Stevenson v. Great Am. Dream, Inc.

• Decision Date: 31 December 2013
• Docket Number: CIVIL ACTION FILE NO. 1:12-CV-3359-TWT
• Parties: MARTISHA STEVENSON Individually and on behalf of others similarly situated, et al., Plaintiffs, v. THE GREAT AMERICAN DREAM, INC. doing business as Pinups, et al., Defendants.
• Court: U.S. District Court — Northern District of Georgia

MARTISHA STEVENSON Individually and on behalf of others similarly situated, et al., Plaintiffs, v. THE GREAT AMERICAN DREAM, INC. doing business as Pinups, et al., Defendants.

CIVIL ACTION FILE NO. 1:12-CV-3359-TWT

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION

SO ORDERED: December 31, 2013

OPINION AND ORDER

The Plaintiffs are dancers at Pin Ups Nightclub seeking damages for violation of the minimum wage and overtime wage requirements of the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. ("FLSA"). It is before the Court on the Plaintiffs' Motion for Partial Summary Judgment [Doc 53]. For the reasons set forth below, the Plaintiffs' Motion for Partial Summary Judgment is GRANTED.

I. Background

The Plaintiffs are current and former adult entertainers at Pin Ups Nightclub, run by the Defendant The Great American Dream, Inc. The Plaintiffs were compensated exclusively through tips. (Pls.' Statement of Facts ¶¶ 6-7.) They broughtsuit alleging that--because they were "employees"--they were entitled to minimum wage and overtime compensation under the FLSA. On December 17, 2012, they moved for conditional certification of a collective action class [Doc. 15], which was granted on August 14, 2013 [Doc. 50]. The class closed on December 13, 2013 [Doc. 52]. Now, the Plaintiffs move for partial summary judgment on one question: Were the Plaintiffs "employees" under the FLSA? The Plaintiffs argue that they were. The Defendants assert three responses. First, they argue that James W. Lee, Sr. was erroneously included as a defendant. Second, they argue that additional discovery is needed on new opt-in Plaintiffs. Third, they argue that the entertainers were properly classified as independent contractors.

II. Summary Judgment Standard

Summary judgment is appropriate only when the pleadings, depositions, and affidavits submitted by the parties show that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. FED. R. CIV. P. 56(c). The court should view the evidence and any inferences that may be drawn in the light most favorable to the nonmovant. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970). The party seeking summary judgment must first identify grounds that show the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). The burden then shifts to the nonmovant, who must go beyond thepleadings and present affirmative evidence to show that a genuine issue of material fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 (1986). "A mere 'scintilla' of evidence supporting the opposing party's position will not suffice; there must be a sufficient showing that the jury could reasonably find for that party." Walker v. Darby, 911 F.2d 1573, 1577 (11th Cir.1990).

A party may move for summary judgment on a part of a claim or defense. FED. R. CIV. P. 56(a). "A[n] . . . order granting partial summary judgment from which no immediate appeal lies is merged into the final judgment and reviewable on appeal from that final judgment. . . .An order granting [summary] judgment on certain issues is a judgment on those issues. It forecloses further dispute on those issues at the trial stage. An order denying a motion for partial summary judgment, on the other hand, is merely a judge's determination that genuine issues of material fact exist. It is not a judgment, and does not foreclose trial on the issues on which summary judgment was sought." Lind v. United Parcel Serv., Inc., 254 F.3d 1281, 1284 n.4 (11th Cir. 2001) (quoting Glaros v. H.H. Robertson Co., 797 F.2d 1564, 1573 (Fed. Cir. 1986)).

III. Discussion

The Defendants' first two arguments are easily disposed of. First, the Court need not consider at this stage whether Lee is an appropriate defendant. That issue has no bearing on the narrow question addressed by the motion for partial summaryjudgment. In fact, this Court previously rejected a similar argument. See Clincy v. Galardi South Enterprises, Inc., 808 F. Supp. 2d 1326, 1329 (N.D. Ga. 2011) ("The parties disagree as to which Defendant(s) employs the entertainers if the entertainers are found to be employees, but the resolution of that question is immaterial to the determinations the Court needs to make in resolving the pending Motions for Summary Judgment."). Second, additional discovery is unnecessary to rule on this motion. The Defendants argue that some of the opt-in Plaintiffs may have worked for shorter intervals of time. (Defs.' Resp. to Mot. for Summ. J., at 6.) However, the determination of employee-status will not vary based on minor distinctions. An entertainer who worked under identical circumstances as the other Plaintiffs will not be classified differently simply because she worked for a shorter period of time. See Reich v. Priba Corp., 890 F. Supp. 586, 591 (N.D. Tex. 1995) (Only 10 out of 1,200 entertainers actually performed at the club on a consistent basis, yet the court made a single determination regarding whether they were all employees or independent contractors.). The Defendants also argue that at least one Plaintiff signed an arbitration agreement. (Defs.' Resp. to Mot. for Summ. J., at 6.) But the Court is not making a determination regarding who is entitled to relief. It is possible that a Plaintiff held to be an "employee" may still be denied relief by this Court if the Defendants file a motion to compel arbitration.

