ORDER AND REASONS

SARAH S. VANCE, District Judge.

Before the Court is plaintiffs' motion to remand state class action claims,1 defendants' motion to dismiss certain claims,2 defendants' motion to strike class action claims,3 and plaintiffs' motion to for leave to file a first amended complaint.4 For the following reasons, the Court DENIES plaintiffs' motion to remand their state law class action claims, GRANTS IN PART and DENIES IN PART defendants' motion to dismiss certain claims, DENIES defendants' motion to strike the class action claims, and GRANTS plaintiffs' motion for leave to amend the complaint.

I. BACKGROUND

Plaintiffs are satellite television technicians who installed DirecTV products at customers' houses. On February 22, 2010, Plaintiffs filed a petition in the 22nd Judicial District Court of Louisiana on behalf of themselves and all similarly situated individuals.5 Plaintiffs seek a collective action under the Fair Labor Standards Act, alleging minimum wage, overtime, and record keeping violations.6 Plaintiffs also bring a class action for alleged violations of the Louisiana wage and hour laws7 and for state law tort violations.8

Specifically, plaintiffs allege that the defendants engaged in "a nationwide scheme" in violation of both the FLSA and Louisiana law.9 First, plaintiffs allege that the defendants failed to record or pay wages, or deducted wages, for time actually worked. These uncompensated hours include time worked before the first and after the last customer visit of the day, travel time, and meal periods during which work was performed. Second, plaintiffs allege that the defendants failed to calculate the applicable overtime rate properly. Third, plaintiffs allege that the defendants engaged in a "charge-back scheme" in which they improperly withheld certain amounts from the plaintiffs' pay. At times, plaintiffs allege, they were charged even more than they earned and therefore lost money on a particular job assignment. Plaintiffs allege that each of these actions violated the FLSA. They also contend that the deductions from their pay violated the Louisiana wage and hour laws. In addition, plaintiffs allege that under state tort law, the defendants' failure to pay them the proper amounts constituted negligence, misrepresentation, acts of dominion over plaintiffs' property, and fraud, and that defendants' actions caused them severe emotional distress.

Defendants removed the case to this Court,10 and plaintiffs now move to remand their state claims to state court.11 Defendants move to dismiss the FLSA claims and the state law fraud claims,12 and they also move to strike the class allegations associated with the state law claims.13 Plaintiffs also move for leave to amend the complaint.14

II. MOTION TO REMAND

A. Legal Standard

A defendant may remove any civil action over which the federal court has original jurisdiction.15 The removing party bears the burden of establishing the existence of federal jurisdiction.16 Section 1441 is to be narrowly construed to restrict removal because "a defendant's use of that statute deprives a state court of a case properly before it and thereby implicates important federalism concerns."17

B. Discussion

It is undisputed that the removal of the FLSA claims to this Court was proper. Further, the presence of a federal claim brings the entire action within the Court's original jurisdiction.18 Thus, removal of both the federal and state law claims was proper under section 1441. Plaintiffs also have not questioned that the Court may exercise supplemental jurisdiction over the state claims under section 1367(a).19 Plaintiffs contend, however, that the Court should exercise its discretion to remand their state claims under section 1441(c) and should decline supplemental jurisdiction under section 1367(c). These provisions will be considered in turn.

1. Discretionary Remand

Section 1441(c) provides:

For remand to be proper under section 1441(c), the claim to be remanded must be (1) a separate and independent claim or cause of action; (2) joined with a federal question; (3) otherwise non-removable; and (4) a matter in which state law predominates.21 One claim is not separate and independent from another when "there is a single wrong to plaintiff, for which relief is sought, arising from an interlocked series of transactions."22 The test for separateness is "the separateness of the wrong to the plaintiff,"23 and the test for independence is whether the claims "involve substantially the same facts and transactions."24 In making this determination, the Court looks to the plaintiffs' complaint, which controls.25

