Cachola-Bonilla v. Wyndham El Conquistador Resort, Civil No. 05-2294 (DRD).

• Decision Date: 19 September 2008
• Docket Number: Civil No. 05-2294 (DRD).
• Citation: 577 F.Supp.2d 566
• Parties: Justin CACHOLA-BONILLA, et al., Plaintiff(s), v. WYNDHAM EL CONQUISTADOR RESORT & COUNTRY CLUB, Defendant(s).
• Court: U.S. District Court — District of Puerto Rico

Page 566

577 F.Supp.2d 566

Justin CACHOLA-BONILLA, et al., Plaintiff(s), v. WYNDHAM EL CONQUISTADOR RESORT & COUNTRY CLUB, Defendant(s).

Civil No. 05-2294 (DRD).

United States District Court, D. Puerto Rico.

September 19, 2008.

COPYRIGHT MATERIAL OMITTED

George E. Green, Miguel A. Maza & Associates, Joanna Bocanegra-Ocasio, Bocanegra Law Offices, PSC, Jose I. Ayala-Santana, Ayala Cadiz Law Office, San Juan, PR, for Plaintiffs.

Edwin J. Seda-Fernandez, Patricia R. Limeres-Vargas, Adsuar Muniz Goyco Seda & Perez Ochoa PSC, San Juan, PR, for Defendant.

ORDER

DANIEL R. DOMINGUEZ, District Judge.

Pending before the Court is a Motion For Summary Judgment filed by defendant Wyndham El Conquistador Resort & Country Club ("El Conquistador") (Docket entries No. 50, 51); plaintiff's opposition thereto (Docket entries No. 61, 62, 63), and defendant's reply to plaintiffs' opposition to defendant's motion for summary judgment (Docket entries No. 69, 70).

INTRODUCTION

Plaintiffs, Justin Cachola Bonilla ("Cachola"), Juan Canales Medina ("Canales"), Juan R. Ojeda ("Ojeda"), Melvin Rodríguez López ("Rodríguez-López"), Julio Rodríguez Millan ("Rodríguez-Millan"), and Juan C. Monteczuma ("Monteczuma" or collectively "plaintiffs"), allege that their employer El Conquistador had illegally deducted twenty-five percent (25%) from their tips, in violation of provisions under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 203, 215. Plaintiffs further claim that El Conquistador has taken retaliatory adverse employment actions against them for having complained about the above described unlawful practice under the FLSA. Plaintiffs claim back pay for the amounts improperly deducted from their tips, retroactive to three (3) years from the "filing of the complaint ... in an amount not less than $20,748.00 to each plaintiff and [an] equal amount as liquidated damages; and for plaintiffs JCB [Cachola] and JRO [Ojeda] who were terminated in retaliation for claiming their rights, back pay of wages from date of termination, as well as front pay, and the cost of any other employment benefits and, an equal amount as liquidated damages, a reasonable amount in attorney's fees, the costs of this action, and pre and post judgment interest at the prevailing rate."¹ See Complaint (Docket No. 1).

FACTUAL AND PROCEDURAL BACKGROUND

Plaintiffs were employed at Le Bistro Restaurant ("Le Bistro"), located in the area known as Las Casitas of El Conquistador Hotel Complex in Fajardo, Puerto Rico. On December 14, 2005, plaintiffs filed (Docket No. 1) the instant action requesting relief under federal law, specifically under the FLSA, as their employer El Conquistador "illegally deducted twenty-five percent (25%) from their tips, illegally [sic] included amounts from a twenty percent (20%) service charge to customers as gratuities instead of salary in plaintiffs' paychecks" (Docket No. 75 at page 4), and "[further] terminated plaintiffs Canales, Cachola, and Rodríguez-López in retaliation for their complaining of such [illegal activity]" (Docket No. 75 at page 5). Plaintiffs allege that the termination of Cachola, Canales and Rodríguez-López was in retaliation for their complaints as to the questionable policy implemented by El Conquistador.

On October 24, 2007, El Conquistador filed a Motion For Summary Judgment (Docket No. 50) together with a statement of uncontested facts, (Docket No. 51), arguing that: (a) the amount of 25% withheld by defendant was not to be considered as tips, but as a service charge, which is a perfectly legal deduction under the FLSA; and (b) plaintiffs cannot prove a retaliation action, as they were discharged for just cause.

On December 10, 2007, plaintiffs opposed, and argued that the alleged service charge claimed by El Conquistador does not meet the definition of service charge under the FLSA, and that plaintiffs have established a prima facie case of retaliation termination, as the facts show that their termination was not for just cause.

On January 10, 2008, El Conquistador replied, Docket No. 70, and alleged that plaintiffs, not the defendant, have the burden of showing the causal link between termination and retaliation, and plaintiffs failed to meet this burden.

The Motion For Summary Judgment (Docket No. 50), as well as all related motions were referred to the United States Chief, Magistrate Judge Just Arenas ("Magistrate Judge") for report and recommendation (Docket entries No. 72, 73). The Report and Recommendation was filed on June 23, 2008 (Docket No. 75). The objections to the Report and Recommendation were filed on July 11, 2008, with leave of Court. See Docket entries No. 76, 77 and 78. The record shows that plaintiffs did not object to the Report and Recommendation.

