PAUL A. ENGELMAYER, District Judge.
Plaintiffs Philip Vasto, Zao Yang, Alex Torres, and Xiaoj Zheng (collectively, "plaintiffs") bring this action on behalf of themselves and similarly situated persons, alleging violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201 et seq., New York Labor Law ("NYLL"), Article 6 §§ 190 et seq., and Article 19 §§ 650 et seq., the Arizona Wage Act ("AWA"), Ariz. Rev. Stat. §§ 23-350 et seq., and the Arizona Minimum Wage Act ("AMWA"), Ariz. Rev. Stat. §§ 23-362 et seq. Plaintiffs allege that defendants Credico (USA) LLC ("Credico"), Cromex Inc. ("Cromex"), Jesse Young ("Young"), and Meixi Xu (also known as "Corona") maintained unlawful employment practices, including misclassifying their employees as independent contractors and thereby failing to pay minimum wage or overtime compensation at the statutorily required rates for employees. Since plaintiffs initiated this lawsuit, five additional plaintiffs have filed notices of consent to join this action.
Before the Court is plaintiffs' motion for conditional certification of a class under the FLSA, which plaintiffs would define to include all persons across the country who performed face-to-face marketing work for Credico and its subcontractor companies, while classified as independent contractors, from July 2012 to the present. Plaintiffs seek court-facilitated notice of this action to such persons via email and text message.
For the reasons that follow, the Court grants plaintiffs' motion for conditional certification and authorizes court-facilitated notice to members of the putative collective.
Credico is a Delaware corporation headquartered in Chicago, Illinois. FAC ¶ 22. It provides face-to-face sales and marketing services to companies in, among others, the telecommunications, financial services, and energy industries, and to charitable organizations. Id. ¶ 26; Vasto Decl., Ex. 4 (Credico Website, "Credico USA Continues U.S. Expansion") ("Credico Art."). Credico's clients include Fortune 500 companies, such as Comcast, Verizon, and Sprint. See Credico Art.; Vasto Decl., Ex. 6, Ex. A ("Corona Lecture Tr."), at 3. Young is Credico's president. FAC ¶ 24; Credico Art.
Credico serves its clients through a global network of independent sales offices ("ISOs"). FAC ¶ 28; Credico Art. As of 2014, Credico contracted with more than 400 ISOs across 19 countries, including more than 100 offices throughout the United States. Credico Art. Each ISO employs workers ("agents") to engage in face-to-face sales and marketing for one or more of Credico's clients. See FAC ¶ 28; Corona Lecture Tr. 1-4. The agents' primary duty is to gather applications from consumers seeking to enroll in program(s) offered by Credico's client. See FAC ¶¶ 1, 28, 30; Corona Lecture Tr. 1-4.
Cromex is an ISO headquartered in New York City. FAC ¶ 23. It provides sales and marketing services for Sprint's Assurance Wireless brand.
Although ISOs are officially designated as "subcontractors,"
Most significant here, plaintiffs allege that Credico requires each of its ISOs to train its workers according to Credico's "Management Training Program," a six-to-twelve month course through which entry-level agents advance to more senior positions within their ISO and the Credico network. FAC ¶ 31.
The particular allegations of the named and opt-in plaintiffs, as set forth in their declarations, are summarized below.
At various points in 2015, the four named plaintiffs worked for Cromex in New York City, promoting Assurance Wireless cellphones and wireless services.
Each plaintiff attests that, at the start of his employment, he received a copy of Cromex's Account Executive Manual, which provides an overview of the Management Training Program, the schedule agents are expected to follow, and the tactics agents are expected to use when making sales pitches.
Each attests that, after his shift, he was required to return to the Cromex office to go over the day's sales and participate in "bell and gong," a ritual in which top performers hit a gong or rang a bell corresponding to the number of sign-ups they made that day.
Each plaintiff attests that he and his coworkers "were required to go through this routine six days per week, Monday through Saturday."
Plaintiffs assert that, given the degree of control that defendants exercised over them, they qualified as employees under the FLSA and were "jointly employed" by each of the defendants. FAC ¶¶ 1, 44-45. Accordingly, plaintiffs claim, they were entitled to minimum wage and overtime compensation for hours worked in excess of 40 hours per week. See id. ¶¶ 73-74.
