Reyes v. Texas Ezpawn, L.P.

• Citation: 459 F.Supp.2d 546
• Decision Date: 28 September 2006
• Docket Number: Civil Action No. V-03-128.
• Parties: Erasmo REYES, individually and on behalf of all others similarly situated, Plaintiff, v. TEXAS EZPAWN, L.P., Defendant.
• Court: U.S. District Court — Southern District of Texas

Page 546

459 F.Supp.2d 546

Erasmo REYES, individually and on behalf of all others similarly situated, Plaintiff, v. TEXAS EZPAWN, L.P., Defendant.

Civil Action No. V-03-128.

United States District Court, S.D. Texas, Victoria Division.

September 28, 2006.

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Hartley Hampton, Michael A. Josephson, Fibich Hampton & Leebron, Houston, TX, for Plaintiffs.

Memorandum & Opinion

JOHN D. RAINEY, District Judge.

Pending before the Court is Defendant Texas EZPAWN, L.P.'s ("Defendant or EZPAWN") Motion for Summary Judgment (Dkt.# 116). Upon consideration of the motion, the response, and the applicable law, the Court is of the opinion that the motion for summary judgment should be granted in part and denied in part as set forth below.

Factual and Procedural Background

Defendant is in the retail pawn and short-term loan business with more than 180 locations across Texas. Customers can receive short-term loans either through a pawn loan or a payday loan. Defendant makes loans secured by any item of value including jewelry, firearms, electronics, televisions, stereos, tools, musical instruments, and other items. Payday loans are short-term unsecured loans that mature on the customer's next pay date, generally seven to thirty-seven days after the loan is made. Defendant also sells merchandise that customers do not redeem or which customers sell directly to it.

The employees at each retail location include Sales and Lending Representatives ("SLRs"), Senior SLRs, one or more Assistant Store Manager ("ASM"), and one Store Manager. SLRs are responsible for customer service and processing customer transactions. Senior SLRs perform the same job duties as SLRs and may also open or close the store. Defendant classifies both SLRs and Senior SLRs as nonexempt employees for purposes of the overtime provisions of the FLSA. It classifies ASMs and Store Managers as exempt.

Summary Judgment Standard

Summary judgment is proper if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R.Crv.P. 56(c); see also Christopher Village, L.P. v. Retsinas, 190 F.3d 310, 314 (5th Cir.1999). The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment, there must be an absence of any genuine issue of material fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). An issue is "material" if its resolution could affect the outcome of the action. Daniels v. City of Arlington, Tex., 246 F.3d 500, 502 (5th Cir.2001), cert. denied, 534 U.S. 951, 122 S.Ct. 347, 151 L.Ed.2d 262 (2001).

The moving party bears the initial burden of informing the court of all evidence demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Only when the moving party has discharged this initial burden does the burden shift to the nonmoving party to demonstrate that there is a genuine issue of material fact. Id. at 322, 106 S.Ct. 2548. If the moving party fails to meet this burden, then they are not entitled to a summary judgment and no defense to the motion is required. Id.

"For any matter on which the non-movant would bear the burden of proof at trial ..., the movant may merely point to the absence of evidence and thereby shift to the non-movant the burden of demonstrating by competent summary judgment proof that there is an issue of material fact warranting trial." Transamerica Ins. Co. v. Avenell, 66 F.3d 715, 718-19 (5th Cir. 1995); see also Celotex, 477 U.S. at 323-25, 106 S.Ct. 2548. To prevent summary judgment, the non-movant must "respond by setting forth specific facts" that indicate a genuine issue of material fact. Rushing v. Kansas City S. Ry. Co., 185 F.3d 496, 505 (5th Cir.1999), superceded by statute on other grounds as noted in Mathis v. Exxon Corp., 302 F.3d 448, 459 n. 16 (5th Cir.2002).

When considering a motion for summary judgment, the court must view the evidence in the light most favorable to the non-movant and draw all reasonable inferences in favor of the non-movant. See Yaquinto v. Segerstrom (In re Segerstrom), 247 F.3d 218, 223 (5th Cir.2001); see also Samuel v. Holmes, 138 F.3d 173, 176 (5th Cir.1998). The court must review all of the evidence in the record, but make no credibility determinations or weigh any evidence, disregard all evidence favorable to the moving party that the jury is not required to believe, and give credence to the evidence favoring the non-moving party as well as to the evidence supporting the moving party that is uncontradicted and unimpeached. Moore v. Willis Indep. Sch. Dist., 233 F.3d 871, 874 (5th Cir.2000). However, the non-movant cannot avoid summary judgment simply by presenting "conclusory allegations and denials, speculation, improbable inferences, unsubstantiated assertions, and legalistic argumentation." See TIG Ins. Co. v. Sedgwick James of Wash., 276 F.3d 754, 759 (5th Cir.2002); see also Little v. Liquid Air Carp., 37 F.3d 1069, 1075 (5th Cir.1994) (en banc).