In the Report and Recommendation, the Magistrate Judge recommended that El Conquistador's Motion For Summary Judgment be granted in part and denied in part. The Magistrate Judge's recommendations are:

1. El Conquistador has not shown that the "service charges" added to its customers' bills were compulsory in nature to be paid by clients as required by Department of Labor regulations, and therefore were not bona fide. The Magistrate Judge recommends that summary judgment be denied as to the claims related to the service charge. See Docket No. 75 at page 23.

2. Plaintiffs have established a prima facie case of retaliatory discharge as to Canales only, as Canales was forewarned that his job was at risk if he continued complaining of the service charge. Canales was terminated shortly thereafter for complaining of the service charges, and the reasons for his termination stem from his protected activity. The Magistrate Judge recommended the court that summary judgment be denied as to the Canales' retaliation claim. See Docket No. 75 at page 23.

3. Plaintiffs failed to establish a claim of retaliatory discharge as to plaintiffs Cachola, Rodríguez-López and Rodríguez-Millán, as they failed to establish a causal connection between their complaints about the service charge and their terminations. Further, plaintiff failed to prove El Conquistador's articulated valid non discriminatory disciplinary reason was a sham or a pretext for discrimination. Fennell v. First Step Designs, 83 F.3d 526, 535 (1st Cir.1996). The Magistrate Judge recommended that summary judgment be granted as to the retaliation claims of Cachola, Rodríguez-López and Rodríguez-Millán. The Court incorporates the Magistrate Judge's clarifications as to Ojeda, included in the Report and Recommendation as footnote 2.² See Docket No. 75 at page 23.

Hence, since plaintiffs Cachola, Rodríguez-López and Rodríguez-Millán were unable to establish a retaliatory discharge claim, the Magistrate Judge found that Law 80, 29 L.P.R.A. §§ 185a et seq., is inapplicable. For the reasons set forth below, the Report and Recommendation issued by the Magistrate Judge is confirmed and adopted in toto, except that the claim as to Law 80 under 29 L.P.R.A. § 185 is dismissed without prejudice but on alternate grounds.³

The Court incorporates in toto except as to the Law 80 claims the factual findings made by the Magistrate Judge in his Report and Recommendation (Docket No. 75 at pages 4-7).

STANDARD FOR REVIEW

The district court may refer dispositive motions to a United States Magistrate Judge for a report and recommendation. 28 U.S.C. § 636(b)(1)(B); Rule 72(b) of the Federal Rules of Civil Procedure ("Fed. R.Civ.P."); Local Civil Rule 72(a) of the Local Rules of the United States District Court for the District of Puerto Rico ("L.Civ.R."). See Mathews v. Weber, 423 U.S. 261, 96 S.Ct. 549, 46 L.Ed.2d 483 (1976). An adversely affected party may contest the Magistrate Judge's report and recommendation by filing its objections within ten (10) days after being served a copy thereof. See Fed.R.Civ.P. 72(b) and L.Civ.R. 72(d). Moreover, 28 U.S.C. § 636(b)(1) (1993), in pertinent part, provides that:

Within ten days of being served with a copy, any party may serve and file written objections to such proposed findings and recommendations as provided by rules of court. A judge of the court shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made. A judge of the court may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate.

(Emphasis ours).

"Absent objection, ... [a] district court ha[s] a right to assume that [the affected party] agree[s] to the magistrate's recommendation." Templeman v. Chris Craft Corp., 770 F.2d 245, 247 (1st Cir. 1985), cert. denied, 474 U.S. 1021, 106 S.Ct. 571, 88 L.Ed.2d 556 (1985). Moreover "failure to raise objections to the Report and Recommendation waives that party's right to review in the district court, and those claims not preserved by such objections are precluded on appeal." Davet v. Maccarone, 973 F.2d 22, 30-31 (1st Cir. 1992). See also Sands v. Ridefilm Corp., 212 F.3d 657, 663 (1st Cir.2000); Henley Drilling Co. v. McGee, 36 F.3d 143, 150-151 (1st Cir.1994) (holding that objections are required when challenging findings actually set out in magistrate's recommendation, as well as magistrate's failure to make additional findings); Lewry v. Town of Standish, 984 F.2d 25, 27 (1st Cir.1993) (stating that "[o]bjection to a magistrate's report preserves only those objections that are specified"); Keating v. Secretary of H.H.S., 848 F.2d 271, 275 (1st Cir.1988); Borden v. Secretary of H.H.S., 836 F.2d 4, 6 (1st Cir.1987) (holding that appellant was entitled to a de novo review, "however he was not entitled to a de novo review of an argument never raised"). See also United States v. Valencia-Copete, 792 F.2d 4, 6 (1st Cir.1986); Park Motor Mart, Inc. v. Ford Motor Co., 616 F.2d 603, 605 (1st Cir.1980). The Court, in order to accept the unopposed R & R, needs only satisfy itself by ascertaining that there is no "plain error" on the face...