However, plaintiffs allege, they and their colleagues were misclassified as independent contractors. Id. ¶¶ 2, 8. Accordingly, each plaintiff attests that he and his coworkers, regardless of their title, "were paid only by commission, at $10 for every qualified customer [they] signed up. If the customer signed up but turned out to be unqualified for the Assurance Wireless program, [they were] not paid."
At various points between 2012 and 2015, Torres and the five opt-in plaintiffs, Matheus Leite, Aysha Amjad, Danielle Bolden, Emily Luchnick, and Lillian Vilchez, collectively worked at seven Credico ISOs in four states, conducting face-to-face marketing for six Credico clients.
Regardless of the ISO that employed him or the service he was marketing, each of these plaintiffs makes certain common factual allegations about his employment. Each attests that he participated in a "Management Training Program," under which he was required to (1) arrive at the office in the morning for motivational "atmosphere room" meetings; (2) report to the field for "ride-outs"; and (3) return to the office for evening meetings, where he participated in additional rituals like "bell and gong."
Each opt-in plaintiff attests that he was classified as an independent contractor and paid only a set fee per qualified customer that he signed up.
Each opt-in plaintiff who was promoted from account executive to a more senior position attests that, notwithstanding his change of title, his schedule and payment remained the same, with the exception that he was required to report to the office earlier for additional morning meetings.
Two opt-in plaintiffs, Leite and Amjad, offer mirror-image accounts of their experiences starting their own ISOs, once they graduated from the Management Training Program. Each attests that he received instructions from his former supervisors and other Credico officials (including, in Leite's case, Credico Vice President for the United States, Raf Diaz), which he was told were binding on all ISO owners within the Credico network. Leite Decl. ¶¶ 13, 15, 22; Amjad Decl. ¶¶ 9, 12. Specifically, each attests, he was instructed that, before opening his ISO, he must raise a certain amount of money and organize a team of agents. Leite Decl. ¶ 13; Amjad Decl. ¶ 9. Additionally, each attests, he was told where to open his office and what marketing campaign his business should promote. Leite Decl. ¶ 15; Amjad Decl. ¶ 9. Finally, each attests, he was informed that the uniform features of the Management Training Program, including the six-day workweek schedule, and the morning and evening meetings, were necessary for a "successful business" in the Credico network. Leite Decl. ¶ 22; Amjad Decl. ¶ 12.
On July 27, 2015, plaintiffs filed a complaint in the Northern District of Illinois, bringing claims, on behalf of themselves and other similarly situated employees, against defendants under the FLSA, NYLL, AWA, and AMWA. Dkt. 1. The case was assigned to the Hon. Milton I. Shadur, United States District Judge. On July 30, 2015, plaintiffs filed the FAC. Dkt. 6. On August 5, 2015, plaintiffs moved for class certification as to their state law claims and for limited discovery on class certification-related issues. Dkt. 10. On September 28, 2015, Credico answered. Dkt. 26.
On October 19, 2015, plaintiffs moved to amend the FAC to add additional claims and parties. Dkt. 33. On October 23, 2015, plaintiffs moved for conditional certification and judicial notice under the FLSA. Dkt. 38. On November 3, 2015, Judge Shadur summarily denied plaintiffs' motion for conditional certification. Dkt. 41.
On November 4, 2015, plaintiffs moved to transfer the case to this District. Dkt. 42. On November 9, 2015, plaintiffs withdrew their motion for leave to amend the FAC. See Dkt. 46. That day, Judge Shadur granted plaintiffs' motion to transfer. Id.
On December 4, 2015, the Court accepted this case as related to Martin v. Sprint/United Management Company, 15 Civ. 5237, a separate action pending on the Court's docket.
On December 22, 2015, plaintiffs filed a renewed motion for conditional certification and a memorandum of law in support. Dkt. 62 ("Pl. Br."). Plaintiffs also submitted supporting declarations by plaintiffs' counsel, Savytska Decl., and the named plaintiffs, Dkt. 62, Exs. 2-10.
On January 4, 2016, the Court granted in part and denied in part the Martin plaintiffs' motion for conditional certification. 15 Civ. 5237, Dkt. 86, reported as Martin v. Sprint/United Mgmt. Co., No. 15 Civ. 5237 (PAE), 2016 WL 30334 (S.D.N.Y. Jan. 4, 2016).
