A. JOE FISH, Senior District Judge.
Before the court are the following motions: (1) the defendant Detail Solutions' motion for summary judgment ("Detail Motion") (docket entry 74); (2) the plaintiff's objection and motion to strike portions of defendant Detail Solutions' reply brief in support of motion for summary judgment ("Plaintiff's Motion to Strike") (docket entry 86); (3) the executrix's objection to plaintiff's motion for summary judgment and brief in support ("Executrix's Motion to Strike") (docket entry 92); and (4) the plaintiff's motion for partial summary judgment ("Mendoza Motion") (docket entry 87). For the reasons stated below, the Detail Motion is granted, the Plaintiff's Motion to Strike is granted, the Executrix's Motion to Strike is granted, and the Mendoza Motion is stricken in part and denied in part.
This is a dispute over alleged violations of the Fair Labor Standards Act ("FLSA"), including failure to pay minimum wage, unpaid overtime wages, and retaliation. See Complaint Under 29 U.S.C. 201-216 ("Complaint") ¶¶ 13-21 (docket entry 1). The plaintiff, Esau Torres Mendoza ("Mendoza"), was employed by the defendant, Detail Solutions, LLC ("Detail Solutions"), at least from April 2010 through November 2010.
Mendoza's duties with Detail Solutions included washing and detailing cars at certain automobile dealerships in the Dallas area. Id. at 3. He did not apparently interact with customers or use the telephone or computer as part of his responsibilities. Id. Mendoza also apparently never worked outside of the state for Detail Solutions and only worked for its Dallas-based customers. Id. Mendoza is an undocumented worker who does not possess a social security card, a U.S. citizenship card, or a U.S. or foreign passport. Id.; see also Appendix in Support of Defendant Detail Solutions' Motion for Summary Judgment ("Detail Appendix") at 8-9, 14 (docket entry 76). Mendoza avers that for
Mendoza filed a complaint against Detail Solutions and Charles Austein on December 1, 2010. See generally Complaint. After Mr. Austein passed away, the plaintiff's motion to substitute the executrix of Mr. Austein's estate, Carole Austein ("Austein"), as a defendant was granted. See Order of April 20, 2012 (docket entry 71). Detail Solutions filed an answer on January 12, 2011. See Defendants' Original Answer ("Answer") (docket entry 8). On June 20, 2012 Detail Solutions moved for summary judgment on the issue of the FLSA's coverage of Detail Solutions.
Summary judgment is proper when the pleadings, depositions, admissions, disclosure materials on file, and affidavits, if any, "show[] that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a), (c)(1).
When evaluating a motion for summary judgment, the court views the evidence in the light most favorable to the nonmoving party. Id. at 255, 106 S.Ct. 2505 (citing Adickes v. S.H. Kress & Company, 398 U.S. 144, 158-59, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970)). However, it is not incumbent upon the court to comb the record in search of evidence that creates a genuine issue as to a material fact. See Malacara v. Garber, 353 F.3d 393, 405 (5th Cir.2003). The nonmoving party has a duty to designate the evidence in the record that establishes the existence of genuine issues as to the material facts. Celotex Corporation v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "When evidence exists in the summary judgment record but the nonmovant fails even to refer to it in the response to the motion for summary judgment, that evidence is not properly before the district court." Malacara, 353 F.3d at 405.
The FLSA mandates that covered employers pay wages of at least $7.25 an hour to their employees. 29 U.S.C. § 206(a)(1)(C). It also mandates that covered employers not utilize employees "for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed." 29 U.S.C. § 207(a)(1).
Consistent with Congress's power to regulate interstate commerce, these provisions only apply (1) to an employer that has "employees who in any workweek [are] engaged in commerce or in the production of goods for commerce" ("individual coverage"), or (2) to an employer that has employees "employed in an enterprise engaged in commerce or in the production of goods for commerce" ("enterprise coverage"). See 29 U.S.C. § 206(a)(1) and 29 U.S.C. § 207(a)(1); for the terms "individual coverage" and "enterprise coverage," see, e.g., Martin v. Bedell, 955 F.2d 1029, 1032 (5th Cir.), cert. denied, 506 U.S. 915, 113 S.Ct. 323, 121 L.Ed.2d 243 (1992). "Commerce" is defined as "trade, commerce, transportation, transmission, or communication among the several States or between any State and any place outside thereof." 29 U.S.C. § 203(b). On "production of goods," the statute provides the following definition: "[A]n employee shall be deemed to have been engaged in the production of goods if such employee was employed in producing, manufacturing, mining, handling, transporting, or in any other manner working on such goods, or in any closely related process or occupation
To establish that his employer is subject to the requirements of the FLSA, the plaintiff employee has the burden to show that there is coverage, whether individual or enterprise. See, e.g., D.A. Schulte, Inc. v. Gangi, 328 U.S. 108, 120, 66 S.Ct. 925, 90 L.Ed. 1114 (1946).
