MARILYN L. HUFF, District Judge.
On June 8, 2017, Defendant Gerald Church filed a motion to dismiss Plaintiff R. Alexander Acosta's first amended complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. No. 15.) On June 28, 2017, the Court took the matter under submission and notified the parties that the Court would consider the evidence attached to Defendant Church's motion in deciding the motion and convert the motion to dismiss into a motion for summary judgment. (Doc. No. 16.) On July 17, 2017, Plaintiff filed its opposition to Defendant Church's motion. (Doc. No. 22.) On July 24, 2017, Defendant Church filed his reply. (Doc. No. 23.) For the reasons below, the Court denies Defendant Church's motion.
Defendant EuroAmerican Propagators, LLC is a California limited liability company that during the relevant period, was operating and maintaining a wholesale plant nursery facility in Bonsall, California. (Doc. No. 12, FAC ¶ 5; Doc. No. 15-2, Church Decl. ¶ 2.) Defendants John Rader and Gerald Church founded EuroAmerican in 1992 and were 50/50 owners of the company. (Doc. No. 15-2, Church Decl. ¶¶ 2-3; Doc. No. 22-1, Rader Decl. ¶ 2.) Plaintiff alleges that starting with the pay period beginning on November 28, 2016, Defendants have employed up to 238 employees to make and produce plants for their wholesale nursery, who have not been paid any wages for the work performed. (Doc. No. 12, FAC ¶ 13.) EuroAmerican filed for bankruptcy in January 2017. (Doc. No. 22-1, Rader Decl. ¶ 3.)
On January 24, 2017, Plaintiff filed a complaint against Defendants EuroAmerican, Rader, and Church, alleging causes of action for: (1) violation of the Hot Goods Provisions of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 215(a)(1); (2) failure to pay minimum wages in violation of 29 U.S.C. §§ 206 and 215(a)(2); and (3) violation of 29 U.S.C. § 215(a)(3). (Doc. No. 1, Compl. ¶¶ 16-24.) On May 8, 2017, Defendant Church filed a motion to dismiss Plaintiff's complaint for failure to state a claim. (Doc. No. 6.)
In response to Defendant Church's motion to dismiss, on May 26, 2017, Plaintiff filed a first amended complaint against Defendants, alleging the same three causes of action as in the original complaint and adding a claim for violation of the Migrant and Seasonal Agricultural Worker Protection Act ("MSPA"), 29 U.S.C. § 1862(c) and 29 C.F.R. § 500.81. (Doc. No. 12, FAC ¶¶ 21-30.) In light of the FAC, the Court denied as moot Defendant Church's motion to dismiss Plaintiff's original complaint. (Doc. No. 14.)
On June 8, 2017, Defendant filed a motion to dismiss Plaintiff's FAC for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. No. 15.) Defendant Church argues that all of the claims in the FAC against him should be dismissed because he is not an "employer" under the FLSA or the MSPA. (Doc. No. 15-1 at 2.) In support of his motion to dismiss, Defendant Church attached certain evidence to his motion. (
Summary judgment is appropriate under Rule 56 of the Federal Rules of Civil Procedure if the moving party demonstrates that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a);
A party seeking summary judgment always bears the initial burden of establishing the absence of a genuine issue of material fact.
When ruling on a summary judgment motion, the court must view the facts and draw all reasonable inferences in the light most favorable to the non-moving party.
Defendant Church argues that he is entitled to summary judgment of Plaintiff's claims because he is not an "employer" under the FLSA or the MSPA. (Doc. No. 15-1 at 8-17.) In response, Plaintiff argues that Defendant Church's motion should be denied because there is at least a factual dispute as to whether he was an "employer" during the relevant period. (Doc. No. 22 at 6-15.)
The FLSA defines "employer" to "include[] any person acting directly or indirectly in the interest of an employer in relation to an employee. . . ." 29 U.S.C. § 203(d). "[T]he definition of `employer' under the FLSA is not limited by the common law concept of `employer,' but `is to be given an expansive interpretation in order to effectuate the FLSA's broad remedial purposes.'"
