Chapman v. Bok Fin. Corp.
| Decision Date | 25 July 2014 |
| Docket Number | Case No. 12-CV-613-GKF-PJC |
| Parties | NANCY CHAPMAN, individually and on behalf of a class of those similarly situated, Plaintiff, v. BOK FINANCIAL CORPORATION, and BOKF, NA, Defendants. |
| Court | U.S. District Court — Northern District of Oklahoma |
Before the Court is the Motion for Partial Summary Judgment Against Both Defendants [Dkt. # 66] filed by plaintiff Nancy Chapman ("Chapman"), individually and on behalf of a class, and the Motion for Partial Summary Adjudication of Plaintiffs' Misclassification Claim and Part of the Plaintiffs' DFW "Off the Clock" Claim [Dkt. # 68] filed by defendants BOK Financial Corporation and BOKF, NA (collectively, "BOK").
On April 30, 2013, the Court conditionally certified collective actions for plaintiffs' misclassification claim, wherein plaintiffs allege BOK misclassified loan officers as exempt under the Fair Labor Standards Act ("FLSA") after April 30, 2010 and before January 1, 2011; and plaintiffs' Dallas/Ft. Worth ("DFW") "off the clock" claim wherein plaintiffs allege that BOK instructed DFW loan officers to not report overtime hours.
In their Motion for Partial Summary Judgment Against Both Defendants, plaintiffs seek partial summary judgment on three of defendants' affirmative defenses to plaintiffs' misclassification claim (the outside sales, administrative, and highly compensated employee exemptions).
In their Motion for Partial Summary Adjudication of Plaintiffs' Misclassification Claim and Part of the Plaintiffs' DFW "Off the Clock" Claim, defendants contend they are entitled to partial summary judgment because plaintiffs' misclassification claim is time-barred, and because a portion of the "off the clock" claims brought by plaintiffs Allen and Cordova are for months occurring more than two years prior to the filing of their consents to join. In response, plaintiffs argue that the standard two-year statute of limitations does not apply because BOK willfully violated the FLSA, thus a three-year statute of limitations applies.
On March 24, 2010, the Department of Labor ("DOL") issued an "Administrator's Interpretation," in which DOL withdrew a 2006 Opinion Letter wherein it had concluded on the facts presented "that mortgage loan officers with archetypal job duties fell within the administrative exemption [to the overtime requirements of the FLSA]."1 The 2010 Administrator's Interpretation declared that "employees who perform the typical job duties" of the hypothetical mortgage loan officer "do not qualify as bona fide administrative employees."
Following the 2010 Administrator's Interpretation, BOK addressed the issues involved in determining whether its mortgage loan officers should be reclassified. In addressing those issues, BOK (i) consulted outside resources, including banking trade organizations;2 (ii) hademployees attend seminars (including a conference conducted by the American Mortgage Association) concerning FLSA coverage after the 2010 Administrator's Interpretation; (iii) evaluated possible exemptions remaining for mortgage loan officers, including the outside sales, highly compensated, executive, and administrative exemptions; and (iv) surveyed peer banks on their reactions to and evaluations of the 2010 Administrator's Interpretation and the peer banks' treatment of mortgage loan officers.
BOK's initial determination following the 2010 Administrator's Interpretation was that its mortgage loan officers would still fall under one or more exemptions depending on the nature of a particular mortgage loan officer's work. BOK later reconsidered its position. One of the items BOK considered was an email sent on October 5, 2010, by Rod Alba ("Alba"), the vice president of the American Bankers Association ("ABA") to Jeff Harjo ("Harjo"), BOK's senior vice president, chief auditor, and member of the BOK team responsible for the reclassification of loan originators. Attached to the email was a memorandum prepared by Patton Boggs, a law firm engaged by the ABA, entitled "Overtime Status of Mortgage Loan Officers Under FLSA." The memorandum noted that exemption determinations under the FLSA are based on the duties and responsibility of each specific position, discussed differing treatment under the FLSA for employees with the same title, and discussed the ways in which loan officers might retain their exempt status (including the administrative exemption, the outside sales exemption, the executive exemption, and the highly compensated exemption). Harjo reviewed the memorandum and considered it in evaluating the reclassification of loan originators.
