Alfaro-Huitron v. WKI Outsourcing Sols., LLC
| Decision Date | 22 January 2018 |
| Docket Number | No. CV 15-210 JCH/JHR,CV 15-210 JCH/JHR |
| Parties | ESTEBAN ALFARO-HUITRON, ELEAZAR GARCIA-MATA, JOSE ANTONIO GARCIA-MATA, JUAN GUZMAN, JOSE GERARDO JASSO, RAUL JASSO-CERDA, ISMAEL MARTINEZ GONZALEZ, ENRIQUE ROJAS-TORRES, LAZARO ROJAS-TORRES, TRINIDAD SANTOYO-GARCIA PEDRO TAMEZ, ANGELA TREJO, EFRAIN TREJO, SANTOS TREJO, and YANETH TREJO, Plaintiffs, v. WKI OUTSOURCING SOLUTIONS, LLC, JAIME CAMPOS, CERVANTES AGRIBUSINESS, CERVANTES ENTERPRISES, INC., RJF FARMS, INC., RONNIE J. FRANZOY, TIERRA DE DIOS FARMS, LLC, LACK FARMS, INC. and SKYLINE PRODUCE, LLC Defendants. |
| Court | U.S. District Court — District of New Mexico |
This matter is before the Court on the Motion for Summary Judgment by Defendant Cervantes Agribusiness [Doc. 185] the Motion for Summary Judgment by Defendant Cervantes Enterprises, Inc. [Doc. 186], and Cervantes Defendants' Motion for Partial Summary Judgment Based on Plaintiffs' Alleged Contract and Limited Contract Remedies [Doc. 208]. After careful consideration of the motions, briefs, and relevant law, the Court concludes that all three of the Cervantes Defendants' motions shall be granted.
Plaintiffs allege four causes of action against Cervantes Agribusiness and Cervantes Enterprises, Inc. (collectively, "Cervantes Defendants"): violation of the Agricultural Worker Protection Act, fraud, breach of contract, and civil conspiracy. The allegations are largely based on an agreement between Dino Cervantes, the general manager of both Cervantes Defendant entities, and Defendant Jaime Campos, representative of Defendant WKI Outsourcing Solutions, LLC ("WKI"). Mr. Campos and Mr. Cervantes signed an agreement under which Mr. Campos would provide 15 agricultural workers to work for Mr. Cervantes from November 10, 2011 to March 9, 2012. [Doc. 206-2, p. 1] The Agreement states that the workers would be skilled farm laborers and would be United States citizens, legal residents, or foreign workers with temporary H-2A working visas. [Doc. 206-2, p. 1]
Only nine of the 14 plaintiffs in this case assert causes of action against the Cervantes Defendants. Those nine are: Esteban Alfaro-Huitron, Eleazar Garcia-Mata, Jose Antonio Garcia-Mata, Juan Guzman, Enrique Rojas-Torres, Lazaro Rojas-Torres, Raul Jasso-Cerda, Trinidad Santoyo-Garcia, and Pedro Tamez.
According to a June 12, 2011 article in the El Paso Times, Jaime Campos founded WKI, a farmworker employment agency designed to help farmers in southern New Mexico with a reported worker shortage that was negatively impacting their harvests. [Doc 206-7, p. 11] The article explained that WKI was in the process of becoming certified by the U.S. Department of Labor to obtain temporary work visas for Mexican farm laborers who could fill the need described by the farmers interviewed for the article. No representative from either Cervantes Defendant entity was quoted or mentioned in the article.
Mr. Campos testified in a deposition that the purpose of WKI was to get H-2A workers to serve New Mexico farms. [Doc. 206-1, p. 6, 16:11-15] Mr. Campos explained that the labor shortage was allowing farm laborers to take advantage of the farmers by working unpredictable hours, missing days of work, and even drinking beer on the job, but the farmers could not fire them because there was no one else to do the work. [Doc. 206-1, p. 7, 19:14-20:7] According to Mr. Campos, the lack of reliable workers sometimes led farmers to hire undocumented laborers instead. [Doc. 206-1, p. 7, 18:17-20:7] Mr. Campos knew of the H-2A visa program, which was designed to be a legal way to bring foreign laborers to the United States and which he believed would help both the farmers and the foreign laborers who wanted to come do the work in the United States. [Doc. 206-1, p. 7, 18:24-19:11, 20:25-21:12]
Mr. Campos explained in a deposition that in the beginning he contacted farmers to discuss their expectations for the following growing season. [Doc. 206-1, p. 13, 42:5-17] Mr. Campos stated that most farmers told him they were planning on growing smaller crops because they did not have a reliable labor force to do a full harvest. [Doc. 206-1, p. 13, 42:5-17] During his meetings with farmers, Mr. Campos explained that his plan was to apply for an H-2A visa for workers whom WKI would then outsource to the farmers. [Doc. 206-1, p. 13, 43:20-23] He also informed them that the ability to bring those workers was not guaranteed, but was subject to the approval of the U.S. Department of Labor. [Doc. 206-1, p. 13, 44:21-45:17] Mr. Campos estimates that he met with about ten farmers on behalf of WKI. [Doc. 206-1, p. 14, 47:13-16]
