Mould v. NJG Food Serv. Inc.
| Decision Date | 04 December 2013 |
| Docket Number | CIVIL NO. JKB-13-1305 |
| Parties | JEFFREY B. MOULD Plaintiff v. NJG FOOD SERVICE INC., et al. Defendants |
| Court | U.S. District Court — District of Maryland |
This memorandum and the accompanying order address motions in the two actions consolidated under this caption. Jeffrey B. Mould brought his suit against NJG Food Service, Inc. ("NJG"), OC Crabbag, LLC ("Crabbag"), Nolen J. Graves, and Albert Levy (collectively "Defendants") for violations of the Fair Labor Standards Act of 1928 ("FLSA"), 19 U.S.C. §§ 201 et seq., the Maryland Wage and Hour Law ("MWHL"), Md. Code Ann., Labor & Employment §§ 3-401 et seq., the Maryland Wage Payment and Collection Law ("MWPCL"), Md. Code Ann. Labor & Employment §§ 3-503 et seq., the Internal Revenue Code ("IRC"), 29 U.S.C. § 7434, as well as for the common law torts of conversion and unjust enrichment. Kathleen Yanek and Julianne Lodowski (collectively with Mould, "Plaintiffs") brought their suit on behalf of themselves and others similarly situated as a collective and class action against Defendants for violations of the FLSA, the MWHL, the MWPCL, and for the common law torts of conversion and unjust enrichment. Now before the Court are (1) Defendants' motions to dismiss (ECF Nos. 35; JKB-13-2183, No. 9.) 1, (2) Plaintiff Mould's motion for leave to file asecond amended complaint (ECF No. 36), (3) Defendants' motion to stay discovery, consolidate, and extend time (ECF No. 37), (4) Plaintiff Mould's motion for leave to file a limited surreply to Defendants' reply to Plaintiff's opposition to Defendants' partial motion to dismiss (ECF No. 65), (5) Plaintiffs Yanek and Lodowski's motion for leave to file a second amended complaint and supplemental motion for leave to file a second amended complaint (JKB-13-2183, ECF Nos. 18, 20), and (6) Plaintiffs Yanek and Lodowski's motion for leave to file a limited surreply (JKB-13-2183, ECF No. 19). The issues have been briefed and no hearing is required. Local Rule 105.6.
For the reasons set forth below, (1) Defendants' motions to dismiss (ECF Nos. 35; JKB-13-2183, No. 9) will be GRANTED IN PART and DENIED IN PART, (2) Plaintiff Mould's motion for leave to file a second amended complaint (ECF No. 36) will be DENIED, (3) Defendants' motion to stay discovery, consolidate, and extend time (ECF No. 37) will be GRANTED2, (4) Plaintiff Mould's motion for leave to file a limited surreply to Defendants' reply to Plaintiff's opposition to Defendants' partial motion to dismiss (ECF No. 65) will be DENIED, (5) Plainitffs Yanek and Lodowski's motion for leave to file a second amended complaint and supplemental motion for leave to file a second amended complaint (JKB-13-2183, ECF Nos. 18, 20) will be GRANTED, and (6) Plainitffs Yanek and Lodowski's motion for leave to file a limited surreply (JKB-13-2183, ECF No. 19) will be DENIED.
The complaints present several identical questions of law and fact.3,4 Mould, Yanek, and Lodowski were all employed as servers at the Crab Bag restaurant. Mould worked there from February 13, 2011 until his employment was terminated on June 23, 2013. .) Yanek worked there from October 2009 until her employment was terminated in September 2012. (JKB-13-2183, ECF No. 3, Yanek Sec. Am. Compl., ¶ 3.) Lodowski worked there from August 2009 until her employment was terminated in September 2012. (Id. at ¶ 4.) Plaintiffs allege that they, and other similarly situated servers, were paid an hourly wage of $3.63 and an overtime hourly rate of $7.26 during the relevant period. (Mould Am. Compl., ¶¶ 12, 15; Yanek Sec. Am. Compl., ¶¶ 15, 18.)
During this period, Defendants utilized a tip credit to satisfy minimum wage requirements under the FLSA and the MWHL. (Mould Am. Compl., ¶¶ 13-14; Yanek Sec. Am. Compl., ¶¶ 16-17.) In addition, Defendants instituted a tip pooling arrangement. (Id.) Plaintiffs allege that both the tip pooling arrangement and the use of a tip credit violated the FLSA and the MWHL. (Mould Am. Compl., ¶ 14; Yanek Sec. Am. Compl., ¶ 17.)
