civ. 7735, 2011 WL 5597371, at *2 (S.D.N.Y. Nov. 16, 2011) (citing Myers, 624 F.3d at 554-55).

In the first stage of the inquiry, to establish that the named plaintiffs are "similarly situated" to the potential opt-in plaintiffs, they must "make a modest factual showing' that they and potential opt-in plaintiffs together were victims of a common policy or plan that violated the law.'" Myers, 624 F.3d at 555 (quoting Hoffmann v. Sbarro, Inc., 982 F.Supp. 249, 261 (S.D.N.Y. 1997)). "The modest factual showing cannot be satisfied simply by unsupported assertions, but it should remain a low standard of proof because the purpose of this first stage is merely to determine whether similarly situated plaintiffs do in fact exist...." Id. (citations and internal quotation marks omitted). At this procedural stage, "the court does not resolve factual disputes, decide substantive issues going to the ultimate merits, or make credibility determinations." Cunningham v. Elec. Data Sys. Corp., 754 F.Supp.2d 638, 644 (S.D.N.Y. 2010) (citation omitted). Typically this evidentiary burden may be satisfied by credible witness affidavits, including affidavits by plaintiffs. Shi Yong Li v. 6688 Corp., No. 12 Civ. 6401, 2013 WL 5420319, at *1 (S.D.N.Y. Sept. 27, 2013) (citation omitted). If the plaintiffs demonstrate that "similarly situated" employees exist, the Court should conditionally certify the class, order that appropriate notice be given to putative class members and the action should continue as a "collective action throughout the discovery process." Cunningham, 754 F.Supp.2d at 644 (citation omitted).

The second step, typically taken upon the completion of discovery, requires the court to determine, "on a fuller record, ... whether a so-called collective action' may go forward by determining whether the plaintiffs who have opted in are in fact similarly situated' to the Plaintiffs." Myers, 624 F.3d at 555. "The action may be de-certified' if the record reveals that they are not, and the opt-in plaintiffs' claims may be dismissed without prejudice." Id.

III. Application of Facts to Law

Plaintiff has made a modest factual showing that the employees at Murano Ristorante and Delmonico Kitchen were similarly situated and were subjected to a common policy that violated the law, but he has not satisfied his burden with respect to the employees ...

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