The phrase "employees who in any workweek [are] engaged in commerce or in the production of goods for commerce" is not statutorily defined. Courts in the Fifth Circuit have interpreted the "engaged in commerce" language in 29 U.S.C. §§ 206(a)(1) and 207(a)(1) by applying a "practical test," which looks to whether an employee's work "is so directly and vitally related to the functioning of an instrumentality or facility of interstate commerce as to be, in practical effect, a part of it, rather than isolated local activity." See Sobrinio v. Medical Center Visitor's Lodge, Inc., 474 F.3d 828, 829 (5th Cir.2007), quoting Mitchell v. H.B. Zachry Company, 362 U.S. 310, 324, 80 S.Ct. 739, 4 L.Ed.2d 753 (1960). The Supreme Court has also explained that the test is whether "the employee's activities ... are actually in or so closely related to the movement of the commerce as to be a part of it." McLeod v. Threlkeld, 319 U.S. 491, 497, 63 S.Ct. 1248, 87 L.Ed. 1538 (1943). It is settled that Congress did not regulate to the full extent of its power under the Commerce Clause when it enacted the FLSA. See Wirtz v. Wohl Shoe Company, 382 F.2d 848, 850 (5th Cir.1967) ("it is now settled that in enacting the FLSA Congress did not exercise the full scope of its authority to regulate the working conditions of employees whose activities merely affect commerce"). It is therefore not sufficient, for purposes of the "engaged in commerce" clause of the individual coverage provision, that an employee's work merely "affects" interstate commerce in some way. Id.
Congress did define the phrase "enterprise engaged in commerce or in the production of goods for commerce." Such an enterprise is one that "(i) has employees engaged in commerce or in the production of goods for commerce, or that has employees handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce by any person; and (ii) is an enterprise whose annual gross volume of sales made or business done is not less than $500,000 (exclusive of excise taxes at the retail level that are separately stated)." 29 U.S.C. § 203(s)(1)(A). "Goods" are defined in the statute as "goods (including ships and marine equipment), wares, products, commodities, merchandise, or articles or subjects of commerce of any character, or any part or ingredient thereof, but does not include goods after their delivery into the actual physical possession of the ultimate consumer thereof other than a producer, manufacturer, or processor thereof." 29 U.S.C. § 203(i).
The first prong of the enterprise coverage definition can be met in one of two ways, either via the "engaged in commerce" clause or via the "handling" clause. Given the identical language, the "engaged in commerce" clause can be analyzed in essentially the same manner as individual coverage is analyzed.
With respect to individual coverage, Mendoza argues only that he was "engaged in commerce," not that he was "engaged in the production of goods for commerce." See Mendoza Response at 6-7. Mendoza asserts that he was "involved in the preparation and detailing of new cars, that had moved through interstate commerce for dealerships so that they could sell them to first time buyers in Texas." Id. at 6. Because such preparation is "an integral part of the sale of new vehicles," Mendoza argues that he was "actually in or so closely related to the movement of the commerce as to be a part of it." Id.
Mendoza misconstrues the "engaged in commerce" prong of the FLSA's individual coverage provision. To be engaged in commerce, it is not enough for an employee's work to be "integral" to interstate commerce. "[T]he test of whether one is in commerce is obviously more exacting than the test of whether [an] occupation is necessary to production for commerce." Armour & Company v. Wantock, 323 U.S. 126, 131, 65 S.Ct. 165, 89 L.Ed. 118 (1944). This "exacting" test requires the court to consider whether the work that Mendoza himself performed is, "in practical effect, a part of" either "commerce" or the "functioning of an instrumentality or facility of interstate commerce." See McLeod, 319 U.S. at 497, 63 S.Ct. 1248; and Sobrinio, 474 F.3d at 829. In answering this question, courts routinely look to whether the employee's work engages him in the "actual movement of persons or things."
Mendoza's lack of other employment duties only bolsters this conclusion. Detail Solutions points out, and Mendoza does not dispute, that he did not utilize any instrumentalities of interstate commerce in the performance of his job. Detail Brief at 3. His car-washing activities did not require use of computers, telephones, or other such instrumentalities of interstate commerce. Id. Mendoza was thus not "engaged in commerce," and the court concludes that there is no individual coverage of Mendoza under the FLSA.
Mendoza never argues that Detail Solutions had employees who were "engaged in commerce" or in "the production of goods for commerce." The court thus need not analyze this clause of the enterprise coverage provision.