Plaintiffs' state claims are not separate and independent from their FLSA claims. The claims are not separate because they allege the same wrongs, namely, a "charge-back" scheme in which the defendants made improper deductions from plaintiffs' pay. When a single wrong gives rise to multiple claims, those claims are not considered separate.26 Further, the state and federal claims are not independent because they involve substantially the same facts. Plaintiffs allege a single "nationwide scheme" that is not divisible into state and federal components. Evidence of the deductions made from plaintiffs' pay will be identical for the state and federal claims. Moreover, both sides agree that a crucial issue will be whether any or all of the defendants employed the plaintiffs and the evidence on this question will be the same as well. State and federal claims are not independent when their facts overlap to this extent.27

Plaintiffs argue that the state and federal claims have different elements and requirements. Assuming that this is true, the claims nonetheless involve a single wrong and substantially the same facts. The claims, therefore, are not separate and independent.28 Moreover, severing the state claims and requiring parallel proceedings in state and federal court would waste judicial and party resources.29 Thus, the Court will not remand the state claims under section 1441(c).

2. Supplemental Jurisdiction

Section 1367(c) provides that a district court may decline to exercise supplemental jurisdiction if:

In addition to the statutory factors, the court must also balance the factors of judicial economy, convenience, fairness, and comity.31 Section 1367(c)(3) does not apply because the Court has not dismissed all of the plaintiffs' federal claims, but the Court will consider subsections (1), (2), and (4).

Plaintiffs assert that their state claims raise novel and complex issues of state law under section 1367(c)(1), but they do not specify what they are. To the contrary, plaintiffs' state wage-and-hour and tort claims do not appear to raise any novel or complex issues of state law. Thus, section 1367(c)(1) does not apply.

As to section 1367(c)(2), plaintiffs' state law claims do not substantially predominate over their federal claims. A state claim substantially predominates if it "constitutes the real body of a case, to which the federal claim is only an appendage."32 If "state issues substantially predominate, whether in terms of proof, of the scope of the issues raised, or of the comprehensiveness of the remedy sought, the state claims may be dismissed without prejudice and left for resolution to state tribunals."33 As discussed supra, plaintiffs' federal and state actions involve substantially the same facts and evidence. The claims are "sufficiently intertwined so that one does not predominate over the other."34 The FLSA claims are addressed at length in the complaint, and they cannot be considered a mere appendage to the state claims.

Plaintiffs also argue that the Court should decline to exercise supplemental jurisdiction over their state law claims because there are different procedures for aggregating class members in an FLSA collective action and in a Rule 23(b)(3) class action. A collective action functions like a class action under Rule 23 in that it provides a judicial mechanism for the efficient resolution of the claims of multiple plaintiffs that involve common factual issues on the basis of representative proof.35 Under the collective action provision of the FLSA, "[n]o employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought."36 Therefore, in the FLSA context, a plaintiff must affirmatively join the lawsuit or "opt in," whereas under Rule 23(b)(3), a claimant must affirmatively "opt out" of the class action in order to preserve individual claims.

These procedures are indeed different,37 but those differences do not justify remanding plaintiffs' state law claims. The requirement that class members opt into a collective action applies only to claims under the FLSA and does not limit the procedural mechanisms available to employees who bring state law actions.38 In cases with both FLSA collective action claims and Rule 23 class action claims based on state law, most courts have held that the differences between opt-in and opt-out procedures do not justify remanding the state law claims.39 Moreover, some courts that have remanded the state law class action in this situation have relied at least in part on factors not present here, such as a showing that state claims vastly outnumbered federal claims.40

If the FLSA collective action and the state law class action were severed from each other, numerous practical difficulties would result.41 First, discovery in the two cases would be largely duplicative and uncoordinated. Second, a ruling in one case could have a preclusive effect in the other. Alternatively, the two courts could make conflicting rulings regarding discovery, relevance, privilege, or other procedural or substantive matters. Keeping these claims in a single forum will avoid needless litigation expenses and promote judicial economy.

Some courts have ruled that proceeding with both an opt-in and an opt-out class action would result in notices that would be confusing to potential class members.42 While the Court is aware of this possibility, the danger of confusion would also exist if opt-in and opt-out actions were to proceed simultaneously in federal and state court. The Court will consider the merits of any notices drafted by counsel at the appropriate time. At present, the Court will not remand plaintiffs' state law claims on this basis.43

For these reasons, plaintiffs' motion to remand their state law claims is DENIED.

