United States District Court, E.D. New York
MAGDALENO ROCHA, individually and on behalf of others similarly situated, Plaintiff,
BAKHTER AFGHAN HALAL KABABS, INC., d/b/a BAKHTER AFGAN HALAL KABABS, WAZIR KHITAB, ABASEEN FOOD CORP., d/b/a BAKHTER AFGHAN HALAL KABABS, INC., NAWAZ KHAN-NABI and HABIB KHAN, Defendants
For Magdaleno Rocha, individually and on behalf of others similarly situated, Plaintiff: Michael A. Faillace, LEAD ATTORNEY, Joshua S. Androphy, Michael Faillace & Associates, P.C., New York, NY; Lina Marcela Franco, Michael Faillace & Associates, New York, NY.
For Mateo Calel, Plaintiff: Lina Marcela Franco, Michael Faillace & Associates, New York, NY; Michael A. Faillace, Michael Faillace & Associates, P.C., New York, NY.
For MIGUEL PORTILLO, Plaintiff: Michael A. Faillace, Michael Faillace & Associates, P.C., New York, NY; Peter Hans Cooper, Cilenti & Cooper, PLLC, New York, NY.
For Bakhter Afghan Halal Kababs, Inc., doing business as Bakhter Afgan Halal Kababs, Defendant: Michael A. Faillace, Michael Faillace & Associates, P.C., New York, NY; Robert Aronov, Robert Aronov & Associates, P.C., Richmond Hill, NY.
For Wazir Khitab, Abaseen Food Corp, doing business as Bakhter Afghan Halal Kababs, Inc., Nawaz Khan-Nabi, Habib Khan, Defendants: Robert Aronov, Robert Aronov & Associates, P.C., Richmond Hill, NY.
MEMORANDUM & ORDER
MARGO K. BRODIE, United States District Judge.
Plaintiff Magdaleno Rocha commenced this action individually and on behalf of others similarly situated on January 11, 2013, against Defendants Bakhter Afghan Halal Kababs, Inc., doing business as Bakhter Afghan Halal Kababs, and Wazir Khitab, alleging minimum wage and overtime violations of the Fair Labor Standards Act, 29 U.S.C. § § 201 et seq., and minimum wage, overtime and spread-of-hours violations of New York Labor Law § 652 and regulations, 12 N.Y. Comp. Codes R. & Regs. § 142-2.2, and seeking certification of the action as a collective action pursuant to the Fair Labor Standards Act, 29 U.S.C. § 216(b). On July 11, 2013, and September 17, 2013, Mateo Calel and Miguel Portillo consented to join this action, respectively, as opt-in plaintiffs pursuant to 29 U.S.C. § 216(b). (Docket Entry Nos. 12, 15.) Plaintiffs filed an Amended Complaint on February 4, 2013, (Docket Entry No. 4), adding Defendants Abaseen Food Corp., doing business as Bakhter Afghan Halal Kababs, Nawaz Khan-Nabi and Habib Khan. (Docket Entry No. 4.) Plaintiffs filed a Second Amended Complaint on April 17, 2014, (Docket Entry No. 10), adding an allegation of retaliatory termination against Defendant Khan. The Court allowed limited discovery. Defendants now move to dismiss
the Amended Complaint for lack of subject matter jurisdiction and for failure to state a claim, and, in the alternative, for summary judgment. For the reasons set forth below, the Court denies Defendants' motions.
Defendants are owners and operators of the Bakhter Afghan Halal Kababs Restaurant (the " Restaurant" ), located in Flushing, Queens. (Am. Compl. ¶ 21.) Rocha began working for Defendants at the Restaurant in June 2006, working on the grill and preparing plates with cooked food to serve Restaurant customers. ( Id. at 9 ¶ ¶ 36-37.) Rocha typically worked 66 hours each week. ( Id. at 9-10 ¶ ¶ 42-45.) He was paid his wages in cash, and was initially paid $400 each week. This amount increased every 6 to 18 months, and beginning in September 2011, Rocha was paid $650 each week. ( Id. ¶ ¶ 48-54.) Rocha's weekly pay did not vary even when Rocha worked longer than his typical hours. ( Id. ¶ 56.) Rocha was not provided with any break periods, and was never required to keep track of his time. ( Id. ¶ 57.) Defendants did not utilize any devices to keep track of the hours worked by employees, did not provide Rocha with any documentation of his hours worked, and did not post any notices or provide any other notification of statutory overtime and wage requirements. ( Id. ¶ ¶ 57-59.) Rocha seeks to represent a class of similarly situated individuals, who were also subject to the requirements to work in excess of 40 hours each week without being paid minimum wages, overtime compensation or spread-of-hours pay. ( Id. at 9 ¶ 44, ¶ ¶ 60-68.)