Mendoza does not specifically identify the "handling clause" as the basis of his enterprise coverage argument, but the court construes his summary judgment response as making such an argument. See Mendoza Response at 7 ¶ 21. Mendoza urges that "[t]he evidence also establishes that two or more of [Detail Solutions'] employees regularly and recurrently handled or worked on new automobiles made outside the state of Texas." Id. Detail Solutions disputes the sufficiency of the evidence Mendoza uses to establish that the cars Detail's employees washed had moved in interstate commerce. See Detail Reply at 2. Mendoza asserts by affidavit that the cars he washed (which include Audi, Nissan, Volvo, Toyota, GMC, and Suzuki) were manufactured out of state. See Plaintiff's Appendix to Brief in Support of Plaintiff's Response to Defendant Detail Solutions' Motion for Summary Judgment ("Mendoza Appendix 1") at 9 ¶ 4 (docket entry 81).
Mendoza, however, is not shown to have personal knowledge about where these cars were manufactured and so his statement cannot meet the requirements of FED. R. CIV. P. 56(c)(4). Mendoza also includes in the appendix to his response printouts from Internet sites purporting to show that the types of cars he washed are manufactured in states other than Texas. See id. at 12-21. Detail Solutions correctly argues that these Internet pages do not meet the authentication requirement of Federal Rule of Evidence 901. See Detail Reply at 2.
In addition, Mendoza has submitted no evidence about the makes of car that other employees at Detail Solutions washed in the course of their employment. This is fatal to Mendoza's enterprise coverage argument, because enterprise coverage requires the court to find that an employer had multiple employees "handling, selling, or otherwise working on" goods that have moved in interstate commerce. See 29 U.S.C. § 203(s)(1)(A)(i). The court thus concludes that the plaintiff has not brought forward evidence sufficient to show that Detail Solutions "has employees ... working on goods ... that have been moved in ... commerce."
Mendoza argues further that he and other employees were required to wear uniforms on the job and that these uniforms contained labels that stated they were made in Honduras. See Mendoza Response at 7 ¶ 21. Mendoza is apparently arguing that wearing such a uniform means that he and Detail's other employees were "handling materials"
Under this definition, it is clear that uniforms do not qualify. They are not necessary for doing or making anything and they do not have a significant connection to the activity of washing cars. They may be important to the business in identifying or advertising itself. But their lack of connection to the actual commercial activities of Detail Solutions' enterprise means they cannot be considered "materials" for purposes of enterprise coverage.
Given the failure of both his individual coverage and his enterprise coverage arguments, Mendoza has not sustained his burden of showing that the FLSA applies to Detail Solutions. Detail Solutions' motion for summary judgment is therefore granted on Mendoza's FLSA minimum wage and overtime claims.
As an initial matter, there is a question whether the FLSA's retaliation provisions can apply to an employer who is not otherwise covered by the act under its individual coverage or enterprise coverage provisions. The Fifth Circuit has answered this question in the affirmative. See Wirtz v. Ross Packaging Company, 367 F.2d 549, 550-551 (5th Cir.1966). The court must therefore analyze whether or not the back pay damages Mendoza seeks as a remedy for Detail Solutions' alleged retaliation are available in this case.
Detail Solutions argues that Mendoza's status as an undocumented worker precludes awarding him back pay damages, under Hoffman Plastic Compounds, Inc. v. National Labor Relations Board, 535 U.S. 137, 122 S.Ct. 1275, 152 L.Ed.2d 271 (2002). Hoffman explained that an award of back pay damages to a worker whose immigration status placed him in violation of Immigration Reform and Control Act of 1986 ("IRCA") "runs counter to policies underlying the IRCA" and would condone prior violations of the immigration laws and encourage future violations. See Hoffman, 535 U.S. at 149-50, 122 S.Ct. 1275.
As an initial matter, the court notes that the admissions to which Detail Solutions points in its brief establish that Mendoza would have been in violation of 8 U.S.C. § 1324a(b), which requires possession of documents establishing employment authorization, at the time of his employment and discharge from Detail Solutions. See Detail Appendix at 8-9, 14. Not only so, but Mendoza never disputes Detail Solutions' claims that Mendoza provided it a false social security number that did not belong to him. The question then becomes whether the logic of Hoffman, a case that arose under the National Labor Relations Act ("NLRA"), applies equally to awards of back pay to undocumented workers under other federal labor statutes.
