Casias v. Distribution Mgmt. Corp.
| Decision Date | 28 September 2012 |
| Docket Number | Case No. 1:11-CV-00874 MV/RHS |
| Parties | ANDREW CASIAS, ERNEST CASIAS, on behalf of themselves and similarly-situated employees of Distribution Management Corporation, Inc., Plaintiffs, v. DISTRIBUTION MANAGEMENT CORPORATION, INC., Defendant. |
| Court | U.S. District Court — District of New Mexico |
THIS MATTER comes before the Court on Plaintiffs Andrew Casias and Ernest Casias's Motion to Dismiss Counterclaim [Doc. 20] and Motion to Dismiss Amended Counterclaim [Doc. 23]. Having considered the motions, briefs, and relevant law, and being otherwise fully informed, the Court finds that the Motion to Dismiss Counterclaim is moot and will be denied as moot and that the Motion to Dismiss Amended Counterclaim is well taken and will be granted.
On August 30, 2011, Plaintiffs Andrew Casias and Ernest Casias ("Plaintiffs"), on behalf of themselves and similarly-situated class members, filed a Complaint against Defendant Distribution Management Corporation, Inc. ("Defendant") seeking equitable relief, employment benefits, overtime pay, liquidated damages, and attorney's fees for alleged violations of the New Mexico Minimum Wage Act, New Mexico Statutes Annotated Sections 50-4-19 through 50-4-30. Thereafter, on October 6, 2011, Defendant filed an Answer and a Counterclaim. Plaintiffs moved to dismiss the Counterclaim on November 9, 2011, and Defendant responded on November 28,2011. On December 5, 2011, Defendant filed an Amended Counterclaim. Plaintiffs moved to dismiss the Amended Counterclaim on January 4, 2012, Defendant responded on January 23, 2012, and Plaintiffs replied on February 6, 2012.
In the Amended Counterclaim, Defendant alleges that Plaintiff Andrew Casias signed an agreement dated November 10, 2009, in which he agreed to enter into an independent contractor relationship with Defendant ("Independent Contractor Agreement"). See Am. Countercl. ¶¶ 2, 4. Defendant alleges that the Independent Contractor Agreement provides that Plaintiff Andrew Casias would indemnify Defendant as follows:
Indemnity. Contractor [Andrew Casias] agrees to defend, indemnify and hold harmless Company [DMC] from any direct, indirect and consequential loss, damage, fine, expense, including reasonable attorney's fees, action, claim for injury to persons, including death, and damage to property, which Company [DMC] may incur arising out of or in connection with the operation of the Equipment, Contractor's [Andrew Casias's] obligations under this Agreement, or any breach by Contractor [Andrew Casias] of the terms of this Agreement.
Id. ¶ 9. "Equipment" is defined as "[Contractor's] self-provided vehicle." See id., Exh A, p. 1.
In the Amended Counterclaim, Defendant further alleges that Plaintiff Ernest Casias entered into in a written agreement with Defendant on October 15, 2010 ("Subcontractor Agreement"), and that the Subcontractor Agreement, like the Independent Contractor Agreement, expressly contemplated and detailed an independent contractor relationship. See id. ¶¶ 3, 4. Defendant further alleges that the Subcontractor Agreement contains, among other things, the following indemnification provision:
INDEMNIFICATION. The Carrier (the "Indemnitor") [Ernest Casias] agrees to indemnify and hold harmless the Company (the "Indemnitee") [DMC] from and against any claims, damages, losses or expenses, including reasonable attorneys' fees caused directly orindirectly by or arising out of the performance or failure of performance of this Agreement by the Indemnitor [Andrew Casias] or any acts, omissions, or conduct of the Indemnitor [Andrew Casias], its drivers, employees or agents, whether negligent or otherwise, including but not limited to claims or demands by or [o]n behalf of shippers, consignees, members of the public, drivers or employees and their dependents or next of kin.
Article III of the Independent Contractor Agreement is entitled "Duties of Contractor" and contains eighteen paragraphs detailing the duties of Andrew Casias under the Agreement, including but not limited to being hired as an independent contractor, providing "on-time delivery performance," "comply[ing] with all reporting and communication requirements," "provid[ing] all the Equipment ready to operate and fully roadworthy," "provid[ing] competent drivers," and "operat[ing] the Equipment in a safe and prudent manner." See id., Exh. A, ¶¶ 3.01 to 3.18. Article IV of the Independent Contractor Agreement is entitled "Compensation" and provides that "Contractor will be paid as described on the agreed upon Statement of Work." Id., Exh. A, ¶ 4.01.
