Jackson v. Innovative Securities Services, LLC ( 2010 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
ARTHUR JACKSON
and
WILLIAM CONRAD,
Plaintiffs, Civil Action 09-00425 (HHK)
v.
INNOVATIVE SECURITIES
SERVICES, LLC, et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiffs Arthur Jackson and William Conrad bring this action against defendants
Innovative Securities Services, LLC, Jeffrey Jackson, and Kenny Jackson, alleging violations of
the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq., and the District of Columbia
Wage Payment and Collection Act (“WPCA”), D.C. Code § 32-1303. Specifically, plaintiffs
allege repeated unlawful failures to pay overtime and holiday wages to Innovative’s employees.
Before the Court is Jeffrey Jackson’s motion to dismiss [#14]. Upon consideration of the
motion, the opposition thereto, and the record of this case, the Court concludes that the motion
must be denied.
I. BACKGROUND
Plaintiffs are current and former employees of Innovative Securities, a provider of various
security services including consulting, guard dog rental, and guard service. Compl. ¶ 11. During
the time period relevant to this action, plaintiffs were employed by Innovative as special police
officers, special police officer site supervisors, and security guards. Id. ¶ 14. Plaintiffs allege that
defendants Jeffrey and Kenny Jackson are the owners of Innovative, id. ¶ 12, and in that capacity
failed to pay overtime and holiday pay as required by law. Id. ¶¶ 18–31.
II. LEGAL STANDARD
Jeffrey Jackson, proceeding pro se, moves for dismissal of this action, apparently on the
ground that plaintiffs’ complaint fails to state a claim upon which relief may be granted pursuant
to Federal Rule of Civil Procedure 12(b)(6).1 On a Rule 12(b)(6) motion, however, if “matters
outside the pleading are presented to and not excluded by the court, the motion shall be treated
as one for summary judgment.” Fed. R. Civ. P. 12(d). Thus, because Jackson’s motion and
plaintiffs’ opposition thereto are both accompanied by factual affidavits upon which the Court
relies, the Court converts Jackson’s motion to dismiss into a motion for summary judgment
pursuant to Federal Rule of Civil Procedure 56.2
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Jackson does not state the legal basis for his motion but the argument he advances
in support of his motion indicates that it is brought pursuant to Rule 12(b)(6).
2
A motion for summary judgment should be granted only if it is shown “that there
is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a
matter of law.” Fed. R. Civ. P. 56(c). The moving party’s “initial responsibility” consists of
“informing the district court of the basis for its motion, and identifying those portions of ‘the
pleadings, depositions, answers to interrogatories, and admissions on file, together with the
affidavits, if any,’ which it believes demonstrate the absence of a genuine issue of material fact.”
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting Fed. R. Civ. P. 56(c)). If the moving
party meets its burden, the burden then shifts to the non-moving party to establish that a genuine
issue as to any material fact actually exists. See Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586 (1986). To meet its burden, the non-moving party must show that “the
evidence is such that a reasonable jury could return a verdict” in its favor. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986). Such evidence must consist of more than mere
unsupported allegations or denials and must set forth specific facts showing that there is a
genuine issue for trial. Fed. R. Civ. P. 56(e); Celotex, 477 U.S. at 322 n.3. If the evidence is
“merely colorable” or “not significantly probative,” summary judgment may be granted.
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III. ANALYSIS
Jackson moves for summary judgment on the grounds that he is not and has never been
an officer, owner, or agent of Innovative, and was thus never plaintiffs’ employer. Plaintiffs
respond that Jackson held himself out and acted as an officer and owner of Innovative, thereby
making himself an employer in the meaning of the FLSA and WPCA and subject to liability for
failing to comply with those laws. The Court finds that there is a genuine issue of material fact as
to whether Jackson was an employer within the meaning of the statutes.
The FLSA defines the term “employer” as including “any person acting directly or
indirectly in the interest of an employer in relation to an employee.” 29 U.S.C. § 203(d). In light
of this “unhelpful” definition, the federal courts have developed “a four-factor ‘economic reality’
test” for determining whether an employer-employee relationship exists. Henthorn v. Dep’t of
Navy, 29 F.3d 682, 684 (D.C. Cir. 1994). Because the WPCA’s language closely tracks that of the
FLSA, the same test is employed in that context. Villar v. Flynn Architectural Finishes, Inc.,
664 F. Supp. 2d 94, 96 (D.D.C. 2009). “The test asks: ‘whether the alleged employer (1) had the
power to hire and fire the employees, (2) supervised and controlled employee work schedules or
conditions of employment, (3) determined the rate and method of payment, and (4) maintained
employment records.’” Henthorn, 29 F.3d at 684 (quoting Bonnette v. Cal. Health & Welfare
Agency, 704 F.2d 1465, 1470 (9th Cir. 1983)); see also Morrison v. Int’l Programs Consortium,
Inc., 253 F.3d 5, 11 (D.C. Cir. 2001). No single factor is dispositive, and the court applying the
test must look to “the totality of the circumstances.” Morrison, 253 F.3d at 11.
Anderson, 477 U.S. at 249–50.
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Under this test, the Court finds that plaintiffs have adduced sufficient evidence to create a
genuine issue of material fact as to whether Jackson was their employer at Innovative. Although
Jackson denies any affiliation with Innovative beyond serving as a consultant, plaintiffs assert
that he managed the company’s payroll, signed paychecks, assigned and disciplined employees,
and formed contracts with clients. Aff. of Arthur H. Jackson, Jr. ¶¶ 5–10. Further, they aver that
“Kenneth Jackson told [one of the plaintiffs] that he and his brother Jeffrey Jackson had a 50%
ownership share in Innovative.” Id. ¶ 4. Taking these assertions as true, as it must at this stage,
Liberty Lobby, Inc., 477 U.S. at 255, the Court finds that there is a genuine issue for trial.
First, because the FLSA employment test focuses on “economic realities” rather than
“technical concepts,” the fact, if true, that Jackson’s formal title was “consultant” is not, by itself,
sufficient to establish that he was not an employer as a matter of law. See Henthorn, 29 F.3d at
684. Second, plaintiffs have presented competent evidence which, if believed, could lead a
reasonable jury to find that Jackson “supervised and controlled employee work schedules or
conditions of employment [and] determined the rate and method of payment” of wages. Id.Such evidence would support a finding that Jackson was plaintiffs’ employer. Accordingly,
summary judgment for Jackson is inappropriate.
For the foregoing reasons, it is this 30th day of September 2010, hereby
ORDERED that defendant’s motion for summary judgment [#14] is DENIED.
Henry H. Kennedy, Jr.
United States District Judge
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