Wirtz v. Soft Drinks of Shreveport, Inc.

• Decision Date: 23 December 1971
• Docket Number: Civ. A. No. 12987.
• Parties: W. Willard WIRTZ, Secretary of Labor, United States Department of Labor v. SOFT DRINKS OF SHREVEPORT, INC., et al.
• Court: U.S. District Court — Western District of Louisiana

336 F. Supp. 950

W. Willard WIRTZ, Secretary of Labor, United States Department of Labor v. SOFT DRINKS OF SHREVEPORT, INC., et al.

Civ. A. No. 12987.

United States District Court, W. D. Louisiana, Shreveport Division.

December 23, 1971.

COPYRIGHT MATERIAL OMITTED

Charles Donahue, U. S. Dept. of Labor, Washington, D. C., Beverley R. Worrell and Edwin G. Salyers, U. S. Dept. of Labor, Atlanta, Ga., for plaintiff.

Robert G. Pugh, Pugh & Nelson, Shreveport, La., for William I. Simmons.

Jack H. Kaplan, Abramson, Maroun & Kaplan, Shreveport, La., for Stanley Gilman.

Booth, Lockard, Jack, Pleasant & LeSage, Whitfield Jack, Shreveport, La., (court-appointed), for witness Joe W. Harris.

OPINION

DAWKINS, Chief Judge.

This action was brought by W. Willard Wirtz, then Secretary of Labor, United States Department of Labor, under Section 17 of the Fair Labor Standards Act of 1938, as amended (29 U.S.C. § 201 et seq.), (the Act), alleging that defendants violated the provisions of Sections 15(a) (1), 15(a) (2), and 15(a) (5) of the Act and seeking to permanently enjoin and restrain them from violating the aforesaid provisions of the Act, and to restrain them from further withholding payments of unpaid overtime compensation. The complaint alleged that defendants violated Section 6 of the Act, which fixes minimum wages,¹ Section 7 of the Act, which deals with overtime wages and maximum hours,² and Section 11(c), which requires the keeping of adequate records.³

The case came on for hearing before this Court February 6 and 7, 1968. Having considered all pleadings, testimony of the witnesses, exhibits filed in evidence, and memoranda submitted by opposing counsel, we now make and enter, pursuant to Rule 52, F.R.Civ.P., the following findings of fact and conclusions of law.

Default judgment was entered against Soft Drinks of Shreveport, Inc., February 14, 1968, permanently enjoining and restraining it from violating Section 15(a) (1), Sections 6 and 7 and 15(a) (2), and Sections 11(c) and 15(a) (5) of the Act. It was further ordered that this defendant be enjoined and restrained from withholding payment of minimum wages and overtime compensation to its employees in the total sum of $3,418.38.

Drs. William I. Simmons and Stanley L. Gilman, president and vice president respectively, also were made defendants. Along with these orthodontists, Mrs. Gilman was the remaining stockholder, but was inactive in the corporate affairs and not made a party to the suit.

Soft Drinks is incorporated in Shreveport, Louisiana, with its bottling plant here, and wholesale routes completely within the State of Louisiana. For the period in question, February to December, 1966, this defendant regularly received shipments of Canada Dry products from Dallas, Texas. The consignments were off-loaded and stored at the Shreveport bottling plant, then distributed to retail outlets via driver-salesmen. A variety of the Canada Dry products came in returnable bottles. These containers, along with the bottles emanating locally were collected and returned to Shreveport, where they were sorted for re-use locally or return to Dallas for cleaning and refilling.

The first Wage and Hour investigation in September, 1965, addressed itself only to receipt of goods from out-of-state. A promise was exacted from the corporate and individual defendants to comply with the Act. Defendants undertook to segregate the work of unloading the Canada Dry interstate truck by assigning to that task certain specified employees.

Another investigation was launched in February, 1966, which revealed violations⁴ and at the end of which the coverage of the Act was carefully explained to defendants. They again promised future compliance and agreed to pay employees back wages.

