192 F.3d 437 (4th Cir. 1999), 98-1969, Hukill v. Auto Care

Docket Nº:98-1969 (CA-97-1567-A).
Citation:192 F.3d 437
Party Name:MONTE J. HUKILL, Plaintiff-Appellee, v. AUTO CARE, INCORPORATED; MCGILLICUDDY & ASSOCIATES; WILLIAM MCGILLICUDDY, Defendants-Appellants.
Case Date:September 22, 1999
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit
 
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Page 437

192 F.3d 437 (4th Cir. 1999)

MONTE J. HUKILL, Plaintiff-Appellee,

v.

AUTO CARE, INCORPORATED; MCGILLICUDDY & ASSOCIATES; WILLIAM MCGILLICUDDY, Defendants-Appellants.

No. 98-1969 (CA-97-1567-A).

United States Court of Appeals, Fourth Circuit

September 22, 1999

Argued: April 8, 1999.

Appeal from the United States District Court for the Eastern District of Virginia, at Alexandria.

Leonie M. Brinkema, District Judge.

Page 438

COUNSEL ARGUED: John Michael Bredehoft, VENABLE, BAETJER & HOWARD, L.L.P., McLean, Virginia, for Appellants. Michaele Snyder Battles, KIBLAN & BATTLES, McLean, Virginia, for Appellee. ON BRIEF: Garald M. Bowen, GERALD M. BOWEN LAW OFFICES, McLean, Virginia, for Appellants.

Before ERVIN,[*] HAMILTON, and LUTTIG, Circuit Judges.

Vacated and remanded with instructions by published opinion. Judge Hamilton wrote the opinion, in which Judge Ervin and Judge Luttig joined.

OPINION

HAMILTON, Circuit Judge:

Monte Hukill (Hukill) brought this action against the defendants, William McGillicuddy (McGillicuddy), McGillicuddy Associates, Inc. (MAI), and Auto Care, Inc. (ACI), alleging that the defendants violated the Family and Medical Leave Act (FMLA), see 29 U.S.C. §§ 2601-2654, when the defendants refused to reinstate him in his former position with MAI upon his return from a leave of absence for a surgical procedure. Prior to trial, the district court held that, even though the defendants, individually or collectively, employed less than fifty employees during the period relevant to Hukill's FMLA claims, it had subject matter jurisdiction over Hukill's FMLA claims because the defendants and several corporations constituted an "integrated employer," 29 C.F.R. § 825.104(c)(2), and, therefore, the defendants were employers under the FMLA. Following a jury trial, the jury found in Hukill's favor. Judgment was entered in favor of Hukill in the amount of $17,825 on his FMLA claims, and the district court also awarded costs and attorney's fees in the amount of $56,545.97. On appeal, the defendants principally contend that the district court lacked subject matter jurisdiction over Hukill's FMLA claims. We agree. Accordingly, we vacate the district

Page 439

court's judgment and remand with instructions to dismiss the case for lack of subject matter jurisdiction.

I

A

MAI, a Virginia corporation, owns and operates an automotive service station in Burke, Virginia. McGillicuddy owns 100% of MAI's stock.

McGillicuddy also owns 50% percent of the stock in seven other Virginia corporations.1 Three of these corporations, King's Park Auto Care, Inc. (KPAC), Willston Center Auto Care, Inc. (WCAC), and Vienna Auto Care, Inc. (VAC), operate automobile service stations. Three others, Arlington Auto Care, Inc. (AAC), West Springfield Automotive, Inc. (WSA), and Burke Center Goodyear, Inc. (BCG), operate Goodyear tire centers. The seventh corporation, ACI, provides contract administrative services to MAI, KPAC, WCAC, VAC, AAC, WSA, and BCG. More specifically, ACI provides the following services to these corporations: (1) payroll services, with each payroll account being maintained separately; (2) bookkeeping services, with each set of books being maintained separately; (3) the administration of a health care plan, with individual accounts for each corporation being maintained separately; (4) issuance of various policy statements (e.g., substance abuse policy) applicable to each corporation; and (5) a secure site for the maintenance of personnel records.

McGillicuddy is president of ACI, MAI, KPAC, WCAC, VAC, AAC, WSA, and BCG, and functions on a day-to-day basis as the chief executive officer of these corporations. His office is at ACI, which is located in Arlington, Virginia. McGillicuddy is also a director of these corporations. Edmonds is the other director of these corporations, except MAI. Kathy McGillicuddy, McGillicuddy's wife, is a director of MAI. Jon Olson (Olson), comptroller for ACI, is the secretary-treasurer of ACI, MAI, KPAC, WCAC, VAC, AAC, WSA, and BCG, although he is not a director of or shareholder in any of these corporations. According to Hukill, during the period relevant to this appeal, ACI had five employees, MAI had eight, KPAC had ten, WCAC had six, and VAC, AAC, WSA, and BCG each had twelve. See Appellee's Brief at 4 n.2.

ACI, MAI, KPAC, WCAC, VAC, AAC, WSA, and BCG each operates at separate locations in Northern Virginia; files separate tax returns; holds separate shareholder and Board of Directors' meetings; conducts separate banking operations; with minor exceptions, purchases goods separately; enters into separate lease agreements; and does not share office space.2

For each corporation, in his capacity as president and chief executive officer, McGillicuddy establishes wage and benefit guidelines. For each automobile service station and tire center, in his capacity as president and chief executive officer, McGillicuddy hires a manager who is responsible for managing the automobile service station or tire center's day-to-day operations.3 Each manager is responsible for hiring employees and negotiating the salary of the new employee using the guidelines established by McGillicuddy. In general, McGillicuddy, as president and chief executive officer of each automobile service station and tire center, does not get involved in the operational and employment matters of each station unless requested

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by an individual manager. Olson, as secretary-treasurer of each automobile service station and tire center, does not get involved in employment matters, but does have to approve large expenditures. Finally, ACI has no role in MAI, KPAC, WCAC, VAC, AAC, WSA, or BCG's labor relations; no power to hire, fire, or supervise employees at its clients' companies; and no power to control the work schedules of the employees of its clients. Furthermore, there is no evidence that MAI has any control over the labor relations of KPAC, WCAC, VAC, AAC, WSA, or BCG, or vice versa.

However, there is some evidence in the record suggesting that ACI, MAI, KPAC, WCAC, VAC, AAC, WSA, and BCG's operations are interrelated. For example, aside from the obvious commonality of officers and directors, ACI made some bulk purchases of equipment on behalf of MAI, KPAC, WCAC, VAC, AAC, WSA, and BCG; on occasion, some employees were transferred from one automobile service station to another; the manager of BCG ran an advertisement in a newspaper implying an...

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