On January 11, 2016, Cromex and Corona answered. Dkts. 77, 78. On January 22, 2016, Cromex and Corona notified the Court that they do not oppose plaintiffs' motion for conditional certification. Dkt. 82.
On February 5, 2016, plaintiffs replied, Dkt. 87 ("Pl. Reply Br."), and filed consent forms and declarations by five plaintiffs who have opted into this lawsuit, Dkt. 86; Dkt. 87, Exs. 1-5. Plaintiffs also filed supplemental declarations by Zheng and plaintiffs' counsel, Dkt. 87, Exs. 6-7, and a revised notice and consent form, id., Ex. 8.
On February 22, 2016, the Court granted plaintiffs leave to file new evidence in support of their motion. Dkt. 97. On February 23, 2016, plaintiffs submitted a declaration by opt-in plaintiff Emily Luchnick, Luchnick Supp. Decl., and accompanying exhibits.
On February 26, 2016, with leave of court, Credico filed a sur-reply, Dkt. 105 ("Credico Sur-reply Br."), along with five supporting declarations, Dkts. 100-104.
The FLSA provides that an action may be maintained against an employer "by any one or more employees for and on behalf of himself or themselves and other employees similarly situated." 29 U.S.C. § 216(b). "Although they are not required to do so by FLSA, district courts `have discretion, in appropriate cases, to implement [§ 216(b)] . . . by facilitating notice to potential plaintiffs' of the pendency of the action and of their opportunity to opt-in as represented plaintiffs." Myers v. Hertz Corp., 624 F.3d 537, 554 (2d Cir. 2010) (quoting Hoffmann-La Roche, Inc. v. Sperling, 493 U.S. 165, 169 (1989)).
"In determining whether to exercise this discretion . . . the district courts of this Circuit appear to have coalesced around a two-step method," which the Second Circuit has endorsed as "sensible." Id. at 554-55; see, e.g., Martin, 2016 WL 30334, at *4; Romero v. H.B. Auto. Grp., Inc., No. 11 Civ. 386 (CM), 2012 WL 1514810, at *8 (S.D.N.Y. May 1, 2012); Damassia v. Duane Reade, Inc., No. 04 Civ. 8819 (GEL), 2006 WL 2853971, at *3 (S.D.N.Y. Oct. 5, 2006); Hoffmann v. Sbarro, Inc., 982 F.Supp. 249, 261 (S.D.N.Y. 1997).
"The first step involves the court making an initial determination to send notice to potential opt-in plaintiffs who may be `similarly situated' to the named plaintiffs with respect to whether a FLSA violation has occurred." Myers, 624 F.3d at 555. "The court may send this notice after plaintiffs make a `modest factual showing' that they and potential opt-in plaintiffs `together were victims of a common policy or plan that violated the law.'" Id. (quoting Sbarro, 982 F. Supp. at 261). Although "[t]he `modest factual showing' cannot be satisfied simply by `unsupported assertions,' . . . it should remain a low standard of proof because the purpose of this first stage is merely to determine whether `similarly situated' plaintiffs do in fact exist." Id. (quoting Dybach v. State of Fla. Dep't of Corr., 942 F.2d 1562, 1567 (11th Cir. 1991)); accord Damassia, 2006 WL 2853971, at *3 ("[A] plaintiff's burden at this preliminary stage is minimal." (internal quotation marks omitted) (collecting cases)); Sbarro, 982 F. Supp. at 261 ("The burden on plaintiffs is not a stringent one."). "A court need not evaluate the underlying merits of a plaintiff's claims to determine whether the plaintiff has made the minimal showing necessary for court-authorized notice." Damassia, 2006 WL 2853971, at *3; accord Gjurovich v. Emmanuel's Marketplace, Inc., 282 F.Supp.2d 101, 105 (S.D.N.Y. 2003); Sbarro, 982 F. Supp. at 262.
"At the second stage, the district court will, on a fuller record, determine whether a so-called `collective action' may go forward by determining whether the plaintiffs who have opted in are in fact `similarly situated' to the named plaintiffs. The action may be `de-certified' if the record reveals that they are not, and the opt-in plaintiffs' claims may be dismissed without prejudice." Myers, 624 F.3d at 555.
