Duvall v. Heart of CarDon, LLC

• Decision Date: 17 March 2020
• Docket Number: 1:17-cv-04439-JRS-MJD
• Citation: 611 F.Supp.3d 607
• Parties: Autumn DUVALL, Plaintiff, v. HEART OF CARDON, LLC, et al. Defendants.
• Court: U.S. District Court — Southern District of Indiana

611 F.Supp.3d 607

Autumn DUVALL, Plaintiff,

v.HEART OF CARDON, LLC, et al. Defendants.

No. 1:17-cv-04439-JRS-MJD

United States District Court, S.D. Indiana, Indianapolis Division.

Signed March 17, 2020

Robert J. Hunt, Law Office of Robert J. Hunt, LLC, Carmel, IN, Robert Peter Kondras, Jr., Hassler Kondras Miller LLP, Terre Haute, IN, for Plaintiff.

David L. Swider, Gregory W. Guevara, Tyler John Moorhead, Bose McKinney & Evans LLP, Indianapolis, IN, for Defendants.

Entry on Cross Motions for Partial Summary Judgment and Defendant Dr. Stephen Moore's Motion for Summary Judgment

(ECF Nos. 59, 62)

JAMES R. SWEENEY II, JUDGE

Plaintiff Autumn Duvall alleges that her former employer, Defendant Heart of CarDon, LLC ("Heart of CarDon") and its CEO, Defendant Dr. Stephen Moore, deducted from her wages for a criminal history check, uniform purchases, and her installment-contract purchase of a personal computer in violation of Indiana's wage assignment statute, IND. CODE § 22-2-6-1 et seq. Duvall contends that those illegal deductions resulted in Defendants' failure to pay her the "amount due" in violation of Indiana's wage payment statute, IND. CODE § 22-2-5-1 et seq. , entitling her to liquidated damages and attorney's fees. Duvall further alleges that the criminal history check deductions resulted in Defendants' failure to pay her overtime wages in violation of the Fair Labor Standards Act of 1938 ("FLSA"), 29 U.S.C. § 201 et seq.¹ Heart of CarDon and Duvall each move for partial summary judgment on the wage-deduction claims, Duvall moves for summary judgment on Dr. Moore's FLSA liability, and Dr. Moore moves for summary judgment on all claims.²

For the reasons explained below, Duvall's motion (ECF No. 62) is granted in part , and she is entitled to summary judgment on the uniform deduction claim. Duvall's motion is otherwise denied. Heart of CarDon's motion (ECF No. 59) is granted in part , and it is entitled to summary judgment on the claims arising from the criminal history deductions and the personal computer deduction. Its motion is otherwise denied. Dr. Moore's motion (ECF No. 59) is granted , and he is entitled to summary judgment on Duvall's claims.

I. Background

Heart of CarDon is part of CarDon & Associates, a group of companies owned by Dr. Moore and his family. The various CarDon entities together operate senior living communities throughout Indiana. CarDon & Associates, Inc. is the CarDon entity that provides management and administrative support, while Heart of CarDon employs workers and leases their services to the individual communities. (Iskander Dep. 35:21–36:14.) Dr. Moore is the CEO and President of Heart of CarDon. (Moore Dep. 5:4–8, ECF No. 60-11.)

Duvall worked for Heart of CarDon as an LPN at a starting pay of $18.50 per hour. (Duvall Dep. 41:14–20, ECF No. 60-1; ECF No. 60-2 at 13.) Heart of CarDon paid Duvall weekly, issuing paychecks nine days after the end of each pay period. (See Duvall Dep. Ex. 12, ECF No. 60-2 at 9; ECF No. 60-8 at 1; ECF No. 60-4 at 13–30.)

A. Criminal History & Uniforms

In her application to work for Heart of CarDon, Duvall signed an authorization stating, "I authorize Heart of CarDon and Edge Information Management, Inc., a consumer reporting agency, to obtain information from" various sources "relating to my past activities, to supply any and all information concerning my background." (Duvall Dep. 35:3–25; id. Ex. 4, ECF No. 60-2 at 4.) Heart of CarDon's employee handbook states that the "[a]pplicable fees for obtaining the criminal history check are at the employee's expense and are due at the time of hire either in cash or by authorized paycheck deduction. This fee will be a minimum of $40.00." (ECF No. 63-5 at 30.)

Upon beginning her employment with Heart of CarDon, Duvall signed a wage assignment form. The top portion of the form contains two paragraphs, one relating to the cost of criminal history and the other relating to uniforms. The form states:

Limited Criminal History Checks

Long Term Care facilities are required by law to check the limited criminal history of all associates. The cost for obtaining this information is currently $27.50 and at the associate's expense. It is due at the time of hire or can be deducted from the first two paychecks. If Heart of CarDon (the Company) pays the amount of the fee on behalf of the associate, the Company considers this a loan and will expect repayment by either direct payment or paycheck deduction. To authorize the deduction from the paycheck, the associate must sign the statement below.

(Duvall Dep. Ex. 15, ECF No. 60-2 at 12.)

