SUE E. MYERSCOUGH, District Judge.
This cause is before the Court on the 29 U.S.C. § 216(b) Motion for Conditional Certification and Court-Authorized Notice to Potential Class Members (d/e 26) filed by Plaintiffs Brittany Michelle Watt, James E. Kirkpatrick, Jr., and Paul Rowland. In their Motion, Plaintiffs request that the Court conditionally certify this action for purposes of notice and discovery; order that judicial notice be sent to all putative collective members; approve the form and content of Plaintiffs' proposed judicial notice and consent form; order Defendants to produce to Plaintiffs' counsel the contact information for each putative collective member; authorize a 90-day notice period for putative collective members to join the case; and equitably toll all putative collective members' statute of limitations as of three years from the date of filing of Plaintiffs' initial complaint or, in the alternative, three years from the filing of the motion to stay the proceedings.
Because Plaintiffs have made a modest factual showing that they and the putative collective members were victims of a common policy or plan that violated the law, the motion for conditional certification is granted. The Court will also equitably toll the statute of limitations from May 9, 2017 to December 14, 2017, a period of seven months and five days constituting the time the anti-suit injunction was in place. Finally, the Court approves Plaintiffs' proposed notice with the following amendments: (1) Defendants are not required to provide to Plaintiffs the last four digits of the social security numbers of putative collective members; (2) Defendants shall provide the last known telephone numbers of those individuals whose notices are returned or otherwise undelivered or for any individuals for whom Defendants do not have a mailing address and Plaintiffs may only use those telephone numbers for the purpose of locating the current addresses of those individuals; and (3) Plaintiffs shall not send reminder notices after 50 days.
Plaintiffs Brittany Michelle Watt, James E. Kirkpatrick, Jr., and Paul Rowland bring this Fair Labor Standards Act (FLSA) action on behalf of themselves and other similarly situated employees. Plaintiffs allege that Defendants Fox Restaurant Venture, LLC, Fox NC Acquisition, LLC, and Fox SC Acquisition, LLC, all of whom are Jimmy John's franchisees, misclassified them and other assistant store managers as exempt from the FLSA's overtime provisions.
A detailed recitation of the procedural background of this and related cases is necessary to put some of the issues in context. In 2014 and 2015, three plaintiffs who worked as assistant store managers filed FLSA lawsuits against Jimmy John's and/or specific Jimmy John's franchisees alleging that they were misclassified as exempt employees.
In 2015, two of the cases were consolidated and conditional certification of nationwide collective actions were granted in the consolidated case and the third case.
After three of the Northern District opt-in plaintiffs filed collective action lawsuits against their franchisee employers in other federal district courts asserting the same misclassification claims, Jimmy John's moved in the Northern District court to enjoin those lawsuits until the claims against Jimmy John's were resolved in the Northern District action.
On April 28, 2017, Plaintiff Watt filed this action against Defendants. Attached to the Complaint were Consent to Join Forms executed by Paul Rowland and James E. Kirkpatrick Jr.
On May 9, 2017, the Northern District court extended the anti-suit injunction to additional lawsuits brought by opt-in plaintiffs, including this lawsuit brought by Plaintiff Watt.
On June 22, 2017, Plaintiff Watt and Defendants filed a joint motion to stay proceedings in this Court, asserting that the Northern District court had enjoined opt-in plaintiffs—including Plaintiff Watt—from continuing with any lawsuits against Jimmy John's franchisees until further order of the court but allowing those plaintiffs to seek tolling and other relief in the other cases. Joint Mot., ¶¶ 1-6. The Court granted the motion and stayed this case.
On December 14, 2017, the Seventh Circuit reversed the Northern District court's anti-suit injunction, finding the district court lacked the authority to enjoin the franchisee cases.
On March 19, 2018, Plaintiff Watt and the two individuals who had executed the Consent to Join Forms attached to the original Complaint, James E. Kirkpatrick, Jr. and Paul Rowland, filed an Amended Complaint (d/e 18). A Consent to Join Form executed by Richard Peterson is attached to the Amended Complaint.
In the Amended Complaint, Plaintiffs allege that Defendants employed Plaintiffs and members of the FLSA collective as an employer, joint employer, or single employer. Defendants subjected Plaintiffs to common employment practices in over 33 store locations using nearly identical policies and procedures. Plaintiffs and other assistant store managers regularly worked in excess of 40 hours per workweek without being paid overtime wages. Plaintiffs allege that the work performed by assistant store managers did not include managerial responsibilities or the exercise of meaningful independent judgment and discretion but were manual in nature.
On April 16, 2018, Defendants filed an Answer and Affirmative Defenses (d/e 23). On April 23, 2018, Defendants filed Amended Affirmative Defenses (d/e 25) after obtaining leave of Court.
On May 7, 2018, Plaintiffs filed the motion for conditional certification at issue herein. Defendants filed a response (d/e 30), and Plaintiffs filed a reply (d/e 29). On November 7, 2018, U.S. District Judge Colin S. Bruce recused himself from participating in this matter, and the case was assigned to the undersigned judge. No discovery has been conducted in this case.