Plaintiffs move for conditional certification of a collective consisting of all persons who performed face-to-face marketing work for Credico and its subcontractor ISOs in the United States between July 2012 and the present, while classified as independent contractors. Pl. Br. 1. To justify such conditional certification, plaintiffs must make a "modest factual showing" of a "factual nexus" that binds all members of the proposed collective together as victims of a common unlawful practice. Martin, 2016 WL 30334, at *4-5; Sbarro, 982 F. Supp. at 261; see also Vasquez v. Vitamin Shoppe Indus. Inc., No. 10 Civ. 8820 (LTS), 2011 WL 2693712, at *3 (S.D.N.Y. July 11, 2011) ("As Plaintiff proposes a nationwide class, he bears the burden of showing a nationwide policy or plan pursuant to which [plaintiffs are subjected to FLSA violations]."). After reviewing the pleadings, plaintiffs' declarations, and the documentary evidence submitted in connection with this motion, the Court finds that plaintiffs have satisfied this minimal burden.
The declarations of the four named and five opt-in plaintiffs, who collectively worked at 10 ISOs in four states, commonly allege practices that violate the FLSA. Specifically — regardless of the ISO at which he worked, the marketing campaign on which he was staffed, or the title he held — each declarant attests that he: (1) lacked discretion over the manner in which he performed his work and was consistently monitored by his employers; (2) was regularly required to work more than 40 hours per week; and (3) was paid only a flat-rate commission for each qualified customer he signed up.
Important here, the declarants supply a strong basis for inferring that these unlawful employment practices were not particular to them or the ISOs at which they worked, but instead reflect core components of a uniform Management Training Program implemented at Credico ISOs across the country. The declarations contain virtually identical accounts of the distinctive wage-and-hour practices that the declarants followed pursuant to the Management Training Program. As to their schedules, each declarant attests that he and his colleagues were required to undergo the following daily routine: (1) attending early morning meetings in the "atmosphere room," where they engaged in motivational rituals; (2) conducting "ride-outs" in the field during which they signed up consumers with their Credico-provided tablets; and (3) attending evening meetings at which they participated in the "bell and gong" ritual.
Plaintiffs' common and reasonably detailed accounts of their experiences pursuant to the Management Training Program satisfactorily suggest a Credico-wide policy and/or practice. Indeed, courts in this District have held that "[w]here plaintiffs allege such idiosyncratic conduct across multiple [locations/subcontractors], it is reasonable to infer that the same pattern of behavior occurred at defendants' other [locations/subcontractors]." Morris v. Lettire Const., Corp., 896 F.Supp.2d 265, 270-71 (S.D.N.Y. 2012) (plaintiffs' uniform allegations that they received "purely `straight time' pay in the same distinctive manner . . . no matter where they worked or who supervised them" supported "a reasonable inference that plaintiffs' experiences reflected a company-wide policy"); see also Costello, 2014 WL 4377931, at *6 ("The probity of drawing . . . an inference [of a common unlawful policy] . . . may . . . be affected by the commonality of the substantive testimony or affirmations that the plaintiffs provide.").
In addition, several declarants claim knowledge that the wage-and-hour practices they challenge derived from Credico, as opposed to the ISOs that directly employed them. For instance, Vasto, Leite, and Vilchez each attest that they were told by their supervisors that the commissions they received were determined by Credico.
These second-hand accounts are further corroborated by the attestations of Leite and Amjad as to their experiences as owners of ISOs within the Credico network. Each attests that the agents who worked at his ISO were classified as independent contractors and paid solely based on the number of qualified customers they signed up. Leite Decl. ¶ 21; Amjad Decl. ¶ 11. Each attests that this compensation scheme was dictated by Credico: Leite attests that he and other ISO owners received "strict guidelines" from Credico, which required them to specify in job postings that "the [agent] positions were paid solely based upon performance." Leite Decl. ¶ 19. And Amjad attests that, when she started her ISO, her former supervisor gave her a number of standard business-operations forms, which had been provided to him by Credico to use at his own company. Amjad Decl. ¶ 10. These included a sample independent contractor agreement, which states that agents are to be paid only a set fee per sign-up. Id.; see id., Ex. 2. Amjad was also given roll call sheets to track each agent's weekly earnings based upon set fees per sign-up. Id. ¶ 10; see id., Ex. 5. She attests that she was required to submit these forms each week to a Credico-designated accountant. See id. ¶¶ 13-14.
