Thornton v. Crazy Horse, Inc.
| Decision Date | 14 June 2012 |
| Docket Number | Case No. 3:06-cv-00251-TMB |
| Parties | SHANNA THORNTON, JENNIFER PRATER, and HEATHER KIDD, Plaintiffs, v. CRAZY HORSE, INC., JEANETTE H. JOHNSON, SANDS NORTH, INC. d/b/a/ FANTASIES ON 5TH AVENUE, KATHLEEN HARTMAN, CAROL J. HARTMAN, and MARCO GONZALEZ, Defendants. |
| Court | U.S. District Court — District of Alaska |
The Defendants in this case operate clubs featuring adult entertainment in Anchorage, Alaska. Defendants Crazy Horse, Inc. and Jeanette H. Johnson (the "Crazy Horse Defendants") operate an establishment known as the Crazy Horse Saloon ("Crazy Horse"). During all relevant times, Defendants Sands North, Inc. d/b/a/ Fantasies on 5th Avenue ("Sands North"), Kathleen Hartman, Carol J. Hartman, and Marco Gonzalez (the "Fantasies Defendants") operated an establishment known as Fantasies on 5th Avenue ("Fantasies"). Plaintiffs Shanna Thornton, Jennifer Prater, and Heather Kidd were formerly employed as dancers at the clubs. In this action, they have asserted claims against Defendants for violations of the Fair Labor Standards Act ("FLSA"), the Alaska Wage and Hour Act ("AWHA"), and Alaska Statutes § 23.05.140.1 Specifically, Plaintiffs seek to recover: (a) unpaid wages resulting from hourly charges levied byDefendants that they claim reduced their wages below the minimum wage; (b) unpaid overtime; (c) other allegedly compulsory charges; and (d) amounts that they claim they were forced to "tip out" to other employees as part of an illegal tip pool. Plaintiffs bear the burden of proving that they were not properly compensated.2
The Court held a four day bench trial commencing on January 3, 2012.3 The Parties subsequently submitted written summary arguments and proposed findings of fact and conclusions of law.4 Federal Rule of Civil Procedure 52(a) provides that "[i]n an action tried on the facts without a jury . . . the court must find the facts specially and state its conclusions of law separately." Having considered the testimony of the witnesses, exhibits admitted into evidence, and the Parties' submissions, the Court makes the findings of fact and conclusions of law set forth below.5
1. Twelve witnesses testified at the trial.6 The three Plaintiffs all testified on their own behalf. Plaintiffs also called Monique Alicia Seybold, a former dancer at Crazy Horse, as a rebuttal witness. The Court finds that Plaintiffs' testimony was generally credible; however, as discussed below, Plaintiffs' recollections were more favorable to their present litigation position than what likely occurred in several respects, most notably, those bearing on their potential damages calculations. The Court also finds that Seybold's testimony was generally credible.
2. The Crazy Horse Defendants called Jeanette Johnson, Mark R. Yost, Irina Gabryushina, Mernie Anna Myrtle Davies, Jenada Johnson, and Barbara Taylor. At all relevant times, Jeanette Johnson has been the owner and manager of Crazy Horse.7 Yost is a former doorman8 and Gabryushina is a former dancer at Crazy Horse.9 Davies currently works and previously worked at Crazy Horse in a number of different roles, including as a "house mom" (i.e., floor manager), bartender, and waitress.10 Jenada Johnson is Jeanette Johnson's daughterand is the payroll manager at Crazy Horse.11 Barbara Taylor is Jeanette Johnson's sister and is a house mom at Crazy Horse.12
3. The Court finds that Gabryushina, Davies, Jenada Johnson, and Taylor generally testified credibly. Jeanette Johnson and Yost, however, did not. Jeanette Johnson's testimony was frequently contradicted, including by exhibits, her own prior affidavits, and other witnesses, including other Crazy Horse witnesses. Although the Court does commend Jeanette Johnson for what is undoubtedly her sincere belief in supporting charitable causes, her testimony was defensive, self-serving, and not believable. Additionally, Yost was clearly uncomfortable on the stand, his demeanor suggested that he was not being truthful, and the gist of his testimony -which, in essence, was that he worked for tips, but rarely received them - simply does not make sense. Jeanette Johnson and Yost's lack of credibility serves only to bolster Plaintiffs' testimony.