Calel worked for Defendants from July 2011 until August 2013 as a general helper and kitchen preparation worker. (Declaration of Mateo Calel in Opposition to Defendants' Motion for Summary Judgment (" Calel Decl." ) ¶ 3.) Calel worked 6 days each week, generally 11 1/2 hours on weekdays, and 12 hours on Fridays and Saturdays, for a total of approximately 70 hours each week. ( Id. ¶ 4.) Calel was paid a cash salary that began at $400 each week at the beginning of his employment, and increased to $575 each week. ( Id. ¶ ¶ 5, 14.) Calel did not receive a statement of hours worked or wages paid, and he was not paid overtime for any work. ( Id. ¶ ¶ 6-7.)
Portillo worked for Defendants from April 2011 until June 23, 2013, as a dishwasher, general helper and kitchen preparation worker. (Affidavit of Miguel Portillo in Opposition to Defendants' Motion for Summary Judgment (" Portillo Aff." ) ¶ 3.) Portillo worked 6 days each week, generally
11 1/2 hours on the weekdays and 12 hours on Fridays and Saturdays, for a total of approximately 70 hours each week. ( Id. ¶ 4.) Portillo was paid a weekly salary in cash, which began at $400 each week and increased to $600 each week. ( Id. ¶ 5.) Portillo did not receive a statement of hours worked or wages paid, and he was not paid overtime for any work. ( Id. ¶ ¶ 6-7.)
a. Standards of Review
i. Rule 12(b)(1)
" [A] district court may properly dismiss a case for lack of subject matter jurisdiction under Rule 12(b)(1) if it lacks the statutory or constitutional power to adjudicate it." Shabaj v. Holder, 704 F.3d 234, 237 (2d Cir. 2013) (alteration in original) (quoting Aurecchione v. Schoolman Transp. Sys., Inc., 426 F.3d 635, 638 (2d Cir. 2005)). " '[T]he court must take all facts alleged in the complaint as true and draw all reasonable inferences in favor of plaintiff,' but 'jurisdiction must be shown affirmatively, and that showing is not made by drawing from the pleadings inferences favorable to the party asserting it.'" Morrison v. Nat'l Austl. Bank Ltd., 547 F.3d 167, 170 (2d Cir. 2008) (alteration in original) (citations omitted), aff'd, 561 U.S. 247, 130 S.Ct. 2869, 177 L.Ed.2d 535 (2010). A court may consider matters outside of the pleadings when determining whether subject matter jurisdiction exists. M.E.S., Inc. v. Snell, 712 F.3d 666, 671 (2d Cir. 2013); Romano v. Kazacos, 609 F.3d 512, 520 (2d Cir. 2010); Morrison, 547 F.3d at 170.
ii. Rule 12(b)(6)
In reviewing a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure, the court " must take all of the factual allegations in the complaint as true." Pension Ben. Guar. Corp. ex rel. St. Vincent Catholic Med. Ctrs. Ret. Plan v. Morgan Stanley Inv. Mgmt. Inc., 712 F.3d 705, 717 (2d Cir. 2013) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)); see also Lundy v. Catholic Health Sys. of Long Island Inc., 711 F.3d 106, 113 (2d Cir. 2013) (quoting Holmes v. Grubman, 568 F.3d 329, 335 (2d Cir. 2009)); Matson v. Bd. of Educ., 631 F.3d 57, 63 (2d Cir. 2011) (quoting Connecticut v. Am. Elec. Power Co., 582 F.3d 309, 320 (2d Cir. 2009)). A complaint must plead " enough facts to state a claim to relief that is plausible on its face." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A claim is plausible " when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Matson, 631 F.3d at 63 (quoting Iqbal, 556 U.S. at 678); see also Pension Ben. Guar. Corp., 712 F.3d at 717-18. " [W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged -- but it has not 'show[n]' -- 'that the pleader is entitled to relief.'" Pension Ben. Guar. Corp., 712 F.3d at 718 (alteration in original) (quoting Iqbal, 556 U.S. at 679). Although all allegations contained in the complaint are assumed true, this principle is " inapplicable to legal conclusions." Iqbal, 556 U.S. at 678.
iii. Rule 56(b)
Summary judgment is proper only when, construing the evidence in the light most favorable to the non-movant, " there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a); see also Bronzini v. Classic Sec., L.L.C., 558 F.App'x 89, 89 (2d Cir. 2014); Kwan v.