Both Leite and Amjad also attest that, when they opened their ISOs, they were informed by their past supervisors and other Credico executives (including, as to Leite, Credico's vice president for the United States) that the uniform features of the Management Training Program, including the six-day workweek schedule and the morning and evening meetings, were necessary for a "successful business" in the Credico network. Leite Decl. ¶ 22; Amjad Decl. ¶ 12. Leite and Amjad understood these statements to connote that Credico monitored the performance of each agent and ISO, and would shut down a company whose agents did not meet the target for qualified sign-ups. See Leite Decl. ¶ 15 ("[My former supervisor] explained that Credico could take away the client (the entity we were helping sign up customers for) if the office did not meet weekly targets for numbers of sign-ups. In that case, I would have to go into a `retrain.'"); id. ¶ 20 (discussing how, when his ISO was unable to maintain the target number of sign-ups, he was demoted to the position of account executive at another ISO); Amjad Decl. ¶ 21 (attesting that when her ISO was not making enough sign-ups, she was demoted to the assistant manager position at another ISO). The named plaintiffs' attestations that they could be terminated for failing to meet targets for qualified sign-ups suggests that ISO owners, in turn, enforced these quotas, and the long hours required to meet them, within their companies. See, e.g., Torres Decl. ¶ 19 ("My co-workers and I were required to sign up a minimum number of qualified customers per week. . . . We were told by our supervisors at Cromex, including Corona, that we could be terminated for failure to meet these goals."); id. ¶ 30 (explaining that agents at Vaeley Marketing Group were informed that they could be terminated for failing to sign up 60 qualified customers per week, and that the ISO owner "had to get approval from Credico to reduce [their] quota").
The assembled evidence thus supplies a sufficient basis on which to infer, at a minimum, a de facto policy by Credico under which ISO owners were obligated or incented (1) to require their agents/employees to work more than 40 hours per week in order to satisfy Credico's sign-up quotas, but (2) not to compensate them for overtime or guarantee a minimum wage for all hours worked. Courts have found evidence of such "dual-edged policies" to support conditional certification of a class. Winfield, 843 F. Supp. 2d at 404 ("[C]ourts have found plaintiffs to be similarly situated when they made common allegations that dual-edged policies of [not paying overtime while imposing strict sales quotas] . . . effectively required them to work uncompensated overtime.") (collecting cases); see, e.g., Levy v. Verizon Info. Servs., Inc., No. 06 Civ. 1583 (SMG), 2007 WL 1747104, at *2, *4-5 (E.D.N.Y. June 11, 2007) (finding telephone sales representatives similarly situated where they alleged that they were encouraged to work overtime to meet strict sales quotas but that overtime was rarely approved, resulting in a consistent failure to pay overtime compensation); Falcon v. Starbucks Corp., 580 F.Supp.2d 528, 536 (S.D. Tex. 2008) (plaintiffs similarly situated where they presented evidence that defendant's policy of requiring them "to perform job duties that could not easily be completed within 40 hours while, at the same time, strongly discouraging overtime" resulted in off-the-clock work and time shaving); Wilks v. Pep Boys, No. 02 Civ. 0837 (AAT), 2006 WL 2821700, at *6 (M.D. Tenn. Sept. 26, 2006) (conditionally certifying nationwide collective where plaintiffs "made a strong case for their argument that [company's compensation] system dictates that managers must commit the FLSA violations alleged by the plaintiffs in order to keep their jobs, or at least that they are strongly motivated to do so"), aff'd, 278 F. App'x 488 (6th Cir. 2008).
The plaintiffs' declarations, therefore, furnish a sufficient basis on which to find that they are "similarly situated" to all members of the putative collective.
Various documents submitted by the parties buttress plaintiffs' claim that the wage-and-hour policies described in their declarations are common to ISOs in the Credico network. These include the following:
Id. at 28.
These documents further show that Credico monitored the hours worked by ISOs' agents, and indeed appears to have acknowledged that agents participating in the Management Training Program are required to work more than 40 hours per week. For instance, the ARC Rules of Engagement states that ISOs must enter "roll call" and "feet on the street" data by 8 a.m. CST. ARC Rules, at 4.
