O'Bryant v. ABC Phones of N.C., Inc.
| Decision Date | 22 December 2020 |
| Docket Number | No. 19-cv-02378-SHM-tmp,19-cv-02378-SHM-tmp |
| Parties | JACOB O'BRYANT and MARK BRANDON BAKER, individually and on behalf of all others similarly situated, Plaintiffs, v. ABC PHONES OF NORTH CAROLINA, INC. d/b/a VICTRA, f/d/b/a A WIRELESS, Defendant. |
| Court | U.S. District Court — Western District of Tennessee |
JURY DEMAND
Plaintiffs bring this action under the Fair Labor Standards Act, 29 U.S.C. §§ 201-219 ("FLSA"). Before the Court are three motions. The first is the August 14, 2020 Joint Motion for Settlement Approval—Preliminary Approval of Amended Settlement (the "Joint Motion"). (D.E. No. 71.) That motion is brought by Plaintiffs Jacob O'Bryant and Mark Baker (collectively, "Plaintiffs" or "Named Plaintiffs") and Defendant ABC Phones of North Carolina, Inc., d/b/a VICTRA, f/d/b/a A Wireless ("VICTRA"). The second is a Motion to Intervene (the "Hardney Motion"), filed on August 18, 2020, brought by Ron Hardney, Manuel Panngasiri, and Michelle Salway, along with seventy-six other opt-in plaintiffs in the Hardney action, Hardney, et al. v. ABC Phones of North Carolina, Inc., No. 20-cv-0076 (the "Hardney Action"). (D.E. No. 72.) The third is a Motion to Intervene (the "Motion to Intervene"), filed on September 9, 2020, brought by Priscilla Solorio and Mariano Diaz (the "Putative Intervenors"), named plaintiffs in Solorio, et al. v. ABC Phones of North Carolina, Inc., No. 1:20-cv-01051-NONE-JLT (the "Solorio Action"). (D.E. No. 78.)
The Hardney Motion is DENIED AS MOOT. The Motion to Intervene is DENIED. The Joint Motion is GRANTED.
This dispute arises from VICTRA's alleged failure to pay overtime compensation to certain employees. VICTRA sells Verizon-compatible phones, Verizon data plans, and cellular phone accessories through VICTRA-branded locations. (Second Amended Complaint, D.E. No. 67 ¶ 12.) VICTRA sets wage and hour policies, including employees' overtime pay, commission pay, and overtime rates. (Id. ¶ 15.) VICTRA compensates its retail associates by paying an hourly rate plus bonuses and commissions, which are paid according to frequently adjusted formulas. (Id. ¶ 16.) The commission payments and/or non-discretionary bonuses are not included in the employees' regular rate when overtime payments are calculated. (Id. ¶ 21.)
On June 10, 2019, Plaintiffs filed a Complaint in this action (the "Initial Complaint"). (D.E. No. 1.) In theirInitial Complaint, Plaintiffs, VICTRA retail sales associates employed on an hourly-plus-commission basis, alleged that VICTRA employed a uniform payment structure for its retail sales associates that violated the FLSA. (Id. ¶¶ 8, 9, 34-39.) Plaintiffs alleged that VICTRA's payment scheme calculated the amount of overtime due by using the employees' base hourly rate rather than the regular rate as defined by 29 C.F.R. § 778.114, which required including commission payments and non-discretionary bonuses when calculating overtime. (See id. ¶¶ 19-21.) The collective action described in the Initial Complaint was:
All current and former retail employees of ABC Phones of North Carolina, Inc. or any of its subsidiaries doing business as VICTRA, who were paid an hourly wage plus commission, and who were employed in the United States at any time during the applicable limitations period covered by this Collective Action Complaint (i.e. two years for FLSA violations and, three years for willful FLSA violations) up to and including the date of final judgment in this matter, and who are Named Plaintiffs or elect to opt-in to this action pursuant to the FLSA, 29 U.S.C. § 216(b).
(Id. ¶ 4.)
