Leon v. Tapas & Tintos, Inc.

• Citation: 51 F.Supp.3d 1290
• Decision Date: 07 October 2014
• Docket Number: Case No. 14–21133–CIV.
• Parties: Reinaldo Segundo LEON, and all similarly-situated individuals, Plaintiff, v. TAPAS & TINTOS, INC. and Nicolas D. Justo, individually, Defendants.
• Court: U.S. District Court — Southern District of Florida

51 F.Supp.3d 1290

Reinaldo Segundo LEON, and all similarly-situated individuals, Plaintiff

v.TAPAS & TINTOS, INC. and Nicolas D. Justo, individually, Defendants.

Case No. 14–21133–CIV.

United States District Court, S.D. Florida, Miami Division.

Signed Oct. 7, 2014.

Filed Oct. 8, 2014.

Zandro E. Palma, Zandro E. Palma, P.A., Miami, FL, for Plaintiff.

Richard Jay Burton, Daniel J. Poterek, Burton Firm, Miami, FL, for Defendant.

ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS

FEDERICO A. MORENO, District Judge.

Plaintiff Reinaldo Segundo Leon brings this action against Defendants Tapas & Tintos, Inc., a restaurant and bar located in Miami Beach, and against Nicolas Justo, director and owner of the restaurant. Plaintiff alleges he was employed by the Defendants between March 2006 and November 2011, and that his duties included food preparation, cooking, dishwashing, cleaning, and janitorial work. In his First Amended Complaint, Plaintiff alleges Defendants failed to pay overtime in violation of the Fair Labor Standards Act (Counts I and II), improperly retaliated against Plaintiff in violation of Fla. Stat. § 440.205 (Count III), misclassified Plaintiff in paying him as an independent contractor rather than a general employee in violation of the Florida Deceptive and Unfair Trade Practices Act (Count IV), and issued fraudulent tax returns based on this misclassification in violation of 26 U.S.C. § 7434 (Count V).

Defendants have moved to dismiss Plaintiff's complaint, or alternatively for a more definite statement, arguing Plaintiff's complaint is devoid of facts supporting Plaintiff's conclusory recitations of the elements for each cause of action, is vague and ambiguous, and that Plaintiff has otherwise failed to state claims for relief under the relevant statutes.

For the reasons provided below, the Court grants in part and denies in part the Motion to Dismiss. Plaintiff is granted leave to amend the complaint in accordance with this Order, and must do so by no later than October 29, 2014. Plaintiff must also file his written notice consenting to become a party member by no later than October 29, 2014. Defendants must file both a motion to dismiss, should it choose to do so, and an answer to the amended pleading by no later than November 20, 2014.

Legal Standard

When ruling on a motion to dismiss, a court must view the complaint in the light most favorable to the plaintiff and accept the plaintiff's well-pleaded facts as true. See St. Joseph's Hosp., Inc. v. Hosp. Corp. of Am., 795 F.2d 948, 953 (11th Cir.1986). This tenet, however, does not apply to legal conclusions. See Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). Moreover, “[w]hile legal conclusions can provide the framework of a complaint, they must be supported by factual allegations.” Id. at 1950. Those “[f]actual allegations must be enough to raise a right to relief above the speculative level on the assumption that all of the complaint's allegations are true.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 545, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). In short, the complaint must not merely allege a misconduct, but must demonstrate that the pleader is entitled to relief. See Iqbal, 129 S.Ct. at 1950.

I. Plaintiff has Stated a Claim for Relief under the Fair Labor Standards Act.

In Counts I and II, Plaintiff alleges failure to pay overtime against each Defendant under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 207. Plaintiff alleges Defendant is and was engaged in interstate commerce as defined under the Act where: (1) Defendant has more than two employees engaged in commerce or in the production of goods for commerce and who sold, handled, and worked on goods and materials previously moved through interstate commerce, as well as initiating credit card transactions, and (2) the annual gross revenue of Defendants was in excess of $500,000 per annum. Plaintiff concludes that for these reasons, there is enterprise coverage under the Act. Plaintiff further alleges that because he regularly handled and worked on goods and materials that were moved across State lines, there is individual coverage.

Defendants argue that Plaintiff has failed to allege any facts to support these conclusory assertions of enterprise and individual coverage, and that “a mere recitation of the elements is insufficient to state a claim.” Defendants point to two district court cases, wherein the court dismissed similar claims for those reasons. See Schainberg v. Urological Consultants of South Florida, P.A., 2012 WL 3062292 (S.D.Fla. July 26, 2012) ; Rushton v. Eye Consultants of Bonita Springs, 2011 WL 2601245 (M.D.Fla. June 30, 2011). In Schainberg, the Court found that Plaintiff “has merely repeated the statutory language verbatim, adding nothing else in the way of factual matter,” thus “find[ing] the allegations to be conclusory.” 2012 WL 3062292 at *3. In Rushton, the Court found that Plaintiff “has failed to allege any facts to support these conclusory statements,” and that “[a] mere recitation of the elements is insufficient to state a claim.” 2011 WL 2601245 at *2.

