Tejeda v. Boston Market Corporation ( 2023 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Jose Tejeda, No. CV-23-01497-PHX-JJT 10 Plaintiff, ORDER 11 v. 12 Boston Market Corporation, et al., 13 Defendants. 14 15 At issue is Plaintiff’s and Opt-In Plaintiffs’ Motion for Entry of Default Judgment 16 against Defendants (Doc. 18, “Mot.”). Defendants did not file a response. For the reasons 17 set forth below, the Court finds that default judgment against Defendants is warranted in 18 part. 19 I. BACKGROUND 20 Plaintiff Jose Tejeda filed a Complaint (Doc. 1, “Compl.”) individually and on behalf 21 of all similarly situated individuals against his former employers, Defendants Boston Market 22 Corporation (“Boston Market”), Jignesh Pandya, and Mital Pandya (“the Pandyas”). The 23 Complaint alleges class-action claims under the Arizona Minimum Wage Act, A.R.S. § 23- 24 363 (“AMWA”), and the Arizona Wage Act, A.R.S. § 23-350 (“AWA”). Plaintiff also 25 alleges collective-action claims under the Fair Labor Standards Act, 29 U.S.C. §§ 206(a), 26 207 (“FLSA”). (Compl.) In his AMWA and AWA claims, Plaintiff alleges a putative class 27 of over one hundred individuals who worked for Boston Market in Arizona and did not 28 receive the proper compensation over a period of weeks in 2023. (Compl. ¶¶ 92–93.) As for 1 the FLSA collective action, six other former Boston Market employees filed notice of 2 consent to join: Carson Hagenson, Christian Heintzelman, Cesar Velasco Lopez, Josefina 3 Medina, Casey Neal, and Yolanda Perez (“Opt-In Plaintiffs”).1 (Doc. 8.) 4 Plaintiff served process on Boston Market on July 31, 2023 (Doc. 7) and on the 5 Pandyas on September 16, 2023 (Docs. 9, 10). Defendants failed to answer or otherwise 6 respond, and the Clerk of Court entered their default on October 18, 2023. (Doc. 12.) 7 Plaintiff then filed the present motion for default judgment on November 14, 2023. (Mot.) 8 Defendants have not responded thereto. 9 II. DEFAULT JUDGMENT 10 After the Clerk of Court enters default, the Court may enter default judgment 11 pursuant to Rule 55(b). The Court’s “decision whether to enter a default judgment is a 12 discretionary one.” Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). Although the 13 Court should consider and weigh relevant factors as part of the decision-making process, 14 it “is not required to make detailed findings of fact.” Fair Housing of Marin v. Combs, 285 15 F.3d 899, 906 (9th Cir. 2002). 16 As an initial matter, the Court must address Plaintiff’s AMWA and AWA claims, 17 which he brings as class actions under Federal Rule of Civil Procedure 23. Rule 23(a) 18 provides that a class action may proceed only if four prerequisites are met: (1) numerosity, 19 (2) commonality, (3) typicality, and (4) adequacy of representation. Fed. R. Civ. P. 23(a). 20 The prerequisites provided under Rule 23 serve “the important function of protecting 21 absent class members whose rights may be affected by the class certification.” Davis v. 22 Hutchins, 321 F.3d 641, 649 (7th Cir. 2003). Accordingly, courts have held that “relief 23 cannot be granted to a class before an order has been entered determining that class 24 treatment is proper.” Davis v. Romney, 490 F.2d 1360, 1366 (3d Cir. 1974). 25 Here, the putative class cannot prevail via default judgment because the Court has 26 yet to certify the class. Nor will the Court entertain the possibility of certifying the class at 27 this point because Plaintiff has not satisfied the first prerequisite. Although there is no 28 1 The Court refers to Plaintiff and Opt-In Plaintiffs collectively as Plaintiffs. 1 precise number required to meet the numerosity requirement, the class must be “so 2 numerous that joinder of all members is impracticable.” Fed. R. Civ. P. 23(a)(1). Despite 3 Plaintiff’s allegation that the class consists of over one hundred individuals, Plaintiff only 4 provides detailed allegations as to seven of them at this time, which is insufficient to satisfy 5 the numerosity requirement. The Court will therefore deny Plaintiff’s motion as to the 6 class-action AMWA and AWA claims. However, Plaintiff Tejeda also brings AMWA and 7 AWA claims as an individual. Therefore, he may recover damages if default judgment is 8 warranted as to his individual claims. 