Cataldie v. Seaside Healthcare Sys., LLC
| Decision Date | 23 March 2020 |
| Docket Number | CIVIL ACTION 19-195-SDD-EWD |
| Parties | CHRISTOPHER CATALDIE v. SEASIDE HEALTHCARE SYSTEMS, LLC, ET AL. |
| Court | U.S. District Court — Middle District of Louisiana |
This matter is before the Court on the Motion to Dismiss for Lack of Subject Matter Jurisdiction, Lack of Standing and No Cause of Action1 filed by Defendants Seaside Healthcare Systems, LLC ("Seaside") and Eric Gintoli ("Gintoli") (collectively "Defendants"). Plaintiff Christopher Cataldie ("Plaintiff") filed an Opposition.2 For the following reasons, Defendants' Motion to Dismiss3 shall be GRANTED in part and DENIED in part as explained below.
The facts alleged by Plaintiff are as follows. Seaside entered into a contract on July 1, 2018 with Christopher Cataldie, NP, LLC ("Cataldie LLC"), an LLC in which Plaintiff is a member. The contract employed Plaintiff as a nurse practitioner and, among other things, provided compensation rates for Plaintiff that differed depending on whether Plaintiff worked on weekdays or weekends. Plaintiff alleges that he "routinely worked inexcess of 40 hours in a workweek" yet was never paid overtime rates, despite allegedly being a non-exempt employee under the Fair Labor Standards Act ("FLSA").5 Plaintiff ceased work for Seaside on January 20, 2019 and sent a letter on February 8, 2019 demanding payment of wages.
On April 3, 2019, Plaintiff filed suit against Defendants and Robert V. Blanche MD, LLC (allegedly also an employer of Plaintiff along with Seaside), seeking to recover unpaid wages and penalty wages in addition to attorney's fees and court costs. Plaintiff claims that the Defendants' failure to pay wages according to overtime rates violated the FLSA; Plaintiff also asserts a breach of contract claim and a claim under the Louisiana Penalty Wage Act ("LPWA"). Defendants filed the present Motion to Dismiss seeking to dismiss Plaintiff's claims under the FLSA. Plaintiff filed his Opposition on July 8, 2019.
In attacking Plaintiff's FLSA claim, Defendants contend that Plaintiff lacks standing to assert a claim on behalf of the corporate entity of which Plaintiff is a member because Plaintiff himself is not a party to the employment contract at issue.6 In other words, Defendants argue that the contract is between Seaside and Cataldie LLC; Cataldie in his individual capacity is a third party.7 In support of this assertion, Defendants rely upon a case involving a breach of contract claim.8 The Defendants' argument as to Plaintiff's standing to bring a FLSA claim presents the issues of (1) whether an individual memberof a corporate entity can assert a right arising from a contract claim when the corporate entity is a party to the contract and not the individual member, and (2) whether the FLSA provides corporate entities with a right of action.9 These issues are left wholly unaddressed by Plaintiff; rather, Plaintiff addresses Article III standing and argues that an employment relationship existed between the parties.10
First, while Defendants are correct that "[i]t is axiomatic that individuals who are not parties to a contract cannot sue to enforce rights under the contract,"11 Plaintiff's FLSA claim is entirely separate from Plaintiff's breach of contract claim. The FLSA provides individual employees with a right of action; § 216(b) provides that "[a]n action to recover the liability prescribed in either of the preceding sentences may be maintained against any employer . . . by any one or more employees for and on behalf of him or themselves."12 "The FLSA imposes a legal duty on every employer to pay overtime to non-exempt employees and . . . explicitly establishes a private right of action to enforce that duty."13 Therefore, if Plaintiff has alleged facts supporting the elements of the cause of action, then Plaintiff has correctly filed a lawsuit against Defendants in his individualcapacity. Second, because Plaintiff has presented a FLSA claim in his individual capacity, it is irrelevant whether the FLSA provides corporate entities with a right of action.
