Massachusetts Delivery Ass'n v. Coakley, Civil Action No. 10–11521–DJC.

Decision Date08 April 2011
Docket NumberCivil Action No. 10–11521–DJC.
Citation797 F.Supp.2d 164,17 Wage & Hour Cas.2d (BNA) 971
PartiesMASSACHUSETTS DELIVERY ASSOCIATION, Plaintiff, v. Martha COAKLEY, in her official capacity as Attorney General of the Commonwealth of Massachusetts, Defendant.
CourtU.S. District Court — District of Massachusetts

OPINION TEXT STARTS HERE

Carie A. Torrence, David C. Casey, Vanessa K. Hackett, Littler Mendelson P.C., Boston, MA, Walter C. Hunter, Littler Mendelson, P.C., Providence, RI, for Plaintiff.

Kate J. Fitzpatrick, Commonwealth of Massachusetts, Worcester, MA, Douglas S. Martland, Pierce O. Cray, Attorney General's Office, Boston, MA, for Defendant.

MEMORANDUM AND ORDER

CASPER, District Judge.I. Introduction

Plaintiff Massachusetts Delivery Association (MDA), a trade organization whose member companies provide same-day delivery services, brought this action for declaratory and injunctive relief against Defendant Martha Coakley in her official capacity as Attorney General of the Commonwealth of Massachusetts (the Attorney General). Currently, some of MDA's member companies are defending against a flurry of lawsuits in both state and federal courts brought by courier drivers, as well as against enforcement investigations brought by the Attorney General, which accuse the companies of violating the Massachusetts Independent Contractor statute, M.G.L. c. 149, § 148B, by classifying courier drivers as independent contractors rather than employees.

MDA now seeks a declaratory judgment that one aspect of that statute-the subsection requiring that “an individual performing any service” for an employer “shall be considered to be an employee [unless] the service is performed outside the usual course of the business of the employer,” M.G.L. c. 149, § 148B(a)(2), commonly known as “the B prong” of the statute-cannot be enforced against same-day delivery service companies because it is preempted by the Federal Aviation Administration Authorization Act (“FAAAA”), 49 U.S.C. § 14501 et seq., which states that “no State ... shall enact or enforce any law, rule, regulation, standard or other provision having the force or effect of law relating to intrastate rates, intrastate routes, or intrastate services of any freight forwarder or broker.” 49 U.S.C. § 14501(b)(1). This argument mirrors the preemption claims raised by MDA's member companies in the pending state and federal actions. MDA also seeks injunctive relief prohibiting the Attorney General from enforcing the B prong against same-day delivery service companies.

As the parties acknowledge, this Court has jurisdiction under 28 U.S.C. § 1331 and 28 U.S.C. § 2201. Before the Court is the Attorney General's motion to dismiss on the ground that, pursuant to Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971) and its progeny, this court must abstain from exercising its jurisdiction and allow the pending state court actions to run their course. For the reasons discussed below, the Attorney General's motion to dismiss is GRANTED.1

II. Factual Background 2A. The Massachusetts Independent Contractor statute

The Massachusetts Independent Contractor statute governs whether workers in Massachusetts are classified as employees or as independent contractors. M.G.L. c. 149, § 148B. Each classification carries different legal rights and obligations regarding minimum wage levels, overtime, health insurance and other benefits, employer record-keeping, protections against discharge and withholding from taxation. M.G.L. c. 149, § 148B(d). A worker performing any service for an employer may only be classified as an independent contractor if three conditions are met: first, “the individual is free from control and direction in connection with the performance of the service, both under his contract for the performance of service and in fact,” M.G.L. c. 149, § 148B(a)(1) (known as “the A prong”); second, “the service is performed outside the usual course of the business of the employer,” M.G.L. c. 149, § 148B(a)(2) (“the B prong”); and third, “the individual is customarily engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed.” M.G.L. c. 149, § 148B(a)(3) (“the C prong”). If any of these three prongs are not satisfied, the employer must classify the worker as an employee; failure to do so exposes both the employer and the employer's president and treasurer to both civil and criminal penalties, including fines of up to $50,000 and imprisonment of up to two years per infraction. M.G.L. c. 149, §§ 27C(a)(1), 148B(d).

B. Parties

The Attorney General, the Defendant in this action, is charged with enforcing the Massachusetts Independent Contractor statute. M.G.L. c. 149, § 2. The Attorney General may issue civil citations of up to $25,000 for each violation, may bring direct civil or criminal proceedings in state court against violators or may permit employees alleging misclassification to bring their own civil court proceedings to enforce the statute. M.G.L. c. 149, §§ 27C, 150. In the past year, the Attorney General brought over 60 direct actions and permitted nearly 2,000 private rights of action enforcing the statute. In the past few years, the Attorney General has received numerous requests for private rights of action alleging misclassification by delivery companies and has approved such requests against eleven such companies.

Plaintiff MDA is a non-profit trade organization comprised of approximately 40 same-day delivery companies that either engage independent contractor delivery drivers directly or subcontract through entities that engage independent contractor delivery drivers. As noted in the record, in 2010, the MDA website stated that [i]n association with the M[essenger] C[ourier] A[ssociation of] A [merica], your industry peers have established this State Association to protect the I[ndependent] C[ontractor] model in our state.” MDA's member companies rely on independent contractor delivery drivers to perform the companies' core business: picking up and delivering products throughout the state and across state lines. MDA acknowledges in its complaint that this conduct “arguably violate[s] the B prong, and that “no MDA member can satisfy the B prong with respect to independent contract drivers because the MDA's members are all in the delivery service industry.” Am. Compl. at ¶¶ 8, 21. MDA thus asserts that its members are “in peril of an enforcement action and civil actions by private parties.” Id. at ¶ 8.