In opposing conditional certification, Credico argues that these documents reflect no more than "recommended best practices," and thus do not show that Credico plays a role "in how its subcontractors classify and pay their workers." Credico Sur-reply Br. 5. But the mandatory language of the ARC Rules of Engagement and the Introduction to Credico (USA) Accounting belies this characterization. On their faces, these documents do not recommend that ISO owners submit roll call data on a daily basis or pay agents commission based on the rates established by Credico — they require it. And although the recruiting manual does not itself dictate that agents work more than 40 hours per week or be paid on commission, it acknowledges such policies and does not restrict them to a particular marketing campaign or ISO.
Courts in this Circuit frequently find corporate documents of this nature probative of a common policy that justifies conditional certification of a company-wide collective. See, e.g., Costello, 2014 WL 4377931, at *5 (plaintiffs "met their burden" where "[defendant's] own documents acknowledge[d] that [assistant store managers] nationwide are expected to perform at least some non-exempt work"); McEarchen v. Urban Outfitters, Inc., No. 13 Civ. 3569 (FB), 2014 WL 2506251, at *2 (E.D.N.Y. June 3, 2014) (affirming conditional certification of nationwide class where "the record before the court . . . included evidence in the form of corporate documentation that members of the putative collective share a commonality that is material to the application of the FLSA"); Alli v. Boston Mkt. Co., No. 10 Civ. 4 (JCH), 2011 WL 4006691, at *4 (D. Conn. Sept. 8, 2011) (conditionally certifying nationwide class based on, inter alia, evidence that defendant held a "uniform orientation" at which "employee guidelines" were distributed, and implemented a "standardized eight week training program for new [assistant general managers], promulgated at the corporate level").
In the face of plaintiffs' showing, Credico argues that plaintiffs have failed to establish that they are similarly situated to other members of the putative collective. See Credico Br. 8-13. It argues that even if plaintiffs were subject to unlawful employment practices at their respective ISOs, the evidence does not supply a sound basis to infer that their experiences are typical of agents across ISOs nationwide. Id. Drawing on the Court's decision denying nationwide conditional certification in Martin, Credico argues that plaintiffs here similarly "did not identify any unlawful corporate policy or practice that Credico mandated for all of its subcontractors that violates the FLSA." Credico Sur-reply Br. 1 (emphasis omitted).
Credico's reliance on Martin is misplaced. The facts here are far afield from those that led the Court to deny certification there. In Martin, the plaintiffs sought conditional certification of a class of all workers ("Agents") whose job was to gather Lifeline applications for Assurance Wireless (the "Sprint-wide class"), or, in the alternative, all persons whose job was to collect Lifeline applications through Credico, either directly or through one of its subcontractors (the "Credico-wide class"). Martin, 2016 WL 30334, at *5, *12. In support, the plaintiffs submitted declarations of 10 Agents who collectively had worked for six companies ("Sprint Partners"), including two Credico subcontractors, in three states, each of whom alleged employment practices that violated the FLSA. Id. at *1-3, *8. They also submitted Sprint-issued documents showing that Sprint exerted control over Sprint Partners and imposed various requirements that bear on Agents' activities. Id. at *5-6.
Critically, however, the documents adduced in Martin were "conspicuously silent as to how Agents are to be classified and paid"; they did not indicate that Sprint or Credico dictated the wages or schedules of individual workers.
In so ruling, however, the Court emphasized that "[t]he existence of an intermediary company does not, of course, preclude a finding of a nationwide practice attributable to a common principal such as Sprint [or Credico]." Id. at *10. On the contrary: "One can readily imagine a scenario in which a company with nationwide operations imposed a common policy as to wages, hours, or employment classifications that bound the intermediaries proximate to the affected workers." Id. But, the Court stressed, "solid evidence of such a policy, not conjecture, is necessary." Id. The Martin plaintiffs simply failed to supply such evidence. Id. at *11-13.
Plaintiffs have done so here. They have presented solid evidence of the type lacking in Martin. The declarations submitted here provide a concrete basis for inferring that the unlawful employment practices the declarants claim to have suffered are "traceable" to Credico: Multiple declarants attest that their supervisors told them that their fixed-rate commissions were set by Credico. And the declarants who opened their own ISOs attest that they lacked discretion in setting wage-and-hour policies for their workers. Such policies, they attest, were dictated, monitored, and enforced by Credico. The Credico-issued documents that plaintiffs have adduced further support their claim that agents were paid according to a fixed commission schedule and expected to work more than 40 hours per week. Notably, these documents portray these policies as applying to all ISOs in the Credico network. By their terms, they do not limit their scope to particular ISOs, regions, or clients.
