Koszkos v. Janton Indus., Inc.

• Decision Date: 03 August 2016
• Docket Number: 15-CV-1700 (SJ) (JO)
• Parties: KONRAD KOSZKOS, et al., Plaintiffs, v. JANTON INDUSTRIES, INC., et al., Defendants.
• Court: U.S. District Court — Eastern District of New York

KONRAD KOSZKOS, et al., Plaintiffs, v. JANTON INDUSTRIES, INC., et al., Defendants.

15-CV-1700 (SJ) (JO)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

August 3, 2016

REPORT AND RECOMMENDATION

James Orenstein, Magistrate Judge:

Plaintiffs Konrad Koszkos ("Koszkos") and Kristopher Mercado ("Mercado") accuse defendants Janton Industries, Inc. ("Janton"), Designcore, Ltd. ("Designcore"), Joseph F. Ianno, and Frank Ianno (collectively, the "Iannos") of failing to pay the wages to which they were entitled under federal and state law. See Docket Entry ("DE") 33 (Second Amended Complaint) ("SAC"); 29 U.S.C. § 201, et seq. (the Fair Labor Standards Act, or "FLSA"); New York Labor Law ("NYLL") §§ 190, 650, et seq. The defendant employers did not respond, and the plaintiffs therefore seek a default judgment. DE 44. Upon a referral from the Honorable Sterling Johnson, Jr., United States District Judge, I now make this report and for the reasons set forth below respectfully recommend that the court grant the plaintiffs' motion for default judgment and enter judgment against all defendants jointly and severally in the amount of $26,153.53 (consisting of $8,247.50 in unpaid overtime wages; $8,247.50 in liquidated damages; $1,772.03 in prejudgment interest; $7,486.50 in reasonable attorneys' fees; and $400.00 in recoverable costs) as well as post judgment interest at the federal statutory rate pursuant to 28 U.S.C. § 1961.

I. Background

A. Facts

Janton and Designcore are construction companies that share a principal place of business in Brooklyn, New York; the Iannos are their officers, directors, and owners. SAC ¶¶ 11-14. The plaintiffs worked for the defendants as carpenters, building and installing cabinets in commercial locations. Koszkos worked for the defendants from March 2013 to March 2014. Id. ¶ 21. He typically worked six days per week, for a total of approximately 50 to 80 hours, and was paid $30 per hour for the first 40 hours each week, $45 per hour for hours 40 through 50, and $30 per hour for all hours worked over 50. Id. ¶¶ 26-27. Mercado worked for the defendants from August 2013 to December 2013. Id. ¶ 30. He typically worked five to seven days per week, for approximately 50 to 60 hours, and was paid $20 per hour for the first 40 hours each week, $30 per hour for hours 40 through 45, and $20 per hour for all hours worked over 45. Id. ¶¶ 34-35.

B. Proceedings

Koszkos filed the initial Complaint on March 30, 2015. DE 1. On April 8, 2015, he filed an Amended Complaint that added Mercado as a plaintiff. DE 9. The plaintiffs filed proofs of service on the defendants on April 23 and 27, 2015. DE 11; DE 12; DE 13; DE 14. The defendants never responded and the Clerk entered their defaults on June 5, 2015. DE 16. The plaintiffs filed a motion for default judgment, together with an affirmation by counsel in support, on June 8, 2015. DE 17 (notice of motion); DE 18 (affirmation of Lloyd Ambinder). The court referred that motion to me on June 9, 2015. The next day, I scheduled a damages inquest, directed the plaintiffs to file any further evidence or arguments that they wished me to consider by July 1, 2015, and invited the defendants - notwithstanding their default - to submit a response to any such supplemental submissions by July 8, 2015. DE 19. At my direction, the plaintiffs served that order on the defendants and filed proof of service on June 17, 2015. DE 20; DE 21; DE 24; DE 25.

I convened a damages inquest on July 22, 2015, at which the defendants did not appear despite being provided notice. I expressed certain concerns at that hearing about the sufficiency of the Amended Complaint and offered plaintiffs the opportunity to amend the complaint and file a new motion for default judgment. DE 32 (minute entry). The plaintiffs withdrew their motion and promptly filed their amended pleading on July 28, 2015. DE 33. They then filed proofs of service ofthat pleading on the several defendants between August 12 and November 9, 2015. DE 36; DE 37; DE 38; DE 43. The defendants again defaulted. Docket Entries dated Oct. 20 & Nov. 19, 2015.

The plaintiffs filed the instant motion for default judgment on November 20, 2015. DE 44 (notice of motion); DE 45 (declaration of Jonathan Roffe) ("Roffe Decl."); DE 45-7 (Koszkos Decl.); DE 45-8 (Mercado Decl.); DE 45-9 (Koszkos's time records); DE 45-10 (Mercado's time records); DE 45-11 (damages calculations); DE 45-12 (billing statement); DE 46 (memorandum of law) ("Memo."). The court referred the motion to me on December 1, 2015. That same day, I directed the plaintiffs to file any further evidence or arguments that they wished me to consider by December 22, 2015, and again invited the defendants to submit a response to any such supplemental submissions by December 29, 2015. Order dated Dec. 1, 2015. At my direction, the plaintiffs served that order on the defendants on December 3, 2015. DE 48. None of the parties have made any further submissions since then.