Although MDA has not disclosed a list of its member companies (or at least has not done so on the record in this case), counsel for MDA has acknowledged in a filing to this Court that at least three MDA member companies—including one headed by MDA's Vice–President–are defendants in private civil actions pending in state court alleging violations of the Massachusetts Independent Contractor statute. See Reynolds v. City Express, Inc.,3 SUCV 2010–02655 (Suffolk County Super. Ct., filed July 1, 2010); Okeke v. Dynamex Operations E., Inc., MICV 2010–02017 (Middlesex County Super. Ct., filed May 26, 2010); Reynolds v. World Courier Ground, Inc., NOCV 2010–00914 (Norfolk County Super. Ct., filed May 14, 2010; removed sub. nom. Reynolds v. World Courier Ground, Inc., 1:10–cv–11060–JLT, 2010 WL 3778565 (D.Mass.) June 22, 2010; remanded Feb. 14, 2011).

Additionally, a number of private civil actions are pending in both state and federal courts in Massachusetts alleging that a number of same-say service delivery companies, which may or may not be MDA members, misclassified their employees as independent contractors. See Oliveira v. Advanced Delivery Sys., Inc., MICV 2009–01311 (Middlesex County Super. Ct., filed Apr. 3, 2009) (plaintiff's motion for partial summary judgment granted July 20, 20 10); Arrigo v. Contractor Mgmt. LLC, 1:10–cv–11650–MLW (Middlesex County Super. Ct., filed Aug. 9, 2010; removed to this Court, Sept. 28, 2010; motion to remand pending); Versolato v. Office Depot, Inc., 1:10–cv–10379–RWZ (Essex County Super. Ct., filed Jan. 19, 2010; removed to this Court, March 3, 2010); Garcia v. Advanced Delivery Sys., Inc., 1:10–cv–11731–GAO (Middlesex County Super. Ct., filed Sept. 19, 2010; removed to this Court, Oct. 12, 2010).

C. The Ongoing State Proceedings1. Reynolds v. City Express, Inc.

Plaintiffs Stephen Reynolds and Dickran Yeretzian filed a complaint in Suffolk County Superior Court on July 1, 2010, on behalf of themselves and a putative class of similarly situated courier drivers, against defendants including City Express, Inc. City Express is a member of MDA. The complaint alleged misclassification under the Massachusetts Independent Contractor statute, multiple violations of state wage laws, unjust enrichment and sought quantum meruit. On September 30, 2010, City Express filed its answer, which included an affirmative defense stating that [p]laintiffs' claims ... are preempted in whole or in part by federal law ... including but not limited to, the [FAAAA] of 1994.” The case is ongoing.

2. Okeke v. Dynamex Operations East, Inc.

Plaintiffs Michael Okeke and Willy Carl Paquiot filed a complaint in Middlesex County Superior Court on May 26, 2010 (superseded on March 9, 2011 by an amended complaint), on behalf of themselves and a putative class of similarly situated individuals, against Dynamex Operations East. Dynamex is a member of MDA. The complaint alleged various violations of state employment laws, including misclassification under the Massachusetts Independent Contractor statute. On August 31, 2010, Dynamex filed its answer, which included an affirmative defense stating that [p]laintiffs' claims ... are preempted in whole or in part by federal law ... including but not limited to, the [FAAAA] of 1994.” The case is ongoing.

3. Reynolds v. World Courier Ground, Inc.

Plaintiff Stephen Reynolds filed a complaint in Norfolk County Superior Court on May 14, 2010 on behalf of...

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3 cases
  • Massachusetts Delivery Ass'n v. Coakley
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • January 20, 2012
    ...parties. The district court found that Younger abstention was appropriate in these circumstances. Mass. Delivery Ass'n v. Coakley, 797 F.Supp.2d 164, 176 (D.Mass.2011). We reverse that determination and hold that Younger abstention is inappropriate and the federal courts should exercise jur......
  • Kilroy v. Mayhew
    • United States
    • United States District Courts. 1st Circuit. United States District Court (Maine)
    • January 13, 2012
    ...have disagreed as to how the general rubric applies in the context of abstention doctrines. See Mass. Delivery Ass'n v. Coakley, 797 F.Supp.2d 164, 168 n. 2 (D.Mass.2011) (collecting cases involving Younger abstention); see also Burckhart Search Group, Inc. v. Doral Fin. Corp., Civil No. 11......
  • Kilroy v. Mayhew, Docket no. 1:11-cv-343
    • United States
    • United States District Courts. 1st Circuit. United States District Court (Maine)
    • January 13, 2012
    ...have disagreed as to how the general rubric applies in the context of abstention doctrines. See Mass. Delivery Ass'n v. Coakley, 797 F. Supp. 2d 164, 168 n.2 (D. Mass. 2011) (collecting cases involving Younger abstention); see also Burckhart Search Group,Page 2Inc. v. Doral Fin. Corp., Civi......

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