Ellis v. Holy Comforter Saint Cyprian Community Action Group , 153 F. Supp. 3d 338 ( 2016 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
_______________________________
)
WILLIE LEE ELLIS, et al., )
)
Plaintiffs, )
)
v. )
) Civ. Action No. 15-842 (EGS)
)
HOLY COMFORTER SAINT CYPRIAN )
COMMUNITY ACTION GROUP, )
)
Defendant. )
)
MEMORDANUM OPINION
Plaintiffs Willie Lee Ellis, Henry Wood, Thomas Moore,
James Young, and Murphy McNeil (“Plaintiffs”) bring this action
against Holy Comforter Saint Cyprian Community Action Group
(“Community Action Group” or “CAG”) alleging violations of the
Fair Labor Standards Act, 29 U.S.C. § 207 et seq., the D.C.
Living Wage Act, D.C. Code § 2-220.01 et seq., the D.C. Minimum
Wage Revision Act, D.C. Code § 32-1001 et seq., and the D.C.
Wage Payment and Collection Act, D.C. Code § 32-1301 et seq.
Defendant moves to dismiss for lack of standing. Upon
consideration of the motion, the response and reply thereto, the
applicable law, the entire record, and for the reasons stated
below, Defendant’s motion is DENIED.
I. BACKGROUND
Plaintiffs are former employees of Community Action Group,
a rehabilitation facility in the District of Columbia. Compl.,
Docket No. 1 at 3. Plaintiffs allege that, while employed as
rehabilitation monitors at CAG, they were not paid the proper
hourly rate nor properly compensated for work in excess of forty
hours per week. Id. at 3-4. CAG moves to dismiss Plaintiffs’
claims for lack of standing. See generally Def.’s Mot. to
Dismiss (“Def.’s Mot.”).
On February 24, 2015, CAG signed a contract entitled
“Agreement Regarding the Mediated Settlement Under the Living
Wage Act of 2006” (“the Agreement”) with the D.C. Department of
Employment Services Office of Wage-Hour Compliance (“D.C. Office
of Wage-Hour”). See Def.’s Ex. 1. The Agreement acknowledges
CAG’s commitment to pay $170,000 to resolve certain wage and
hour claims and indicates that the D.C. Office of Wage-Hour will
not commence any lawsuit against CAG “with respect to unresolved
claims asserted by the D.C. Office of Wage-Hour for unpaid wages
on behalf of employees found to be due back wages as a result of
a Living Wage audit completed on February 10, 2015.”. Id. The
Agreement covers “payments to all former and current employees
for calendar years 2013 and 2014.” Id. CAG argues that
Plaintiffs’ injuries have already been redressed through the
2
Agreement and that allowing Plaintiffs’ lawsuit to proceed would
result in their double recovery. Id. at 4-5.
II. STANDARD OF REVIEW
A motion to dismiss for lack of standing is properly
considered a challenge to the Court’s subject matter
jurisdiction and should be reviewed under Federal Rule of Civil
Procedure 12(b)(1). Little v. Fenty, 689 F. Supp. 2d 163, 166 n.
3 (D.D.C. 2012); see also Hasse v. Sessions, 835 F.2d 902, 906
(D.C. Cir. 1987)(“[T]he defect of standing is a defect in
subject matter jurisdiction.”). To survive a Rule 12(b)(1)
motion to dismiss, “the plaintiff bears the burden of
establishing jurisdiction by a preponderance of the evidence.”
Moran v. U.S. Capitol Police Bd., 820 F. Supp. 2d 48, 53 (D.D.C.
2011) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 561
(1992)). Because Rule 12(b)(1) concerns a court’s ability to
hear a particular claim, the court “must scrutinize the
plaintiff’s allegations more closely when considering a motion
to dismiss pursuant to Rule 12(b)(1) than it would under a
motion to dismiss pursuant to Federal Rule 12(b)(6).” Schmidt v.
U.S. Capitol Police Bd., 826 F. Supp. 2d 59, 65 (D.D.C. 2011).
In so doing, the court must accept as true all of the factual
allegations in the complaint and draw all reasonable inferences
in favor of the plaintiff, but the court need not “accept
inferences unsupported by the facts or legal conclusions that
3
are cast as factual allegations.” Rann v. Chao, 154 F. Supp. 2d
61, 63 (D.D.C. 2001). Finally, in reviewing a motion to dismiss
pursuant to Rule 12(b)(1), the court “may consider materials
outside the pleadings as it deems appropriate to resolve the
question whether it has jurisdiction in the case.” Scolaro v.
D.C. Bd. of Elections & Ethics, 104 F. Supp. 2d 18, 22 (D.D.C.
2000); see also Jerome Stevens Pharms., Inc. v. FDA, 402 F. 2d
1249, 1253 (D.C. Cir. 2005).
