Bryant v. Tristate Logistics of Arizona LLC ( 2020 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Jayce Bryant, No. CV-19-01552-PHX-SMB 10 Plaintiff, ORDER 11 v. 12 Tristate Logistics of Arizona LLC, et al., 13 Defendants. 14 15 Pending before the Court is Defendants Tristate Logistics of Nevada, LLC, C&A 16 Holdings, LLC, and The Bon Air Trust’s Motion to Dismiss, (Doc. 18, “Mot.”). Plaintiff 17 Jayce Bryant responded, (Doc. 22, “Resp.”), and Defendants replied, (Doc. 23, “Reply”). 18 Defendants move to dismiss Plaintiff’s Complaint against them1 with prejudice under 19 Federal Rule of Civil Procedure 12(b)(6). (Mot. at 1.) The Court has considered the 20 pleadings and issues the following Order.2 21 BACKGROUND3 22 Plaintiff Jayce Bryant “brings this action against Defendants for their unlawful 23 failure to pay overtime in violation of the Fair Labor Standards Act [(“FLSA”)].” (Doc. 1, 24 “Compl.” ¶ 2.) While employed full-time by Defendants between March 2016 and July 25 26 1 As noted by the moving Defendants, the other defendants: (1) Tristate Logistics of Arizona, LLC; (2) Tristate Logistics, LLC; and (3) Carlos Jorge, are not parties to this 27 Motion. (Doc. 18 at 1 n.1; Doc. 23 at 1 n.1.) 2 Defendants requested oral argument, but the Court finds that the issues presented in the 28 Motion can be appropriately resolved without hearing. See LRCiv 7.2(f). 3 The Court accepts the Complaint’s well-plead allegations as true for purposes here. 1 2016,4 (id. ¶ 14), “[Plaintiff] was paid approximately $96 per day, regardless of the number 2 of hours he worked for Defendants,” “to perform automobile parts delivery-related duties, 3 which generally consisted of . . . transporting and delivering automobile parts,” (id. ¶¶ 15- 4 16). In other words, although Plaintiff “worked approximately between forty-eight (48) 5 and sixty (60) hours per week,” (id. ¶ 73), he “was never paid any overtime premium 6 whatsoever for time spent working in excess of 40 hours per week,” (id. ¶ 78), but instead 7 “paid on a daily, flat rate basis,” (id. ¶ 79). 8 Because he was not paid at least one and one-half times the regular rate at which he 9 was employed for hours in excess of 40 hours per work week, Plaintiff claims Defendants 10 violated the FLSA. (Id. ¶¶ 128-135.) More specifically, his Complaint alleges one count 11 under section 207 of the FLSA against (1) Tristate Logistics of Arizona, LLC; (2) Tristate 12 Logistics, LLC; (3) Carlos Jorge and Jane Doe Jorge; (4) Tristate Logistics of Nevada, 13 LLC; (5) C&A Holdings, LLC; and (6) The Bon Air Trust. (Id.) The latter three Defendants 14 now move under Rule 12(b)(6) to dismiss the Complaint in its entirety against them. (Mot. 15 at 1.) 16 LEGAL STANDARD 17 To survive a Rule 12(b)(6) motion for failure to state a claim, a complaint must meet 18 the requirements of Rule 8(a)(2). Fed. R. Civ. P. 12(b)(6). Rule 8(a)(2) requires a “short 19 and plain statement of the claim showing that the pleader is entitled to relief,” so that the 20 defendant has “fair notice of what the . . . claim is and the grounds upon which it rests.” 21 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 22 41, 47 (1957)). Dismissal under Rule 12(b)(6) “can be based on the lack of a cognizable 23 legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” 24 Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1988). A complaint that 25 sets forth a cognizable legal theory will survive a motion to dismiss if it contains sufficient 26 factual matter, which, if accepted as true, states a claim to relief that is “plausible on its 27 4 The Complaint alleges Plaintiff worked as a “courier/warehouse worker,” which 28 consisted of “work . . . akin to a specialty job on the production line,” beginning around April 1, 2016. (Compl. ¶¶ 61, 69.) 1 face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). 