Salaka v. Live Music Tutor, Inc.
| Decision Date | 27 January 2016 |
| Docket Number | Case No. 6:14-cv-1154-Orl-40DAB |
| Parties | STEPHEN SALAKA, Plaintiff, v. LIVE MUSIC TUTOR, INC., TED GEE, TODD LEE, and NATHANIEL FRIENDS, SR., Defendants. |
| Court | U.S. District Court — Middle District of Florida |
This cause came on for consideration without oral argument on the following motion filed herein:
Plaintiff, Stephen Salaka, filed this action asserting claims under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201-219, and for other relief, arising out of an alleged employment relationship with Defendant Live Music Tutor, Inc. (Doc. 1). Plaintiff filed an Amended Complaint on September 16, 2014, which alleges the following claims: an FLSA minimum wage violation (Count I); violation of the FLSA overtime provisions (Count II); common law claim for breach of contract and unpaid wages (Count III); violation of Florida's Minimum Wage Act (Count IV); and unjust enrichment (Count V) (Doc. 10). Defendants answered the Amended Complaint (Doc. 18) and discovery commenced. Following the close of discovery, Defendants filed the instant motion, with supporting exhibits. The parties have also filed a Joint Stipulation of Agreed Material Facts, with supporting exhibits (Doc. 52). Plaintiff has filed his Memorandum in opposition to the motion (Doc. 53), and Defendants have filed a Reply brief (Doc. 54). On January 4, 2016, the matter was referred to the undersigned United States Magistrate Judge for issuance of a Report and Recommendation. Upon review of the arguments and evidence presented and the applicable law, it is respectfully recommended that the motion be denied, as set forth herein.
III. The Allegations of the Complaint and Factual Background
Although the parties disagree on many factual matters, including the interpretation of certain documents, they have submitted a Joint Stipulation of Agreed Material Facts (Doc. 52), which the Court takes to be true, for present purposes. By way of summary, the parties agree that Live Music Tutor, Inc. ("LMT") is a Florida corporation incorporated on September 1, 2012; Defendant, Ted Gee ("GEE") is a co-founder of LMT and also serves as the CEO and President; at all times relevant, Defendant, Todd Lee ("LEE") held the title of Vice President of Operations for LMT; and Defendant, Nathaniel Friends, Sr. held the title of General Counsel. Defendant GEE holds the largest share of equity in the company, and provided most of its funding. LMT is a technology company providing an online product which would support live, real-time interactive music education over the internet. LMT had their base product developed overseas and it was not market ready when it was brought onshore.
Plaintiff is recruited
On or about October 28, 2012, Plaintiff was first contacted by Carl Sharperson regarding LMT. On October 30, 2012, Mr. Sharperson sent Plaintiff the LMT Confidentiality Agreement to execute (Doc. 52-5). This agreement, along with a copy of the signed signature page, was emailed back to Mr. Sharperson by Plaintiff. Mr. Sharperson was given equity in the form of shares in LMT for recruiting Plaintiff. It is unclear what consideration, if any, was given to Plaintiff.
(Doc. 52-6).
On November 17, 2012, GEE sent an email to Plaintiff with an attachment titled, "LMT Employment Master Letter rev 5.dox". The email stated:
(Doc. 52-7). Attached to the email is an incomplete draft agreement of an "employment offer,"1 dated October 24, 2012 (Doc. 52-7, p. 2-3). Importantly, there is no signed copy of this agreement, or any written employment agreement, in evidence. The parties have stipulated that:
Although neither party was able to provide the signed copy of the "initial agreement" between the parties, both parties testified in deposition that the agreement dated October 24th, 2012 and identified as the "initial agreement" was fully executed. The parties executed the "initial agreement," which was originally dated October 24, 2012 sometime during the month of December 2012 (Gee Dep. 39:7 - 24, ECF No. 50, Ex. 1) (Salaka Dep. 14:3 - 11, ECF No. 50, Ex. 2) (ECF No. 50, Ex. 5)
Plaintiff begins working
Following the November 17 email, Plaintiff began his association with Defendants in earnest. On November 19, 2012, GEE sent an email to several people, including Plaintiff, which provided, in part: "I would like to welcome Stephen Salaka who will be responsible for the engineering portion of the team." (Doc. 52-8). Plaintiff was added to "Friday leadership and daily ops meetings," the first of which, a "Daily Staffing Progress quick call" was set to take place on November 20, 2012. Thereafter, Plaintiff reached out to the leaders at LMT to discuss the current systems and processes utilized in the business. On November 21, 2012, GEE replied to Plaintiff's email providing photographs for the LMT website. GEE wrote, (Doc. 52-11). On November 24, 2012, GEE sent out an email to LMT that included leadership biographies and an organizational chart for LMT. This organizational chart depicts Plaintiff as head of engineering and technology (Doc. 52-12).
On November 27, 2012, Plaintiff met with GEE and others at the Orange County library in downtown Orlando to go through GEE's "intent, and strategy discussions for Engineering." On November 29, 2012, GEE sent an email to the leadership team, including Plaintiff. The email also discussed an upcoming leadership meeting in Milwaukee, Wisconsin, which was to be held on December 11, 2012 (Doc. 52-14). On January 3, 2013, LMT filed its 2013 Annual Report with the Secretary Of State. The report lists GEE as President, SALAKA and LEE as Vice Presidents, and FRIENDS as General Counsel (Doc. 52-17).
Plaintiff's duties
Conference calls with LMT were a daily occurrence for Plaintiff. Plaintiff was required to attend telephonic daily leadership meetings at times set by LMT, usually in the early morning or end of the workday. These conference calls began as early as November 2012, and continued throughout 2013. These conferences typically included the LMT leadership staff, including Plaintiff, GEE, and LEE. Plaintiff was also involved in conferences with LMT's external contractors, as part of his role leading the engineering of LMT's product.
The parties agree that Plaintiff was engaged by LMT, based on his expertise, education, and experience in software, specifically to help LMT with the movement and the progression of the system and business from a software perspective. Plaintiff's role within LMT was to create the business strategy for the organization, as well as to create a project plan for LMT. Further, he was to oversee the software development side of LMT's product. Plaintiff testified that he was able to utilize his best judgment and initiative in determining how to fulfill the projects, however he would take direction from GEE and LEE, as well as other members of the LMT leadership team, in terms of when things needed to be complete, corrected, or fixed.
Plaintiff maintained and worked from a home office, which was used as a federal tax deduction. Plaintiff paid all expenses associated with the home office including utilities, telephone, Internet access, computers, printers, and office supplies (including printer paper and ink). Plaintiff was required to attend daily meetings as well as lead daily meetings at specific times during the day. Outside of those meetings, Plaintiff had flexibility in terms of his work hours, as long as deadlines were met.
LMT contracted with a number of external vendors or contract developers during Plaintiff's tenure. The contracts were reviewed by LMT's CEO, GEE and General Counsel, FRIENDS. Their fees were negotiated by LMT and services were provided for the benefit of LMT. On occasion, Plaintiff would be included in negotiations of those contracts; however GEE was the individual who needed to sign off on the contracts. For developers who provided services under the umbrella of software engineering, Plaintiff would act as their point of contact with LMT.
On December 1, 2012, GEE sent out an email to several individuals with an attachment entitled, "LMT Employee Inv & Rights Agree (1).docx". GEE indicated that LMT needed the document signed and returned to LMT's General Counsel, FRIENDS, by December 3, 2012. The agreement provided, in part:
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