III. DISCUSSION
To establish Article III standing, Plaintiffs must
demonstrate that (1) they have personally suffered an “injury in
fact”; (2) the injury complained of is fairly traceable to the
challenged action of the Defendant; and (3) it is likely that
the injury will be redressed by a favorable decision by the
Court. Lujan, 504 U.S. at 560-61 (internal citations omitted).
CAG argues that Plaintiffs have failed to demonstrate than an
action in this Court will redress their alleged injuries
because, according to CAG, Plaintiffs’ injuries were already
redressed through the Agreement between CAG and the D.C. Office
of Wage-Hour. Def.’s Mot. at 3-5. Plaintiffs argue that the
majority of Plaintiffs have not received any payment from CAG as
a result of the Agreement, and that those who did receive
4
payment did not receive the full amount owed to them under the
law. 1 Pls.’ Opp. at 4.
The Agreement fails to demonstrate that Plaintiffs’ alleged
injuries will not be redressed by a favorable decision by the
Court. First, the Agreement is between CAG and the D.C. Office
of Wage-Hour and is clearly limited to resolution of claims
under the D.C. Living Wage Act for calendar years 2013 and 2014.
See Def.’s Ex. 1. Plaintiffs’ complaint alleges injuries under
the Fair Labor Standards Act, the D.C. Minimum Age Revision Act,
and the D.C. Wage Payment and Collection Act, in addition to the
D.C. Living Wage Act. See generally Compl. Moreover, Plaintiffs’
complaint alleges unpaid wages beginning as early as 2008, when
Plaintiff Young began his employment at CAG. Id. at 3.
Accordingly, while some of plaintiffs’ injuries may have been
partially redressed as a result of the Agreement, the complaint
alleges additional injuries for which CAG has provided no
evidence of redress. Plaintiffs may proceed to seek redress of
their entire injury. See Massachusetts v. EPA, 549 U.S. 497,
525-26 (2007) (litigation success need only partially redress a
plaintiff’s injuries to meet the redressability requirement);
see also Dove v. Coupe, 81-cv-3022, 1982 WL 2190 at *1 (D.D.C.
1 Plaintiffs further indicate that the individual Plaintiffs who
did receive payment from CAG neither deposited nor cashed these
payments. Pls.’ Opp. at 4.
5
May 19, 1982)(plaintiff who received partial redress of his
injuries could proceed to seek further redress of his whole
injury).
Furthermore, even though the D.C. Office of Wage-Hour
entered into an Agreement with CAG on behalf of certain CAG
employees, there is no evidence in the record that Plaintiffs
agreed to forego their private right of action against CAG. CAG
argues that even though Plaintiffs are not parties to the
Agreement, Plaintiffs are barred from filing this lawsuit
because they are third-party beneficiaries to the Agreement.
Def.’s Mot. at 3.
Under D.C. contract law, “[o]ne who is not a party to a
contract nonetheless may sue to enforce its provisions if the
contracting parties intend the third party to benefit directly
thereunder.”. W. Union Tel. Co. v. Massman Constr. Co., 402 A.2d
1275, 1277 (D.C. 1979). But it does not follow that intended
beneficiaries of a settlement agreement, who did not release
their claims against defendant, would be barred from filing
their own suit. In fact, a “beneficiary who has not previously
assented to the promise for his benefit may in a reasonable time
after learning of its existence and terms render any duty to
himself inoperative from the beginning by disclaimer.”
Restatement (Second) of Contracts: Disclaimer by a Beneficiary §
6
306 (1981). “It is black letter contract law that a third party
‘beneficiary is entitled to reject a promised benefit . . .’ and
when this occurs, ‘the effect on the promisor’s duty to the
beneficiary is the same as if no promise had been made.’”.
United States v. Weeks, 388 F.3d 913, 917 (D.C. Cir. 2004) rev’d
on other grounds 544 U.S. 917 (2005)(quoting Restatement
(Second) of Contracts: Disclaimer by a Beneficiary § 306, at
cmt. & illus. b (1981)). Absent evidence that Plaintiffs
assented to the Agreement, Plaintiffs are entitled to disclaim
any obligations owed to them thereunder, provided the disclaimer
occurs within a reasonable time. CAG provides no evidence that
Plaintiffs assented to the Agreement nor does it argue that
Plaintiffs disclaimer occurred outside a reasonable time period.
Accordingly, upon review of the record, and accepting the
factual allegations in the complaint as true, Plaintiffs have
alleged an injury capable of being redressed by a favorable
decision of this Court.
IV. CONCLUSION
For the foregoing reasons, Defendant’s Motion to Dismiss is
DENIED. An appropriate order accompanies this Memorandum
Opinion.
Signed: Emmet G. Sullivan
United States District Court
January 27, 2016
7