III. MOTION TO AMEND

Leave to amend a complaint is freely given "when justice so requires."44 In exercising its discretion to grant or deny leave to amend, the Court may consider whether the party seeking leave is doing so after undue delay, in bad faith, or for a dilatory motive.45 "It is within the district court's discretion to deny a motion to amend if it is futile."46 Futility means "that the amended complaint would fail to state a claim upon which relief could be granted."47 To determine futility, the court "appl[ies] the same standard of legal sufficiency as applies under Rule 12(b)(6)."48

Plaintiffs' proposed amendments generally fall into two categories: allegations adding further detail to the existing FLSA claims,49 and allegations of retaliation in violation of the FLSA.50 Defendants argue that both categories of amendments should be rejected.

First, defendants argue that the proposed amendments that add further detail to the FLSA allegations would be futile because they do not cure the deficiencies that they assert exist in the original complaint. Under the standard for futility, the success of plaintiffs' motion to amend depends on whether the allegations of the complaint, as amended, are sufficient to survive a Rule 12(b)(6) motion. Here, in addition to opposing the motion to amend, the defendants have also moved to dismiss the case under Rule 12(b)(6). Because the standards for deciding these motions are identical, the Court will not consider them separately, but rather will consider defendants' motions to dismiss in light of the proposed amended complaint.51

Second, defendants argue that the retaliation claim would be more appropriately adjudicated in a separate action. Plaintiffs claim that they have suffered retaliation, but they do not allege they share this in common with the other potential FLSA claimants. Although the assertion of these individual claims may ultimately affect the certification decision, plaintiffs are free to join their claims under Rule 18. Moreover, Defendants do not assert any undue delay, bad faith, or dilatory motive on the part of the plaintiffs, nor do they allege that these amendments are futile. Thus, there is no reason to deny plaintiffs' motion to amend.

Defendants offer no arguments in opposition to the remainder of the proposed amendments. For the reasons stated, the Court GRANTS plaintiffs' motion for leave to amend.

IV. MOTIONS TO DISMISS

A. Legal Standard

To survive a Rule 12(b)(6) motion to dismiss, the plaintiffs must plead enough facts "to state a claim to relief that is plausible on its face."52 A claim is facially plausible when the plaintiff pleads facts that allow the court to "draw the reasonable inference that the defendant is liable for the misconduct alleged."53 A court must accept all well-pleaded facts as true and must draw all reasonable inferences in favor of the plaintiff.54 But the Court is not bound to accept as true legal conclusions couched as factual allegations.55

A legally sufficient complaint must establish more than a "sheer possibility" that plaintiffs' claim is true.56 It need not contain detailed factual allegations, but it must go beyond labels, legal conclusions, or formulaic recitations of the elements of a cause of action.57 In other words, the face of the complaint must contain enough factual matter to raise a reasonable expectation that discovery will reveal evidence of each element of the plaintiffs' claim.58 If there are insufficient factual allegations to raise a right to relief above the speculative level,59 or if it is apparent from the face of the complaint that there is an insuperable bar to relief,60 the claim must be dismissed.

B. Motion to Dismiss Certain Claims

1. Employment Relationship

Defendants contend that plaintiffs have not adequately pleaded that they were employees of defendants, which is necessary to recover under the FLSA.61 Plaintiffs do allege in their complaint that they were employees of DirecTV, JP & D, and Modern Day.62 Plaintiffs also make allegations that are relevant to the factors used by the Fifth Circuit to determine employment status. Plaintiffs have pleaded facts upon which a plausible inference of employment can be made, and the Court therefore will not dismiss plaintiffs' FLSA claims.