Paragraph two of the Subcontractor Agreement is entitled "Transportation Services" and details the services Plaintiff Ernest Casias agrees to provide Defendant, including but not limited to "pickup and delivery service," "ship[ing] in accordance with applicable tariff regulations," providing "all personnel[ and] vehicles . . . necessary [for] pickup and delivery service," acquiring "a facility to accommodate and protect the transfer of property," and "comply[ing] strictly . . . with all other laws, rules, regulations and ordinances." Id., Exh. B, ¶ 2. Paragraph eight of the Subcontractor Agreement is entitled "Payments to Carrier" and provides that "[Defendant] agrees to pay Carrier [Ernest Casias] on the basis of the attached Statement of Work." Id., Exh. B, ¶ 8.
Defendant alleges in its Amended Counterclaim that the claims asserted by Plaintiffs in theComplaint, and the fees and expenses Defendant has incurred and will incur to defend Plaintiffs' suit, fall within the terms of the indemnification provisions in the Independent Contractor Agreement and Subcontractor Agreement (collectively, "Agreements"). See id. ¶ 13. Defendant makes no allegation in its Amended Counterclaim that Plaintiff Andrew Casias (1) operated equipment improperly, (2) failed to fulfill any of his obligations under the Independent Contractor Agreement, or (3) breached the Independent Contractor Agreement. Likewise Defendant makes no allegation that Plaintiff Ernest Casias (1) performed or failed to perform under the Agreement, or (2) caused harm by his "act[], omission[], or conduct."
The only loss that Defendant alleges in the Amended Counterclaim is that Plaintiffs filed a complaint against Defendant "seeking equitable relief, employment benefits, overtime pay, liquidated damages and attorney fees . . . for alleged violations of the New Mexico Minimum Wage Act" by Defendant. Id. ¶ 8. Defendant alleges that if in resolving Plaintiffs' Complaint the Court finds the Agreements enforceable and determines that Plaintiffs have been properly classified as independent contractors, the Court should enter an award of indemnification for Defendant that includes an award of all costs, expenses, and reasonable attorney fees incurred by Defendant in defending Plaintiffs' action. See id. ¶ 14.
Under Rule 12(b)(6), a court may dismiss a complaint for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). "The nature of a Rule 12(b)(6) motion tests the sufficiency of the allegations within the four corners of the complaint." Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir. 1994). When considering a 12(b)(6) motion, the Court must accept as true all well-pled factual allegations in the complaint, view those allegations in thelight most favorable to the non-moving party, and draw all reasonable inferences in the non-moving party's favor. See Smith v. United States, 561 F.3d 1090, 1097 (10th Cir. 2009), cert. denied, 130 S. Ct. 1142 (2010).
"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citations omitted). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. Although this standard does not require "detailed factual allegations," it "demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Id. Accordingly, a complaint "that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do.'" Id. (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). In other words, "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. Nor does a complaint suffice if it "tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Id. (quoting Twombly, 550 U.S. at 557). Thus, while a court must take all of the factual allegations in the complaint as true, "a plaintiff armed with nothing more than conclusions" cannot survive a motion to dismiss. Id. at 1950.
Plaintiffs move to dismiss the Amended Counterclaim on two grounds. First, Plaintiffs argue that their overtime claims pursuant to the New Mexico Minimum Wage Act do not fall within the scope of the Agreements' indemnification provisions because those provisions are limited to accidents causing personal injury or property damage and do not apply to actions forovertime pay. Second, Plaintiffs contend that even if their overtime claims did fall within the scope of the indemnification provisions, the Court should strike those provisions because they are unconscionable and in violation of New Mexico public policy. In response, Defendant argues that the plain language of the indemnification provisions encompasses Plaintiffs' overtime wage claims and that Plaintiffs' public policy argument fails because Plaintiffs are not "employees" protected by the New Mexico Minimum Wage Act.1
In New Mexico,2 a primary goal of contract interpretation is to ascertain "the intentions of the...
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