Contrera v. Langer

Decision Date04 June 2018
Docket Number16 Civ. 3851 (LTS) (GWG)
Citation314 F.Supp.3d 562
Parties Usvaldo CONTRERA et al., Plaintiffs, v. Irving LANGER et al., Defendants.
CourtU.S. District Court — Southern District of New York

Peter David Winebrake, The Winebrake Law Firm, LLC, Dresher, PA, Christopher Robert Travis, Christopher R. Travis, Esq, Meredith Reade Miller, Miller Law, PLLC, Marc Andrew Rapaport, Rapaport Law Firm, PLLC, New York, NY, for Plaintiffs.

Larry Rafael Martinez, Christopher Paul Hampton, Gerald Charles Waters, Jonathan D. Farrell, Loretta Mae Gastwirth, Robert R. Barravecchio, Meltzer, Lippe, Goldstein & Breitstone, LLP, Mineola, NY, for Defendants.

OPINION AND ORDER

GABRIEL W. GORENSTEIN, UNITED STATES MAGISTRATE JUDGE

Plaintiffs Usvaldo Contrera, Francisco Lopez, Pedro Batista, Fabian Herrera, and Antonio Reyes—former superintendents, handymen, and a porter at residential buildings in Upper Manhattan and the Bronx—filed this action against various individuals and entities that plaintiffs collectively refer to as "the E & M Enterprise" alleging that this enterprise employed them and it violated the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. ("FLSA"), and various provisions of the New York Labor Law. Plaintiffs now move to amend their complaint.1 For the reasons set forth below, this motion is granted in part and denied in part.

I. BACKGROUND

Contrera and Lopez filed the original complaint in this action on May 23, 2016. See Class Action Complaint, filed May 23, 2016 (Docket # 1). It alleged claims against business entities that owned, controlled, or managed more than 3,000 rental apartments in approximately 262 buildings in New York City, as well as against individuals who controlled these entities. See id. ¶¶ 2, 10, 45–250. The complaint alleged that the defendants maintained an unlawful policy of encouraging superintendents and porters to work in excess of 40 hours per week, but failed to pay these individuals at the appropriate minimum wage or overtime rates. See id. ¶ 17. Contrera and Lopez worked for defendants as superintendents in two of their apartment buildings. See id. ¶¶ 29–31, 37–39. Contrera and Lopez claimed that they were required to remain on call "at virtually all times" and routinely worked more than 80 hours per week, but were paid less than the minimum hourly wage set in the FLSA, and were not paid overtime rates for hours worked in excess of 40, as required by the FLSA. Id. ¶¶ 32–35, 40–43, 310–20. The complaint also included so-called "Class Action Allegations," by which plaintiffs asserted that defendants deprived all porters and superintendents employed in their apartment buildings of the minimum hourly wage and overtime rates. See id. ¶¶ 251–62.

On September 23, 2016, defendants moved to dismiss the complaint, or in the alternative, for summary judgment. See Notice of Motion, filed Sept. 23, 2016 (Docket # 40). On July 27, 2017, before the Court ruled on that motion, plaintiffs filed their first amended complaint. See Amended Class Action Complaint, filed July 27, 2017 (Docket # 156) ("FAC"). The FAC added three new plaintiffs: Pedro Batista, who worked for the E & M Enterprise as both a handyman and a superintendent; Fabian Herrera, who worked for the E & M Enterprise as a porter and superintendent; and Antonio Reyes, who worked for the E & M Enterprise as a handyman. See id. ¶¶ 5–6, 53–64. In the FAC, plaintiffs alleged, among other claims, that Batista, Herrera, and Reyes were not paid the appropriate minimum wage or overtime rates for hours worked in excess of 40. See id. ¶¶ 380–412. The FAC also added a claim on behalf of all plaintiffs for overtime wages under the New York Labor Law. See id. ¶¶ 430–36. Finally, the FAC added that the defendants designated in writing that Contrera and Lopez were hourly employees, with Contrera's hourly rate set at $10.00 per hour with an overtime rate of $15.00 per hour, and Lopez's hourly rate set at $9.17 per hour. See id. ¶¶ 43, 52. In support of this allegation, the FAC cited to "Employee Enrollment Applications" for Contrera and Lopez indicating that these employees were to be paid hourly. See id. ¶ 43 (citing Contrera's Staffpro Employee Enrollment Application, dated Nov. 18, 2013 (annexed as Ex. A to the Declaration of Scott Katz, dated Sept. 19, 2016 (annexed as Ex. D to the Declaration of Larry R. Martinez, filed Sept. 23, 2016 (Docket # 42) ) ("Katz Decl.") ) ("Contrera EEA") ); id. ¶ 52 (citing Lopez's Staffpro Employee Enrollment Application, undated (annexed as Ex. C to Katz Decl.) ("Lopez EEA") ). Another document cited in the FAC is signed by Contrera and indicates that he was to be paid at a rate of $10 per hour. See FAC ¶ 52 (citing Notice and Acknowledgment of Pay Rate and Payday Under Section 195.1 of the New York State Labor Law Notice for Hourly Rate Employees, dated Nov. 26, 2013 (annexed as Ex. B to Katz Decl.) ("Contrera Section 195.1 Wage Notice") ). Plaintiffs also allege that Batista was designated as an hourly employee, though they fail to indicate the form of this designation or Batista's hourly rate. See id. ¶ 384.

