Flores v. Nuvoc, Inc.

• Citation: 610 F.Supp.2d 1349
• Decision Date: 20 November 2008
• Docket Number: Case No. 06-22487-CIV.
• Parties: Edgardo FLORES, Jose Rosales, and Nestor Benitez, Plaintiffs, v. NUVOC, INC., a Florida Corporation, Raphael Baruch and Juan Sarda, Defendants.
• Court: U.S. District Court — Southern District of Florida

610 F.Supp.2d 1349

Edgardo FLORES, Jose Rosales, and Nestor Benitez, Plaintiffs, v. NUVOC, INC., a Florida Corporation, Raphael Baruch and Juan Sarda, Defendants.

Case No. 06-22487-CIV.

United States District Court, S.D. Florida.

November 20, 2008.

Jamie H. Zidell, J.H. Zidell, P.A., Miami Beach, FL, for Plaintiffs.

Robert Ingham, Ingham & Associates, Miami, FL, for Defendants.

ORDER ON DEFENDANTS' RENEWED MOTION FOR JUDGMENT AS A MATTER OF LAW AND ON OTHER PENDING MOTIONS

ALAN S. GOLD, District Judge.

This matter is before the Court upon Defendants' Renewed Motion for Directed Verdict or Alternatively Motion for Judgment Notwithstanding the Verdict and Motion for New Trial [DE 216, 217]. In addition, Plaintiffs have filed a Motion for Liquidated Damages [DE 205], and an Alternative Motion to Strike Motion for Judgment NOV, Motion for New Trial, Renewed Motion for Directed Verdict [DE 225]. Oral argument was held on November 14, 2008. For reasons stated in this Order, I grant Defendants' Rule 50 motion and deny all other pending motions.¹

II. DISCUSSION

The Plaintiffs argue that they qualify for enterprise coverage under the FLSA because as part of their employment, they were employees handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce by a person.² The Defendants argue that they are entitled to judgment as a matter of law because, under the undisputed facts, none of the Plaintiffs qualify under the first prong of enterprise coverage. The Defendants further argue that the preponderance of the evidence fails to establish that, under the second prong of enterprise coverage, the enterprise did annual gross sales or business done in excess of $500,000.

A. Standard of Review

The standard for judgment as a matter of law mirrors that of summary judgment in that the non-movant must do more than raise some doubt as to the existence of facts but must produce evidence that would be sufficient to require submission of the issue to a jury. Thorne v. All Restoration Services, Inc., 448 F.3d 1264, 1267 (11th Cir.2006); Matsushita Elec. Ind. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). Although this Court must look at the evidence in the light most favorable to the non-moving party, "the non-movant must put forth more than a mere scintilla of evidence suggesting that reasonable minds could reach differing verdicts." Abel v. Dubberly, 210 F.3d 1334, 1337 (11th Cir.2000). Therefore, a substantial conflict in the evidence is required before a matter will be sent to the jury, and the grant of a Rule 50 motion is proper when the evidence is so weighted in favor of one side that that party is entitled to succeed in his or her. position as a matter of law. Id. I conclude that the Plaintiffs failed to raise a substantial conflict in the evidence that their activities on behalf of the enterprise were inherently local. Applying these criteria, I conclude that the Defendants are entitled to judgment as a matter of law.

B. Enterprise Coverage

1. Engaged in Commerce or in the Production of Goods for Commerce.

To establish a claim for overtime compensation under the FLSA, Plaintiffs must show that either they were engaged in commerce or in the production of goods for commerce (individual coverage) or, that Nuvoc is an enterprise engaged in commerce or in the production of goods for commerce (enterprise coverage). See 29 U.S.C. § 207(a)(1). As already mentioned, the Plaintiffs concede that they are not covered by the "individual coverage" prong. The issue, therefore, is whether they fall within the second prong of "enterprise coverage."

An enterprise engaged in commerce or in the production of goods for commerce is defined as an enterprise that:

(i) has employees engaged in commerce or in the production of goods for commerce, or that has employees handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce by any person; and

(ii) is an enterprise whose annual gross volume of sales made or business done is not less than $500,000 (exclusive of excise taxes at the retail level that are separately stated)

29 U.S.C. § 203(s)(1)(A).

The regulation interpreting the FLSA clarifies that:

An enterprise ... will be considered to have employees engaged in commerce or in the production of goods for commerce, including the handling, selling or otherwise working on goods that have been moved in or produced for commerce by any person, if ... it regularly and recurrently has at least two or more employees engaged in such activities. On the other hand, it is plain that an enterprise that has employees engaged in such activities only in isolated or sporadic occasions, will not meet this condition.

