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Kirkland v. Speedway LLC

United States District Court, N.D. New York

May 18, 2017

KELLY KIRKLAND, individually and on behalf of all others similarly situated, Plaintiff,
SPEEDWAY LLC, Defendant.

          E. STEWART JONES HACKER MURPHY, LLP Attorneys for Plaintiff.

          LITTLER MENDELSON PC Attorneys for Defendant.





         There are two motions pending before the Court. First, Defendant moves to have the Court enter judgment in favor of Plaintiff with regard to her Uniform Maintenance Pay, 12 N.Y.C.R.R. § 146-1.7(a), claim in conformance with Defendant's March 2, 2016 Rule 68 Offer of Judgment and subsequently to dismiss that claim as moot pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. See Dkt. No. 18. Defendant also moves for summary judgment pursuant Rule 56 of the Federal Rules of Civil Procedure with regard to Plaintiff's New York Human Rights Law ("NYHRL") and Uniform Maintenance Pay claims. See Dkt. No. 38.


         On or about November 13, 2014, Defendant Speedway LLC hired Plaintiff Kelly Kirkland to work the overnight shift at its Hess-branded gas station in Ithaca, New York. See Dkt. No. 38-1 at ¶¶ 15-16. Her job consisted of running the register, maintaining the appearance of the store, and preparing food items. See Id. at ¶ 18. Plaintiff was required to wear a clean uniform to work. See Dkt. No. 43-3 at ¶ 25. Part of the required uniform was a Hess-branded polo shirt. When Plaintiff was hired, her supervisor, Brian Morgan, provided her with one polo shirt. See id. at ¶ 2.1. She received another polo shirt later in her employment. See Dkt. No. 38-1 at ¶ 22. Plaintiff worked a total of ten shifts although she was scheduled to work twelve. See Id. at ¶ 17; see also Dkt. No. 43-3 at ¶ 17.

         Plaintiff worked with Joseph Leeks for three of these shifts. See Dkt. No. 38-1 at ¶ 30. Plaintiff knew Mr. Leeks before she was hired because she was a frequent customer of the gas station; and he was a friend of Plaintiff's then-boyfriend, who also worked with Mr. Leeks. See Id. at ¶¶ 27-29. Plaintiff alleges that Mr. Leeks sexually harassed her during each of the shifts they worked together.

         On the first shift, Plaintiff testified that Mr. Leeks told a co-worker that they were dating and at least once called her "hun." See Dkt. No. 38-4, Pl's Depo. at 156, 161 Plaintiff also testified that Mr. Leeks was "creepy, " and he was constantly staring at her and making her feel uncomfortable. See Pl's Depo. at 162-64.

         On the second shift, Plaintiff alleges that Mr. Leeks constantly said to her, "How you doing, baby girl? How are you, hun? Can I give you a ride, baby girl? Hun, what's the matter? You doing okay, Hun? Baby girl, what's the matter?" See Id. at 168. Furthermore, Plaintiff testified that Mr. Leeks inappropriately touched her hand twice, see Id. at 176, and that Mr. Leeks bumped into her on purpose, see Id. at 180. Finally, she testified that Mr. Leeks stared at her constantly. See Id. at 181 (stating that he looked like "a monster from the closet").

         On the third shift, Plaintiff testified that Mr. Leeks constantly called her "baby girl." See Id. at 186. Further, Mr. Leeks placed both hands on Plaintiff's shoulders, and she froze in fear and told him not to do that. See Id. at 200. In addition, she testified that he was constantly staring at her. See Id. at 203. Moreover, she stated that, when she tried to hand Mr. Leeks money, he grabbed her hand. See Id. at 204. Finally, she testified that he bumped into her again in the same manner as the previous shift. See Id. at 205.

         On December 10, 2014, Plaintiff left a note asking her manager, Mr. Morgan, to call her. Mr. Morgan called Plaintiff, and she described the preceding events to him. See Pl's Depo. at 261. Mr. Morgan told Plaintiff that he would no longer schedule her to work with Mr. Leeks and that he was going to forward her complaints to the human resources manager.