To establish a prima facie case for failure to pay overtime compensation and/or minimum wages under FLSA, an employee must demonstrate: “(1) an employment relationship, (2) that the employer engaged in interstate commerce, and (3) that the employee worked over forty hours per week but was not paid overtime wages.” Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233, 1277 n. 68 (11th Cir.2008). With respect to the third element, Plaintiff has sufficiently alleged that he worked over forty hours per week but was not paid overtime. With respect to the first element, Plaintiff has sufficiently demonstrated an employment relationship between himself and each Defendant. Under 29 U.S.C. § 203, “employee” is defined as “any individual employed by an employer,” and “employer” is defined as “any person acting directly or indirectly in the interest of an employer in relation to an employee.” As to Defendant Justo, Plaintiff alleges Mr. Justo is the director and owner of Tapas & Tintos. Plaintiff further alleges that Defendant Justo, along with Tapas & Tintos, “had absolute control over Plaintiff's hours of work,” that “[t]he work performed by Plaintiff was an integral part of the Defendants' business,” and that “Plaintiff performed his work entirely at the Defendants' facilities and used Defendants' equipment and supplies.” This is sufficient to establish Defendants as “employers” under FLSA. See, e.g., Alvarez Perez v. Sanford–Orlando Kennel Club, Inc., 515 F.3d 1150, 1160 (11th Cir.2008) (finding that an individual who is involved in the “day-to-day operation” of a company or who has “some direct responsibility for the supervision of an employee” may be considered an “employer” under the statute).

With respect to the second element, “[u]nder the FLSA, an employer is required to pay overtime compensation if the employee can establish enterprise coverage or individual coverage.” Thorne v. All Restoration Services, Inc., 448 F.3d 1264, 1265–66 (11th Cir.2006). For “individual coverage” to apply under the FLSA, an employee must have been (1) engaged in commerce or (2) engaged in the production of goods for commerce. 29 U.S.C. § 207(a) (stating “no employer shall employ any of his employees who ... is engaged in commerce or in the production of goods for commerce ... for a workweek longer than forty hours unless such employee received compensation ... at a rate no less than one and one-half times the regular rate”).

For individual coverage, “[a]n employee is engaged in commerce if he is engaged in activities that constitute interstate commerce, not merely affect it.” Thompson v. Robinson, Inc., 2007 WL 2714091, at *3 (M.D.Fla. Sept. 17, 2007) (citing Thorne, 448 F.3d at 1266 ). “An employee must ‘directly participat[e] in the actual movement of persons or things in interstate commerce by (i) working for an instrumentality of interstate commerce, ... or (ii) by regularly using the instrumentalities of interstate commerce in his work, e.g., regular and recurrent use of interstate telephone, telegraph, mails, or travel.’ ” Id. “Goods cease to move in interstate commerce once they reach the customer for whom they are intended.” Id. (citing Thorne, 448 F.3d at 1267 ). Thus, an employer who “purchases goods that previously moved in interstate commerce for intrastate use” or an employee who “engage[s] in any further intrastate movement of the goods [is] not covered under the Act.” Id.

In this case, Plaintiff's duties included food preparation, cooking, dishwashing, cleaning, and janitorial work. Plaintiff alleges that he was individually engaged in commerce because he regularly handled and worked on goods and materials that were moved across state lines. However, it appears that Defendant Tapas & Tintos, a restaurant, prepares food to be served in the local restaurant; Plaintiff does not allege that the food later returned to interstate commerce. The mere fact that the food may have passed in interstate commerce prior to arriving at the restaurant does not mean that the Plaintiff was engaged in commerce for individual coverage. Thompson, 2007 WL 2714091, at *3 ; see also Martin v. Briceno, 2014 WL 2587484 (S.D.Fla. June 10, 2014) ; Lopez v. Top Chef Inv., Inc., 2007 WL 4247646 (S.D.Fla. Nov. 30, 2007). With respect to dishwashing, cleaning, and janitorial work, Plaintiff similarly has not alleged that any “goods and materials,” whatever those may be, were later returned to interstate commerce. Plaintiff, therefore, has not established individual coverage.

However, the employees are still covered under FLSA if the employer is covered as an enterprise. For “enterprise coverage” to apply, the enterprise must have (1) 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...