In support of this claim, Plaintiffs allege that Defendants failed to give Plaintiffs notice about any tip credit they were utilizing to meet minimum wage requirements. (Id.) Plaintiffs further allege that they, and others similarly situated, were coerced by Defendants into participating in a tip pooling arrangement, whose terms violated the FLSA and the MWHL. (Id.) Specifically, from approximately December 2011 until June 2013, Defendants required servers to contribute either 2.5% of net sales for the shift ("A.M. percentage") or 5% of net sales for the shift ("P.M.percentage") to the tip pool. (Id.) Included in this calculation were non-food sales (e.g., sales of The Crab Bag t-shirts), unpaid tabs and compensated meals (e.g., meals eaten by Defendants or other employees of the Crab Bag and meals that customers refused to pay for), and mandatory service charges. (Id.) Servers were required to place an envelope containing their required contribution to the tip pool in the tip-out safe at the end of each shift. 5 (Mould Am. Compl., ¶ 14; Yanek Am. Compl., ¶¶ 17, 66.) This policy applied to any shift in which a busboy or foodrunner was present, irrespective of the number of such employees present or the amount of time such employees spent on the shift. (Id.) The money that servers contributed to the tip pool was then "distributed to various employees beyond just the busboys and foodrunners . . . including . . . line cooks, steamers, employees at the raw bar, carryout cashiers, carryout cooks, an prep cooks, and, upon information and belief, members of management." (Id.) Plaintiffs further allege that both the amounts to be contributed to the tip pool by Plaintiffs and the amounts distributed to other employees "changed at the direction and whim of Defendants." (Mould Am. Compl., ¶ 14; Yanek Am. Compl., ¶ 17.) In particular, "[d]efendants continually attempted to exert their influence and coercion to keep the exact nature and application of the tip pool secret and have repeatedly disciplined employees, up to termination of employees, for questioning the validity of the tip pool and tip credit." (Id.)
Plaintiff Mould also alleged Defendants terminated his employment in retaliation against him for complaining about Defendants' pay practices. (Id. at ¶ 71.) Specifically, after he filed his initial complaint in the present case (ECF No. 1), on June 14, 2013, he informed other servers about this lawsuit and their rights under the FLSA, the MWHL, and other statutes. (Mould Am. Compl., ¶ 18.) On June 23, Defendant Levy informed Mould that there had been complaintsagainst him and that, as a result, he was suspended indefinitely. (Id.) Mould was then escorted off the premises and informed that he was no longer permitted on The Crab Bag property. (Id.) On June 27, Mould was advised that his employment was terminated. (Id.) Mould has alleged that during his tenure at the Crab Bag, he was never disciplined and never received any write-up regarding disciplinary action. (Id.)
In support of his claim under the Internal Revenue Code, Mould has alleged that, as of December 2011, Defendants instructed him and other servers not to report any tips (i.e., to enter the amount of $0) into the DIGITAL DINING system used by Defendants to keep track of the hours worked by servers. (Id. at ¶¶ 52-53.) Mould further alleges that as a result of this policy, Defendants willfully over-reported the tips he earned on his 2012 W-2 by $10,000. (Id.)
Plaintiff Mould filed his original complaint with this Court on May 1, 2013. (ECF No. 1.) On June 5, Defendants filed their answer to the original complaint. (ECF No. 8.) On September 4, with leave from the Court, Mould filed the amended complaint that is the subject of this motion to dismiss. 6 (Mould Am. Compl.) Defendants filed the present motion to dismiss on September 5. (ECF No. 35.)
On June 28, Defendants made a first offer of judgment to Plaintiff Mould.7 (ECF No. 35-2.) In this first offer of judgment, which Defendant had until July 15, 2013 to accept, Defendants offered to have judgment entered against them in the amount of $40,000 "representing full judgment to settle, release and satisfy any and all causes of action brought, or which could have been brought, in the above-captioned civil action by Plaintiff Mould." (Id.) On August 30,Defendants again offered to have judgment entered against them. (ECF No. 35-3.) In this second offer of judgment, Defendants offered to have judgment entered against them in the amount of $35,151.20 with regard to the "minimum wage and overtime claims that Mr. Mould has advanced under the Fair Labor Standards Act (FLSA) and Maryland Wage Hour Law (MWHL)." (Id.) The offer did not cover Mould's other claims. (Id.) In both offers of judgment, Defendants agreed to pay reasonable attorney's fees and costs as determined by the Court. (ECF Nos. 35-2, 35-3.) Plaintiff Mould did not accept either of Plaintiffs' offers.
On September 9, Mould filed a motion for leave to file a second amended complaint (ECF No. 36), and Defendants filed a motion to stay discovery, consolidate cases, and extend time to answer Count X (ECF No. 37.) On October 28, Mould filed a motion for leave to file a limited surreply to Defendants' reply to Plaintiff's opposition to Defendants' partial motion to dismiss.8
Plaintiffs Yanek and Lodowski filed their original complaint on July 26 2013. (JKB-13-2183, ECF No. 1.) On August 16, Defendants filed the present motion to dismiss. (JKB-13-2183, ECF No. 9.) On September 4, Plaintiffs Yanek and Lodowski filed a first amended complaint. (JKB-13-2183, ECF No. 16.) On October 3, Plainitffs Yanek and Lodowski filed a motion for leave to file a second amended complaint (JKB-13-2183, ECF No. 18.) and a supplemental motion for leave to file a second amended complaint. (JKB-13-2183, ECF No. 20.) As a technical matter, Defendants' motion to dismiss is...
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