On September 9, 2019, Plaintiffs filed a First Amended Complaint (the "FAC"). (D.E. No. 12.) In the FAC, Plaintiffs, inter alia, changed Baker's job description from "retail sales person" to "store manager." (Compare D.E. No. 1 ¶ 9, with D.E. No. 12 ¶ 11.) The FAC stated a separate retail "manager[]"subcollective, in addition to the Initial Complaint's retail "employee[]" collective:
All current and former retail managers of ABC Phones of North Carolina, Inc. or any of its subsidiaries doing business as VICTRA, who were paid an hourly wage plus commission, and who were employed in the United States at any time during the applicable limitations period covered by this Collective Action Complaint (i.e. two years for FLSA violations and, three years for willful FLSA violations) up to and including the date of final judgment in this matter, and who are Named Plaintiffs or elect to opt-in to this action pursuant to the FLSA, 29 U.S.C. § 216(b).
(See D.E. No. 12 ¶ 4).
The FAC alleged an additional violation of the FLSA: VICTRA's failure to pay its retail managers for work performed "off-the-clock." (Id. ¶¶ 23, 26-29.) Plaintiffs alleged that VICTRA "converted its salaried store managers to hourly paid employees but did not substantially alter the work that such store managers, including [] Baker, were required to perform outside of their shifts"; that "store managers were not told that they should or could clock-in to complete work performed off-premises"; that these tasks included "participating in mandatory conference calls scheduled outside of manager's shifts; responding to employee calls after work, before work, and on days off; responding to employee text messages; and routinely checking and responding to issues brought up in group.me[]." Plaintiffs alleged that these tasks were performed "in excess of an hour per week." (Id. ¶¶ 26-29.)
Also on September 9, 2019, the parties filed a Motion for Settlement Approval. (D.E. No. 14.) On July 3, 2020, the parties filed a joint motion for Approval of First Amendment to Settlement and Release Agreement to Provide Further Benefits to the Store Manager and Non-Manager Classes. (D.E. No. 58.) On August 4, 2020, the Court denied both motions. (D.E. No. 66.) The Court's reasons are summarized as follows:
On August 11, 2020, the Plaintiffs filed a Second Amended Complaint ("SAC"), which is the operative complaint. (D.E. No. 67.) The SAC adds an allegation that the off-the-clock claims apply to the non-manager sub-class as well as the manager sub-class. (Id. ¶ 30.)
Also on August 11, 2020, the parties filed a Stipulated Motion for Conditional Certification of the Collective Encompassed by the Parties' Settlement. (D.E. No. 68.) That motion defined the collective as:
Current and former non-exempt employees of VICTRA who worked as store managers and non-manager retail employees who worked in any VICTRA-owned store in the United States at any time between June 10, 2016, and August 7, 2020.
(Id. at 887.) The parties asked the Court to conditionally certify the defined collective. (See id.) The Court granted that relief on October 15, 2020. (D.E. No. 87.)
On August 14, 2020, the parties submitted the Joint Motion. (D.E. No. 71.) The parties seek preliminary approval of the settlement and approval of the opt-in procedures. (See id. at 921.) The parties represent that, at a mediation on August 21, 2019 (the "Mediation"), they were able to settle the managers' claims. (Id. at 895.) The parties represent that, in the weeks after the Mediation, they were able to reach an agreement to settle the retail employees' claims. (Id. at 896.) In preparation for the Mediation, the parties represent that they "conducted informal discovery" that led to VICTRA's production of "over 400,000 payroll records containing 24 variables related to the Named Plaintiffs and putative members of the collective" and containing "hours and wage information spanning more than three years of pay periods, includingregular hours and pay, overtime hours and pay, commissions and special incentive payments, extra unearned overtime payments, and other payroll components." (Id. at 894-95.)
The Joint Motion is accompanied by an Amended Settlement Agreement. (D.E. No. 71-1.) The settlement amount payable to the opt-in plaintiffs is $1,400,576.40, which does not include the Service Awards to the Named Plaintiffs, the Plaintiffs' attorneys' fees, and the Administration Fee (payable to the Settlement Administrator). (Id. at 929.) The parties represent that the following changes to the original settlement agreement resolve the Court's prior concerns with the settlement:
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