Cano v. DPNY, Inc.
| Decision Date | 08 November 2012 |
| Docket Number | 10 Civ. 7100 (ALC) (JCF) |
| Parties | GIL SANTIAGO CANO, HECTOR HERNANDEZ ZAVALA, JUAN HERNANDEZ ZAVALA, OMAR HERNANDEZ ZAVALA, ARISTEO BASURTO, CARLOS RODRIGUEZ HERRERA, LEONARDO JUAREZ, SAUL ISIDRO, ABOUBACAR GOUEM, ANATOLE YAMEOGO on behalf of himself and all others similarly situated, Plaintiffs, v. DPNY, INC. d/b/a DOMINO'S PIZZA, BMW PIZZA, INC. d/b/a DOMINO'S PIZZA, DAVID L. MELTON, ANGELINA M. MELTON, ZIA SHAH, SHAIK SHAMIN, MOHAMMED PATWARY, MOHAMMED MOCTER, Defendants. |
| Court | U.S. District Court — Southern District of New York |
ECF
JAMES C. FRANCIS IV
Gil Santiago Cano, Hector Hernandez Zavala, Juan Hernandez Zavala, Omar Hernandez Zavala, Aristeo Basurto, Carlos Rodriguez Herrera, Leonardo Juarez, Saul Isidro, Aboubacar Gouem, and Anatole Yameogo, on behalf of themselves and all others similarly situated, bring this action against DPNY, Inc. d/b/a Domino's Pizza, BMW Pizza, Inc. d/b/a Domino's Pizza, David L. Melton, Angelina M. Melton, Zia Shah, Shaik Shamin, Mohammed Patwary, and Mohammed Mannaf a/k/a Mohammed Mocter.1 The plaintiffs, who are current and former employees at Domino's Pizza stores owned or managed by the defendants, seek damages and injunctive relief under the Fair LaborStandards Act (the "FLSA") and New York Labor Law ("NYLL").
The plaintiffs now move under Rules 15(a) and 21 of the Federal Rules of Civil Procedure for leave to file a Second Amended Complaint to add as defendants Domino's Pizza Inc., Domino's Pizza LLC, and Domino's Pizza Franchising LLC (the "Proposed Defendants").
For the reasons set forth below, the motion is granted.
According to the plaintiffs, David Melton and Angelina Melton are the owners and operators of four Domino's Pizza stores in New York. (First Amended Collective/Class Action Complaint ("FAC"), ¶¶ 20, 22, 24). Zia Shah, Shaik Shamin, Mohammed Patwary, and Mohammed Mannaf manage these stores. (FAC, ¶¶ 25-29). DPNY, Inc., is a New York corporation that operates as Domino's Pizza at some or all of the defendants' stores. (FAC, ¶¶ 30, 33). David Melton is the president and Angelina Melton is the Franchise Administrator of DPNY, Inc. (FAC, ¶¶ 31-32). BMW Pizza, Inc., was a New York corporation that was doing business as Domino's Pizza at some or all of the defendants' stores until February 19, 2002, at which time it merged with DPNY, Inc. (FAC, ¶¶ 37, 40). David Melton was the President and Angelina Melton was the Franchise Administrator of BMW Pizza, Inc. (FAC, ¶¶ 38-39).
In their First Amended Complaint, the plaintiffs allege that the defendants willfully engaged in unlawful employment policies, patterns, or practices, in violation of both federal and state law.(FAC, ¶ 1). They contend that the defendants removed recorded hours from time records and required them to work off-the-clock, as a result of which the plaintiffs were paid less than the minimum wage, were paid less than they were entitled to in overtime wages, and in some cases were not paid for the hours that they worked. (FAC ¶¶ 98-116). They claim that the defendants paid them "tipped wages" without complying with the prerequisites for taking a tip credit and applied tipped wage calculations even when the plaintiffs performed tasks for which tips were not available. (FAC, ¶¶ 120-132). The plaintiffs also allege that the defendants took illegal deductions from their wages for required uniforms and did not pay the uniform laundering allowance (FAC, ¶¶ 138-42); did not reimburse them for the required use and maintenance of delivery bicycles (FAC, ¶¶ 143-147); failed to pay spread-of-hours wages (FAC, ¶¶ 149-151); did not provide statutorily mandated breaks (FAC, ¶¶ 153-155); and did not provide the required notice of employment laws (FAC, ¶¶ 128-130). In addition, they contend that the defendants retaliated against them when they voiced complaints about these unlawful practices by reducing their schedules, removing them from the schedule all together, or terminating them. (FAC, ¶¶ 158-169).
The Complaint in this action was filed on September 16, 2010. On November 15, 2010, the plaintiffs filed a First Amended Complaint that added Leonardo Juarez, Saul Isidro, Aboubacar Gouem, and Anatole Yameogo as plaintiffs. The parties stipulated toconditional certification of an FLSA collective action and, after the close of a three month opt-in period on July 14, 2011, the case now includes 44 opt-in claimants.