Under the FLSA, employers must pay their employees overtime wages for each hour worked in excess of 40 hours per week. 29 U.S.C. § 207(a)(1). The FLSA contains several exemptions from this requirement, including the exemption for "any employee employed in a bona fide executive, administrative, or professional capacity." 29 U.S.C. § 213(a)(1). Congress has delegated the authority to define the scope of the exemptions to the Secretary of Labor. 29 U.S.C. § 213(a)(1);
In addition, employees may bring a collective action against an employer to recover unpaid overtime compensation on behalf of themselves and on behalf of other similarly situated employees. 29 U.S.C. § 216(b). Unlike class actions under Federal Rule of Civil Procedure 23(b), where potential plaintiffs are included in the class unless they opt out, potential plaintiffs in FLSA collective actions must affirmatively opt in to the suit.
Moreover, under the FLSA, the statute of limitations continues to run for each potential plaintiff until he or she opts in to the lawsuit. 29 U.S.C. § 256;
The statute of limitations in FLSA suits is not jurisdictional, and equitable tolling can be applied.
Plaintiffs request that the Court conditionally certify a collective, apply equitable tolling, and approve the sending of notice to the putative collective members.
The Seventh Circuit has not articulated the procedure for determining whether an FLSA lawsuit should proceed as a collective action.
Under the first stage, referred to as the conditional certification stage or notice stage, the plaintiff must make a minimal showing that individuals in the potential class are similarly situated.
After the opt-in process and the completion of discovery, the Court proceeds to the second stage of the analysis. At stage two, the Court determines whether there is sufficient similarity between the named plaintiffs and the opt-in plaintiffs to allow the case to proceed on a collective basis.
This case is at the first stage. At this stage, a plaintiff can show sufficient similarity if the plaintiff can show "`some factual nexus' [that] connects her to other potential plaintiffs as victims of an unlawful practice."
Plaintiffs assert that they have presented sufficient evidence that the assistant store managers who work for Defendants are similarly situated with respect to job requirements and pay provisions and were subjected to a common policy or practice of being improperly classified as exempt, salaried employees in violation of the FLSA.
Defendants oppose conditional certification, arguing that Plaintiffs have failed to establish that their proposed collective is similarly situated. Defendants assert that it is unrebutted that the three Defendants are separate and distinct legal entities which control their own individual work rules and conditions of employment. Resp. at 4 (d/e 30), citing Defendants' withdrawn Motion to Dismiss (d/e 11). Defendants also argue that the declarations attached to the Motion for Conditional Certification fall short of supporting conditional certification.
Plaintiffs have made the required modest factual showing sufficient to demonstrate that they and the putative collective members were victims of a common policy or plan that violated the law.
Plaintiffs attach to their Motion the declarations of each named Plaintiff and Peterson, the individual who filed a Consent to Join Form. These declarations suggest that assistant store managers for the three Defendants have similar compensation, job duties, and limitations on their authority.
Watt states that she worked for Jimmy John's under the franchisee Fox Restaurant Venture, LLC—owned by Peter Fox—as an assistant store manager from approximately 2014 to March 2015 in Bloomington, Indiana. Kirkpatrick, a resident of Rock Hill, South Carolina, worked for Jimmy John's under the franchisee Fox NC Acquisition as an assistant store manager in 2013 and early 2016. Rowland worked for Jimmy John's under the franchisee Fox SC Acquisition LLC in Columbia, South Carolina—owned by Peter Fox—as an assistant store manager from approximately April 2012 through April 2016. Peterson, a resident of Spartanburg, South Carolina, also worked for Jimmy John's under franchisee Fox SC Acquisition, LLC as an assistant store manager toward the end of 2015 until June 2016.
Each declarant indicates that he or she was paid on a salary basis and was required to and did work in excess of 40 hours per week. All of the declarants were classified as exempt employees and were not paid overtime.
The declarants describe the same job duties—such as preparing food, taking orders, cleaning the restaurant—and the same lack of job duties such as firing and scheduling. (Rowland states he could not fire without verbal consent of Peter Fox.) Three of the four declarants also assert that they were not allowed to hire, discipline, supervisor, delegate, or exercise meaningful independent judgment and discretion. None of the declarants was allowed to deviate from any policies or procedures without obtaining approval from an Area Manager. Consequently, Plaintiffs have made a minimal showing that they and the putative collective members are similarly situated.
Moreover, Plaintiffs have presented some evidence that such similarity between the assistant store managers is the result of a common, unlawful policy. Plaintiffs need not point to a specific written policy that requires them to work overtime.
In this case, Kirkpatrick states that he has personal knowledge of the similarities in the policies and practices used by the three Defendants. According to Kirkpatrick, all three Defendants used nearly identical policies and procedures, required employees to meet similar operations standards and goals, and even shared manuals and other documents. Rowland states that the three Defendants worked closely and that, as a former assistant store manager, he had knowledge that corporate audit scores were shared among the three Defendants and that Fox SC and Fox NC used the same punch lists for opening/closing procedures. The Court also notes that Plaintiffs alleged, and Defendants admitted, that the principal office for all three Defendants is located at 1909 Fox Drive, Champaign, Illinois.
