United States District Court, N.D. New York
DECISION AND ORDER
LAWRENCE E. KAHN, U.S. DISTRICT JUDGE
Anthony Griffin, Mark McIndoo, and Susan DeTomaso commenced
this class and collective action against defendant Aldi, Inc.
and Doe Defendants 1-10 pursuant to the Fair Labor Standards
Act (“FLSA”), 29 U.S.C. § 201 et
seq., and New York state law, Dkt. No. 1
(“Complaint”) ¶ 1. Presently before the
Court is Plaintiffs' motion for restrictions, penalties,
and other relief related to Aldi's communications with
potential collective members. Dkt. No. 54
(“Motion”); see also Dkt. No. 56
(“Supplemental Memorandum”). Aldi filed a
response, Dkt. No. 58 (“Response”), and on April
26, 2017, the Court held a hearing on Plaintiffs' Motion,
Dkt. No. 61. For the following reasons, Plaintiffs'
Motion is granted in part and denied in part.
facts alleged in the Complaint are summarized in this
Court's previous decision dismissing Plaintiffs'
unjust enrichment claim. Griffin v. Aldi, Inc., No.
16-CV-354, 2016 WL 7235787, at *1-2 (N.D.N.Y. Dec. 14, 2016).
According to Plaintiffs, Aldi has continually misclassified
its store managers as “exempt” employees who are
not entitled to overtime pay under the FLSA and New York
state law. Compl. ¶ 1. The misclassification stems from
the alleged lack of managerial tasks performed by store
managers. Id. ¶¶ 47-48. Since store
managers do not exercise managerial discretion, Plaintiffs
suggest that they are properly categorized as non-exempt
employees entitled to overtime pay under the FLSA and New
York state law. Id. ¶ 1.
filed their Complaint on March 29, 2016. Compl. They
described the case as a “[c]lass and [c]ollective
action, ” id. ¶ 1, and they included
allegations relevant to the requirements for maintaining such
actions, id. ¶¶ 167-85. On December 14,
2016, the Court dismissed Plaintiffs' unjust enrichment
claim, Griffin, 2016 WL 7235787, at *5, and on
February 22, 2017, U.S. Magistrate Judge Andrew T. Baxter
granted Plaintiffs' motion for conditional certification,
Dkt. No. 45 (“February Order”) at
On March 14, 2017, Judge Baxter approved the proposed notice
of suit, which was to be sent to potential collective members
in order to inform them of their right to participate in this
action. Dkt. No. 48-1 (“Proposed Notice”); Dkt.
No. 49. Judge Baxter also approved the parties'
stipulation that “Defendant's Counsel will not
affirmatively contact or communicate with any potential
members of the collective, unless the contact or
communication occurs within the normal course of
Defendant's business.” Dkt. No. 48
(“Stipulations”) at 1; Dkt. No. 49. On April 20,
2017, Plaintiffs filed an emergency motion due to their
discovery that, without mentioning this litigation, Aldi was
asking departing store managers to sign releases that waived
their right to participate in any class or collective action
against the company. Dkt. No. 54-1 (“Memorandum”)
to Plaintiffs, since this case began in March 2016, Aldi
“has been improperly disseminating [r]eleases to
terminated putative class members . . . without providing any
notice of their potential rights in this litigation.”
Dkt. No. 54-2 (“Melamed Affidavit”) ¶ 4. The
releases are contained in separation agreements, one example
of which is attached as an exhibit to the Melamed Affidavit.
Melamed Aff. Ex. A. This particular separation agreement was
offered to Ryan Jon Truman, a former Aldi store manager who
was fired on March 24, 2017. Id. Ex. B, ¶¶
5-6. Truman's separation agreement provided that he would
receive a “Separation Benefit” of $2, 696 in
exchange for agreeing to give up his “right to bring,
or be a member of any class, representative or collective
action against ALDI.” Id. Ex. A, at 1. The
agreement also stated that it was “strictly
confidential, ” that any claims for
“pay/compensation/benefits” were forfeited, and
that Truman “ha[d] been properly paid for all hours
worked, including overtime.” Id. at 1-2.
agreement did not mention this lawsuit, and Truman says he
was never told about the case. Id. Ex. B, ¶ 7.
Truman also claims that although he was given twenty days to
sign the agreement, he received four phone calls on April 6,
2017-six days before the signing deadline-from an Aldi
“District Operator” who “request[ed] that
[he] sign the Agreement.” Id. ¶¶ 6,
10, 12. Truman told the district operator that he
“still had 6 days to review the Agreement, ” to
which the district operator “responded that if [he] did
not sign the Agreement now, . . . Aldi would proceed with
contesting [his] unemployment claim.” Id.
¶¶ 12-13. Truman never signed the agreement;
indeed, on April 1, 2017-five days before the calls from the
district operator-he had joined this lawsuit. Dkt. No. 51
(“Truman Consent-to-Sue Form”).
say their “counsel has received numerous telephone
calls from putative collective and class members in response
to the recently disseminated [separation agreements].”