2 Facial plausibility exists if the pleader sets forth “factual content that allows the court to 3 draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. 4 “Threadbare recitals of the elements of a cause of action, supported by mere conclusory 5 statements, do not suffice.” Id. Plausibility does not equal “probability,” but requires “more 6 than a sheer possibility that a defendant has acted unlawfully.” Id. “Where a complaint 7 pleads facts that are ‘merely consistent’ with a defendant’s liability, it ‘stops short of the 8 line between possibility and plausibility of entitlement to relief.’” Id. (quoting Twombly, 9 550 U.S. at 557). 10 DISCUSSION 11 As a preliminary matter, Defendants do not dispute whether the Complaint sets forth 12 allegations showing that the FLSA applies to Plaintiff.5 Instead, at issue is whether the 13 Complaint adequately alleges Defendants, but not all defendants, were Plaintiff’s 14 “employers,” as required by the FLSA. (Mot. at 2, 5-8; Reply at 2-7.) 15 I. “Employer” Liability Under the FLSA 16 The FLSA only imposes liability on “employers.” Bonnette v. Cal. Health and 17 Welfare Agency, 704 F.2d 1465, 1468 (9th Cir. 1983), disapproved on other grounds by, 18 Garcia v. San Antonio Metro. Transit Auth., 469 U.S. 528 (1985). As the statutory 19 definition provides, an “employer” “includes any person acting directly or indirectly in the 20 interest of an employer in relation to an employee . . . .” 29 U.S.C. §203(d). The term “is 21 not limited by the common law concept of ‘employer,’ and is to be given an expansive 22 interpretation in order to effectuate the FLSA’s broad remedial purposes.” Bonnette, 704 23 F.2d at 1469 (citation omitted). Notably, “an employer-employee relationship . . . does not 24 depend on ‘isolated factors but rather upon the circumstances of the whole activity.’” 25 5 Specifically, they do not contest whether Plaintiff is an employee allegedly “engaged in 26 commerce or in the production of goods for commerce, or . . . employed in an enterprise engaged in commerce.” 29 U.S.C. § 207(a)(1) (emphasis added). This analysis is apart 27 from whether Defendants are Plaintiff’s “employers” under the FLSA. See Chao v. A-One Med. Servs., Inc., 346 F.3d 908, 917 (9th Cir. 2003) (“Whether two companies constitute 28 a single enterprise for FLSA coverage and whether they are liable as joint employers under § 207 are technically separate issues.”). 1 Bonnette, 704 F.2d at 1469 (quoting Rutherford Food Corp. v. McComb, 331 U.S. 722, 2 730 (1947)). “The touchstone is economic reality.” Bonnette, 704 F.2d at 1469 (internal 3 quotation marks and citation omitted). As a guide in making this determination, the Ninth 4 Circuit looks to four factors: “whether the alleged employer (1) had the power to hire and 5 fire the employees, (2) supervised and controlled employee work schedules or conditions 6 of employment, (3) determined the rate and method of payment, and (4) maintained 7 employment records.” Id. at 1470. “[T]his is not a mechanical determination, . . . and it 8 will not be applied blindly.” Id. Rather, “[t]he ultimate determination must be based ‘upon 9 the circumstances of the whole activity.’” Id. (quoting Rutherford, 331 U.S. at 730). 10 The Complaint generally alleges Plaintiff was an employee of “Defendants” and 11 “Defendants were and continue to be ‘employers’ as defined by FLSA.” (Compl. ¶¶ 47, 12 48.) It also alleges that “Defendants were joint employers under the FLSA and 29 C.F.R. 13 § 791.2(b) and employed Plaintiff.” (Id. ¶ 56.) In explaining these employer-employee 14 relationships, the Complaint alleges (1) “Defendants . . . directed and exercised control 15 over Plaintiff’s . . . work and wages at all relevant times,” (id. ¶¶ 49, 102); (2) “Defendants 16 controlled [Plaintiff’s] schedule,” (id. ¶ 67); (3) “Defendants had the right to hire and fire 17 . . . Plaintiff,” (id. ¶ 69.b.); (4) “Plaintiff . . . used Defendants’ equipment and wore 18 company uniforms,” (id. ¶ 66); and (5) “Plaintiff . . . [was] subject to Tristate Logistics’ 19 supervisory and disciplinary authority . . . and required to follow rules guidelines set by 20 Tristate Logistics; and [was] trained by Defendants with regard to policy and procedure,” 21 (id. ¶ 62). 