Walker v. Honghua Am., LLC

• Decision Date: 07 May 2012
• Docket Number: Civ. Action No. 4:12–cv–00134.
• Citation: 870 F.Supp.2d 462
• Parties: Bobby WALKER, Paul Frazier, David Fred Mehaffey II, Juan Garcia, Broderick McCloud, Michael Weathersby, Edgar Sanchez, and Javier Pineda, et al., Plaintiffs, v. HONGHUA AMERICA, LLC, Defendant.
• Court: U.S. District Court — Southern District of Texas

870 F.Supp.2d 462

Bobby WALKER, Paul Frazier, David Fred Mehaffey II, Juan Garcia, Broderick McCloud, Michael Weathersby, Edgar Sanchez, and Javier Pineda, et al., Plaintiffs,

v.HONGHUA AMERICA, LLC, Defendant.

Civ. Action No. 4:12–cv–00134.

United States District Court,

S.D. Texas,

Houston Division.

May 7, 2012.

Mark Joseph Oberti, Houston, TX, for Plaintiff. Andrea Marie Johnson, Burleson Cooke L.L.P, Houston, TX, for Defendant.

MEMORANDUM AND ORDER

KEITH P. ELLISON, District Judge.

Before the Court is Plaintiffs' Motion to Conditionally Certify a Collective Action and to Issue Notice (“Motion”). (Doc. No. 10.) After considering the Motion, all responses and replies thereto, and the applicable law, the Court concludes that the Motion should be GRANTED in part and DENIED in part.

I. FACTS

In January 2012, Bobby Walker (“Walker”), Paul Frazier (“Frazier”), David Fred Mehaffey II (“Mehaffey”), Juan Garcia (“Garcia”), Broderick McCloud (“McCloud”), Michael Weathersby (“Weathersby”), Edgar Sanchez (“Sanchez”), and Javier Pineda (“Pineda”) (collectively, “Plaintiffs”) filed this lawsuit against HongHua America, LLC (“HongHua” or “Defendant”), alleging violations of the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. (“FLSA”). (Doc. No. 1, Pl.'s Compl. ¶ 1.) Defendant, an American subsidiary of a Chinese company, designs and manufactures land rigs and offshore drilling modules. ( Id. ¶ 18.) Walker, Frazier, Mehaffey, and Garcia were employed by Defendant as Crane Operators. ( Id. ¶¶ 6–7.) McCloud, Weathersby, Sanchez, and Pineda worked for Defendant as Roughneck/Riggers. ( Id. ¶¶ 10–13.)

Plaintiffs claim that Defendant systematically labeled many of its employees “independent contractors” so that it could avoid paying them overtime as required by the FLSA, 29 U.S.C. § 207(a)(1). ( Id. ¶ 1.) Although there are exemptions to § 207(a)(1)'s requirements, Plaintiffs insist that none of these exemptions applied to them. ( Id. ¶ 47.) Consistent with its policy, Defendant allegedly misclassified Plaintiffs as independent contractors and paid them “straight-time overtime” when they worked over 40 hours in a workweek, rather than the time and one-half specified in the FLSA. ( Id. ¶ 2.) According to Plaintiffs, Defendant fired Walker and Frazier when they complained about not being paid time and one-half. ( Id. ¶ 3.) Plaintiffs aver that Defendant's violations of the FLSA were blatant and willful. ( Id. ¶ 41.) Consequently, Plaintiffs seek to recover unpaid overtime wages due to them and their similarly situated former coworkers. ( Id. ¶ 5.) Additionally, Walker and Frazier bring suit for retaliatory termination in violation of the FLSA's anti-retaliation provision, 29 U.S.C. § 215(a)(3). ¹ ( Id.) In their Complaint, Plaintiffs explain that they seek to represent a class under 29 U.S.C. § 216(b)² on behalf of: “All current and former Crane Operators and Roughneck/Riggers who were employed by HongHua during the three-year period preceding the filing of this complaint.” ( Id. ¶ 72.)

Plaintiffs filed this Motion, seeking to conditionally certify their proposed class. (Doc. No. 10.) Defendant filed a Response (Doc. No. 20) and a Sur–Reply (Doc. No. 24). Plaintiffs filed a Reply (Doc. No. 22).

II. LAW

Under § 207(a) of the FLSA, covered employers are required to compensate nonexempt employees at overtime rates for time worked in excess of statutorily-defined maximum hours. Section 216(b) provides a right of action for employees against employers who violate § 207. Similarly situated employees can “opt-in” to a lawsuit under § 207(a) to benefit from a judgment. Holbrook v. Smith & Hawken, Ltd., 246 F.R.D. 103, 105 (D.Conn.2007). Courts recognize two methods for determining whether to authorize notice to similarly-situated employees: the spurious class action Shushan approach, or the two-step Lusardi approach. Aguirre v. SBC Communications, Inc., No. H–05–3198, 2006 WL 964554, at *4–5, 2006 U.S. Dist. LEXIS 22211, at *14 (S.D.Tex. April 11, 2006) (citing Shushan v. Univ. of Colo. at Boulder, 132 F.R.D. 263 (D.Colo.1990); Lusardi v. Xerox Corp., 118 F.R.D. 351 (D.N.J.1987)). The Fifth Circuit has not determined which method is more appropriate, Mooney v. Aramco Servs. Co., 54 F.3d 1207, 1216 (5th Cir.1995), but most courts use the Lusardi approach, including this one, Aguirre, 2006 WL 964554, at *4–5, 2006 U.S. Dist. LEXIS 22211, at *14. See also Detho v. Asia Bilal, No. H–07–2160, 2008 WL 1730542, at *2, 2008 U.S. Dist. LEXIS 29502, at *5 (S.D.Tex. April 10, 2008); Johnson v. Big Lots Stores, Inc., Nos. 04–3201, 05–6627, 2007 WL 5200224, at *3 (E.D.La. Aug. 21, 2007) (“Since Mooney district courts in the Fifth Circuit have uniformly used [the Lusardi approach] to determine whether a collective [action] should be certified under the FLSA.”).