4. The Fantasies Defendants called Carol Hartman, the current owner of the club and former minority owner of Sands North, and Marco Gonzalez, Carol Hartman's son, who formerly had a two percent interest in Sands North.13 Kathleen Hartman, who is Carol Hartman's sister and was the majority owner at the time,14 did not testify. At all relevant times,Carol Hartman handled the club's bookkeeping.15 Gonzalez was the disc jockey and had no management authority.16 The Court finds that their testimony was generally credible.
5. Resolving the numerous factual disputes in this case has required Court to sort through two or more contradictory but equally plausible accounts put forward by witnesses who were generally credible. In these instances, the Court has weighed the evidence, considered the totality of the circumstances, and the burden of proof to make its findings. In some cases, the Court has made findings consistent with one of these accounts. In others, it has found that the truth lies somewhere in between the Parties' characterizations, and has done its best to determine what it is. Accordingly, in certain instances, the Court has not accepted (in whole or in part) the testimony of witnesses who were generally credible.
6. The Parties submitted a number of exhibits, most of which were admitted without significant dispute.17 Crazy Horse's records, however, require further comment. The Court admitted Crazy Horse's daily records, which were kept in spiral bound notebooks,18 over Plaintiffs' objection.19 The testimony at trial established that these records were kept using an unorthodox methodology relying heavily on symbols and abbreviations which required lengthyexplanations to interpret, were kept by a number of different individuals, that there was no formalized training for keeping the records, that there was no formalized process for determining who was in charge of keeping the records on any particular day, and that there were many instances where the records may have been inaccurate, or at the very least, incomplete. Under these circumstances, the Court finds that Crazy Horse's daily records are unreliable and entitled to no weight.
7. These problems were not limited to the spiral notebooks, however. Crazy Horse's records in general were shown to be highly unreliable. They were kept by many different people who used inconsistent notation methods, are fraught with errors and omissions, and, as Jeanette Johnson conceded, may not be accurate in important respects.20 Accordingly, the Court has significantly discounted the weight of this evidence.
8. Thornton worked at Crazy Horse in 2003 and 2004.21 Based on her recollection, commencing in September of 2003, she worked a total of 608 standard time hours and 108.5 overtime hours over the course of 83 days of work at Crazy Horse.22 This included approximately 192 standard time hours, 18.5 overtime hours worked in excess of 40 per week, and 2 hours worked in excess of 8 per day, over the course of 25 days of work between August 22, 2003, and August 21, 2004.23
9. Prater worked at Crazy Horse from November 2005 to May of 2006.24 Based on her recollection, she worked a total of 930 standard time hours and 207 overtime hours over the course of 124 days of work at Crazy Horse.25 This did not include any time prior to August 22, 2004.
10. Kidd worked at Crazy Horse from July 29, 2003, to April 29, 2006.26 Based on her recollection, she worked a total of 4,485 standard time hours and 671 overtime hours over the course of 568 days of work at Crazy Horse.27 This included approximately 1,513 standard time hours, 51.5 overtime hours worked in excess of 40 per week, and an additional 168.5 overtime hours worked in excess of 8 per day, over the course of 205 days of work between August 22, 2003, and August 21, 2004.28 It also included approximately 120 standard time hours and 22.5 overtime hours over the course of 15 days of work prior to August 22, 2003.29
11. The Plaintiffs testified that they generally worked at least eight hours, if not more, although this included time spent changing clothes, doing their hair and makeup, and "get[ting] in the right frame of mind" to work.30 Davies indicated that she had never seen a dancer work more than eight hours, although the dancers often did spend significant amounts of timepreparing for work or "hav[ing] coffee or get[ting] something to eat."31 There was no requirement that the dancers conduct these activities at the club, as opposed to at home, before they came to work.32 The weight of the evidence suggests that to the extent that the Plaintiffs were present at the club for more than eight hours on any given day, approximately one hour was spent preparing for work or on meals. With that exception, the Court finds that Plaintiffs' estimates based on their recollections support a just and reasonable inference of the amount and extent of their work at Crazy Horse.
12. At Crazy Horse, the dancers were compensated in a number of ways. First, the dancers received biweekly paychecks supposedly in the amount of the minimum wage from the club.33 Second, dancers received discretionary amounts paid by customers for dances on the club's main stage (referred to as "stage tips"). Third, dancers received fees from customers for "table dances" performed for specific customers. Fourth, dancers received fees from customers for dances performed for specific customers in the club's VIP room.
13. There was no established amount for stage tips. Customers chose to pay or not pay whatever amount they thought was appropriate.34
14. The...
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