Diggs v. Ovation Credit Servs., Inc.

• Decision Date: 27 March 2020
• Docket Number: Case No. 3:18-cv-367-J-34MCR
• Citation: 449 F.Supp.3d 1280
• Parties: Vernon DIGGS, individually and on behalf of those similarly situated, Plaintiffs, v. OVATION CREDIT SERVICES, INC., Terry D. Cordell, and Amy Myers, Defendants.
• Court: U.S. District Court — Middle District of Florida

449 F.Supp.3d 1280

Vernon DIGGS, individually and on behalf of those similarly situated, Plaintiffs,

v.OVATION CREDIT SERVICES, INC., Terry D. Cordell, and Amy Myers, Defendants.

Case No. 3:18-cv-367-J-34MCR

United States District Court, M.D. Florida, Jacksonville Division.

Signed March 27, 2020

Andrew Ross Frisch, Chanelle Ventura, Morgan & Morgan, PA, Plantation, FL, for Plaintiffs.

Eric James Holshouser, Michael J. Lufkin, Rogers Towers, P.A., Jacksonville, FL, for Jacksonville, FL, for Defendants.

ORDER

Marcia Morales Howard, United States District Judge

THIS CAUSE is before the Court on the parties' cross-motions for partial summary judgment, see Plaintiff's Motion for Partial Summary Judgment and Incorporated Memorandum of Law (Doc. 54; Plaintiffs' Motion), filed on May 22, 2019; Defendants Ovation Credit Services, Inc., Terry D. Cordell, and Amy Myers' Motion for Partial Summary Judgment and Supporting Memorandum of Law (Doc. 55; Defendants' Motion), filed on May 22, 2019 (collectively, Cross-Motions), and their respective responses, see Plaintiff's Response in Opposition to Defendants' Motion for Partial Summary Judgment (Doc. 64; Plaintiffs' Response); Defendants Ovation Credit Services, Inc., Terry D. Cordell, and Amy Myers' Response Opposing Plaintiff's Motion for Partial Summary Judgment (Doc. 65; Defendants' Response). With leave of Court, see Orders (Doc. 68 & 70), the parties each filed a reply on July 27, 2019. See Plaintiffs' Reply to Defendants' Response in Opposition to Plaintiff's Motion for Partial Summary Judgment (Doc. 71; Plaintiffs' Reply); Defendants' Reply to Plaintiff's Response in Opposition to Defendants' Motion for Partial Summary Judgment (Doc. 72; Defendants' Reply). As such, the Cross-Motions are ripe for review.

I. Background

Plaintiff Vernon Diggs, individually and in a representative capacity, initiated the instant action on March 16, 2018, by filing a Complaint and Demand for Jury Trial (Doc. 1; Complaint) against Defendants Ovation Credit Services, Inc., Terry D. Cordell, and Amy Myers. In the Complaint, Diggs asserts violations of the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201 et seq. ¹ Specifically, he alleges that Defendants violated the FLSA by failing to compensate him and other similarly situated employees for their overtime hours (Count One) and by failing to pay him and other similarly situated employees the statutorily required minimum wage (Count Two). Between March 26, 2018 and July 3, 2018, five other Ovation employees (Kimberly Gosse, Ernest Jackson, Michael Robinson, Gabor Szabo, and Daniel Wessels) opted into the litigation by filing notices of their consent to become party plaintiffs. See Notices of Consent to Join (Doc. 7-1; Doc. 8-1; Doc. 11-1; Doc. 15-1; Doc 21-1). On September 28, 2019, the Court granted Plaintiffs' Motion to Conditionally Certify Collective Action (Doc. 25; Motion to Certify), see Order Granting Motion to Certify (Doc. 77), and on January 9, 2020, the Court approved the parties' proposed class notice, see Order Denying Motion to Toll Statute of Limitations and Approving Class Notice (Doc. 91).²

II. Relevant Facts³

Ovation provides "services to consumers to help them resolve inaccuracies on their credit report." See Plaintiffs' Motion, Exhibit G: Deposition of Terry Cordell (Doc. 54-7; Cordell Dep.) at 33. These services include "education to consumers for credit and credit use," as well as "services to help them optimize their individual credit profiles." Id. Ovation also works "with consumers to assist them in disputing inaccurate or misleading information from their credit reports via the credit bureaus." See id., Exhibit H: Deposition of Amy Myers (Doc. 54-8; Myers Dep.) at 14-15. Plaintiffs were employed by Ovation as credit analysts where their primary duties were "to speak with [Ovation's] customers and to enroll them into [Ovation's] credit repair services" through inbound and outbound telephone calls. See Cordell Dep. at 25, 38. Ovation obtains customers through partner referrals or after customers discover Ovation on their own through Ovation's website. See id. at 33. Ovation's referral partners are "generally mortgage lenders or partners that are associated with the lending space. So they all typically offer some type of service around qualifying somebody with their credit score, and they refer them to [Ovation], in most cases, whenever those individuals['] credit scores prevent them from working with that original partner." Id. at 34. Notably, Ovation's largest referral partner was Lending Tree, see Myers Dep. at 16, which purchased Ovation in 2018, see Cordell Dep. at 14-15.

