Gaither v. Davi Transp. Servs., LLC

• Decision Date: 22 May 2020
• Docket Number: Civil Action No. ELH-18-1447
• Parties: TREKELL GAITHER, et al., Plaintiffs, on behalf of themselves and others similarly situated, v. DAVI TRANSPORTATION SERVICES, LLC, et al., Defendants.
• Court: U.S. District Court — District of Maryland

TREKELL GAITHER, et al., Plaintiffs,on behalf of themselves and others similarly situated, v. DAVI TRANSPORTATION SERVICES, LLC, et al., Defendants.

Civil Action No. ELH-18-1447

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND

May 22, 2020

MEMORANDUM OPINION

This case concerns claims of denial of overtime and hourly wages lodged by non-emergency medical transportation "paratransit drivers." ECF 1 (the "Complaint"), ¶ 1. Plaintiffs Trekell Gaither, Whitney Davis, Wayne Flemming, Crystal Kendricks, and Robert Lemon filed suit against defendants Davi Transportation Services, LLC ("Davi" or "Davi Transportation"); James Davis, the owner of Davi Transportation; and Transdev Services, Inc., f/k/a Veolia Transportation Services, Inc. ("Transdev"). Id.

In particular, plaintiffs allege violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201 et seq.; the Maryland Wage and Hour Law ("MWHL"), Md. Code (2016 Repl. Vol., 2017 Supp.), §§ 3-401 et seq. of the Labor and Employment Article ("L.E."); and the Maryland Wage Payment and Collection Law ("MWCPL"), L.E. §§ 3-501 et seq. Id. ¶ 2. In addition, plaintiffs claim violations of Baltimore City Code, Art. 5, § 26. Id. Numerous exhibits were appended to the suit.

According to the Complaint, plaintiffs "drove vehicles owned by" Davi Transportation and Davis to transport "Medicaid recipients" in the Baltimore City area, based on "individualized routes created by Transdev." ECF 1, ¶ 1. The routes required plaintiffs "to work shifts lasting up to 15 hours," but defendants allegedly paid plaintiffs only "a few dollars for each pickup, and just one dollar each time a person scheduled to be picked up was absent." Id. As a result, plaintiffs' "hourly wages fell far below state and federal minimum wage rates," and even further "below Baltimore City's living wage rates[.]" Id. Therefore, they seek recovery of unpaid wages, damages, as well as attorneys' fees and costs.

Now pending is plaintiffs' unopposed motion for default judgment against Davi Transportation. ECF 34. The motion is supported by a memorandum of law (ECF 34-1) (collectively, the "Motion") and several exhibits. ECF 34-3 - ECF 34-10. A copy of the Motion was sent to Davi's resident agent, at the last known address. ECF 34 at 2.

No hearing is necessary to resolve the Motion. For the reasons that follow, I shall grant the Motion in part and deny it in part.

I. Factual and Procedural Background

By letter of August 2, 2018 (ECF 13), plaintiffs notified the Court that Davis filed for bankruptcy on December 5, 2017. Plaintiffs acknowledged that, pursuant to 11 U.S.C. § 362, "this matter is stayed as to Mr. Davis ...." Id. However, they asserted that the matter "may proceed against other Defendants, who have not filed for bankruptcy." Id.

On December 3, 2018, plaintiffs and Transdev jointly moved the Court to approve their Settlement Agreement (ECF 26), in which Transdev agreed to pay plaintiffs a total of $130,000, in addition to $30,000 in attorneys' fees and costs. ECF 26-1 at 7. By Order of the same date (ECF 27), I approved the Settlement Agreement.¹

In light of the Settlement Agreement, plaintiffs and Transdev stipulated to the dismissal of plaintiffs' claims against Transdev, with prejudice. ECF 30. By marginal Order of December 6, 2018 (ECF 31), I approved the parties' stipulation of dismissal.

Davi Transportation was served on June 25, 2018. ECF 8. But, Davi never responded to the suit. See Docket. On August 8, 2018, plaintiffs filed a "Motion for Clerk's Entry of Default" against Davi Transportation (ECF 14), which was entered by the Clerk on December 4, 2018. ECF 28. And, on January 30, 2019, plaintiffs moved for default judgment as to Davi Transportation. ECF 34. They requested a total award of unpaid wages and damages of $276,941.65, plus attorneys' fees and costs of $26,776.03. Id.

In their submission, plaintiffs did not address the implications of granting default judgment as to Davi Transportation while the litigation was stayed as to its owner, codefendant James Davis, because of his bankruptcy proceedings. The Court subsequently learned that the bankruptcy court had granted a discharge to Mr. Davis on March 26, 2019, thereby terminating the automatic stay. See In re James Davis, RAG-17-26336, ECF 94 (Bankr. D. Md.) (Bankruptcy Discharge).

In an Order of June 25, 2019 (ECF 35), the Court directed plaintiffs to submit a status report. In plaintiffs' report of July 9, 2019 (ECF 37), they asserted: "Granting default judgment as to Davi Transportation while the litigation is stayed as to Mr. Davis is appropriate because Defendant Davis and Defendant Davi Transportation are joint employers of Plaintiffs. Id. at 1 (citing ECF 1, ¶¶3, 15-17, 20, 22-27). Plaintiffs claimed that "joint employers are jointly and separately liable for FLSA violations" under the FLSA and Maryland wage and hour laws. ECF 37 at 1 (citing Salinas v. Comm. Interiors, Inc., 848 F.3d 125, 141-42 (4th Cir. 2017)).