On September 8, 2017, defendants moved to partially dismiss the FAC on the grounds that (1) under the New York Labor Law, Contrera and Lopez were not entitled to be paid the overtime rate for hours worked in excess of 40; and (2) Lopez's FLSA claims were time-barred. See Notice of Motion, filed Sept. 8, 2017 (Docket # 192). On March 5, 2018, this Court issued a Report and Recommendation recommending that the district judge deny this motion. Contrera v. Langer, 290 F.Supp.3d 269 (S.D.N.Y. 2018). The district judge has not yet ruled on this Report and Recommendation.

On March 16, 2018, plaintiffs filed the instant motion to amend the FAC. See Pl. Not. While the FAC sought to recover unpaid wages at the minimum wage rate dictated by the FLSA, see FAC ¶¶ 402–05, and overtime wages at the rates set by the FLSA and New York Labor Law, see id. ¶¶ 406–12, 430–36, the proposed Second Amended Complaint additionally seeks to recover unpaid wages on the ground that the parties agreed to specific hourly and overtime rates that defendants failed to pay, see Second Amended Class Action Complaint With Comparison Notes, dated Mar. 16, 2018 (annexed as Ex. 1 to Rapaport Decl.) ("SAC"), ¶¶ 4, 437–43, ad damnum ¶¶ 6–7. Plaintiffs seek to recover these "agreed upon wages" pursuant to section 198(3) of the New York Labor Law or under a common law claim for breach of contract. See id. ¶¶ 437–43.

II. GOVERNING LAW

Rule 15(a) provides that a court should "freely" grant leave to amend "when justice so requires." Fed. R. Civ. P. 15(a)(2). The decision to grant or deny leave to amend under Rule 15(a)(2) is within the trial court's discretion. E.g., Zenith Radio Corp. v. Hazeltine Research, Inc., 401 U.S. 321, 330, 91 S.Ct. 795, 28 L.Ed.2d 77 (1971) (citing Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962) ). The court may deny leave to amend for "good reason," which normally involves an analysis of the factors articulated in Foman: undue delay, bad faith, futility of amendment, or undue prejudice to the opposing party. E.g., McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 200 (2d Cir. 2007) (citing Foman, 371 U.S. at 182, 83 S.Ct. 227 ). "Mere delay, however, absent a showing of bad faith or undue prejudice, does not provide a basis for a district court to deny the right to amend." State Teachers Ret. Bd. v. Fluor Corp., 654 F.2d 843, 856 (2d Cir. 1981) (citing Howey v. United States, 481 F.2d 1187, 1190–91 (9th Cir. 1973), and Middle Atl. Utils. Co. v. S.M.W. Dev. Co., 392 F.2d 380, 384 (2d Cir. 1968) ). While the party seeking to amend its pleading must explain any delay, the party opposing the amendment "bears the burden of showing prejudice, bad faith, and futility of the amendment." United States ex rel. Raffington v. Bon Secours Health Sys., Inc., 285 F.Supp.3d 759, 766 (S.D.N.Y. 2018) (internal quotation marks and citations omitted).

"In gauging prejudice," a court considers, "among other factors, whether an amendment would require the opponent to expend significant additional resources to conduct discovery and prepare for trial or significantly delay the resolution of the dispute." Ruotolo v. City of New York, 514 F.3d 184, 192 (2d Cir. 2008) (internal quotation marks omitted) (quoting Block v. First Blood Assocs., 988 F.2d 344, 350 (2d Cir. 1993) ). Obviously, "[u]ndue prejudice arises when an amendment comes on the eve of trial and would result in new problems of proof." Id. (internal quotation marks and alteration omitted) (quoting Fluor Corp., 654 F.2d at 856 ). Nonetheless, "allegations that an amendment will require the expenditure of additional time, effort, or money do not themselves constitute undue prejudice." Christians of Cal., Inc. v. Clive Christian N.Y., LLP, 2014 WL 3605526, at *5 (S.D.N.Y. July 18, 2014) (internal quotation marks and alterations omitted) (quoting A.V. by Versace, Inc. v. Gianni Versace S.p.A., 87 F.Supp.2d 281, 299 (S.D.N.Y. 2000) ). Thus, "the adverse party's burden of undertaking discovery, standing alone, does not suffice to warrant denial of a motion to amend a pleading." United States ex rel. Mar. Admin. v. Cont'l Ill. Nat'l Bank & Tr. Co. of Chi., 889 F.2d 1248, 1255 (2d Cir. 1989) (citation omitted); accord Fresh Del Monte Produce, Inc. v. Del Monte Foods, Inc., 304 F.R.D. 170, 174 (S.D.N.Y. 2014).

Finally, when a party argues that an amendment would be futile, the court must determine whether "a proposed claim could ... withstand a motion to dismiss pursuant to [Federal Rule of Civil Procedure] 12(b)(6)." Dougherty v. Town of N. Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 88 (2d Cir. 2002) (citing Ricciuti v. N.Y.C. Transit Auth., 941 F.2d 119, 123 (2d Cir. 1991) ). Pursuant to Rule 12(b)(6), a party may move to dismiss the opposing party's pleading on the ground that it "fail[s] to state a claim upon which relief can be granted." While a court must accept as true all of the allegations...

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