The Fifth Circuit has distinguished awards of back pay to undocumented workers under the NLRA from awards of workers compensation to undocumented workers under the Longshore and Harbor Workers' Compensation Act ("LHWCA"). See generally Bollinger Shipyards, Inc. v. Director, Office of Worker's Compensation Programs, 604 F.3d 864 (5th Cir.2010). The Bollinger court concluded that Hoffman did not apply to the LHWCA because (1) "workers' compensation under the LHWCA is a non-discretionary, statutory remedy," (2) "the LHWCA is a substitute
Here, none of the three factors the Fifth Circuit in Bollinger used to distinguish the LHWCA from the NLRA is present. Back pay is a discretionary remedy under the FLSA. 29 U.S.C. § 216 mandates that a violator of section 215(a)(3) (the retaliation provision) "shall be liable for such legal or equitable relief as may be appropriate to effectuate the purposes of section 215(a)(3) of this title, including without limitation employment, reinstatement, promotion, and the payment of wages lost and an additional amount as liquidated damages." Thus, unlike the LHWCA, a violation of the FLSA is not solely remedied by compensation for wages lost. If the court does not consider it "appropriate to effectuate the purposes of section 215(a)(3)" by an award of back pay that would simultaneously frustrate the purpose of the IRCA, the court has discretion not to award any back pay. Second, the FLSA does not function as a substitute for tort law in a limited employment context, as the LHWCA does. Finally, the FLSA does not contain any express provisions authorizing the award of benefits in equal amounts to nonresident aliens, as the LHWCA does.
The court has identified no other relevant factors that would distinguish the FLSA from the NLRA so as to make Hoffman inapplicable. Since Mendoza has essentially admitted his undocumented status (which placed him in violation of the IRCA at the time of his employment), and since Hoffman, absent special factors, prohibits awards of back pay to undocumented workers under federal labor statutes, the court agrees with Detail Solutions that Mendoza cannot be permitted to recover back pay damages for employment time lost due to any alleged retaliation motivating his firing.
Mendoza argues in his motion to strike that, since Detail Solutions did not in its initial motion request summary judgment on elements of damages other than back pay that may have resulted from the alleged retaliation (including emotional distress, humiliation, and pain and suffering), those issues are not properly before the court. See Mendoza Motion to Strike at 2 ¶¶ 2-4. The court agrees, and it will defer consideration of whether any of these elements of damages may have resulted from the alleged retaliation and of whether such damages are available to Mendoza in spite of Hoffman. Mendoza's motion to strike any portions of Detail Solutions' reply brief that request summary judgment on such elements of damages is therefore granted.
Austein objects that Mendoza's motion for partial summary judgment is, in effect, a sur-reply filed without leave of the court, in that it largely copies Mendoza's summary judgment response and attempts to raise again issues that were fully briefed and argued in the context of Detail Solutions' summary judgment motion. See Executrix's Motion to Strike at 1-2. The court construes this objection as a motion to strike portions of Mendoza's partial summary judgment motion. The court agrees with Austein that the sections of Mendoza's motion that address the issues of FLSA coverage and back pay damages, see Mendoza Brief at 5-6, 8-10, are repetitious, largely unnecessary, and function in
Mendoza argues that Charles Austein must be considered an "employer" for FLSA purposes, because he was the owner and President of Detail Solutions in the relevant time period and because he had primary responsibility for the company's financial decisions. See Mendoza Brief at 7. Neither Detail Solutions (in its response) nor Austein (in her objection) addresses this aspect of Mendoza's summary judgment motion.
The FLSA defines an employer as "any person acting directly or indirectly in the interest of an employer in relation to an employee." 29 U.S.C. § 203(d). The Fifth Circuit has explained that the question whether a person is an employer is a question of fact and that "the total employment situation should be considered." See Wirtz v. Lone Star Steel Company, 405 F.2d 668, 669 (5th Cir.1968). The test is one of "economic reality," rather than "technical concepts." See Goldberg v. Whitaker House Cooperative, Inc., 366 U.S. 28, 33, 81 S.Ct. 933, 6 L.Ed.2d 100 (1961); Gray v. Powers, 673 F.3d 352, 354 (5th Cir.2012). Key factors under this test of economic reality include whether an alleged employer: "(1) possessed the power to hire and fire the employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records." Williams v. Henagan, 595 F.3d 610, 620 (5th Cir.2010), citing Watson v. Graves, 909 F.2d 1549, 1553 (5th Cir.1990).
Mendoza contends the following facts contribute to a finding that Mr. Austein was an "employer" of Mendoza and other Detail employees: (1) Mr. Austein was an owner during the relevant time period; (2) he was the President of Detail Solutions with control over day to day operations; (3) he was the person most responsible for the company's financial decisions. See Mendoza Brief at 4, 7. These facts, while perhaps relevant to the issue of Austein's employer status, are not enough to enable this court to conclude that he was an "employer" for purposes of the FLSA. While it is true that "operational control" is a key consideration, see Gray, 673 F.3d at 355, Mendoza's bare assertion that Mr. Austein exercised operational control over Detail Solutions is neither dispositive nor persuasive in the absence of specific facts indicating such control. The court denies Mendoza's summary judgment motion on the issue of whether Charles Austein was an "employer" of Mendoza for purposes of the FLSA.
For the reasons stated above, Detail Solutions' motion for summary judgment is