Butler v. Directsat USA, LLC

• Decision Date: 10 April 2012
• Docket Number: Civil Action No. DKC 10–2747.
• Citation: 876 F.Supp.2d 560
• Parties: Jeffry BUTLER, et al. v. DIRECTSAT USA, LLC, et al.
• Court: U.S. District Court — District of Maryland

876 F.Supp.2d 560

Jeffry BUTLER, et al.

v.DIRECTSAT USA, LLC, et al.

Civil Action No. DKC 10–2747.

United States District Court, D. Maryland.

April 10, 2012.

Daniel Adlai Katz, Law Office of Gary M. Gilbert and Associates PC, Silver Spring, MD, Jac A. Cotiguala, Jac A. Cotiguala and Associates, James B. Zouras, Ryan F. Stephan, Stephan Zouras LLP, Chicago, IL, for Jeffry Butler, et al.

Colin D. Dougherty, Eric J. Bronstein, Gregory S. Voshell, John P. Elliott, Elliott

Greenleaf and Siedzikowski PC, Blue Bell, PA, John Augustine Bourgeois, Katrina J. Dennis, Kramon and Graham PA, Baltimore, MD, for DirectSAT USA, LLC, et al.

MEMORANDUM OPINION

DEBORAH K. CHASANOW, District Judge.

Presently pending and ready for resolution in this Fair Labor Standards Act (“FLSA”) case are motions for conditional certification of a collective action and facilitation of notice (ECF No. 41), and to seal (ECF No. 43) filed by Plaintiffs Jeffry Butler and Charles Dorsey. Also pending is a motion to seal filed by Defendants DirectSAT USA, LLC (“DirectSAT”), UniTek USA, LLC (“UniTek”), and UniTek Global Services, Inc. (“UGS”). (ECF No. 56). The issues are fully briefed, and the court now rules pursuant to Local Rule 105.6, no hearing being deemed necessary. For the reasons that follow, Plaintiffs' motion for conditional certification of a collective action and facilitation of notice will be granted in part and denied in part, as will the parties' motions to seal.

I. BackgroundA. Factual Background

Defendant DirectSAT, a subsidiary of UniTek and UGS, provides satellite installation services to DirectTV customers throughout the country. Plaintiffs are technicians who previously installed, upgraded, and serviced DirectTV equipment at customer locations in Maryland, Virginia, and the District of Columbia. ( See ECF No. 41–8) (setting forth the job description for the “technician” position).¹ Jeffry Butler began working for Defendants as a technician in October 2007 and held this position for approximately ten months before being promoted to warehouse manager. Although initially based out of DirectSAT's warehouse in Capitol Heights, Maryland, Mr. Butler transferred to the warehouse in Waldorf, Maryland, after the Capitol Heights warehouse closed. Charles Dorsey starting working for Defendants as a technician in May 2009 and held this position for approximately seven months. During his tenure, Mr. Dorsey was also based out of DirectSAT's Waldorf, Maryland warehouse. In their declarations and deposition testimony, Mr. Butler and Mr. Dorsey, the named Plaintiffs, allege the following facts.

Defendants pay their technicians “based on job or piece rates.” (ECF No. 54, at 14).² Thus, rather than receiving a typical hourly wage, DirectSAT compensates technicians based on the work they complete at a customer's home by assigning a value to each completed job. Technicians are then credited with the value assigned to their jobs, and this value becomes the basis for calculating wages, including overtime. “For example, if a technician worked 40 hours in a particular week and accumulated $1,000 in production, the technician's effective hourly rate would be $25.00/hour.” ( Id. at 16). Technicians receive different piece rates depending on their technician level, which varies based on experience and efficiency. Higher-ranked technicians receive higher piece rates.

Plaintiffs assert that although DirectSAT's employee handbook provides that technicians will be paid for any overtime hours worked, the company did not follow this formal policy. Both Mr. Butler and Mr. Dorsey state that general managers and supervisors instructed them to record time only when they were performing jobs at customer locations. They also assert that management either encouraged or instructed them to work “off the clock” in the evenings after they arrived home and in the mornings before arriving at their first jobs. ( E.g., ECF No. 41–9, Butler Decl., at 2). During this time, Plaintiffs would perform numerous uncompensated tasks, including building satellite dishes for upcoming installations, preparing routes and schedules based on company emails listing next-day installations, pre-calling customers, loading their vehicles at the warehouse, and attending company meetings. These tasks resulted in Plaintiffs routinely working in excess of forty hours per week.