         On December 13, 2014, Plaintiff went to pick-up her pay-check at the gas station. Mr. Leeks was there and yelled Plaintiff's name several times and tried to get her attention. See Id. at 196. Plaintiff ignored him and walked away and called Mr. Morgan after this incident. See Id. at 264.

         During the time she worked for Defendant, Plaintiff also worked at Rite-Aid. On December 14, 2014, Mr. Leeks approached Plaintiff while she was working at Rite-Aid. Plaintiff testified that Mr. Leeks asked her to cook for him, asked her to move away with him to Florida, rubbed her arm, and made her feel "completely terrified." See Id. at 216. Eventually Plaintiff ran away from Mr. Leeks and complained to her Rite-Aid manager that she was "creeped out." See Id. at 229. Plaintiff called Mr. Morgan after the Rite-Aid incident.

         Plaintiff testified that she met with Defendant's human resources manager, Renee Schroll, on December 16, 2014, and told her that she was afraid of Mr. Leeks, upset that no one had told her that Mr. Leeks was a violent sex-offender, [1] and was uncomfortable working with him. See Pl's Depo. at 258-59. Plaintiff also gave Ms. Schroll a written statement. See Dkt. No. 38-15. Ms. Schroll interviewed Mr. Leeks and a witness to the harassment and afterward concluded that Plaintiff's complaints were "not substantiated"; however, she also concluded that Plaintiff should not be scheduled to work with Mr. Leeks anymore. See Dkt. No. 38-9, Schroll Dec., at ¶ 19.

         Plaintiff was originally scheduled to work on the date of her interview with Ms. Schroll, December 16, 2014; however, she did not. Thereafter, she was not placed on the schedule again. The parties dispute why she was never scheduled again. Plaintiff claims it was retaliation for her complaints; Defendant, on the other hand, argues that Plaintiff neglected to provide Mr. Morgan with her availability. In any event, Defendant deemed Plaintiff to have abandoned her job on January 31, 2015, due to a month and a half of inactivity. See Id. at ¶ 22.

         Plaintiff commenced this action on September 3, 2015, by service of a Summons with Notice on the New York Secretary of State against Hess Retail Operations, Speedway LLC, and Hess Corporation (collectively "Defendants") in New York State Supreme Court, County of Tompkins. Defendants subsequently removed the action to this District based on diversity of citizenship. See Dkt. No. 1. Subsequently, on March 2, 2016, the Court approved the parties' stipulation to dismiss Defendants Hess Corporation and Hess Retail from this case. See Dkt. No. 16.

         In her complaint, Plaintiff asserts two causes of action: (1) hostile work environment and retaliation in violation of NYHRL; and (2) an individual and putative class action claim to collect unpaid uniform maintenance pay for Defendant's breach of the requirements set forth in 12 N.Y.C.R.R. § 146-1.7(a). See generally Dkt. No. 8. Defendant moves to dismiss Plaintiff's Uniform Pay claim for lack of subject matter jurisdiction; or, alternatively, for summary judgment. Defendant further moves for summary judgment on Plaintiff's NYHRL claims.


         A. Defendant's motion to dismiss Plaintiff's Uniform Maintenance Pay claim

         1. Background

         Part 146 of the New York Minimum Wage Orders pertains to the hospitality industry, i.e., restaurants and hotels. The regulation broadly defines the term "restaurant" to include "any eating or drinking place that prepares and offers food or beverage for human consumption. . . ." 12 N.Y.C.R.R. § 146-3.1(b). Defendant's gas station falls within the statutory definition, as it admits that part of Plaintiff's position was to prepare "pizza and breakfast sandwiches for a customer self-service food case." See Dkt. No. 38-1 at ¶ 18.