It is clear that the Plaintiffs were "employees" under the FLSA. "The FLSA's overtime and minimum wage protections . . . extend only to 'employees.'" Scantland v. Jeffry Knight, Inc., 721 F.3d 1308, 1311 (11th Cir. 2013). The FLSA defines "employee" broadly.¹ Id. "Independent contractors," however, do not fall within that definition. Id. To determine whether a party was an employee or an independent contractor, the Court looks to the "economic reality of the relationship between the alleged employee and alleged employer." Id. (internal quotation marks omitted). The inquiry focuses on the level of economic dependence. Id. at 1312. "[T]he final and determinative question must be whether the . . . personnel are so dependent upon the business with which they are connected that they come within the protection of FLSA or are sufficiently independent to lie outside its ambit." Usery v. Pilgrim Equip. Co., Inc., 527 F.2d 1308, 1311-12 (5th Cir. 1976).² "The concept has also been put in termsof whether the individual is 'in business for [her]self.'" Mednick v. Albert Enterprises, Inc., 508 F.2d 297, 302 (5th Cir. 1975).

The Court may consider various factors, such as (1) degree of control, (2) opportunity for profit or loss, (3) investment in equipment or additional personnel required, (4) skill requires, (5) duration, and (6) the extent to which the service is integral to the alleged employer's business. See Scantland, 721 F.3d at 1312. "[T]hese six factors are not exclusive and no single factor is dominant." Id. The Court must assess the facts relevant to these factors "through the lens of 'economic dependence' and whether they are more analogous to the 'usual path' of an employee or an independent contractor." Id.

This standard is not susceptible to a simple application. See Usery, 527 F.2d at 1311 ("The test is not one which allows for a simple resolution of close cases."). When a disposition in either direction can be justified, the Court must err in favor of a broader reading of "employee."³ Id. ("Given the remedial purposes of the legislation,an expansive definition of 'employee' has been adopted . . . a constricted interpretation of the phrasing by the courts would not comport with its purpose."). To conclude that a party is an "independent contractor" because she bears some of its characteristics would "invite adroit schemes by some employers and employees to avoid the immediate burdens at the expense of the benefits sought by the legislation." Id.; see also Mednick, 508 F.2d at 303 ("An employer cannot saddle a worker with the status of independent contractor, thereby relieving itself of its duties under the F.L.S.A. by granting [her] some legal powers where the economic reality is that the worker is not and never has been independently in the business which the employer would have [her] operate.").

Whether the Plaintiffs are "employees" under the FLSA is a question of law for the Court. See Antenor v. D & S Farms, 88 F.3d 925, 929 (11th Cir. 1996) ("A determination of employment status under the FLSA . . . is a question of law . . .."); Patel v. Wargo, 803 F.2d 632, 634 n.1 (11th Cir. 1986) ("The weight of authority in other circuits supports our characterization of the question as one of law, with the subsidiary findings being issues of fact."). The Defendants frequently reiterate that the facts must be viewed in the light most favorable to the Defendants. However, there islittle dispute regarding the underlying facts of the Plaintiffs' employment arrangement with the Defendants.⁴

To begin, this is not a matter of first impression for this Court. In Clincy v. Galardi South Enterprises, Inc., 808 F. Supp. 2d 1326 (N.D. Ga. 2011), this Court found that adult entertainers--working under conditions similar to the Plaintiffs in this action--were "employees" protected by the FLSA. Many other courts have reached the same conclusion. See Reich v. Circle C. Investments, Inc., 998 F.2d 324 (5th Cir. 1993); Reich v. Priba Corp., 890 F. Supp. 586 (N.D. Tex. 1995); Harrell v. Diamond A Entertainment, Inc., 992 F. Supp. 1343 (M.D. Fla. 1997); Morse v. Mer Corp., 1:08-CV-1389-WTL-JMS, 2010 WL 2346334 (S.D. Ind. June 4, 2010); Hart v. Rick's Cabaret Intern., Inc., No. 09 Civ. 3043, 2013 WL 4822199 (S.D.N.Y. Sept. 10, 2013).

Here, five out of the six factors support finding "employee" status. First, Pin Ups exercised a significant amount of control over the Plaintiffs. The Plaintiffs were issued a document titled "General Policies and Procedures." (Pls.'...