The FLSA defines "employee" as "any individual employed by an employer"63 and "employ" as "to suffer or permit to work."64 The Supreme Court has observed that this definition is broad.65 In determining whether an employment relationship exists, the Fifth Circuit has applied the following factors: (1) the degree of control the company exercises over the individual; (2) whether the employment takes place on the premises; (3) whether the company has the power to hire, fire or modify employment; (4) whether the employees perform a specialty job on the production line; and (5) whether the employee may refuse to work for the company or choose to work for others.66 These factors are illustrative and should not be applied mechanically. Rather, in determining employment status, the Court must consider the totality of the circumstances and the economic reality of the overall arrangement.67 Accordingly, a plaintiff is not required to show that all five of the factors have been met.68 "Where the work done, in its essence, follows the usual path of an employee, putting on an `independent contractor' label does not take the worker from the protection of the Act."69 Further, a defendant and its subordinate contractor may be jointly responsible for the contractor's employees.70

The Court's review of the complaint reveals that plaintiffs have made sufficient allegations of employment to survive a motion to dismiss. Plaintiffs generally allege that they were jointly employed by the defendants.71 In addition, plaintiffs make specific allegations that, if true, would suggest that each of the defendants exercised control over them and had the power to modify their employment.

First, with regard to DirecTV, Plaintiffs Lang and Humphreys allege that DirecTV controlled their daily routines.72 They allege that DirecTV set the rate of compensation for each job, monitored their performance, and ultimately controlled their receipt of wages.73 Moreover, they claim that DirecTV and JP & D conducted background checks and drug tests at facilities of their choice.74 Humphreys also alleges in his declaration that he was required to wear a DirecTV uniform, give clients DirecTV paperwork, and have a DirecTV logo on his vehicle.75 He also alleges that he installed only DirectTV equipment.76 In addition, Lang and Humphreys allege that DirecTV had the power to determine whether they were employed as installers of DirecTV equipment.77 Plaintiffs further allege that the defendants orchestrated a "charge-back" scheme to deprive them of earned wages78 and that the charge-back and underpayment scheme originated with DirecTV.79 The allegations of DirecTV's control over the technicians, including control of their compensation, work assignments, and uniforms, all tend to indicate that the plaintiffs were employees of DirecTV.80

Plaintiffs allege that Modern Day and JP & D were "straw men" that DirecTV set up in an attempt to circumvent the FLSA and Louisiana law.81 Although most of the plaintiffs' allegations do not single out either of these entities, plaintiffs have sufficiently pleaded that they were jointly employed by Modern Day and JP & D. Lang alleges that he was hired by Modern Day,82 and Humphreys alleges that he was hired by Modern Day, JP & D, and DirecTV.83 In addition, plaintiffs claim that the charge-backs that originated with DirecTV were passed down to the HSPs and their subcontractors.84 In this way, Modern Day and JP & D allegedly participated in a scheme that curtailed the amount that the plaintiffs were paid.

As to Modern Day in particular, Lang and Humphreys allege that they reported directly to Modern Day.85 They also assert that Modern Day constructively discharged them after the complaint was filed.86 Plaintiffs make further allegations that suggest that they were not independent contractors. For example, Lang and Humphreys allege that the defendants withheld workers' compensation premiums from their pay.87 If the plaintiffs worked directly under Modern Day and were not independent contractors, that would imply that they were employees of Modern Day.

The complaint presents JP & D as an intermediary between Modern Day and DirecTV. Lang and Humphreys allege that JP & D or DirecTV assigned each of them a contractor number that DirecTV used to monitor their pay and performance.88 Moreover, as noted above, Lang and Humphreys claim that JP & D, as well as DirecTV, conducted background checks and drug tests at facilities of their choice.89 They also claim that JP & D is currently preventing them from being employed to work on DirecTV jobs in retaliation for filing the complaint.90

Plaintiffs have sufficiently pleaded that they were employed by each of the defendants. Thus, defendants' motion to dismiss plaintiffs' FLSA claims on this ground is DENIED.

2. Collective Action

Defendants also move to dismiss plaintiffs' collective action claims under the FLSA. Defendants contend that the plaintiffs have not adequately pleaded facts that would show that they are similarly situated to the potential class members.