This case is thus easily distinguished from Martin and other cases finding insufficient evidence to justify conditional certification of a nationwide class. See Guillen v. Marshalls of MA, Inc., 841 F.Supp.2d 797, 800 (S.D.N.Y. 2012) (denying conditional certification where there was "no evidence . . . that could plausibly lead to the inference that [assistant store managers] nationwide are performing non-exempt tasks" besides the testimony of six employees who worked exclusively in the New York area), adopted, No. 09 Civ. 9575 (LAP) (GWG), 2012 WL 2588771 (S.D.N.Y. July 2, 2012); Brickey v. Dolgencorp., Inc., 272 F.R.D. 344, 348 (W.D.N.Y. 2011) (denying conditional certification of nationwide collective where there was no evidence that the "employer intended, compelled[,] or condoned unlawful consequences that were a direct result of the [alleged unlawful] policy"); Jenkins v. TJX Cos. Inc., 853 F.Supp.2d 317, 321 (E.D.N.Y. 2012) (denying conditional certification where "[p]laintiff's sole submission in support of the existence of a common de-facto policy requiring [assistant store managers] to perform non-exempt tasks [was] [p]laintiff's own deposition testimony, discussing his own personal experience").
Separately, Credico asks the Court to credit declarations by four of its executives and two ISO owners (the "Credico declarants") attesting either to the actual or apparent compliance of its subcontractors with the pertinent wage laws, or that wage-and-hours policies are set by subcontractors acting on their own. See Credico Sur-reply Br. 3-6 (citing, inter alia, Kravtchenko Decl. ¶ 11 (Credico client services manager attesting that Credico believes that some of its subcontractors pay their workers in accordance with the applicable minimum wage and overtime laws); Dkt. 102 ("Medina Decl."), ¶¶ 3-4 (ISO owner attesting that his company pays agents on an hourly basis and complies with the FLSA, and that he has discretion to determine "how and when to pay the field agents working for [his] company"); Diaz Decl. ¶¶ 16-17 (attesting that "[t]o the best of [his] knowledge, Credico does not require any of its subcontractors to have morning `atmosphere room' meetings or evening `bell and gong' meetings with their field agents," or "to work any minimum or maximum number of hours or days per week")). But at this stage, courts in this Circuit routinely decline to consider such opposing declarations, because the issue for the Court is not whose evidence is more persuasive, but "whether Plaintiffs have made the `modest factual showing' that they are required to make at this stage of the litigation." Sharma v. Burberry Ltd., 52 F.Supp.3d 443, 456-57 (E.D.N.Y. 2014) (quoting Amador v. Morgan Stanley & Co. LLC, No. 11 Civ. 4326 (RJS), 2013 WL 494020, at *3 (S.D.N.Y. Feb. 7, 2013)) (collecting cases); see, e.g., Winfield, 843 F. Supp. 2d at 407 n.6 ("[C]ourts in this Circuit regularly conclude that [competing] declarations do not undermine the plaintiffs' showing in the first stage of the conditional certification process."); In re Penthouse Exec. Club Comp. Litig., No. 10 Civ. 1145 (NRB), 2010 WL 4340255, at *4 (S.D.N.Y. Oct. 27, 2010); Flood, 2015 WL 260436, at *5 n.6; Hernandez v. Merrill Lynch & Co., No. 11 Civ. 8472 (KBF), 2012 WL 1193836, at *5 (S.D.N.Y. Apr. 6, 2012); see also Winfield, 843 F. Supp. 2d at 407 n.6 (declining to consider 23 declarations by defendants' employees disputing plaintiffs' allegations where "plaintiffs ha[d] not had an opportunity to depose these declarants); Amador, 2013 WL 494020, at *8 ("[S]tatements gathered by an employer from its current employees are of limited evidentiary value in the FLSA context because of the potential for coercion.").
The Court, therefore, holds that plaintiffs have made the necessary "modest factual showing" that they and agents employed by Credico ISOs nationwide "together were victims of a common policy or plan that violated the law."