29 C.F.R. § 779.238.

Since it is conceded that the neither the Plaintiffs nor the Defendants were engaged in commerce³ or in the production of goods for commerce, the legal question is whether the Plaintiffs were "handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce." There were no material issues of fact before the jury on these questions.⁴ With all inferences in favor of the Plaintiffs, only some of the lumber used by the Plaintiffs for the construction of the shell of the two houses had actually traveled in interstate commerce. Plaintiffs had acknowledged before trial and at oral argument on the Rule 50 motions that the lumber had came to rest within metropolitan Dade County, Florida, at Shell Lumber and Hardware and Florida Lumber Company before being purchased by Nuvoc to "shell out" the two homes in Coconut Grove, Florida. Moreover, there is no record evidence that the Defendants had contracts or solicited business outside of Florida. Nor is this a case where Nuvoc directly used the instrumentalities of interstate commerce to order the lumber, or that the lumber directly traveled in interstate commerce to the building site prior to the time it was handled or worked on by the Plaintiffs in the construction of the two homes.

No published opinion in the Eleventh Circuit has ruled precisely on the application of the "handling" or "otherwise working on" language of this aspect of the "enterprise" prong of the FLSA. However, the Eleventh Circuit has held in a recent unpublished opinion that there is no enterprise coverage where the goods handled by the employees were bought in Florida after having come to rest in Florida at a retail store, and the goods were not resold or otherwise used to produce goods that were to be moved in interstate commerce. Scott v. K.W. Max Inv., Inc., 256 Fed. Appx. 244, 248 (11th Cir.2007).⁵ In Scott, Plaintiff was a home construction worker who did remodeling and yard work, and loaded supplies and materials on to a barge for transport to the work site where a house was being constructed. These materials came primarily from the local Home Depot. The Court found that the only material that "moved in commerce" was not the materials purchase from Home Depot, but the lumber that the employer took from a house outside Florida that was torn down and brought to the construction site. Id. (holding however, that the first prong was nevertheless not met because the use of the lumber was only a sporadic instance of employees using materials that have moved in commerce). Scott therefore applies the definition of "in commerce" found in Thorne, supra—i.e. "directly participating in the actual movement of persons or things in interstate commerce," in the enterprise coverage context. Bien-Aime v. Nanak's Landscaping, Inc., 572 F.Supp.2d 1312, 1317 (S.D.Fla.2008) (emphasis added) (referencing Thorne, 448 F.3d at 1266).

The Scott approach has been adopted by decisions in this district. In Polycarpe v. E & S Landscaping Service, Inc., office supplies, landscaping materials, and toots that had previously traveled in interstate commerce handled by employees were not considered goods for the purposes of enterprise coverage, where employer, as consumers, purchased these goods locally in South Florida. 572 F.Supp.2d 1318, 1321 (S.D.Fla.2008). Similarly, in Bien-Aime, supra, a local landscaping business that consumed gasoline in the operation of its equipment and bought local products for its business using credit cards was found not to implicate interstate commerce in the manner intended to trigger the application of enterprise coverage under the FLSA. 572 F.Supp.2d at 1317. In Lamonica v. Safe Hurricane Shutters, Inc., a hurricane shutter installation business was not "engaged in commerce" and thus not subject to enterprise coverage where there was no showing that blades manufactured in Columbia used in the business were purchased directly from Columbia. 578 F.Supp.2d 1363 (S.D.Fla.2008). Finally, in Morales v. M & M Painting and Cleaning Corp., 2008 WL 4372891 (S.D.Fla., Sep. 24, 2008), the court held although the plaintiffs were painters who may have used paint that was manufactured outside of Florida, there was no evidence that the paint was purchased for resale or that the defendants were not the end-users or ultimate consumers of the paint and, accordingly, the evidence was insufficient to support a finding that the defendants were engaged in commerce under the FLSA.

Plaintiffs argue for a more expansive interpretation of the scope of enterprise coverage. Indeed, one decision in this district has adopted a different interpretation of 29 U.S.C. § 203(s)(1)(A), although the facts are not identical to those here. See, e.g., Galdames v. N & D Investment Corp., 2008 WL 4372889 (S.D.Fla., Sep. 24, 2008) (finding that the language of the statute does not require a showing that an employee was directly participating in the actual movement of persons or things in interstate commerce, only that employees handled goods or materials that at some point moved in interstate commerce).⁶ I decline to follow and apply Galdames.

In Galdame...