The FLSA allows one or more employees to pursue an action in a representative capacity for "other employees similarly situated."91 A collective action affords plaintiffs "the advantage of lower individual costs to vindicate rights by the pooling of resources. The judicial system benefits by efficient resolution in one proceeding of common issues of law and fact."92 The FLSA does not define what it means for employees to be "similarly situated" such that collective adjudication of their claims is appropriate. Courts have utilized two methods for determining whether plaintiffs are similarly situated. The Fifth Circuit has not determined whether either approach is required. The prevailing method, first articulated in Lusardi v. Xerox Corp.,93 calls for a two-step analysis. First, at the "notice stage," a court determines whether notice should be given to potential members of the collective action, "usually based only on the pleadings and any affidavits."94 Because the court has little evidence at this stage, "this determination is made using a fairly lenient standard, and typically results in `conditional certification' of a representative class."95 If the Court grants conditional certification, the case proceeds as a collective action through discovery.96 The defendant may then move for decertification, at which point the court will decide, with the benefit of considerably more information, whether the employees are similarly situated.97

To determine whether plaintiffs are similarly situated to other employees who are potential members of a collective action, Lusardi applies a three-factor test: (1) the extent to which the employment settings of employees are similar or disparate; (2) the extent to which any defenses that an employer might have are common or individuated; and (3) general fairness and procedural considerations.98 The more dissimilar plaintiffs' job experiences are from one another and the more individuated an employers' defenses are, the less appropriate the matter is for collective treatment. Some courts, however, have not used the three-part Lusardi test, but instead have decided whether a collective action is appropriate by drawing on the elements for certification of a class action under Rule 23.99 The Fifth Circuit has affirmed a district court's decertification decision based on the use of the Lusardi test, although it did not specifically endorse it.100 This Court will use the Lusardi approach in determining whether this case is appropriate for collective treatment.101

This case has not yet reached the first, conditional certification stage of the process outlined in Lusardi. Plaintiffs have not moved for certification, and they have not proposed that specific notices be distributed. The Court finds that defendants' motion to dismiss is premature because plaintiffs have not moved for certification and have had no opportunity to develop a record.102 This challenge on the pleadings seeks to end-run the certification process by trying certification on the face of the complaint. Defendants have not pointed to any controlling authority that establishes detailed pleading requirements for collective actions.

Plaintiffs' allegations are not uniquely personal or obviously unsuited to a collective action. At the conditional certification stage, the Court will decide whether the plaintiffs are similarly situated to potential class members under a "fairly lenient standard."103 Courts generally "require nothing more than substantial allegations that the putative class members were together the victims of a single decision, policy, or plan[.]"104 Here, plaintiffs have not alleged "isolated personal incidents of failures to pay, but rather, contend that they and the potential class members were victims of a company-wide policy" of improper deductions.105 Plaintiffs identify the following class:

Plaintiffs have adequately pleaded that they are similarly situated to potential collective action members. The Court will consider defendants' arguments against certification at the appropriate time, but to consider them now would be premature. Defendants' motion to dismiss plaintiffs' collective action claims is DENIED.

3. State Fraud Claim

Defendants also move to dismiss plaintiffs' state law fraud claim for failure to plead with the particularity required by Rule 9(b). For the following reasons, defendants' motion is granted.

Rule 9(b) provides that in fraud cases, "a party must state with particularity the circumstances constituting fraud or mistake." The required conditions of a person's mind, however, may be alleged generally.110 In order to meet the requirements of Rule 9(b), a plaintiff must: (1) specify the statements alleged to be fraudulent, (2) identify the speaker or author of the statements, (3) state when and where the statements were made, and (4) state why the statements were fraudulent.111 In other words, Rule 9(b) mandates that "the who, what, when, and where must be laid out before access to the discovery process is granted."112 The heightened pleading requirements of Rule 9(b) also apply to plaintiffs' intentional misrepresentation claim, which is "essentially an allegation of fraud."113

Here, plaintiffs' fraud and misrepresentation allegations are limited to the following:

Plaintiffs' complaint is devoid of the particular factual allegations required under Rule 9(b). Plaintiffs do not identify a particular fraudulent statement by an employee or officer of any defendant. The misrepresentations that plaintiffs allege are general in nature and do not specify a particular speaker, time, or place. When a plaintiff fails to "plead a description of a particular occasion in which a particular person made a fraudulent statement," the fraud claim must be dismissed.115

In addition, "a complaint alleging fraud may not group the defendants together."116 Plaintiffs must plead specific facts as to each defendant for each of the Rule 9(b) requirements, but they have not done so. Instead, plaintiffs have improperly grouped the defendants together for purposes of their fraud allegations.

