Badgett v. Rent-Way, Inc.

• Decision Date: 30 September 2004
• Docket Number: Civil Action No. 03-188 Erie.
• Citation: 350 F.Supp.2d 642
• Parties: Justin BADGETT and John P. Leasha, Plaintiffs, v. RENT-WAY, INC., Defendant.
• Court: U.S. District Court — Western District of Pennsylvania

350 F.Supp.2d 642

Justin BADGETT and John P. Leasha, Plaintiffs, v. RENT-WAY, INC., Defendant.

Civil Action No. 03-188 Erie.

United States District Court, W.D. Pennsylvania.

September 30, 2004.

Harry F. Kunselman, Esq., Strassburger, McKenna, Gutnick & Potter, Pittsburgh, PA, Attorney for Plaintiff.

Robert B. Cottington, Esq., Eugene K. Connors, Esq., Reed Smith, Pittsburgh, PA, Attorneys for Defendants.

MEMORANDUM OPINION

MCLAUGHLIN, District Judge.

Presently pending in this case brought under the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq., is a motion by the Defendant for summary judgment. We have subject matter jurisdiction over this case pursuant to 28 U.S.C. § 1331. Having reviewed the parties' written submissions and heard oral argument on the matter, the Court will grant Defendant's motion for the reasons set forth below.

I. BACKGROUND

Defendant Rent-Way, Inc. ("Rent-Way") has stores in 33 states across the country and is involved in the business of renting household merchandise to its customers on a rent-to-own basis. Rent-Way's customers may select rental merchandise in one of three ways: from among the merchandise on display at Rent-Way's stores, from catalogs supplied by Rent-Way's vendors and maintained at Rent-Way's stores, or from merchandise displayed on computer monitors in Rent-Way's stores through a function known as eOffice.

If a selected item is in stock, it is typically loaded onto one of Rent-Way's trucks by an account representative, who then delivers the merchandise to the customer's residence and performs any required installation work. It is also possible for customers to take in-stock merchandise home themselves, even large items such as furniture.

When a selected item is not in stock, a store employee will generally check with other nearby Rent-Way stores to see if one of them has the item. If the item is available at another Rent-Way store, an account representative from the requesting store normally drives to the store that has the item, picks the item up, and delivers it to the customer's home.

If an item of selected merchandise cannot be located at another store — e.g., because it is not generally carried by Rent-Way or because special "add-on" features are requested — the item may be special-ordered out of the vendor's catalogue or through eOffice. Special order items are generally shipped by the vendor to the requesting Rent-Way store. Upon their arrival at the appropriate Rent-Way store, special-order items are physically marked as designated for the intended customer so that they do not wind up among the general inventory on the floor. Special-order items are generally delivered to the intended customer by an account representative within 24 to 48 hours of their arrival at the store. In some cases, a customer may opt to pick up the item at Rent-Way's store.

Plaintiffs Justin Badgett and John P. Leasha were formerly employed by Rent-Way as account representatives. Badgett worked at Rent-Way's New Brighton, Pennsylvania store from October 7 to December 22, 2002. Thereafter, he worked primarily at Rent-Way's Aliquippa, Pennsylvania store until his discharge on February 12, 2003. Plaintiff John P. Leasha served at the Aliquippa store from July 9, 2001 until February 23, 2002, when he resigned.

As account representatives, Plaintiffs' primary duties were to deliver and install merchandise in customers' homes, pick up from customers merchandise that was broken or that had not been fully paid for, and collect rental payments. Deliveries were made by Badgett and Leasha on Rent-Way trucks, although Badgett sometimes made deliveries in his own car. When delivering and picking up merchandise, Badgett and Leasha loaded the merchandise onto Rent-Way trucks and drove the trucks. Leasha was on the road every day making deliveries. Badgett made three to four deliveries per week and sometimes spent his entire work day making deliveries.

During their employment with Rent-Way, both Badgett and Leasha were one of only two account representatives in their respective stores. Leasha worked with another account representative by the name of William Lynn Claypoole, while Badgett worked with fellow-account representative Christopher Mack. Plaintiffs generally worked together with their respective partners on most days and shared the driving.

Following the termination of their employment, Plaintiffs commenced this case under the FLSA, claiming that Rent-Way violated the Act by failing to pay them (and other similarly situated employees) overtime for all hours worked in excess of forty hours per week. Rent-Way has moved for summary judgment on the ground that Plaintiffs were exempt from the Act's overtime pay requirements by virtue of the motor carrier exemption set forth in § 13(b)(1) of the FLSA, 29 U.S.C. § 213(b)(1). For the reasons set forth below, we conclude that Defendant's assertion of the exemption is well-founded.