9 In deciding whether default judgment is warranted, the Court considers the 10 following factors: (1) the possibility of prejudice to the plaintiff, (2) the merits of the 11 claims, (3) the sufficiency of the complaint, (4) the amount of money at stake, (5) the 12 possibility of factual disputes, (6) whether default is due to excusable neglect, and (7) the 13 policy favoring decisions on the merits. See Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th 14 Cir. 1986). When considering the merits and sufficiency of the complaint, the Court accepts 15 as true the complaint’s well-pled factual allegations, but the plaintiff must establish all 16 damages sought in the complaint. See Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th 17 Cir. 1977). Having reviewed the complaint and the default judgment motion, the Court 18 finds that the Eitel factors weigh in favor of default judgment as to the FLSA collective 19 action and Plaintiff Tejeda’s individual claims, and damages in the total amount of 20 $37,125.00 are warranted. 21 A. The Possibility of Prejudice to the Plaintiff 22 The first Eitel factor weighs in favor of default judgment. Boston Market and the 23 Pandyas failed to respond to the complaint or otherwise appear in this action despite being 24 served with the complaint, the application for default, and the motion for default judgment 25 and supporting documentation. The Court is satisfied that if the motion is not granted, 26 Plaintiffs “will likely be without other recourse for recovery.” PepsiCo, Inc. v. Cal. Sec. 27 Cans, 238 F. Supp. 2d 1172, 1177 (C.D. Cal. 2002). This prejudice to Plaintiffs supports 28 the entry of default judgment. 1 B. Merits of the Claims and Sufficiency of the Complaint 2 The second and third Eitel factors favor default judgment where the complaint 3 sufficiently states a plausible claim for relief under the Rule 8 pleading standards. See id. 4 at 1175; Danning v. Lavine, 572 F.2d 1386, 1388–89 (9th Cir. 1978). Plaintiff brings 5 state-law claims under the AMWA and the AWA and collective-action claims under the 6 FLSA. 7 1. The State-Law Claims 8 The AWA requires employers to pay their employees regularly, and the AMWA 9 provides the minimum wage in Arizona. A.R.S. §§ 23-351, 23-363. Plaintiff alleges that 10 since May 2023, Defendants failed to pay him at all while he worked for Boston Market. 11 (Compl. ¶ 76.) Accepting this allegation as true, Plaintiff has shown that Defendants 12 violated the AMWA and the AWA. 13 2. The FLSA Collective Action 14 The FLSA provides a mechanism—the “collective action”—through which workers 15 can sue jointly for violations of its overtime compensation and other provisions. See 29 16 U.S.C. § 216(b). The collective action allows a representative plaintiff to bring suit on 17 behalf of a group of workers who are “similarly situated.” See id. The decision to certify a 18 collective action under the FLSA is within the discretion of the Court. Colson v. Avnet, 19 Inc., 687 F. Supp. 2d 914, 925 (D. Ariz. 2010). To certify a collective action under the 20 FLSA, the Court must determine whether the named plaintiff and potential opt-in members 21 are “similarly situated.” 29 U.S.C. § 216(b). The FLSA does not define the term “similarly 22 situated,” and the Ninth Circuit Court of Appeals has not construed the term. Colson, 687 23 F. Supp. 2d at 925. 24 The majority of courts, including this one, have adopted a two-tiered approach to 25 collective-action certification. Id. First, and at issue here, is the “notice stage,” during 26 which courts determine based on pleadings and affidavits whether a collective action 27 should be certified on a conditional basis. Wynn v. Nat’l Broad. Co., Inc., 234 F. Supp. 2d 28 1 1067, 1082 (C.D. Cal. 2002); see also Baughman v. Roadrunner Commc’ns LLC, No. CV 2 12-565-PHX-SRB, 2012 WL 12937133 at *3 (D. Ariz. Sept. 27, 2012). 3 Conditional certification at this first stage requires the plaintiff to make “substantial 4 allegations that the putative class members [are] subject to a single illegal policy, plan, or 5 decision.” Leuthold v. Destination Am., Inc., 224 F.R.D. 462, 466 (N.D. Cal. 2004). 6 Because of the minimal evidence available to the Court at the pleading stage, the initial 7 determination to certify is “based on a fairly lenient standard, and typically results in 8 ‘conditional certification’ of a representative class.” Wynn, 234 F. Supp. 2d at 1082. The 9 evidence must only show that there is some “factual nexus which binds the named plaintiffs 10 and the potential class members together as victims of a particular alleged policy or 11 practice.” Colson, 687 F. Supp. 2d at 926. Although the plaintiff’s burden is light, 12 conditional certification at this first stage is not automatic. Id. at 925. 