         As a part of the hospitality industry, Defendant must comply with the rules set forth in Part 146, including the Uniform Maintenance Pay provision, which provides that, "[w]here an employer does not maintain required uniforms for any employee, the employer shall pay the employee, in addition to the employee's agreed rate of pay, uniform maintenance pay . . . based on the number of hours worked[.]" 12 N.Y.C.R.R. § 146-1.7(a). In 2014, when Defendant employed Plaintiff, the uniform maintenance pay was $9.95 for each week an employee worked more than 30 hours and $4.75 for each week an employee worked up to 20 hours per week. Moreover, the regulation defines "required uniform" as "clothing required to be worn while working at the request of an employer, or to comply with any federal, state, city or local law, rule, or regulation, except clothing that may be worn as part of an employee's ordinary wardrobe." 12 N.Y.C.R.R. § 146-3.10(a). The parties agree that the Hess-branded polo shirt is the only part of Plaintiff's daily wardrobe that qualifies as part of her required uniform.

         Plaintiff generally alleges that Defendant provided "uniforms but did not pay to have the uniforms laundered nor did Defendant[] provide each employee with a sufficient number of uniforms . . . to avoid paying the statutory uniform maintenance fee." See Dkt. No. 8 at ¶ 70.

         As noted above, Defendant moves for the Court to enter judgment in favor of Plaintiff with regard to her Uniform Maintenance Pay claim in conformance with Defendant's March 2, 2016 Rule 68 Offer of Judgment and subsequently to dismiss that claim as moot pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure for lack of subject matter jurisdiction.

         2. Analysis

         "It is well established that '[t]he Case or Controversy Clause of Article III, Section 2 of the United States Constitution limits the subject matter jurisdiction of the federal courts such that the "parties must continue to have a personal stake in the outcome of the lawsuit."'" Tanasi v. New Alliance Bank, 786 F.3d 195, 198 (2d Cir. 2015) (quotation omitted). "That is, '[w]hen the issues in dispute between the parties are no longer live, a case becomes moot.'" Id. (quoting Lillbask ex rel. Mauclaire v. Conn. Dep't of Educ., 397 F.3d 77, 84 (2d Cir. 2005)).

         Rule 68 of the Federal Rules of Civil Procedure provides, in pertinent part, that "a party defending against a claim may serve on an opposing party an offer to allow judgment on specified terms, with the costs then accrued." Fed.R.Civ.P. 68(a). If, within 14 days after being served, the plaintiff accepts, "[t]he clerk must then enter judgment." Id. On the other hand, "an unaccepted offer is considered withdrawn[.]" Fed.R.Civ.P. 68(b). However, the consequence of declining an offer is that, if the plaintiff receives a less favorable judgement, it "must pay the costs incurred after the offer was made." Fed.R.Civ.P. 68(d).

         In Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016), the Supreme Court settled the "disagreement among the Courts of Appeals over whether an unaccepted offer can moot a plaintiff's claim, thereby depriving federal courts of Article III jurisdiction." Id. at 669 (citations omitted). The Court expressly rejected the proposition "that an unaccepted settlement offer [under Rule 68] can moot a complaint." Id. at 671. Rather, the Supreme Court ruled that, "'[w]hen a plaintiff rejects such an offer -- however good the terms -- her interest in the lawsuit remains just what it was before. And so too does the court's ability to grant her relief. An unaccepted settlement offer -- like any unaccepted contract offer -- is a legal nullity, with no operative effect.'" Id. at 670 (quoting [Genesis Healthcare Corp. v. Symczyk, 133 S.Ct. 1523, 1533 (2013) (Kagan, J., dissenting)]).

         In reaching this decision, the Supreme Court emphasized that, after the offer of judgment had expired, the plaintiff's claim remained unsatisfied:

[W]hen the settlement offer Campbell extended to Gomez expired, Gomez remained emptyhanded; his [Telephone Consumer Protection Act] complaint, which Campbell opposed on the merits, stood wholly unsatisfied. Because Gomez's individual claim was not made moot by the expired settlement offer, that claim would retain vitality during the time involved in determining whether the case could proceed on behalf of a class. While a class lacks independent status until certified, see Sosna v. Iowa, 419 U.S. 393, 399, 95 S.Ct. 553, 42 L.Ed.2d 532 (1975), a would-be class representative with a live claim of her own must be accorded a fair opportunity to show that certification is warranted.