The third investigation, in December, 1966, disclosed facts which prompted the Secretary to bring this suit. In the interim before the final investigation, attempts were made to decrease the number of people handling Canada Dry products which were sold on the various routes and the returnable bottles which were collected. Defendants assigned one route truck to handle exclusively interstate goods. We find that these efforts diminished contact by some of the employees, but it did not prevent them from regularly and recurringly collecting and sorting Canada Dry returnable bottles. We are not unmindful that employees are considered "engaged in commerce" within the meaning of Section 207(a) only if a "substantial part" of their work comes within the terms of Section 203 (b). Inconsequential employment is not enough. The evidence satisfactorily supports a finding that the activities with interstate characteristics were regular, recurring and substantial.⁵

Testimony and exhibits prove that several employees were induced to sign back-wage receipts and to endorse checks which were returned to defendants, or who were not paid in any amount following the February investigation. As a result of this testimony, criminal investigations were launched by the United States Attorney, but no criminal charges were filed. It cannot be disputed that those amounts are due the employees for work done but not adequately compensated under the Act. In addition to those amounts, the Secretary is suing to recover wages due employees for work done and inadequately compensated in violation of the Act from February to December, 1966.

The issues to be resolved by us in the latter respect are as follows:

1. Were certain of the defendants' employees during the period from February, 1966, to December, 1966, engaged in commerce or in the production of goods for commerce within the meaning of the Act?

2. Were the defendants, William I. Simmons and Stanley L. Gilman, employers within the meaning of the Act?

3. Should we issue an injunction against the defendants and require them to make restitution to their employees?

1. EMPLOYEES ENGAGED IN COMMERCE OR IN THE PRODUCTION OF GOODS FOR COMMERCE?

Defendants during the pertinent period operated a soft drink business, producing, selling, and distributing a variety of carbonated flavors. All the drinks were canned in Shreveport except for the Canada Dry products which were obtained in cases from Dallas, Texas, and brought to the defendants' plant monthly. After delivery there, orders were received from intrastate customers whom route salesmen would service. The empty Canada Dry bottles were often mixed in with the bottles of other beverages. Defendants' employees were required to sort out the Canada Dry bottles and keep them separate from the other bottles. When another delivery of Canada Dry products was made, returnable bottles would be loaded by the employees onto the Canada Dry truck for return to Dallas for re-use.

The evidence indicates that despite defendants' efforts to limit the handling of Canada Dry bottles to employees who were paid in compliance with the Act, others who were not properly compensated regularly handled and sorted returnable bottles. It is the particular employees which determine coverage under the Act. Consequently we must decide which employees and which week said employees participated in duties that were of an interstate character.⁶

We find that Joseph Ansley, R. G. Mitchell, Jesse James Stevenson, Robert G. Johnson, Kenneth Dixon, and Edward Lee Calhoun were engaged in the handling, sorting, unloading, and loading of Canada Dry bottles which activity clearly caused them to engage in commerce or in the production of goods for commerce.

Ansley was employed during the pertinent period normally in the chocolate room at defendants' plant, running a pressure machine. He was one of the men permanently assigned to the Dallas truck. Throughout the week, Ansley, along with others, would be engaged in sorting bottles preparatory to their local re-use or interstate return to Dallas. None of the witnesses were able to determine the actual period when there was only one route truck handling the Canada Dry products. However, it was a common occurrence for Canada Dry bottles to be mixed in with cases of different flavors, even when supposedly one route was to handle the Canada Dry products exclusively.

Johnson's principal duties were in the plant, though in the mornings he might load trucks and in the evenings unload them. When time permitted, and the number of unsorted cases required it, Mitchell would separate bottles. Johnson testified that he occasionally unloaded and loaded the Dallas truck and worked on the Canada Dry route truck. These tasks with interstate characteristics occurred weekly, though not every day, for each of the employees concerned.

Stevenson's duties included feeding the soaker, loading trucks, unloading trucks, and working in the chocolate room. He spent time handling Canada Dry products, sorting, loading and unloading them.

Johnson and Dixon had duties in the plant. Each operated the cooker in the chocolate room, and both loaded and unloaded the Canada Dry route truck and sorted bottles, including Canada Dry bottles, when other duties permitted.

Calhoun was employed as a route truck helper, and as such he was exempt from the overtime provisions of the Act. His duties included the handling of Canada Dry ginger ale and other products, loading the fulls onto the truck, collecting the empties on the route, and unloading the empties upon return to the plant.

We find as a fact that each employee regularly handled Canada Dry products and returnable bottles as a substantial part of his employment. It is unnecessary to discuss the employees' corroborating evidence, testimony inter sese, and from others. A reasonable interpretation of the testimony is that even during the six months' period in which the Canada Dry products were supposedly handled on only one route, many of the employees at the plant loaded and unloaded the route truck and sorted bottles in which stray Canada Dry containers were regularly found. It is our impression that the instructions...