Dkt. No. 56-1 (“Second Melamed Affidavit”) ¶
13. These former store managers have signed the agreements,
and many are confused about their right to participate in
this action. Id. ¶¶ 14-15. They are
particularly concerned about violating the agreement's
confidentiality clause, and they worry that if they get in
touch with Plaintiffs' counsel, they will have to return
the severance they received from Aldi. Id.
¶¶ 15-16. At least some of these former store
managers contacted Plaintiffs' counsel anonymously, and
some have said they were not advised to speak with an
attorney before signing. Id. ¶¶ 17-18. It
is unclear whether these former store managers signed the
separation agreements before or after conditional
certification and the distribution of the notice of suit.
Plaintiffs speculate that “hundreds, if not thousands,
of putative class members may have been subject to . . .
improper Separation Agreements.” Suppl. Mem. at 3.
seek the following relief for Aldi's allegedly improper
(i) all contact between putative class members and Defendant,
Defendant's legal counsel, or any agent [shall] cease and
desist immediately with respect to any element of this
action; (ii) Defendant [shall] be precluded from using the
improperly obtained Releases; (iii) Defendant [shall] furnish
Plaintiffs' counsel with a list containing the names and
addresses of every putative class member who received a
Release and/or has been contacted concerning this action;
[and] (iv) Plaintiffs' counsel [shall] be permitted to
distribute a Court-approved Corrective Notice to all putative
class members who received the misleading communication.
Id. at 14. Aldi has agreed that the seventeen store
managers “who signed a separation agreement that did
not expressly carve out this pending litigation
after Magistrate Judge Baxter conditionally
certified a collective in this lawsuit . . . [will] be
notified that they may join this lawsuit as an opt-in party
plaintiff if they so desire.” Resp. at 1. Aldi has also
agreed that if it “offers separation agreements to
additional Store Managers while the opt-in period is still
open . . . it will carve out th[is] . . . litigation from the
release provisions and the waiver of the right to participate
in a class or collective action.” Id. at 11.
Otherwise, Aldi opposes the relief sought by Plaintiffs.
Id. at 2.
of its response to Plaintiffs' Motion, Aldi submitted the
declaration of Bruce Persohn, the “Division Vice
President of the South Windsor Division [of Aldi, ] which
encompasses stores in southeast New York, Connecticut,
Massachusetts, Vermont, Rhode Island, and New
Hampshire.” Dkt. No. 58-1 (“Persohn
Declaration”) ¶ 2. He asserts that since 2011 or
earlier, Aldi has regularly “offer[ed] severance to
employees who are not fired for serious misconduct or
otherwise determined to be ineligible for a separation
agreement to assist them monetarily as they transition to a
new job or begin a job search.” Id. ¶ 4.
According to Persohn, these separation agreements have
“been largely the same” since December 2013,
id., and Aldi has not changed the language in these
agreements since this lawsuit began, id. ¶ 5.
Aldi does not present the separation agreements as
“‘take it or leave it' offers, ” and
the “separation offer [is designed] to be
non-coercive.” Id. ¶ 8. The agreements
are often negotiated “without the involvement of legal
counsel.” Id. ¶ 7.
9, 2017, Plaintiffs submitted a letter stating that Aldi has
continued to offer departing store managers separation
agreements and has “threatened [these managers] with a
challenge to their otherwise legitimate unemployment claims
unless they sign.” Dkt. No. 66 (“Plaintiffs'
Letter Brief”) at 1. Plaintiffs point to George Cruz, a
former Aldi store manager who was fired on May 8, 2017.
Id. According to Plaintiffs, the day Cruz was fired,
he was offered a separation agreement by Tom Fangras, his
director of operations, who told him that if he did not sign,
Aldi would contest his unemployment claim. Id. Cruz
“stood his ground” and refused to sign, at which
point Fangras told Cruz that if he did not “join any
lawsuits” and Aldi did not “hear from [him] for
four weeks, ” Fangras would get back to him and
“try to get [him] the severance package again.”
Id. at 1-2. Cruz submitted an affidavit that
reiterates these charges. Dkt. No. 67 (“Cruz
10, 2017, Aldi responded to Plaintiffs' submission. Dkt.
No. 68 (“Aldi Letter Brief”). Aldi offers a
completely different account of Cruz's termination.
According to Aldi, since the April 26, 2017 hearing before
this Court, it “has instructed operations in the field
not to offer separation agreements to Store Managers upon
termination of employment pending this Court's ruling [on
Plaintiffs' Motion].” Id. at 1. Aldi also
says that Cruz was never even offered a separation agreement,
“much less pressure[d] . . . into signing one, ”
and that Fangras told Cruz that Aldi had “no control
over whether unemployment benefits w[ould] be awarded to him
because that is a decision that is made by the state.”
Id. Apparently, “District Manager Chris
Collins” was also present during this conversation,
though he is not mentioned in Plaintiffs' Letter Brief.
Id. Collins and Fangras submitted declarations