Defendants argue, citing their withdrawn Motion to Dismiss, that it is unrebutted that they are separate and distinct legal entities that control their own individual work rules and conditions of employment. However, at this conditional certification stage, the Court does not need to resolve factual disputes or consider evidence presented by Defendants.
Plaintiffs also ask that the Court equitably toll the statute of limitations on all assistant store manager claims as of three years from the date of the filing of Plaintiffs' initial complaint (April 28, 2017) or, in the alternative, three years from the filing of the motion to stay proceedings (June 22, 2017).
For equitable tolling to apply, a plaintiff must show: (1) that she pursued her rights diligently and (2) that extraordinary circumstances prevented a would-be party's timely filing.
Defendants oppose equitable tolling, arguing that equitable tolling is an exceptional remedy that should be granted sparingly. Defendants argue that Plaintiffs do not have standing to move for equitable tolling on behalf of any potential opt-in plaintiffs and the Court cannot grant equitable relief to individuals who are not yet before the Court. Alternatively, Defendants argue that the only possible basis for equitable tolling is the anti-suit injunction ordered by the Northern District of Illinois in
This Court recently decided a nearly identical issue in
In
A litigant can assert the rights of third parties—such as a request to toll the statute of limitations—if three conditions are met: (1) the plaintiff has an injury in fact; (2) there was some hindrance to the third parties in asserting their own rights; and (3) the plaintiff shares a close relationship to the third parties.
Having found standing and that extraordinary circumstances prevented a would-be party's timely filing, the Court must next assess the diligence of the putative collective members. Some courts have noted that a court cannot assess the diligence of a plaintiff who has not opted in.
As in
Therefore, the Court will equitably toll the statute of limitation from May 9, 2017 to December 14, 2017 on Plaintiffs' claim with respect to all of Defendants' current and former employees who are eligible to opt in to this litigation. The seven months and five days during which the injunction was in place should not count toward the putative collective members' deadlines to file their claims and to join the action. Plaintiffs have not demonstrated that equitable tolling is warranted for any other time period.
Plaintiffs have submitted to the Court a proposed notice and proposed consent form. Plaintiffs also proposed the following schedule:
Defendants oppose several of Plaintiffs' proposals.
First, Defendants assert that a protective order should be entered limiting the Plaintiffs' use of any phone numbers to solely the purpose of locating the current addresses of any notice recipients whose notices are returned or otherwise undelivered. Resp. at 8 (citing
The Court orders that Defendants shall provide the last known telephone numbers of those individuals whose notices are returned or otherwise undelivered or for any individuals for whom Defendants do not have a mailing address. Plaintiff may only use those telephone numbers for the purpose of locating the current addresses of those individuals. The parties shall confer regarding the method and time in which Defendants will furnish that information.
Defendants also object to providing the last four digits of potential opt-in plaintiffs' social security numbers. Defendants again cite
Defendants next argue that Plaintiffs have not provided a basis for a proposed notice period of 90 days with a reminder form sent out at 50 days. Defendants assert that a 30 to 60-day notice period is adequate and that a reminder form is unnecessary.
The Court has broad discretion regarding the details of a notice sent to potential opt-in plaintiffs, including the length of the opt-in period.
For the reasons stated, Plaintiffs' 29 U.S.C. § 216(b) Motion for Conditional Certification and Court-Authorized Notice to Potential Class Members (d/e 26) is GRANTED. In addition, the statute of limitations is tolled from May 9, 2017 to December 14, 2017 (seven months and five days) on Plaintiffs' claim with respect to all of Defendants' current and former employees who are eligible to opt-in to this litigation.
(1) The Court conditionally certifies a collective action by Plaintiffs and similarly situated members of the collective pursuant to 29 U.S.C. § 216(b), defined as:
This date is three years, seven months, and five days prior to the date of the mailing of the Notice to account for the equitable tolling.
(2) The Court APPROVES Plaintiffs' proposed Notice, as amended herein, and Plaintiffs' proposed Consent to Become a Party form.
(3) Within 10 days from the date of this Opinion, Defendants are ordered to produce to Plaintiffs in a usable electronic format the names, last known mailing address, and last known personal email addresses of all Putative Collective Members to be notified. Defendants shall only provide last known telephone numbers of those individuals whose notices are returned or otherwise undelivered or for any individuals for whom Defendants do not have a mailing address. Plaintiffs may only use those telephone numbers for the purpose of locating the current addresses of those individuals. The parties shall confer regarding the method and time in which Defendants will furnish the telephone number information.
(4) Within 20 days from the date of this Opinion, Plaintiffs' Counsel or the Third Party Administrator shall mail a copy of the Court-approved Notice and Consent Form to Putative Collective Members. Additionally, Defendants shall place a Notice in all current assistant store managers' pay envelopes. Finally, Plaintiffs shall establish a website with the Notice and Consent Form.
(5) The Putative Collective Members shall have 90 days to mail in their signed Consent forms for filing with the Court.