Discussion

Plaintiff Erasmo Reyes ("Reyes") filed this lawsuit, individually and behalf of others that he alleges are "similarly situated" ("Plaintiffs"). The collective action, brought under the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. ("FLSA"), alleges that current and former ASMs employed by Defendant during the relevant time period were improperly classified as exempt and are thus entitled to overtime compensation. Plaintiffs also seek liquidated damages, attorney's fees, and costs.

Defendant moves the Court for summary judgment on several different grounds. First, Defendant seeks summary judgment relating to the opt-in Plaintiffs' claims on the ground that they have failed to produce evidence relating to those claims and that Reyes has produced no evidence to establish that he is "similarly situated." Next, Defendant moves for summary judgment on Plaintiffs' FLSA misclassification claim on the ground that Plaintiffs were properly classified as exempt as a matter of law. Defendant also claims it is entitled to summary judgment on Plaintiffs' claim for liquidated damages because the decision to classify them was made in good faith. Defendant further moves to limit the statute of limitations to two years on the ground that the evidence establishes that it did not "willfully" violate the FLSA. Additionally, Defendant moves to dismiss EZCORP, Inc. from this lawsuit because it did not employ any of the Plaintiffs in this action. Finally, Defendant moves to dismiss Debra L. Taylor, Cesar Cazares, Jacquelyn Griffith, and Juan Gonzalez because they allegedly attempted to join the action after the expiration of the opt-in period. The Court will address each argument in turn.

I. Defendant's Motion with Respect to the Claims of the Opt-In Plaintiffs

As stated previously, Defendant moves for summary judgment of the opt-in Plaintiffs' claims on the ground that they failed to produce evidence relating to those claims and that Reyes has produced no evidence to establish that he is "similarly situated" such that he could serve as a "class representative."

The Fifth Circuit has recognized two basic methods for making a "similarly situated" determination. See Mooney v. Aramco Servs. Co., 54 F.3d 1207, 1213 (5th Cir.1995), overruled on other grounds by Desert Palace, Inc. v. Costa, 539 U.S. 90, 90-91, 123 S.Ct. 2148, 156 L.Ed.2d 84 (2003). These are the two-step Lusardi approach and the spurious class action Shushan approach. See id.; Shushan v. Univ. of Cola at Boulder, 132 F.R.D. 263 (D.Colo.1990); Lusardi v. Xerox Corp., 118 F.R.D. 351 (D.N.J.1987). Though, the Fifth Circuit in Mooney found it unnecessary to determine which method is most appropriate, 54 F.3d at 1216, "pit is clear that the two-step ad hoc approach is the preferred method for making the similarly situated analysis." Basco v. Wal-Mart Stores Inc., 2004 WL 1497709, at *4 (E.D.La.2004); see also Mielke v. Laidlaw Transit, Inc., 313 F.Supp.2d 759, 762 (N.D.Ill.2004) (stating that the majority of courts have employed or implicitly approved the two-step method).

The first step of the Lusardi analysis is the "notice stage" at which the district court decides whether to issue notice to potential class members. See id. at 1213-214. The court's decision is usually based only on the pleadings and any affidavits that have been submitted. Id. "Because the court has minimal evidence, this determination is made using a fairly lenient standard, and typically results in `conditional certification' of a representative class." Id. at 1214. The lenient standard requires only substantial allegations that potential members "were together the victims of a single decision, policy, or plan...." Id. at n. 8 (citing Sperling v. Hoffmann-La Roche, Inc., 118 F.R.D. 392, 407 (D.N.J.1988)); see also Thiessen v. Gen. Elec. Cap. Corp., 267 F.3d 1095, 1102-03 (10th Cir.2001) (defining notice stage as requiring "substantial allegations" that plaintiff and putative class members were the victims of a single decision, policy, or plan). The second stage of the inquiry typically occurs when discovery is largely complete and the defendant moves to "decertify" the conditionally-certified class. See Mooney, 54 F.3d at 1214; Cameron-Grant v. Maxim Healthcare Servs., 347 F.3d 1240, 1243 n. 2 (11th Cir.2003).

Although extensive discovery has been conducted and the Defendants have subsequently filed a Motion to Decertify the conditionally certified class, the Court addresses this motion as it was filed in the notice stage of the proceedings. The Court will only consider the evidence accompanying the Defendant's present motion and the Plaintiffs'...