Plaintiffs also insist that they were instructed by their general managers not to record overtime on their weekly timesheets. Mr. Butler occasionally recorded his excess hours despite this instruction, but the company regularly refused to pay him overtime. Mr. Dorsey's timesheets were returned to him for correction when he recorded more than forty hours in a given week, and he does not recall ever being paid any overtime. Both complained to management at their warehouses about this issue. In response, management informed them that “[t]here was nothing [it] could do” because the non-payment of overtime was “a corporate decision” (ECF No. 54–15, Butler Dep., at 31), and that “[t]hose were the rules, follow them or work somewhere else,” (ECF No. 54–17, Dorsey Dep., at 24).

B. Procedural Background

Plaintiffs filed a complaint against Defendants on October 4, 2010, on behalf of themselves and similarly situated others.³ They sought to bring an FLSA overtime claim as a collective action pursuant to 29 U.S.C. § 216(b), as well as state overtime and unpaid wage claims as class actions pursuant to Federal Rule of Civil Procedure 23. Defendants subsequently moved to dismiss the complaint. On July 6, 2011, 800 F.Supp.2d 662 (D.Md.2011), the court issued a memorandum opinion and order, granting in part and denying in part Defendants' motion to dismiss.⁴ Defendants then answered the complaint, and the parties began discovery.

On November 1, 2011, Plaintiffs moved for conditional certification of a collective action for DirectSAT technicians based out of the company's Waldorf and Beltsville warehouses during the past three years. (ECF No. 41).⁵ They also requested facilitationof notice to potential opt-in plaintiffs. ( Id.).⁶ They submitted numerous exhibits with their motion, and they subsequently filed a motion to seal four of those exhibits pursuant to a stipulated confidentiality order that the court had previously approved. (ECF No. 43). Before responding to Plaintiffs' certification motion, Defendants filed two motions to compel discovery responses from Mr. Dorsey and to compel Mr. Dorsey's deposition. (ECF Nos. 45, 46). The court held a telephone conference on November 16, 2011, at which time it extended the time for Defendants to oppose Plaintiffs' motion for conditional certification and denied as moot the motion to compel Mr. Dorsey's deposition because the parties had resolved that dispute.⁷

After taking Mr. Dorsey's deposition, Defendants filed their response to Plaintiffs' motion for conditional certification. (ECF No. 54). They submitted numerous exhibits in support of their opposition and filed a motion to seal twelve of those exhibits pursuant to the confidentiality order. (ECF No. 56). Plaintiffs timely replied to Defendants' opposition. Both interim motions to seal, as well as Defendants' motion to compel discovery responses, are unopposed.

II. Motion for Conditional Certification and for Court–Facilitated Notice

“Under the FLSA, plaintiffs may maintain a collective action against their employer for violations under the act pursuant to 29 U.S.C. § 216(b).” Quinteros v. Sparkle Cleaning, Inc., 532 F.Supp.2d 762, 771 (D.Md.2008). Section 216(b) provides, in relevant part, as follows:

An action ... may be maintained against any employer ... in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated. No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought.

“This provision establishes an ‘opt-in’ scheme, whereby potential plaintiffs must affirmatively notify the court of their intentions to be a party to the suit.” Quinteros, 532 F.Supp.2d at 771 (citing Camper v. Home Quality Mgmt., Inc., 200 F.R.D. 516, 519 (D.Md.2000)).

When deciding whether to certify a collective action pursuant to the FLSA, courts generally follow a two-stage process. Syrja v. Westat, Inc., 756 F.Supp.2d 682, 686 (D.Md.2010). In the first stage, commonly referred to as the notice stage, the court makes a “threshold determination of ‘whether the plaintiffs have demonstrated that potential class members are similarly situated,’ such that court-facilitated notice to putative class members would be appropriate.” Id. (quoting Camper, 200 F.R.D. at 519). In the second stage, following the close of discovery, the court conducts a “more stringent inquiry” to determine whether the plaintiffs are in fact “similarly situated,” as required by § 216(b). Rawls v. Augustine Home Health Care, Inc., 244 F.R.D. 298, 300 (D.Md.2007). At this later stage, referred to as the decertification stage, the court makes a final decision about the propriety of proceeding as a collective action. Syrja, 756 F.Supp.2d at 686 (quoting Rawls, 244 F.R.D. at 300). Plaintiffs here have moved for conditional certification of a collective action and they have requested court-facilitated notice to potential opt-in plaintiffs.

A. Conditional Certification Is Appropriate Because Plaintiffs Have Made a “Modest Factual Showing” that Technicians in the Waldorf and Beltsville Warehouses Are “Similarly Situated”

“Determinations of the appropriateness of conditional collective action certification ... are left to the court's discretion.” Id.; see also Hoffmann–La Roche, Inc. v. Sperling, 493 U.S. 165, 169, 110 S.Ct. 482, 107 L.Ed.2d 480 (1989). The threshold issue in determining whether to exercise such discretion is whether Plaintiffs have...