The next paragraph addresses uniforms:

Uniforms

Each associate of The Heart of CarDon (the Company) may be required to wear certain uniforms. The Company will pay for uniforms ordered from our vendor and treat this as a loan to the associate. The Company will expect reimbursement from the associate either by direct payment or paycheck deduction. The associate will sign the uniform order receipt as agreement of the merchandise received and the amount of cost.

(Id. )

Directly below, there are two further paragraphs, one addressing paycheck deductions for criminal history checks and the other addressing paycheck deductions for uniform purchases, with a signature line under each paragraph.

ASSIGNMENT OF WAGES CONSENT

Limited Criminal History Check:

I hereby authorize the Company to deduct, from my paycheck, the full amount of the cost of a limited criminal history check. If my employment is terminated for any reason and the full amount of the charge is unpaid, I authorize the deduction of the total remainder from my final paycheck. Should my final paycheck be insufficient to cover this fee, I will pay the Company the outstanding balance within 10 days or agree that the Company may pursue any and all other legal remedies to cover my debt. If this action occurs, I will be responsible for payment of the attorney's fees and other costs incurred as a result of a successful legal action against me. I understand that this assignment of wages is revocable by me at any time upon ten (10) days' written notice to the Company.

(Id. ) Duvall signed and dated the wage assignment consent for limited criminal history checks. (Id. ) Below reads:

Uniforms:

I hereby authorize the Company to deduct, from my paycheck, the cost of uniforms purchased from the Company's vendor. If my employment is terminated for any reason prior to my having fully repaid this loan amount, I authorize the Company to deduct from my final paycheck any outstanding loan amount needed to reimburse the Company for the cost of uniforms that I have purchased. Should my final paycheck be insufficient to cover this fee, I will pay the Facility the outstanding balance within 10 days or agree that the Facility may pursue any and all other legal remedies to recover my debt. If this action occurs, I will be responsible for payment of the attorney's fees and other costs incurred as a result of a successful legal action against me. I understand that this assignment of wages is revocable by me at any time upon ten (10) days' written notice to the Company.

(Id. ) Duvall likewise signed and dated the wage assignment consent for uniforms. (Id. )

Edge Information Management Inc. ("Edge") conducted a criminal history check on Duvall, charging $27.50 to search data from Indiana, other states, and certain federal agencies, and CarDon & Associates Inc. Accounts Payable paid Edge for the service on Heart of CarDon's behalf. (Iskander Decl. ¶ 7; id. Ex. 2, ECF No. 60-12 at 6–10.) CarDon deducted $13.75 from each of Duvall's first two paychecks for the criminal history check. (Duvall Dep. Ex. 25, ECF No. 60-2 at 14–15.)

Heart of CarDon required employees to wear royal blue or navy blue scrubs. (Duvall Dep. 273:25–274:14.) Heart of CarDon did not require employees to wear scrubs bearing any company-specific logo or markings; nor did Heart of CarDon require employees to purchase scrubs from any particular vendor. (Duvall Dep. 274:15–22.) Heart of CarDon associated with Uniform House, a vendor, to make Uniform House's mobile "Scrub Truck" available for employees to purchase scrubs. (Iskander Decl. ¶ 8; Duvall Dep. 274:23–276:11.) Employees would select scrubs from the Scrub Truck, then sign the receipt and return it to Heart of CarDon for payment through paycheck deduction. Over the course of Duvall's employment, Heart of CarDon deducted from Duvall's paycheck for scrubs purchases on eight occasions for a total of $581.76. Those deductions exceeded 5% of Duvall's disposable earnings for the week on each occasion, with the excess deductions totaling $272.78.

Duvall never attempted to revoke the assignments. (Duvall Dep. 118:18–20.)

B. Purchasing Power

Heart of CarDon contracted with Purchasing Power to allow employees to purchase consumer goods through installment contracts and payroll deductions. (Iskander Dep. II 52:8–24, ECF No. 60-9; id. , Ex. 73, ECF No. 60-10.) Duvall purchased an Apple MacBook through Purchasing Power for $1,654.23, payable in 52 weekly installments deducted from her paycheck. (Duvall Dep. 292:20–293:4; id. , Ex. 75, ECF No. 60-4.) Duvall's contract with Purchasing Power states:

Authorization of Payroll Deduction/Revocation. You voluntarily authorize and direct your employer to take payroll deductions from your paychecks in accordance with the payment schedule disclosed in the FEDERAL TRUTH-IN-LENDING DISCLOSURES , and each payment in the payment schedule in the FEDERAL TRUTH-IN-LENDING DISCLOSURES will be paid to Purchasing Power. You may revoke the authorization for payroll deductions at any time and remain responsible for making payments for any outstanding balance via Backup Payment Method until paid in full.

(Duvall Dep., Ex. 75 at 5, ECF No. 60-4.) An "Agreement for Payroll Deduction Purchase Plan" between Heart of CarDon and Purchasing Power provides:

PAYROLL DEDUCTION. Employer agrees to honor and administer all requests from Employees ("Participant") for periodic

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