22 As it specifically relates to Tristate Logistics of Nevada, LLC, C&A Holdings, LLC, 23 and The Bon Air Trust, the Complaint alleges “[each] is an employer,” (id. ¶¶ 27, 35, 39), 24 and “[each] was at all relevant times Plaintiff’s . . . Employer as defined by 29 U.S.C. § 25 203(d),” (id. ¶¶ 25, 33, 37). It further alleges “[Tristate Logistics of Nevada, LLC and C&A 26 Holdings, LLC] had the authority to hire and fire employees, supervised and controlled 27 work schedules or the conditions of employment, determined the rate and method of 28 payment, and maintained employment records in connection with Plaintiff’s . . . 1 employment with Defendants.” (Id. ¶¶ 28, 36.) There are no additional allegations further 2 exploring these relationships. 3 With the above allegations in mind, Defendants argue that “Plaintiff has failed to 4 make factual allegations against any of [them] that could plausibly give rise to employer 5 status.” (Mot. at 2.) Instead of setting forth factual allegations, as they explain, “[t]he only 6 allegations individually asserted against [them] are broad and conclusory statements.” (Id.) 7 In response, Plaintiff claims the Complaint contains “sufficient facts against all Defendants 8 to put them fairly on notice of the claims against them.” (Resp. at 3.) In particular, he argues 9 the Complaint “allege[s] that each named Defendant is his employer under the FLSA.” (Id. 10 at 5 (citing Compl. ¶¶ 21, 25, 31, 33, 37, 41)). Without identifying how any single 11 Defendant was his employer, he recites the Bonnette factors almost verbatim in his 12 response, but without any elucidation, and points to the Complaint where they are similarly 13 listed. (See Resp. at 5 (citing ¶¶ 24, 28, 32, 36, 42)). He also claims that alleging his dates 14 of employment, job title, rate of pay, and facts concerning his duties and responsibilities 15 while working for “Defendants” is sufficient. (Resp. at 5.) 16 After accepting as true all allegations that are not legal conclusions and considering 17 the FLSA’s expansive definition of “employer,” the Complaint fails to allege that the 18 movants employed Plaintiff. Contra Bonnette, 704 F.2d at 1470; Iqbal, 556 U.S. at 678 19 (“[W]e ‘are not bound to accept as true a legal conclusion couched as a factual allegation.’” 20 (quoting Twombly, 550 U.S. at 555)). As illustrated above, there are no specific factual 21 allegations outlining any employer-employee relationship between Plaintiff and each 22 Defendant. Iqbal, 556 U.S. at 679 (“While legal conclusions can provide the framework of 23 a complaint, they must be supported by factual allegations.”). Instead of explaining his 24 employment relationship with each Defendant, Plaintiff only baldly concludes one exists 25 between him and “Defendants” as a group. In claiming otherwise, Plaintiff relies heavily 26 on the ruling in Kidner v. Moonshine Group LLC, et al., 2:14-cv-2362-SMM, Doc. 35 (D. 27 Ariz. January 22, 2016). However, Kidner is distinguishable and does not stand for the 28 proposition that merely reciting the Bonnette factors is enough to survive a motion to 1 dismiss. Id. To the contrary, there were enough factual allegations in Kidner to identify 2 employer-employee relationships between Moonshine Group, LLC., Union Group LLC, 3 and the individual plaintiffs. Id. at *4. These factual allegations made clear that all 4 defendants owned and operated the Draft House where plaintiffs worked. Id. at *4-5. 