Plaintiffs seek approval of a judicial notice and consent form, Dkt. 87, Ex. 8, which they propose be distributed to all putative class members via email and text message. Pl. Reply Br. 10. Credico requests that the parties be given two weeks to confer on the content and means of dissemination of the notice, as well as the terms of the production of contact information for potential opt-in plaintiffs. Credico Br. 13.
The Court grants Credico's request, and directs the parties to confer and submit to the Court, by two weeks from the issuance of this Order, an agreed-upon proposal, including a proposed notice, procedures for its dissemination, and terms for the production of contact information for potential opt-in plaintiffs. In preparing the proposal, the parties are to give due consideration to the parameters set forth in Martin as to these issues. See Martin, 2016 WL 30334, at *15-20. The Court also offers the following guidance to assist the parties in their deliberations.
First, the Court is prepared to grant plaintiffs' request for permission to distribute the notice via email and text message. As the Court explained in Martin, courts in this District have permitted email and text message distribution where, as here, the nature of the employer's business facilitated a high turnover rate among employees. Id. at *19 (citing Bhumithanarn v. 22 Noodle Mkt. Corp., No. 14 Civ. 2625 (RJS), 2015 WL 4240985, at *5 (S.D.N.Y. July 13, 2015); Chamorro v. Ghermezian, No. 12 Civ. 8159 (TPG), Dkt. 17, ¶ 2(1) (S.D.N.Y. Feb. 25, 2013)).
Second, because plaintiffs allege willful violations of the FLSA, see FAC ¶¶ 73-74, the Court will approve a three-year limitations period in defining the scope of the collective action. See Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132, 141 (2d Cir. 1999) ("The FLSA generally provides for a two-year statute of limitations on actions to enforce its provisions, but allows a three-year limitations period for `a cause of action arising out of a willful violation.'" (quoting 29 U.S.C. § 255(a)); Martin, 2016 WL 30334, at *16.
However, the Court is not persuaded by plaintiffs' argument for equitable tolling. See Pl. Reply Br. 10. As the Court explained in Martin, equitable tolling is appropriate "only in rare and exceptional circumstances," Phillips v. Generations Family Health Ctr., 723 F.3d 144, 150 (2d Cir. 2013) (internal quotation marks and citation omitted), "where a plaintiff has been prevented in some extraordinary way from exercising his rights," Johnson v. Nyack Hosp., 86 F.3d 8, 12 (2d Cir. 1996) (internal citation omitted). Plaintiffs argue that tolling is appropriate here on account of the delay that resulted from the transfer of this case from the Northern District of Illinois. Pl. Reply Br. 10. But it was plaintiffs who moved to transfer the case to this District. The Court does not find that the resulting delay was beyond plaintiffs' control, or that justice requires tolling of the limitations period. See Hart, 2015 WL 365785, at *5 ("[E]quitable tolling may be appropriate when a significant delay in ruling on an FLSA motion for conditional certification is attributable to the Court and not the parties.").
Moreover, less than seven months have passed since plaintiffs filed their original motion for conditional certification in the Northern District of Illinois, and less than five months have passed since plaintiffs renewed their motion in this District. Such delay is not of a magnitude that would justify tolling. See, e.g., Mark v. Gawker Media LLC, No. 13 Civ. 4347 (AJN), 2014 WL 5557489, at *3 (S.D.N.Y. Nov. 3, 2014) (11-month delay in resolving conditional certification motion not "extraordinary" and did not justify equitable tolling from date motion was filed). Therefore, the proposed notice shall be directed to all persons who performed face-to-face marketing work for Credico and its subcontractor ISOs in the United States, while classified as independent contractors, within three years of the issuance of a court-approved notice.
For the foregoing reasons, the Court grants plaintiffs' motion for conditional certification of a collective consisting of all persons who conducted face-to-face marketing work for Credico and its subcontractor ISOs in the United States, while classified as independent contractors, at any point during the three years preceding the issuance of a court-approved notice.
The parties are directed to submit to the Court, within two weeks of this Order, an agreed-upon proposal, including a proposed notice, procedures for its dissemination, and terms for the production of contact information for potential opt-in plaintiffs, consistent with this Order. The Clerk of Court is respectfully directed to terminate the motions pending at docket numbers 62 and 90.
SO ORDERED.