Id. at 672.

         Importantly for the present purpose, however, the Court declined to "decide whether the result would be different if a defendant deposit[ed] the full amount of the plaintiff's individual claim in an account payable to the plaintiff, and the court then enter[ed] judgment for the plaintiff in that amount." Id.

         Defendant suggests that this case presents an opportunity for the Court to answer this unresolved question. In that regard, on March 7, 2016, Defendant served upon Plaintiff an offer of judgment permitting her to (1) take judgment against Defendant as to her Uniform Pay claim; (2) receive payment of one hundred sixty three dollars and fifty cents ($163.50) for any unpaid Uniform Maintenance Pay; and (3) receive payment for Plaintiff's applicable attorney's fees and costs. See Dkt. No. 18-3. Furthermore, on that same day, Defendant deposited $163.50 into its attorney's escrow/trust account. See Dkt. No. 18-1 at 6. Defendant asserts that the funds are payable to Plaintiff and "a check for the full $163.50 will be issued to Plaintiff upon Order of the Court or request by Plaintiff or Plaintiff's counsel." See id. Plaintiff, however, rejected Defendant's offer.

         Defendant argues that, where the "'offer tenders complete relief, the court should . . . enter judgment pursuant to the terms of that offer, with or without the plaintiff's consent.'" See id. (quoting Hepler v. Abercrombie & Fitch Co., 607 F.App'x 91, 92 (2d Cir. 2015) (emphasis added)). Defendant relies on Helper for the proposition that "'a defendant may always end the litigation by offering judgment for all the relief that is sought.'" See Id. (quoting Helper, 607 F.App'x at 92). Defendant also cites two cases in which the courts entered judgment against the defendants, rendering the cases moot, notwithstanding the existence of putative class complaints. See Id. at 7 (citing Franco v. Allied Interstate LLC, No. 13-CV-4053, 2015 WL 7758534 (S.D.N.Y. Nov. 30, 2015); Maximo v. 140 Green Laundromat, No. 14 CIV. 6948, 2015 WL 4095248 (S.D.N.Y. July 7, 2015) (FLSA claim)).

         Finally, Defendant argues that Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016), does not compel an opposite result. See id. at 9. Defendant contends that the "linchpin" of Campbell-Ewald was "the failure of defendant to remit payment to plaintiff, which resulted in a live case and controversy because the unaccepted Rule 68 Offer was never effectuated." See Id. Here, in contrast, Defendant has placed the full amount of the offer in an escrow/trust account payable to Plaintiff. See id.

         The Second Circuit's recent decision in Radha Geismann, M.D., P.C. v. ZocDoc, Inc., 850 F.3d 507 (2d Cir. 2017), forecloses Defendant's argument. ZocDoc confirmed that, "'[w]hen a plaintiff rejects [a Rule 68] offer -- however good the terms -- her interest in the lawsuit remains just what it was before. And so too does the court's ability to grant her relief.'" Id. at 513 (quoting Campbell-Ewald, 136 S.Ct. at 670 (quoting Genesis Healthcare, 133 S.Ct. at 1533 (Kagan, J., dissenting))). Furthermore, because Plaintiff declined the offer, it was considered "withdrawn." Fed.R.Civ.P. 68(b). As the Second Circuit stated, "a 'withdrawn' offer 'ha[s] no continuing efficacy.'" ZocDoc, 850 F.3d at 512 (quoting [Campbell-Ewald, ] 136 S.Ct. at 670). Thus, the Court is powerless to enter judgment in Defendant's favor because the unaccepted Rule 68 offer is a legal nullity.[2] See id. Therefore, the Court denies Defendant's motion to dismiss Plaintiff's Uniform Maintenance Pay Claim.

         B. Motion for summary judgment

         1. ...

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