The plaintiffs move for leave to file a second amended complaint to add corporate franchisors, Domino's Pizza, Inc., Domino's Pizza LLC, and Domino's Pizza Franchising LLC (the "Proposed Defendants"), as defendants. According to the plaintiffs, each of these entities grants franchises to operate Domino's Pizza stores in New York under the Domino's System and sublicenses to use the Domino's Pizza trademark. (Second Amended Complaint ("SAC"), ¶ 46). They contend that the Proposed Defendants are their employers within the meaning of the FLSA and NYLL. The defendants and Proposed Defendants oppose the motion.
A motion to amend is generally governed by Rule 15(a) of the Federal Rules of Civil Procedure, which states that "[t]he court should freely give leave when justice so requires." Fed. R. Civ. P. 15(a)(2). If the amendment seeks to add a party, Rule 21 of the Federal Rules of Civil Procedure, which allows addition of a party "at any time, on just terms," also comes into play. Fed. R. Civ. P. 21. However, that creates no additional obstacle, as the "showing necessary under Rule 21 is the same as that required under Rule 15(a)." Johnson v. Bryson, 851 F. Supp. 2d 688, 703 (S.D.N.Y. 2012); see Soler v. G & U, Inc., 86 F.R.D. 524, 528 (S.D.N.Y. 1980) .
Notwithstanding the liberality of the general rules, "it is within the sound discretion of the court whether to grant leave to amend." John Hancock Mutual Life Insurance Co. v. Amerford International Corp., 22 F.3d 458, 462 (2d Cir. 1994); accord Krumme v. WestPoint Stevens Inc., 143 F.3d 71, 88 (2d Cir. 1998). Regarding the use of this discretion, the Supreme Court has stated:
In the absence of any apparent or declared reason -- such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc. -- the leave should . . . be freely given.
Foman v. Davis, 371 U.S. 178, 182 (1962) (internal quotation marks omitted). Thus, joinder will be permitted absent futility, undue delay, bad faith, or prejudice.
In this case, permitting the amendment would be neither futile nor prejudicial and the plaintiffs have not acted in bad faith or with undue delay.
An amendment may be denied as futile if the proposed pleading would not withstand a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure. Oneida Indian Nation of New York v. City of Sherill, 337 F.3d 139, 168 (2d Cir. 2003), rev'd on other grounds, 544 U.S. 197 (2005); Smith v. CPC International,Inc., 104 F. Supp. 2d 272, 274 (S.D.N.Y. 2000). To overcome objections of futility, the moving party must merely show that it has "at least colorable grounds for relief." Ryder Energy Distribution Corp. v. Merrill Lynch Commodities Inc., 748 F.2d 774, 783 (2d Cir. 1984) (citation omitted); see also Kaster v. Modification Systems, Inc., 731 F.2d 1014, 1018 (2d Cir. 1984); cf. Starr v. Sony BMG Music Entertainment, 592 F.3d 314, 321 (2d Cir. 2010) (); Stoner v. Young Concert Artists, Inc., No. 11 Civ. 7379, 2012 WL 512660, at *3 (S.D.N.Y. Feb. 15, 2012). A "formulaic recitation" of the elements is not enough. Bell Atlantic v. Twombly, 550 U.S. 544, 555(2007). Instead, "[w]hat is required are 'enough facts to state a claim to relief that is plausible on its face.'" Starr, 592 F.3d at 321 (quoting Twombly, 550 U.S. at 570). The plausibility standard is met "when the plaintiff pleads factual content that allows the court to draw the reasonable inference" that the accused entity engaged in the alleged conduct. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). As when considering a motion under Rule 12(b)(6), a court must accept all factual allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. Henneberry v. Sumitomo Corp. of America, 532 F. Supp. 2d 523, 527 (S.D.N.Y. 2007).
In the Second Amended Complaint, the plaintiffs allege that Domino's Pizza, Inc., a business incorporated in Delaware, does business in New York through its subsidiaries, Domino's Pizza LLCand Domino's Pizza Franchising LLC. (SAC, ¶¶ 42-47). They assert that the Proposed Defendants run a pizza delivery business dependent on their franchise and corporate-owned stores selling and delivering pizzas under a prescribed model, and that their profits and financial well-being depend in part upon the success of the defendants' stores. (SAC, ¶¶ 60, 78). The plaintiffs claim that the Proposed Defendants promulgated and implemented employment policies including compensation, hiring, training, and management policies for all of their stores, including the defendants' stores. (SAC, ¶¶ 56, 63-64). They contend that the Proposed Defendants exercised their authority to control, directly or indirectly, the defendants' timekeeping and payroll practices by requiring the use of a trademarked, computerized record-keeping system called Domino's PULSE ("PULSE") that, among other things, tracked hours and wages and retained payroll records, all of which were regularly submitted to...
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