13 At the second stage, after discovery and often precipitated by a motion for 14 decertification by the defendant, the court reevaluates whether the claimants who have 15 consented to sue are indeed “similarly situated.” Wynn, 234 F. Supp. 2d at 1082. This 16 analysis, which is based on much more information, is subject to a stricter standard. Id. 17 Plaintiff argues that collective adjudication is appropriate because Opt-In Plaintiffs 18 were all employed in similar positions, performed similar work, and were similarly not 19 compensated for several workweeks. (Compl. ¶ 90; Mot. at 6–11.) Plaintiff worked for 20 Boston Market as an assistant manager, and Opt-In Plaintiffs worked for Boston Market as 21 cashiers, managers, cooks, dishwashers, shift supervisors, and master backups. (Compl. 22 ¶¶ 29, 33; Mot. at 6–11.) Plaintiff alleges that since May 2023, Defendants have failed to 23 pay any of their employees at Boston Market locations in Arizona. (Compl. ¶ 75.) 24 Accordingly, the Court concludes that Plaintiff has demonstrated a sufficient “factual 25 nexus” to show that collective-action certification under the FLSA is warranted for the 26 purposes of this motion for default judgment. The Court thus turns to the merits of the 27 FLSA claims. 28 1 Congress enacted the FLSA “to protect all covered workers from substandard wages 2 and oppressive working hours.” Barrentine v. Arkansas-Best Freight Sys. Inc., 450 U.S. 3 728, 739 (1981). The FLSA requires employers to pay non-exempt workers a minimum 4 wage for any time spent working during the workweek. 29 U.S.C. § 206(a). Also among 5 the FLSA’s central provisions is its requirement that employers pay non-exempted workers 6 at one and a half times the regular rate for any time worked in excess of forty hours in a 7 single week. 29 U.S.C. § 207; see Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1042 8 (2016). 9 As mentioned, Plaintiff alleges that Defendants failed to pay their employees for 10 several workweeks. (Compl. ¶¶ 73–80.) Because the well-pled factual allegations of the 11 complaint are deemed true upon default, see Geddes, 559 F.2d at 560, Plaintiff has shown 12 that Defendants violated the FLSA. The second and third factors favor default judgment. 13 C. The Amount of Money at Stake 14 Under the fourth Eitel factor, the Court considers the amount of money at stake in 15 relation to the seriousness of the defendant’s conduct. Plaintiff seeks $66,667.50 in total, 16 but because the Court will not grant Plaintiff’s motion as to the class-action claims, the 17 amount is reduced to $37,125.00, as explained in further detail below. The requested 18 damages are set by statute, and Defendants’ violation of state and federal labor law is 19 serious enough to justify a default judgment in this amount. See Tolano v. El Rio Bakery, 20 No. CV-18-00125-TUC-RM, 2019 WL 6464748, at *5 (D. Ariz. Dec. 2, 2019). 21 D. Possible Dispute Concerning Material Facts 22 In light of the sufficiency of the complaint and Defendants’ default, “no genuine 23 dispute of material facts would preclude granting [Plaintiff’s] motion.” PepsiCo, 238 F. 24 Supp. 2d at 1177. This factor weighs in favor of default judgment. 25 E. Whether Default Was Due to Excusable Neglect 26 Plaintiff properly served Defendants with the summons and complaint. (Docs. 7, 9, 27 10.) It therefore is unlikely that Defendants’ failure to answer and the resulting default were 28 due to excusable neglect. Gemmel v. Systemhouse, Inc., No. CIV 04-187-TUC-CKJ, 2008 1 WL 65604, at *5 (D. Ariz. Jan. 3, 2008). This Eitel factor also weighs in favor of default 2 judgment. 3 F. The Policy Favoring a Decision on the Merits 4 The last factor usually weighs against default judgment given that cases “should be 5 decided on their merits whenever reasonably possible.” Eitel, 782 F.2d at 1472. The mere 6 existence of Rule 55(b), however, “indicates that this preference, standing alone, is not 7 dispositive.” PepsiCo, 238 F. Supp. 2d at 1177. Although the final factor weighs against 8 entry of default judgment, the Court is also compelled to deem the well-pled factual 9 allegations against Defendants as true upon default, see Geddes, 559 F.2d at 560. The Court 10 therefore is not precluded by this factor from entering default judgment against Defendants. 11 See PepsiCo, 238 F. Supp. 2d at 1177; Gemmel, 2008 WL 65604, at *5. 12 G. Conclusion 13 Six of the seven Eitel factors weigh in favor of default judgment, and only one factor 14 weighs against it. Considering all the factors together, the Court concludes that default 15 judgment against Defendants is appropriate as to the FLSA claims and the claims brought 16 by Plaintiff Tejeda individually. 