5 Because of these factual allegations, one could reasonably conclude, as the court found, 6 that they were each plaintiff’s “employers” under the FLSA. The same cannot be said in 7 this case. Plaintiff’s Complaint provides no factual allegations supporting the conclusory 8 allegations that Defendants Tristate Logistics of Nevada, LLC, C&A Holdings, LLC, and 9 The Bon Air Trust were Plaintiff’s “employers.” 10 Simply reciting the Bonnette factors, as Plaintiff does here, is not enough under Rule 11 8. Iqbal, 556 U.S. at 678. Relatedly, merely alleging an entity is an employer under the 12 FLSA, as Plaintiff also does here, is also not enough. Id. Using the collective “Defendants” 13 is similarly inadequate. See Adams v. U.S. Airways, Inc., No. CIV-10-1088-PHX-DKD, 14 2011 WL 644089, at * 2 (D. Ariz. Feb. 11, 2011). While alleging employment dates, a job 15 title, pay rate, and daily responsibilities while working for an employer may be adequate, 16 the Complaint blankly alleges each of these things against “Defendants” as a group and 17 fails to set forth any specific factual allegations concerning each Defendant. (See Compl. 18 ¶¶ 14-16, 61.) Accordingly, the Court finds insufficient factual allegations showing each 19 of the moving Defendants was Plaintiff’s “employer.” 20 II. “Joint Employer” Liability Under the FLSA 21 As a general matter, “[i]f an individual is working for more than one company at a 22 time, it is necessary to determine whether the individual’s employers should be treated 23 separately or jointly for purposes of determining employers’ responsibilities under the 24 FLSA.” Chao v. A-One Med. Servs., Inc., 346 F.3d 908, 916 (9th Cir. 2003). While the 25 FLSA does not define “joint employers,” the Department of Labor has promulgated 26 regulations to guide the courts.6 See 29 C.F.R. § 791.2(a) (1961). The regulations provide 27 6 While the DOL recently updated this section on March 16, 2020, the new language does 28 not impact this Court’s decision and both parties refer to the former language. See generally 29 C.F.R. § 791.2 (2020). 1 in part that: 2 Where the employee performs work which simultaneously benefits two or 3 more employers, or works for two or more employers at different times 4 during the workweek, a joint employment relationship generally will be considered to exist in situation such as: 5 6 (1) Where there is an arrangement between employers to share the employee’s services, as, for example, two interchange 7 employees; or 8 (2) Where one employer is acting directly or indirectly in the 9 interest of the other employer (or employers) in relation to the 10 employee; or 11 (3) Where the employers are not completely dissociated with 12 respect to the employment of a particular employee and may be deemed to share control of the employee, directly or 13 indirectly, by reason of the fact that one employer controls, is controlled by, or is under control with the other employer. 14 15 29 C.F.R. § 791.2(b)(1961) (footnotes omitted); see also Bonnette, 704 F.2d at 1469; Chao, 16 346 F.3d at 917-18. The last example “tells us that joint employment will generally be 17 considered to exist when 1) employers are not ‘completely dissociated’ with respect to the 18 employment of the individuals and 2) where one employer is controlled by another or the 19 employers are under common control.” Chao, 346 F.3d at 918; 29 U.S.C. § 791.2(a) (1961) 20 (“A determination of whether the employment by the employers is to be considered joint 21 employment or separate and distinct employment for purposes of the [FLSA] depends upon 22 all the facts and the particular case.”). 