Melissa McGrew v. VCG Holding Corp. ( 2018 )

NOT RECOMMENDED FOR PUBLICATION
File Name: 18a0432n.06
No. 17-5474
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
FILED
Aug 23, 2018
MELISSA MCGREW, et al., ) DEBORAH S. HUNT, Clerk
)
Plaintiffs-Appellants, )
)
ON APPEAL FROM THE
v. )
UNITED STATES DISTRICT
)
COURT FOR THE WESTERN
VCG HOLDING CORP., et al., )
DISTRICT OF KENTUCKY
)
Defendants-Appellees. )
)
BEFORE: NORRIS, BATCHELDER, and STRANCH, Circuit Judges.
ALICE M. BATCHELDER, Circuit Judge. The Plaintiffs, a group of exotic dancers
who worked at a “gentleman’s club,” attempted to bring a class action against the club, a holding
company that owned the club, and two executives (collectively “Defendants”), alleging that the
Defendants had misclassified the Plaintiffs as independent contractors rather than as employees,
resulting in violations of the Fair Labor Standards Act (“FLSA”) and certain Kentucky state
employment laws. But each of the Plaintiffs had entered into individual arbitration agreements
with the Defendants, so the district court dismissed the case and compelled individual arbitration.
The Plaintiffs appealed, raising four issues. First, whether under NLRB v. Alternative
Entertainment, Inc., 858 F.3d 393 (6th Cir. 2017), decided after the district court’s decision, the
individual arbitration agreements conflicted with the National Labor Relations Act (“NLRA”)’s
collective-action guarantees. Second, whether the individual arbitration agreements conflicted
with the FLSA’s collective-action guarantees. Third, whether the arbitrator or the district court
should initially decide whether the Plaintiffs were employees (who are covered by the NLRA and
No. 17-5474, Melissa McGrew, et al. v. VCG Holding Corp., et al.
FLSA) or independent contractors (who are not covered by the NLRA or FLSA). Fourth, whether
the district court abused its discretion by enforcing individual arbitration before facilitating notice
to other potential class members pursuant to Section 216(b) of the FLSA.
We delayed deciding this case because the Supreme Court’s then-pending decision in Epic
Sys. Corp. v. Lewis, 138 S. Ct. 1612 (2018), would resolve the first issue, and our then-pending
decision in Gaffers v. Kelly Servs., Inc., No. 16-2210 (6th Cir. 2018), would resolve the second
issue. In Epic, the Supreme Court abrogated our Alternative Entertainment decision and held that
individual arbitration agreements do not conflict with the NLRA’s collective-action guarantees.
See 138 S. Ct. at 1623–32. And in Gaffers, we held that individual arbitration agreements do not
conflict with the FLSA’s collective-action guarantees. See No. 16-2210, __ F.3d __, slip op. at 2
(6th Cir. Aug. 15, 2018). Epic and Gaffers control here, and resolve the first and second issues in
this case in the Defendants’ favor. And because the holdings of Epic and Gaffers mean that
individual arbitration agreements are enforceable against both employees and independent
contractors, we need not resolve what would have been the third issue in this case if Epic and
Gaffers had gone the other way.
This leaves us with only the fourth issue, and Epic and Gaffers have made it an easy one.
In FLSA collective actions, the Supreme Court has authorized district courts to facilitate notice to
similarly situated potential plaintiffs. See Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 169–
74 (1989). Whether or how to facilitate notice, however, is within the discretion of the district
court. Id. at 171. The Plaintiffs cite no in-circuit authority showing that the district court abused
its discretion at the time by declining to facilitate notice to other potential plaintiffs. But even if
the district court did abuse its discretion, after Epic and Gaffers there will be no FLSA collective
action against the Defendants about which the district court could facilitate notice.
For these reasons, we AFFIRM the judgment of the district court.
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