Further, plaintiffs reported that the bankruptcy court discharged most of Mr. Davis's debts, "including the claims of Plaintiffs." ECF 37 at 2 (citing Davis, RAG-17-26336, ECF 94 (providingthat "[m]ost debts are discharged" and not listing any exception under which plaintiffs' claims would fall)). Therefore, plaintiffs stated that "once the Court issues a decision regarding default judgment as to Davi Transportation, Mr. Davis will be the only remaining Defendant" in this case, and plaintiffs "will move to dismiss the action. ECF 37 at 2.

Additional facts are discussed, infra.

II. Legal Standard

Rule 55(b) of the Federal Rules of Civil procedure governs default judgments. In particular, Rule 55(b)(1) provides that the clerk may enter a default judgment if the plaintiff's claim is "for a sum certain or a sum that can be made certain by computation."² But, "[a] plaintiff's assertion of a sum in a complaint does not make the sum 'certain' unless the plaintiff claims liquidated damages; otherwise the complaint must be supported by affidavit or documentary evidence. Monge v. Portofino Ristorante, 751 F. Supp. 2d 789, 794 (D. Md. 2010) (Grimm, M.J.).³

To be sure, the United States Court of Appeals for the Fourth Circuit has a "strong policy that cases be decided on the merits." United States v. Shaffer Equip. Co., 11 F.3d 450, 453 (4th Cir. 1993); see Tazco, Inc. v. Director, Office of Workers' Compensation Program, 895 F. 2d 949, 950 (4th Cir. 1990). But, that policy is not absolute. Default judgment "'is appropriate when the "adversary process has been halted because of an essentially unresponsive party.'" Entrepreneur Media, Inc. v. JMD Enter. Grp., LLC, 958 F. Supp. 2d 588, 593 (D. Md. 2013) (quoting SEC v. Lawbaugh, 359 F. Supp. 2d 418, 421 (D. Md. 2005)).

Upon the entry of default against a party, the court must determine whether the undisputed factual allegations constitute a legitimate cause of action. Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780-81 (4th Cir. 2001); see also 10A Wright, Miller & Kane, Federal Practice and Procedure § 2688 (3d ed., 2010 Supp.) ("[L]iability is not deemed established simply because of the default . . . and the court, in its discretion, may require some proof of the facts that must be established in order to determine liability."). If the court is satisfied that liability has been established, it must then determine the appropriate amount of damages. Ryan, 253 F.3d at 780-81.

Allegations "relating to the amount of damages" are not deemed admitted based on a defendant's failure to respond to a suit. Fed R. Civ. P. 8(b)(6); see Ryan, 253 F.3d at 780 ("'[D]efault is not treated as an absolute confession by the defendant of his liability and of the plaintiff's right to recover'") (citation omitted); Monge, 751 Supp. 2d at 794; Trs. of the Elec. Welfare Trust Fund v. MH Passa Elec. Contracting, Inc., DKC-08-2805, 2009 WL 2982951, at *1 (D. Md. Sept. 14, 2009) ("Upon default, the well-pled allegations in a complaint as to liability are taken as true, although the allegations as to damages are not."); Pentech Fin. Servs., Inc. v. Old Dominion Saw Works, Inc., 6:09-cv-00004, 2009 WL 1872535, at *1 (W.D. Va. June 30, 2009) ("Upon default judgment, Plaintiff's factual allegations are accepted as true for all purposes excluding determination of damages."). Rather, the court must make an independent determination regarding allegations as to damages. See Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 154 (2d Cir. 1999).

In so doing, the court may conduct an evidentiary hearing. Fed. R. Civ. P. 55(b)(2). However, the court may also make a determination of damages without a hearing, so long as there is an adequate evidentiary basis in the record to support an award of the requested damages. SeeAdkins v. Teseo, 180 F. Supp. 2d 15, 17 (D.D.C. 2001) ("[T]he court may rely on detailed affidavits or documentary evidence to determine the appropriate sum."); see also Trs. of the Nat'l Asbestos Workers Pension Fund v. Ideal Insulation, Inc., ELH-11-832, 2011 WL 5151067, at *4 (D. Md. Oct. 27, 2011) (determining that, in a case of default judgment against an employer, "the Court may award damages without a hearing if the record supports the damages requested"); Monge, 751 F. Supp. 2d at 795 (same); Pentech Fin. Servs., Inc., 2009 WL 1872535, at *2 (concluding that there was "no need to convene a formal evidentiary hearing on the issue of damages" after default judgment because plaintiff submitted affidavits and records establishing the amount of damages).

Notably, under Fed. R. Civ. P. 54(c), "[a] default judgment must not differ in kind from, or exceed in amount, what is demanded in the pleadings." See In re Genesys Data Techs, Inc., 204 F.3d 124, 132 (4th Cir. 2000) ("When a Complaint demands a specific amount of damages, courts have generally held that a default judgment cannot award additional damages."). This is because the amount sought as damages might influence the defendant...