23 Both parties dispute whether Defendants should be treated as joint employers under 24 the FLSA. Defendants argue that “Plaintiff’s only attachment of liability for [them] is 25 through joint employer allegations,” (Reply at 3), and the “Complaint fails to make any 26 specific factual allegations targeted at [them] giving rise to joint employer status.” (Reply 27 at 7.) On the other hand, Plaintiff claims he “properly alleges a horizontal joint employment 28 relationship between Plaintiff and the Defendants,” (id. at 5), because of one allegation in 1 his Complaint, which reads: 2 At all relevant times, all Defendants were horizontal joint 3 employers of Plaintiff and the Collective Members. At all 4 relevant times: (1) Defendants were not completely dissociated with respect to the employment of Plaintiff and the Collective 5 Members; and (2) Defendants were under common control. In 6 any event, at all relevant times, Defendants were joint employers under the FLSA and 29 C.F.R. § 791.2(b) and 7 employed Plaintiff and the Collective Members.” 8 9 (Compl. ¶ 56.) 10 This language in the Complaint is directly imported from Chao, but Plaintiff has 11 substituted “employer” with “Defendants” and “individuals” with “Plaintiff and the 12 Collective Members” in his Complaint. See Chao, 346 F.3d at 918. Even ignoring the fact 13 that the Complaint fails to allege that any Defendant is Plaintiff's employer, the Court 14 would need specific factual allegations, not a recitation of the DOL regulations, concerning 15 whether any of the Defendants should be treated as Plaintiff’s “joint employers” under the 16 FLSA. See Chao, 346 F.3d at 918. 17 III. Leave to Amend 18 Plaintiff does not request leave to amend his Complaint. However, in accordance 19 with the well-settled law in this Circuit, because “it is not ‘absolutely clear’ that [Plaintiff] 20 could not cure [the Complaint’s] deficiencies by amendment,” the Court will give him the 21 opportunity to do so. See Jackson v. Barnes, 749 F.3d 755, 767 (9th Cir. 2014) (citations 22 omitted); Fed. R. Civ. P. 15(a)(2) (“leave to amend should be “freely” given “when justice 23 so requires[]”). Plaintiff’s amended complaint must address the deficiencies identified 24 above. Plaintiff’s amended complaint should follow the form detailed in Local Rule 7.1. 25 Within thirty (30) days from the date of entry of this Order, Plaintiff may submit 26 an amended complaint. Plaintiff must clearly designate on the face of the document that 27 it is the “First Amended Complaint.” If Plaintiff decides to file an amended complaint, he 28 is reminded that an amended complaint supersedes the original complaint, see Lacey v. || Maricopa County, 693 F.3d 896 (9th Cir. 2012), and it must be complete in itself and “must 2|| not incorporate by reference any part of the preceding pleading, including exhibits,” 3], L.R.Civ 15.1. 4 CONCLUSION 5 The Complaint fails to set forth specific factual allegations that Defendants Tristate 6|| Logistics of Nevada, LLC, C&A Holdings, LLC, and The Bon Air Trust were □□□□□□□□□□□ 7\| “employers” or “joint employers” as it relates to the FLSA. Instead of doing so, the 8 || Complaint merely alleges conclusory and unsupported legal findings, which is insufficient under Rule 8. Therefore, the Complaint is dismissed as it relates to these Defendants with 10 || leave to amend. 11 12 Accordingly, 13 14 IT IS ORDERED GRANTING Defendants Tristate Logistics of Nevada, LLC, 15 || C&A Holdings, LLC, and The Bon Air Trust’s Motion to Dismiss, (Doc. 18). The 16 || Complaint is dismissed with leave to amend under Rule 12(b)(6) as it relates to these three 17 || Defendants only; 18 19 IT IS FURTHER ORDERED that Plaintiff may file a First Amended Complaint 20 || + within thirty (30) days of the date of this Order. If a First Amended Complaint is not filed within thirty (30) days, the case will proceed against the remaining defendants only. 22 23 Dated this 18th day of March, 2020. 24 —_——— 25 = oS fe 26 Aonorable Susan M; Brnovich United States District Judge 28 -9-