"Where an individual exercises `control over the nature and structure of the employment relationship," or "economic control' over the relationship, that individual is an employer within the meaning of the [FLSA], and is subject to liability."
The MSPA defines the term "agricultural employer" as "any person who owns or operates a farm, ranch, processing establishment, cannery, gin, packing shed or nursery, or who produces or conditions seed, and who either recruits, solicits, hires, employs, furnishes, or transports any migrant or seasonal agricultural worker." 29 U.S.C. § 1802(2). "The term `employ' has the same meaning under the [MS]PA as under the FLSA."
In his motion, Defendant Church explains that he and Rader were 50/50 owners of EuroAmerican. (Doc. No. 15-1 at 3;
In response, Plaintiff has presented the Court with evidence from which a reasonable fact finder could conclude that Defendant Church had the power to hire and fire employees. Former Regional Sales Broker Ruben Suarez states in his declaration that Church specifically approved his hiring in 2016. (Doc. No. 22-5, Suarez Decl. ¶¶ 3-4.) In addition, both Defendant Rader and Tom Foley, Chief Operations Officer of EuroAmerican, state in declarations that Church was involved in the firing of employee Minerva Ramirez and the elimination of her department in August 2016. (Doc. No. 22-1, Rader Decl. ¶ 6; Doc. No. 22-2, Foley Decl. ¶ 7.) Foley and Suarez further state in their declarations that in early 2017, Church directed many of the employees at issue to leave the company and told them that they would not be paid. (Doc. No. 22-2, Foley Decl. ¶ 11; Doc. No. 22-5, Suarez Decl. ¶¶ 3-4.) Church admits to this specific interaction in his declaration. (Doc. No. 15-2, Church Decl. ¶ 18.)
Further, Plaintiff has presented the Court with evidence from which a reasonable fact finder could conclude that Defendant Church had authority over some of the conditions of employment. Ruben Suarez states in his declaration that "Church continuously and on a regular basis during 2016 and 2017 toured the nursery and interviewed and directed employees as to their job assignments." (Doc. No. 22-5, Suarez Decl. ¶ 9;
In addition, Plaintiff has presented the Court with evidence from which a reasonable fact finder could conclude that Defendant Church had authority over employee pay. Kristi Hill, a staff accountant for EuroAmerican, states in her declaration that in mid-to-late 2016, Defendant Church made various contributions to and directed payments to the employee payroll. (Doc. No. 22-3, Hill Decl. ¶¶ 4-7.) Foley also states in his declaration that in late 2016, he observed Church direct finance department employees to prioritize certain expense payments over employee pay. (Doc. No. 22-2, Foley Decl. ¶ 10.) Further, Rader states in his declaration that Church refused to sign a Wells Fargo line of credit guarantee, which had a negative impact on EuoAmerican's ability to continue its business and meet its payroll obligations.
Defendant Church disputes much of the above evidence and offers contradictory evidence in support of his motion. For example, Defendant Church argues and provides evidence that, in January 2017, he simply told the employees at issue that EuroAmerican did not have money to pay them for their work, but he did not make the decision to terminate their employment. (Doc. No. 15-1 at 14-15;
Church also argues that Plaintiff only proffers evidence of isolated or sporadic instances of economic or operational control by Church over the employment relationship. (Doc. No. 23 at 2.) But "`[employer] status [under the FLSA] does not require continuous monitoring of employees, looking over their shoulders at all times, or any sort of absolute control of one's employees. Control may be restricted, or exercised only occasionally, without removing the employment relationship from the protections of the FLSA.'"
In sum, there are a genuine disputes of fact as to the facts underlying the determination of whether Defendant Church was an "employer" under the FLSA and the MSPA. Accordingly, Defendant Church is not entitled to summary judgment on this issue at this stage in the proceedings.
For the reasons above, the Court denies Defendant Church's motion for summary judgment.