Representatives from five southern New Mexico farms signed agreements to accept workers from WKI. WKI used the same written Agreement of Outsourcing Support form, written by Mr. Campos, with each of the five farms that agreed to accept WKI laborers. [Doc. 206-1, p. 22, 7:9-22] Mr. Campos testified that he gave the same presentation to all the farmers,during which he explained that he would seek H-2A workers and would include the signed Agreement in his application for those workers. [Doc. 206-1, p. 22, 8:4-12; p. 23, 10:19-11:8] Mr. Campos met with Dino Cervantes, the general manager of Cervantes Agribusiness and managing vice president of Cervantes Enterprises, on September 10, 2011 at Cervantes Enterprises' Vado, New Mexico office. [Doc. 206-1, p. 51, 7:14-17; p. 53, 14:21-15:5] When Mr. Cervantes was asked why he agreed to meet with Mr. Campos, Mr. Cervantes replied that "[Mr. Campos] was proposing a new business ... involving foreign workers through the H-2A program, and it sounded interesting to me." [Doc. 206-1, pp. 54-55, 21:20-22:3] Mr. Campos testified that Mr. Cervantes did not tell him where to find labor, and Mr. Campos did not tell Mr. Cervantes that he was going to find that labor in any specific state. [Doc. 206-1, p. 34, 77:18—p. 35, 78:6] Mr. Campos did not ever speak with a representative of Cervantes Enterprises other than Dino Cervantes. [Doc. 206-1, p. 35, 78:7-11]
Mr. Cervantes signed the Agreement of Outsourcing Support to employ 15 agricultural workers from November 10, 2011 to March 9, 2012. [Doc. 206-2, p. 1] Mr. Campos testified that when he completed the Agreement of Outsourcing Support with Mr. Cervantes, he did not realize there was a distinction between Cervantes Enterprises and Cervantes Agribusiness. [Doc. 206-1, p. 29, 51:12-52:6] Mr. Campos filled in the name Cervantes Agribusiness on the form because that was the name on the business card he had from Mr. Cervantes. [Doc. 206-1, p. 29, 52:16-23] Plaintiffs point out that although the Agreement names only Cervantes Agribusiness, it provides the address for Cervantes Enterprises and a description of work done by Cervantes Enterprises ("Processing and Packing: Dry Red Chile and Other Spices"). [Doc. 206-2, p. 1] Plaintiffs also point out that on WKI's H-2A application to the U.S. Department of Labor, underthe heading "Locations and Directions to Work Site," Mr. Campos listed Cervantes Enterprises' name and address. [Doc. 206-2, p. 13]
The Agreement of Outsourcing Support names as parties WKI Outsourcing and Cervantes Agribusiness. [Doc. 206-2, p. 1] The Agreement states that it is "for services as a work force provider," such work force consisting of "skilled farm labor workers; U.S. Citizens, legal residents, or foreign workers with temporary working visas (H-2A)." [Doc. 206-2, p. 1] The Agreement was effective from November 10, 2011 to March 9, 2012, under which WKI would "provide 15 farm workers on a daily basis" and would be responsible for paying each of those workers. [Doc. 206-2, p. 1] Under the Agreement the workers would be responsible for "Processing & Packing: Dry Red Chile & Other Spices." [Doc. 206-2, p. 1] The Agreement was signed and dated September 10, 2011 by Dino Cervantes and Jaime Campos. [Doc. 206-2, p. 1]
WKI's profits would be based on a rate of approximately one dollar for each hour of labor one of its outsourced workers completed. [Doc. 206-1, p. 15, 52:19-53:5] The hourly wage paid by the farmers would be based on the actual wage to be paid by WKI to the worker, plus approximately one dollar, which WKI would keep to cover expenses. [Doc. 206-1, p. 15, 52:19-53:19] WKI did not have the capital to pay workers itself, but was dependent on the funds paid by farmers under each contract. [Doc. 206-1, p. 16, 72:10-25] Mr. Campos testified that the farmers were aware of WKI's profit arrangement, whereby WKI would receive about one dollar for every outsourced hour of labor. [Doc. 206-1, p. 15, 53:12-18]
Another farmer who signed an agreement with Mr. Campos was Ronnie Franzoy of RJF Farms, with whom Mr. Campos met at least five times.1 [Doc. 206-1, p. 14, 48:16-17, 49:8-15] Mr. Franzoy testified that he preferred to hire Mexican laborers, and that his understanding wasMr. Campos would supply him with Mexican laborers; however Mr. Franzoy also stated that he had no intention of paying Mexican laborers a wage of approximately $10.00 per hour as envisioned under the H-2A program. [Doc. 206-1, p. 76, 39:24-25; p. 78, 47:1-21] Mr. Franzoy's understanding was that he would pay Mr. Campos $8.65 per hour of outsourced labor, with $7.50 going to the laborer and the remaining $1.15 to WKI. [Doc. 206-1, p. 81, 74:22-25 - 75:1-14] But Mr. Cervantes, when asked whether he planned on paying H-2A workers the statutorily fixed wage of $9.71 per hour of labor, replied that he and Mr. Campos discussed neither the laborers' nor Mr. Campos's wages. [Doc. 206-1, p. 55, 24:15-25]
In order to access foreign laborers through the federal H-2A visa program, an employer must apply with the Department of Labor for a certification that:
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