In 2015, Ovation primarily made outbound calls to consumers referred to Ovation by its lending referral partners. Id. at 38. In 2016, Ovation "started receiving inbound calls at a higher rate. And now today, the majority...[is] inbound." Id. at 38-39. Nevertheless, from 2016 to 2018, Ovation focused primarily on contacting individuals referred to Ovation through its partners. Id. at 36.

Ovation paid its credit analysts an hourly rate, with the ability to earn commissions depending on the number of sales made. See id. at 43, 74-75. Although termination was not "the first course of action," credit analysts could be terminated if they did not meet the requisite sales quota in a given period." Id. at 74. Plaintiffs allege, and Defendants dispute, that Defendants prohibited Plaintiffs from recording more than 40 hours in a single week and that many credit analysts were unable to meet their sales quotas each pay period if working only 40 hours a week. See, e.g., Plaintiffs' Motion, Exhibit A: Deposition of Vernon Diggs (Doc. 54-1; Diggs Dep.) at 47-48; id., Exhibit I: Declaration of Tara McCool (Doc. 54-9; McCool Decl.) at 3-4. Plaintiffs further allege that to "avoid being written-up and subjected to the possibility of being terminated," they worked overtime without clocking in. See id. Plaintiffs allege that Defendants knew or should have known that they were working off the clock. See McCool Decl. at 3. Plaintiffs also allege that, even though they were generally not paid for their unrecorded overtime work, to the extent that Plaintiffs recorded a nominal amount of overtime, Defendants failed to pay them the proper overtime rate. See Plaintiffs' Motion at 12; id., Exhibit L: Selected Payroll Records (Doc. 54-12; Payroll Records).

III. Standard of Review

Under Rule 56 of the Federal Rules of Civil Procedure (Rule(s)), "[t]he court shall grant summary judgment 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." Rule 56(a). The record to be considered on a motion for summary judgment may include "depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials." Rule 56(c)(1)(A).⁴ An issue is genuine when the evidence is such that a reasonable jury could return a verdict in favor of the nonmovant. See Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996) (quoting Hairston v. Gainesville Sun Publ'g Co., 9 F.3d 913, 919 (11th Cir. 1993) ). "[A] mere scintilla of evidence in support of the non-moving party's position is insufficient to defeat a motion for summary judgment." Kesinger ex rel. Estate of Kesinger v. Herrington, 381 F.3d 1243, 1247 (11th Cir. 2004) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ).

The party seeking summary judgment bears the initial burden of demonstrating to the court, by reference to the record, that there are no genuine issues of material fact to be determined at trial. See Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991). "When a moving party has discharged its burden, the non-moving party must then go beyond the pleadings, and by its own affidavits, or by depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial." Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 593-94 (11th Cir. 1995) (internal citations and quotation marks omitted). Substantive law determines the materiality of facts, and "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248, 106 S.Ct. 2505. In determining whether summary judgment is appropriate, a court "must view all evidence and make all reasonable inferences in favor of the party opposing summary judgment." Haves v. City of Miami, 52 F.3d 918, 921 (11th Cir. 1995) (citing Dibrell Bros. Int'l, S.A. v. Banca Nazionale Del Lavoro, 38 F.3d 1571, 1578 (11th Cir. 1994) ). Notably, the instant action is before the Court on cross-motions seeking summary judgment. "The principles governing summary judgment do not change when the parties file cross-motions for summary judgment." T-Mobile S. LLC v. City of Jacksonville, Fla., 564 F. Supp. 2d 1337, 1340 (M.D. Fla. 2008). Instead, applying the same principles, "the Court must determine whether either of the parties deserves judgment as a matter of law on the undisputed facts." Id.

IV. Discussion

In their respective Cross-Motions, both parties seek a determination as to whether § 207(i) of the FLSA applies to exempt Plaintiffs from the FLSA's overtime pay requirement. See Plaintiffs' Motion at 13-22; Defendants' Motion at 11-22. In addition, Plaintiffs also ask the Court to enter partial summary judgment finding that, on the few occasions that Plaintiffs recorded a nominal amount of overtime, Defendants failed to include commissions when calculating Plaintiffs' overtime pay rate, as required by the FLSA. See Plaintiffs' Motion at 22-23. Finally, Defendants also seek partial summary judgment on Plaintiffs' minimum wage claims in Count Two, arguing that Defenda...