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Chen v. Wai ? Cafe Inc.

United States District Court, S.D. New York

August 2, 2017

YONG KUI CHEN, ZU GUANG ZHU, HAO CHEN, SHUI BING ZHU, GUO REN HUANG and YOU HUANG ZHU, on behalf of themselves and others similarly situated, Plaintiffs,
v.
WAI ? CAFE INC. and WAI YIN CHAN, Defendants.

          MEMORANDUM AND ORDER

          JAMES C. FRANCIS IV UNITED STATES MAGISTRATE JUDGE.

         This case is on remand for consideration of the plaintiffs' New York Labor Law ("NYLL") claims, following the dismissal of all federal claims. Defendant Wai Yin Chan has moved under Rule 12(b)(1) of the Federal Rules of Civil Procedure for the case to be dismissed without prejudice to refiling in state court pursuant to 28 U.S.C. § 1367(c). For the reasons set forth below, the defendant's motion is granted.

         Background

         A. Allegations

         The plaintiffs in this case filed suit in September 2010. Each plaintiff claimed that, he had been employed as a delivery person by defendant Wai ? Cafe Inc. ("Wai ? Cafe") for some period of time between 2004 and 2010 and worked over forty hours per week and often more than ten hours per day. (Complaint (“Compl.”), ¶¶ 19-42). They further alleged that Wai ? Café had failed to pay them properly under the Fair Labor Standards Act (“FLSA”) and the NYLL. (Compl., ¶¶ 43-45). Accordingly, they sought damages for unpaid minimum wages, overtime wages, and spread of hours pay, and, in addition, sought liquidated and punitive damages. (Compl. at 9-10).

         In response, the defendants denied any liability. (Answer, ¶¶ 1-2). As an affirmative defense, the defendants claimed that the first named plaintiff, Yong Kui Chen, had never been employed by Wai ? Café. (Answer, ¶¶ 35-38). They further alleged that the other five named plaintiffs had entered into a contract with Wai ? Café in February 2010 that precluded the claims because it provided the plaintiffs with additional compensation and altered the nature of their relationship to Wai ? Café by giving them a stake in the sale of the business. (Answer, ¶¶ 39-48). The defendants then asserted a counterclaim against the plaintiffs for allegedly accepting a payment pursuant to the contract with no intention of honoring the agreement. (Answer, ¶¶ 53-68).

         B. Procedural History

         1. Trial

         A jury trial was held on February 6 and 7, 2012. Yong Kui Chen v. Wai? Café Inc., No. 10 Civ. 7254, 2012 WL 997004, at *1 (S.D.N.Y. March 26, 2012), aff'd in part, rev'd in part sub nom. Yong Kui Chen v. Wai Yin Chan, 615 F. App'x 10 (2d Cir. 2015). Defendants' counsel was relieved shortly before trial; Mr. Chan proceeded pro se, and Wai ? Café was held to be in default for failing to appear by counsel. Id. I dismissed the claims of plaintiff Yong Kui Chen as he did not attend the trial, but the claims of another plaintiff not named in the Complaint, Jian Hui Lin, were submitted to the jury after he filed a form indicating his consent to sue under the FLSA. Id.

         During the course of trial, Mr. Chan sought to introduce documents into evidence that the plaintiffs objected to, including a purported contract between the parties and records indicating additional payments to the plaintiffs. (Trial Transcript (“Tr.”) at 80, 109). I deemed these documents to be precluded from admission at trial because plaintiffs' counsel represented to me that they had not been turned over in discovery. (Tr. at 84, 110-12).

         Based on the plaintiffs' failure to show that Wai ? Café had gross receipts exceeding $500, 000.00, the FLSA claims were dismissed. Yong Kui Chen, 2012 WL 997004, at *1. I retained supplemental jurisdiction over the plaintiffs' NYLL claims, however, because the case had already been tried and substantial resources had been expended in preparation. Id.; see generally Motorola Credit Corp. v. Uzan, 388 F.3d 39, 56 (2d Cir. 2004). On those claims, the jury found the defendants liable for minimum wage, overtime, and spread of hours pay, but not for liquidated damages as Mr. Chan had not acted willfully. Yong Kui Chen, 2012 WL 997004, at *2.

         All parties were invited to propose damage calculations after trial, but only the plaintiffs did so. Id. Following their submission, I determined the damages owed to each plaintiff. Id. Judgment was entered against the defendants Wai ? Café and Mr. Chan accordingly. Id. at *3.

         2. Appeal

         After I issued my decision, Mr. Chan filed a motion for reconsideration of damages, which I denied. Yong Kui Chen v. Wai? Café Inc., No. 10 Civ. 7254, 2012 WL 1506174, at *1 (S.D.N.Y. April 30, 2012). Mr. Chan also filed an appeal with the United States Court of Appeals for the Second Circuit. (Notice of Appeal in a Civil Case dated April 24, 2012, ECF No. 27). On appeal, counsel was appointed for ...


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