17 III. DAMAGES 18 “A default judgment may be entered without a hearing on damages when the amount 19 claimed is capable of ascertainment from definite figures contained in the documentary 20 evidence or in detailed affidavits.” Taylor Made Golf Co. v. Carsten Sports, Ltd., 175 21 F.R.D. 658, 661 (S.D. Cal. 1997). Here, Plaintiffs seek statutory damages and provide 22 sworn affidavits stating their hours of unpaid work. (Exs. A–G to Mot.) 23 A. Plaintiff Tejeda’s Damages 24 Plaintiff Tejeda claims damages under the AWA, the AMWA, and the FLSA, including 25 the FLSA’s overtime provision. The AWA provides that if an employer fails to pay wages to 26 an employee, the employee may recover against the employer “an amount that is treble the 27 amount of the unpaid wages.” A.R.S. § 23-355(A). Under the AMWA, an employer who fails 28 to pay an employee the state minimum wage is required to pay those wages “and an additional 1 amount equal to twice the underpaid wages.” A.R.S. § 23-364. And under the FLSA, an 2 employee may recover double damages for unpaid time. 29 U.S.C. § 216(b). 3 Plaintiff states in his declaration that over the course of six workweeks, he worked 4 312 unpaid hours at a wage rate of $20 per hour. (Ex. A to Mot.) His unpaid damages are 5 therefore $6,240, and once trebled under the AWA, they rise to $18,720. Although this 6 total engulfs Plaintiff’s other unpaid damages, the Court must still calculate Plaintiff’s 7 AMWA damages2 because Plaintiff concedes that the Pandyas are not liable for AWA 8 damages. (Mot. at 14.) At a state minimum wage of $13.85 per hour,3 Plaintiff’s AMWA 9 damages are $4,321.20, and once trebled under the AMWA, they rise to $12,963.60. 10 Plaintiff was also owed an extra $10 per hour under the FLSA’s overtime provisions for 11 the 72 hours of overtime that he worked during that period. His unpaid overtime damages 12 are therefore $720, and once doubled under the FLSA, they rise to $1,440. 13 Thus, adding the AWA damages to the FLSA overtime damages, Plaintiff Tejeda’s 14 cumulative damages total $20,160. The Pandyas, however, are only liable for $14,403.60 15 of that total, based on the AMWA damages and the FLSA overtime damages. 16 B. Opt-In Plaintiff’s Damages 17 Pursuant to this Order, Opt-In Plaintiffs may recover on default judgment only under 18 the FLSA. Plaintiffs Heintzelman, Hagenson, and Lopez stated that they each worked 180 19 unpaid hours. (Exs. B, C, D.) At a federal minimum wage of $7.25 per hour, their unpaid 20 damages are $1,305 each, and once doubled under the FLSA, they rise to $2,610 each. 21 Plaintiffs Medina, Neal, and Perez each stated that they worked 210 unpaid hours. (Exs. E, 22 F, G.) Their unpaid damages are therefore $1,522.50 each, and once doubled under the 23 FLSA, they rise to $3,045 each. 24 IV. ATTORNEY’S FEES 25 Plaintiff argues that he is entitled to attorney’s fees under 29 U.S.C. § 216(b), which 26 requires the court to “allow a reasonable attorney’s fee to be paid by the defendant, and 27 2 Plaintiff’s AMWA damages engulf his remaining damages. 28 3 See Indus. Comm’n of Ariz., https://www.azica.gov/divisions/labor-department (last visited Dec. 13, 2023) (“2023 Minimum Wage - $13.85 per hour”). || costs of the action.” The Court agrees, and Plaintiff shall have 21 days from the date of this || Order to file his application demonstrating entitlement to and reasonableness of his fees || under Local Rule of Civil Procedure 54.2. 4 IT IS HEREBY ORDERED granting in part and denying in part Plaintiffs and 5 || Opt-In Plaintiffs’ Motion for Entry of Default Judgment against Defendants (Doc. 18). 6 IT IS FURTHER ORDERED that Plaintiff Tejeda will be entitled to default || judgment in the amount of $20,160, for which Defendant Boston Market Corporation shall be fully liable, and of that $20,160, Defendants Boston Market Corporation, Jignesh □□ Pandya, and Mital Pandya shall be liable for $14,403.60, jointly and severally. 10 IT IS FURTHER ORDERED that Opt-In Plaintiffs Heintzelman, Hagenson, and |) Lopez shall each be entitled to default judgment in the amount of $2,610, for which 12 || Defendants Boston Market Corporation, Jignesh Pandya, and Mital Pandya shall be liable, 13} jointly and severally. 14 IT IS FURTHER ORDERED that Opt-In Plaintiffs Medina, Neal, and Perez shall 15 || each be entitled to default judgment in the amount of $3,045, for which Defendants Boston 16 || Market Corporation, Jignesh Pandya, and Mital Pandya shall be lable, jointly and || severally. 18 IT IS FURTHER ORDERED that pursuant to Federal Rule of Civil Procedure || 54(b), the Court determines there is no just reason for delay of entry of partial final 20 || judgment. Accordingly, the Clerk shall enter Default Judgment as stated above. 21 IT IS FURTHER ORDERED that Plaintiff shall have 21 days from the date of this Order to file his fee application in compliance with LRCiv 54.2. 23 Dated this 19th day of December, 2023. CN ‘wala 5 wef hlee— United StatesDistrict Judge 26 27 28 -9-