Andalex Grp. LLC, 737 F.3d 834, 843 (2d Cir. 2013); Kwong v. Bloomberg, 723 F.3d 160, 164-65 (2d Cir. 2013); Redd v. N.Y. Div. of Parole, 678 F.3d 166, 174 (2d Cir. 2012). The role of the court is not " to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Cioffi v. Averill Park Cent. Sch. Dist. Bd. of Educ., 444 F.3d 158, 162 (2d Cir. 2006) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). A genuine issue of fact exists when there is sufficient " evidence on which the jury could reasonably find for the plaintiff." Anderson, 477 U.S. at 252. The " mere existence of a scintilla of evidence" is not sufficient to defeat summary judgment; " there must be evidence on which the jury could reasonably find for the plaintiff." Id. The court's function is to decide " whether, after resolving all ambiguities and drawing all inferences in favor of the non-moving party, a rational juror could find in favor of that party." Pinto v. Allstate Ins. Co., 221 F.3d 394, 398 (2d Cir. 2000).
b. Defendants' motion to dismiss the FLSA claims
The Fair Labor Standards Act (FLSA) provides federal minimum wage and overtime protections for employees that fall within its scope. See 29 U.S.C. § 206 (minimum wage) and § 207 (overtime). The FLSA was enacted to " correct and . . . eliminate" " conditions detrimental to the maintenance of the minimum standard of living necessary for health, efficiency, and general well-being of workers." 29 U.S.C. § 202(a)-(b); Jacobs v. New York Foundling Hosp., 577 F.3d 93, 97 (2d Cir. 2009). " In turn, courts construe the FLSA 'liberally to apply to the furthest reaches consistent with congressional direction.'" Jacobs, 577 F.3d at 97 (quoting Tony & Susan Alamo Found. v. Sec'y of Labor, 471 U.S. 290, 296, 105 S.Ct. 1953, 85 L.Ed.2d 278 (1985)).
The minimum wage and overtime provisions of the FLSA apply to employees who are either (1) " engaged in commerce or in the production of goods for commerce," (individual coverage) or (2) " employed in an enterprise engaged in commerce or in the production of goods for commerce" (enterprise coverage). 29 U.S.C. § 206(a) and § 207(a)(1); Dejesus v. HF Mgmt. Servs., LLC, 726 F.3d 85, 86 (2d Cir. 2013) cert. denied, 572 U.S. ___, 134 S.Ct. 918, 187 L.Ed.2d 781 (2014); Jacobs, 577 F.3d at 96 (" The FLSA requires that employers pay a premium or overtime wage . . . if an employee either: 1) 'is engaged in commerce or in the production of goods for commerce,' or 2) 'is employed in an enterprise engaged in commerce or in the production of goods for commerce.' The two categories are commonly referred to as 'individual' and 'enterprise' coverage." (quoting 29 U.S.C. § 207 (a)(1))).
Defendants argue that if Plaintiffs cannot show that they fall within the ambit of the FLSA under the enterprise coverage theory -- by showing that the Restaurant is an " enterprise engaged in commerce" -- the case should be dismissed for lack of subject matter jurisdiction. (Def. Mem. 4;
Def. Reply 1-2.) Plaintiffs argue that whether the Restaurant is an enterprise engaged in commerce is not a jurisdictional issue, but rather is an element of Plaintiffs' claim that must be decided on the merits and not on a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction. (Portillo Opp'n Mem. 2-3; Rocha Opp'n Mem. 6-7.)
The Second Circuit has held that " [f]or the purpose of determining whether a district court has federal question jurisdiction pursuant to Article III and 28 U.S.C. § 1331 [federal question jurisdiction], the jurisdictional inquiry 'depends entirely upon the allegations in the complaint' and asks whether the claim as stated in the complaint 'arises under the Constitution or laws of the United States.'" Burke v. Lash Work Environments, Inc., 408 F.App'x 438, 440 (2d Cir. 2011) (quoting S. New Eng. Tel. Co. v. Global NAPs Inc., 624 F.3d 123, 132 (2d Cir. 2010)); see also Bay Shore Union Free Sch. Dist. v. Kain, 485 F.3d 730, 734 (2d Cir. 2007) (" A case arises under federal law within the meaning of § 1331 . . . if a well-pleaded complaint establishes either that federal law creates the cause of action or that the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law." (quoting Empire Healthchoice Assur., Inc. v. McVeigh, 547 U.S. 677, 690, 126 S.Ct. 2121, 165 L.Ed.2d 131 (2006))). Once this is established, the federal court has jurisdiction " unless the purported federal claim is clearly 'immaterial and made solely for the purpose of obtaining jurisdiction' or is 'wholly insubstantial and frivolous.'" S. New. Engl. Tel. Co., 624 F.3d at 132 (quoting Carlson v. Principal Fin. Grp., 320 F.3d 301, 306 (2d Cir. 2003)).
Defendants argue that the Court lacks subject matter jurisdiction because Plaintiffs have failed to establish that they are entitled to FLSA coverage under the enterprise theory. However, whether Plaintiffs can establish coverage is an element of Plaintiffs' claim and is not ...