II. STANDARD OF REVIEW

Summary judgment is only appropriate when the pleadings, depositions, answers to interrogatories and admissions on file, together with any affidavits, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Sameric Corp. of Delaware, Inc. v. City of Philadelphia, 142 F.3d 582, 590 (3d Cir.1998). When deciding a motion for summary judgment, a court must draw all reasonable inferences in the light most favorable to the nonmovant. Big Apple BMW, Inc. v. BMW of North America, Inc., 974 F.2d 1358, 1363 (3d Cir.1992). A court may not consider the weight or credibility of the evidence in deciding a motion for summary judgment, even if the quantity of the moving party's evidence far outweighs that of its opponent. Id. But a party opposing summary judgment must do more than just rest upon mere allegations, general denials, or vague statements. Saldana v. Kmart Corp., 260 F.3d 228, 232 (3d Cir.2001). Moreover, a genuine dispute as to a factual issue exists only if the evidence is such that a reasonable jury could return a verdict for the non-movant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

III. DISCUSSION

The narrow issue in this case is whether Plaintiffs are exempt from the maximum hour and overtime provisions of the FLSA under § 13(b)(1) of the Act, 29 U.S.C. § 213(b)(1), commonly known as the "motor carrier exemption." Section 13(b)(1) exempts any employee as to whom the Secretary of Transportation has power to establish qualifications and maximum hours of service pursuant to the provisions of 49 U.S.C. § 31502. See 29 U.S.C.A. § 213(b)(1).¹ Section 31502 empowers the Secretary of Transportation to prescribe qualifications and maximum hours of service with respect to employees of (1) motor carriers and (2) "motor private carriers" "when needed to promote safety of operation." 49 U.S.C. § 31502(b)(2).

In order for the exemption to apply, the employee must: (a) be employed by a "motor carrier" or a "motor private carrier" as defined by the Motor Carrier Act and (b) engage in activities that directly affect the "safety of operation of motor vehicles" in the transportation on the public highways of passengers or property in interstate commerce. See 29 C.F.R. § 782.2(a) (2001); Baez v. Wells Fargo Armored Serv. Corp., 938 F.2d 180, 181-82 (11th Cir.1991); Hutson v. Rent-A-Center, Inc., 209 F.Supp.2d 1353, 1356 (M.D.Ga.2001), aff'd, 37 Fed.Appx. 980, 2002 WL 1276984 (11th Cir. May 21, 2002) (Table No. 01-17261). Thus, an employee's exemption from the FLSA's maximum hour provision "depends both on the class to which his employer belongs and on the class of work involved in the employee's job." 29 C.F.R. § 782.2(a). It is the employer's burden to affirmatively prove that its employees come within the scope of the overtime exemption, and entitlement to the exemption must be proven "plainly and unmistakably." Friedrich v. U.S. Computer Serv., 974 F.2d 409, 412 (3d Cir.1992). See also Bilyou v. Dutchess Beer Distributors, Inc., 300 F.3d 217, 222 (2d Cir.2002); Klitzke v. Steiner Corp., 110 F.3d 1465, 1468 (9th Cir.1997).

A.

The first requirement of the exemption is that the employer must be a "motor private carrier" within the meaning of the Motor Carrier Act. A "motor private carrier" is statutorily defined as "a person, other than a motor carrier, transporting property by motor vehicle when —

(A) the transportation is [across state lines, as provided in 49 U.S.C. § 13501];[²]

(B) the person is the owner, lessee, or bailee of the property being transported; and

(C) the property is being transported for sale, lease, rent, or bailment or to further a commercial enterprise."

49 U.S.C.A. § 13102(13). Rent-Way is a corporation engaged in the business of leasing merchandise to its customers on a rent-to-own basis. It is not disputed that Rent-Way owns the merchandise it leases to its customers, nor is there any question that this merchandise is transported in furtherance of Rent-Way's commercial business. Thus, the only question for present purposes is whether Rent-Way transports merchandise in interstate commerce.

Rent-Way has produced evidence that it engages in the interstate transportation of its merchandise in two ways. First, Rent-Way has shown that employees in its New Brighton and Aliquippa stores sometimes satisfy customer orders by obtaining the requested merchandise from other Rent-Way stores, including stores located in Ohio. According to Phillip Locke, Manager of Rent-Way's Pittsburgh Region, employees are sometimes called upon to pick up merchandise from Rent-Way stores in Ohio and drive the merchandise back to Pennsylvania for delivery to Rent-Way's customers in the Pittsburgh area. Mr. Locke has produced records showing that, during the periods of Plaintiffs' employment, merchandise was transferred from Rent-Way's stores in East Liverpool, Ohio on more than a dozen occasions to the Aliquippa store and, on...