Under the first step of the Lusardi analysis, courts decide whether to issue notice to potential class members. Aguirre, 2006 WL 964554, at *4–5, 2006 U.S. Dist. LEXIS 22211, at *14. As the court's decision is usually based only on the pleadings and affidavits, the standard is lenient and typically results in conditional certification. Id. at *4–5, 2006 U.S. Dist. LEXIS 22211 at *14–15. Indeed, as discovery usually has not been conducted at this stage, courts do not review the underlying merits of the action in determining whether to conditionally certify. Colson v. Avnet, Inc., 687 F.Supp.2d 914, 926 (D.Ariz.2010). “Some courts place an emphasis on finding ‘some identifiable facts or legal nexus [that] binds the claims so that hearing the cases together promotes judicial efficiency.’ ” Aguirre, 2006 WL 964554, at *5, 2006 U.S. Dist. LEXIS 22211, at *15 (quoting Barron v. Henry County Sch. Sys., 242 F.Supp.2d 1096, 1103 (M.D.Ala.2003)). “ ‘A court may deny plaintiffs' right to proceed collectively if the action arises from circumstances purely personal to the plaintiff, and not from any generally applicable rule, policy, or practice.’ ” Id. (quoting England v. New Century Fin. Corp., 370 F.Supp.2d 504, 507 (M.D.La.2005)). Specifically, “[t]he first-stage test requires a minimal showing by the plaintiff that (1) there is a reasonable basis for crediting the assertions that aggrieved individuals exist, (2) that those aggrieved individuals are similarly situated to the plaintiff in relevant respects given the claims and defenses asserted, and (3) that those individuals want to opt-in to the lawsuit.” Id. at *6, 2006 U.S. Dist. LEXIS 22211 at *19;Albanil v. Coast 2 Coast, Inc., No. H–08–486, 2008 WL 4937565, at *6 (S.D.Tex. Nov. 17, 2008) (quoting Maynor v. Dow Chem. Co., No. G–07–504, 2008 WL 2220394, at *6 (S.D.Tex. May 28, 2008)). “Some factual support for the complaint allegations of class-wide policy or practice must be shown to authorize notice.” Maynor, 2008 WL 2220394, at *6. Notably, “[c]ollective actions under the FLSA are generally favored because such allegations reduce litigation costs for the individual plaintiffs and create judicial efficiency by resolving in one proceeding [all] ‘common issues of law and fact arising from the same alleged ... activity.’ ” Ryan v. Staff Care, Inc., 497 F.Supp.2d 820, 823 (N.D.Tex.2007) (quoting Hoffmann–La Roche, Inc. v. Sperling, 493 U.S. 165, 170, 110 S.Ct. 482, 107 L.Ed.2d 480 (1989)).

Once a court conditionally certifies a class, the action proceeds as a collective action during discovery. Aguirre, 2006 WL 964554, at *5, 2006 U.S. Dist. LEXIS 22211, at *16 (citing Mooney, 54 F.3d at 1214). At the second stage of the analysis, the defendant moves to “decertify” the conditionally-certified class. Id. (citing Mooney, 54 F.3d at 1214). The court then must make a factual determination as to whether the employees are similarly situated; if it so finds, the collective action may proceed. Id. at *5–6, 2006 U.S. Dist. LEXIS 22211 at *16–17. Alternatively, if the court finds that the employees are not similarly situated, the opt-in plaintiffs are dismissed without prejudice and the original plaintiffs proceed with their individual claims. Id. at *6, 2006 U.S. Dist. LEXIS 22211 at *17 (citing Mooney, 54 F.3d at 1214).

III. ANALYSIS

Utilizing the Lusardi analysis, the Court concludes that conditional certification is warranted. However, the Court finds that it is appropriate for the case to proceed with two classes: one class consisting of Crane Operators, and a second class consisting of Roughneck/Riggers. Also, although Plaintiffs may issue notice to workers beginning three years prior to the date of this Memorandum and Order, the end date must be set as January 12, 2012, when Defendants refashioned their overtime policy by hiring individuals from a third-party staffing company.

A. Parties' Briefing

In the Motion, Plaintiffs request that the Court conditionally certify a collective action and authorize Plaintiffs to issue “opt-in” notices to similarly situated Crane Operators and Roughneck/Riggers who have performed work for Defendant over the past three years without receiving overtime pay. (Doc. No. 10, Mot. Certify at 2.) Plaintiffs contend that conditional certification is proper because the Plaintiffs and their fellow Crane Operators and Roughneck/Riggers:

• All worked at the same location in Houston, Texas;

• All worked in one of two job categories, either as Crane Operators or Roughneck/Riggers, performing the same essential jobs under similar relevant conditions;

• All worked a lot of overtime;

• All were misclassified as “independent contractors” and thus were not paid overtime compensation that they were entitled to receive under the FLSA;

( Id. at 3.) Plaintiffs observe that other similarly situated individuals exist because, as explained in multiple affidavits, there are probably more than twenty other Crane Operators and two hundred Roughneck/Riggers who have worked for Defendant in the past three years. ( Id. at 13.) Additionally, Plaintiffs contend that there is ample proof that other persons want to join the case; indeed,...