Standing is a threshold question in every case; "[i]f a party lacks standing to bring a matter before the court, the court lacks jurisdiction to decide the merits of the underlying case."14 It is unclear whether Defendant is challenging Plaintiff's standing under Article III or under principles of prudential standing. Whereas Article III standing pertains to an "irreducible constitutional minimum of standing,"15 prudential standing is a matter of statutory standing and essentially involves statutory interpretation.16
Article III standing requires that Plaintiff must allege facts to establish (1) an injury-in-fact, (2) that the injury is "'fairly traceable' to the actions of the defendant," and (3) that the injury will likely be redressed by a favorable decision.17 Thus, Defendants' challenge to Plaintiff's standing in the framework of Article III "turns on whether [Plaintiff] has sufficiently alleged that he was 'employed' by [Defendants], as that concept is interpreted in the context of FLSA."18 Prudential standing, on the other hand, requires that Plaintiff must allege facts demonstrating that Plaintiff falls within the class of persons that has a right to sue under the FLSA.19 This "zone-of-interests test" is effectively a matter of statutory interpretation, requiring the Court to determine whether the FLSA encompasses the Plaintiff's claim.20 Because the FLSA requires the existence of an employmentrelationship, evaluation of Defendants' standing challenge under prudential standing principles depends on whether Plaintiff has alleged facts sufficient to support the existence of an employer-employee relationship with Defendants.
Therefore, regardless of the framework used by Defendants to challenge Plaintiff's standing, the Court must determine whether there are sufficient facts alleged in the Complaint to plausibly plead an employment relationship. Bearing this in mind, the Court now turns to the legal standard for a standing challenge. Because standing is a jurisdictional prerequisite,21 if a plaintiff lacks standing to bring a claim, the Court lacks subject matter jurisdiction over the claim, and dismissal under Rule 12(b)(1) is appropriate.22
"When a motion to dismiss for lack of jurisdiction 'is filed in conjunction with other Rule 12 motions, the court should consider the Rule 12(b)(1) jurisdictional attack before addressing any attack on the merits.'"23 If a complaint could be dismissed for both lack of jurisdiction and for failure to state a claim, "'the court should dismiss only on the jurisdictional ground under [Rule] 12(b)(1), without reaching the question of failure to state a claim under [Rule] 12(b)(6).'"24 The reason for this rule is to preclude courts from issuing advisory opinions and barring courts without jurisdiction "'from prematurely dismissing acase with prejudice.'"25 Accordingly, the Court first considers Defendants' Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction.
The party seeking to invoke federal jurisdiction bears the burden of showing that standing existed at the time the lawsuit was filed.26 In reviewing a motion under 12(b)(1) for lack of subject matter jurisdiction, a court may consider (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts.27
A motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1) is characterized as either a "facial" attack, i.e., the allegations in the complaint are insufficient to invoke federal jurisdiction, or as a "factual" attack, i.e., the facts in the complaint supporting subject matter jurisdiction are questioned.28 A 12(b)(1) Motion unsupported by evidence is analyzed as a facial attack29 and the allegations in the complaint are taken as true.30
Here, Defendants have mounted a facial attack; although Defendants have attached accompanying exhibits as evidence, Defendants' argument does not relate to any underlying factual dispute. Rather, as discussed supra, Defendants' Motion raises a question of law—specifically, whether there existed an employment relationship—thattests the adequacy of the Plaintiff's Complaint. Defendants' 12(b)(1) Motion to Dismiss will be analyzed by the Court as a facial attack, and the allegations in the Complaint shall be accepted as true.
Plaintiff contends in the Complaint that the Court possesses subject matter jurisdiction under 28 U.S.C. § 1331.31 "[A] cause of action arises under federal law only when the plaintiff's well-pleaded complaint raises issues of federal law."32 "When a federal claim appears on the face of the complaint, '[d]ismissal for lack of subject matter jurisdiction is only proper in the case of a frivolous or insubstantial claim,'"33 and "dismissal for want of jurisdiction is disfavored as a matter of policy."34
Plaintiff presents a claim under the FLSA.35 Defendants do not argue that Plaintiff's federal claims are frivolous or insubstantial. Moreover, the substantive challenges presented by Defendants—challenges to Plaintiff's standing and to the alleged employment relationship—pertain to legal determinations at the core of Plaintiff's FLSA claims rather than subject matter jurisdiction.36 Courts have categorized challenges to alleged employment relationships as challenges to the elements of the cause of action rather than issues of standing.37 Consequently, Defendants' Motion is therefore construedas a Rule 12(b)(6) motion to dismiss and shall be considered under that standard.38 As to Plaintiff's state law claims, the Court defers the determination of supplemental jurisdiction for reasons discussed below.
When deciding a Rule 12(b)(6) motion to dismiss, "[t]he 'court accepts all well-pleaded facts as true, viewing them in the light most favorable to the...
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