Plaintiffs' general allegations do not contain the particularity required by Rule 9(b). Moreover, the Court will not consider factual allegations that are not well-pleaded in plaintiffs' complaint and its proper attachments.117 While plaintiffs have failed to meet the pleading requirements of Rule 9(b), such a failure does not usually justify dismissal without leave to amend.118 Accordingly, the Court GRANTS defendants' motion to dismiss plaintiffs' state law fraud claims, without prejudice and with leave to amend within 20 days.119

C. Motion to Strike State Law Class Action Claims

Defendants ask the Court to strike plaintiffs' class allegations on the grounds that the plaintiffs have not met the requirements of Rule 23. Under Rule 23(d)(1)(D), a court may "require that the pleadings be amended to eliminate allegations about representation of absent persons."120 When it is "facially apparent" that Rule 23 cannot be met, "a district court may dismiss the class allegation on the pleadings."121 The Fifth Circuit has observed, however, that "in most cases `a certain amount of discovery is essential in order to determine the class action issue and the proper scope of a class action.'"122

To be certified, a class must satisfy the following threshold requirements of Rule 23(a): (1) numerosity (a "class [so large] that joinder of all members is impracticable"); (2) commonality ("questions of law or fact common to the class"); (3) typicality ("named parties' claims or defenses are typical ... of the class"); and (4) adequacy of representation (representatives "will fairly and adequately protect the interest of the class").123 In addition, the class must satisfy one of the grounds listed in Rule 23(b).124 Rule 23(b)(3), which plaintiffs appear to rely on, allows the Court to certify a class if "questions of law or fact common to class members predominate over any questions affecting only individual members, and ... a class action is superior to other available methods for fairly and efficiently adjudicating the controversy." Because class members must opt out of a Rule 23 class action in order to preserve their individual claims, the standard for certification of a class action is stricter than the test for certification of an opt-in collective action under the FLSA.125

Defendants contend that common questions do not predominate over individual questions in this matter. The predominance requirement, "although reminiscent of the commonality requirement of Rule 23(a), is `far more demanding' because it `tests whether proposed classes are sufficiently cohesive to warrant adjudication by representation.'"126 In deciding at the class certification stage whether common questions predominate, the Court will "consider how a trial on the merits would be conducted if a class were certified."127 "This in turn, entails identifying the substantive issues that will control the outcome, assessing which issues will predominate, and then determining whether the issues are common to the class."128 This inquiry is necessary to prevent the proceeding "from degenerating into a series of individual trials."129

At this stage of the proceedings, plaintiffs have sufficiently alleged that common questions predominate over individual questions. Plaintiffs seek to represent a class of "[a]ll persons who have performed installation and service of DirecTV satellite systems in the state of Louisiana."130 They allege that common questions of law and fact predominate over individual questions.131 In particular, plaintiffs allege that the defendants engaged in a common "charge-back scheme" in which they made deductions from the paychecks of their installers and technicians in violation of Louisiana wage-and-hour and tort law.132 Whether the defendants applied such a general policy presents a common question.

Defendants make a number of arguments against class certification, but these arguments are premature. Plaintiffs have not moved for class certification, and the record is not sufficiently developed for the Court to determine whether class certification would be appropriate.133 Defendants argue, for example, that whether class members were employed by any or all of the defendants presents individual rather than common questions. Plaintiffs argue, however, that the DirecTV workforce is uniform throughout the state, and the degree of control that DirecTV had over its technicians may be a common question.134 Defendants also argue that individualized determinations of liability and damages will be required, but the Court presently lacks the information to evaluate that argument. Whether common questions will predominate over individual question depends upon how plaintiffs intend to prove their case, but plaintiffs are not required to present their trial plan in the complaint. Plaintiffs' class action claims are not facially insufficient,135 and the Court therefore DENIES defendants' motion to strike the class allegations.

V. CONCLUSION

For the reasons stated, the Court DENIES plaintiffs' motion to remand their state class action claims, GRANTS plaintiffs' motion for leave to file an amended complaint, GRANTS IN PART and DENIES IN PART defendants' motion to dismiss certain claims, and DENIES defendants' motion to strike the class action claims.