II. Discussion

A. Applicable Law

1. Default

When a defendant defaults, the court must accept as true all well-pleaded allegations in the complaint, except those pertaining to the amount of damages. Fed. R. Civ. P. 8(b)(6); see Finkel v. Romanowicz, 577 F.3d 79, 83 n.6 (2d Cir. 2009) (citing Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992)). The fact that a complaint stands unanswered does not, however, suffice to establish liability on its claims: a default does not establish conclusory allegations, nor does it excuse any defects in the plaintiff's pleading. With respect to liability, a defendant's default does no more than concede the complaint's factual allegations; it remains the plaintiff's burden to demonstrate that those uncontroverted allegations, without more, establish the defendant's liability on each asserted cause of action. See, e.g., Finkel, 577 F.3d at 84; see also GreyhoundExhibitgroup, 973 F.2d at 159 (complaint's assertion of proximate cause necessary for finding of liability must be "properly alleged"). Accordingly, before considering the issue of damages as to each cause of action, I first examine whether the Complaint successfully states a claim for relief.

If the defaulted complaint suffices to establish liability, the court must conduct an inquiry sufficient to establish damages to a "reasonable certainty." Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999) (citing Transatl. Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997)). Detailed affidavits and other documentary evidence can suffice in lieu of an evidentiary hearing. Action S.A. v. Marc Rich & Co., 951 F.2d 504, 508 (2d Cir. 1991); see also Alcantara, 183 F.3d at 155. When a defendant defaults in an action brought under the FLSA, the plaintiff's recollection and estimates of hours worked are presumed to be correct. Chun Jie Yin v. Kim, 2008 WL 906736, at *3 (E.D.N.Y. Apr. 1, 2008) (citing Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687-88 (1946); Reich v. S. New Eng. Telecomms. Corp., 121 F.3d 58, 66 (2d Cir. 1997)).

2. Federal and State Wage Laws

Both federal and state law require employers to pay their employees the statutory minimum wage as well as a premium (150 percent of the employee's regular rate of pay) for hours worked above 40 hours per week. 29 U.S.C. §§ 206(a), 207(a)(1); 12 N.Y.C.R.R. § 142-2.2. An employee bringing an action for unpaid overtime compensation under either statute has the burden of proving that he performed work for which he was not properly compensated. S. New Eng. Telecomms. Corp., 121 F.3d at 66-67 (citing Mt. Clemens Pottery Co., 328 U.S. at 687); Rivera v. Ndola Pharmacy Corp., 497 F. Supp. 2d 381, 388 (E.D.N.Y. 2007) (citations omitted); Wing Kwong Ho v. Target Constr. of N.Y., Corp., 2011 WL 1131510, at *13 (E.D.N.Y. Mar. 28, 2011) (citing Yang v. ACBL Corp., 427 F. Supp. 2d 327, 331-32, 335-37 (S.D.N.Y. 2005)). If an employer fails to keep the required records, the plaintiff may meet this burden "'if he proves that he has in fact performed work for which he was improperly compensated and if he produces sufficient evidence to show the amount and extent ofthat work as a matter of just and reasonable inference.'" S. New Eng. Telecomms. Corp., 121 F.3d at 66-67 (quoting Mt. Clemens Pottery Co., 328 U.S. at 687). A plaintiff may do so solely through her own recollection. Rivera, 497 F. Supp. 2d at 388 (citing Yang, 427 F. Supp. 2d at 335); Monterossa v. Martinez Rest. Corp., 2012 WL 3890212, at *5 (S.D.N.Y. Sept. 7, 2012) (citing Amaya v. Superior Tile & Granite Corp., 2012 WL 130425, at *7 (S.D.N.Y. Jan. 17, 2012)).

B. Liability

The defendants' default establishes that they failed to pay the plaintiffs overtime wages for all hours worked above 40 hours per week. See SAC ¶¶ 45-57. In order to establish the defendants' liability, the plaintiffs must also establish that the defendants were their employers within the meaning of the law, and that they are within the class of persons entitled to the wage laws' protections. I discuss each of those issues below.

1. The Defendants Were Employers

The applicable federal and state statutes have similar standards to determine whether a party qualifies as a plaintiff's employer. See Ansoumana v. Gristede's Operating Corp., 255 F. Supp. 2d 184, 189 (S.D.N.Y. 2003); 29 U.S.C. § 203(d) (defining an employer as "any person acting directly or indirectly in the interest of an employer in relation to an employee"); NYLL § 2(6) (defining an employer as a "person employing any" employee). I therefore rely on case law interpreting the FLSA in considering whether each defendant was the plaintiffs' employer for purposes of their wage claims.

Recognizing the FLSA's remedial purpose, courts in this jurisdiction have adopted an expansive view of the employment relationships to which the wage laws apply. See Carter v. Dutchess Cmty. Coll., 735 F.2d 8, 12 (2d Cir. 1984). To...