In late 2010, BOK decided to reclassify its mortgage loan officers as non-exempt employees effective January 1, 2011. BOK did not pay overtime compensation from March 24, 2010 through January 1, 2011.
There are fourteen (14) opt-in plaintiffs to the misclassification claim. There are five (5) remaining plaintiffs to the DFW "off the clock" claim.
The earliest consents to join as a party plaintiff were filed on January 25, 2013, more than two years, but less than three years after January 1, 2011.
Two of the plaintiffs in the DFW "off the clock" claim are Richard Allen and Anthony Cordova. Allen was employed by BOKF, NA d/b/a Bank of Texas as a mortgage banker from February 4, 2002 through March 5, 2013. He filed his consent to join on June 18, 2013. Cordova was employed by BOKF, NA d/b/a Bank of Texas as a mortgage banker from February 25, 2010 until November 18, 2013. He filed his consent to join on August 13, 2013.
A motion for summary judgment shall be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A court must examine the factual record in the light most favorable to the party opposing summary judgment. Wolf v. Prudential Ins. Co. of Am., 50 F.3d 793, 796 (10th Cir. 1995). "However, the nonmoving party may not rest on its pleadings but must set forth specific facts showing that there is a genuine issue for trial as to those dispositive matters for which it carries the burden of proof." Applied Genetics Int'l, Inc. v. First Affiliated Secs., Inc., 912 F.2d 1238, 1241 (10th Cir. 1990). The mere existence of an alleged factual dispute does not defeat an otherwise properly supported motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). In essence, the inquiry for the court is "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Id. at 251-52.
BOK moves for summary judgment in its favor on all misclassification claims and as to Allen and Cordova's "off the clock" claims to the extent those claims extend beyond two years prior to the filing of their respective consents to join.
Claims arising under FLSA must be commenced within two years after the cause of action accrued, "and every such action shall be forever barred unless commenced within two years after the cause of action accured, except that a cause of action arising out of a willful violation may be commenced within three years after the cause of action accrued." 29 U.S.C. § 255(a). Title 29 U.S.C. § 256 controls when a FLSA action is commenced:
See Stransky v. HealthONE of Denver, Inc., 868 F. Supp. 2d 1178, 1180-81 (D. Colo. 2012). Chapman's Complaint was filed on November 2, 2012, but Chapman did not file her written consent to join until January 25, 2013. As BOK reclassified plaintiffs as non-exempt under the FLSA on January 1, 2011, the last day for a timely filing of the requisite consent to join per the standard two-year statute of limitations was January 1, 2013. As previously stated, plaintiffs contend their misclassification claims may proceed because genuine disputes of material factexist as to whether BOK's violation was willful. If plaintiffs can show a willful violation, the three-year statute of limitations applies, and plaintiffs' misapplication claims are timely.
Plaintiffs Allen and Cordova also assert "off the clock" claims. Allen and Cordova filed their consents to join on June 18 and August 13, 2013, respectively. BOK contends plaintiffs have not shown a genuine dispute of material fact as to whether a willful violation occurred, therefore Allen and Cordova's "off the clock" claims must be limited to claims arising after June 18 and August 13, 2011, respectively.
The Supreme Court has stated that willfulness under the FLSA requires "that the employer either knew or showed reckless disregard for the matter of whether its conduct was prohibited by the statute." McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133 (1988). In adopting this standard, the Supreme Court noted that the term "willful" is generally understood in the law "to refer to conduct that is not merely negligent." Id. The Court also observed that "[t]he fact that Congress did not simply extend the limitations period to three years, but instead adopted a two-tiered statute of limitations, makes it obvious that Congress intended to draw a significant distinction between ordinary violations and willful violations." Id. at 132-33; see also Bass v. Potter, ...
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