Opinion
C/A 6:22-cv-2307-TMC
07-07-2023
Sidney Jones and Crystal Williams, On Behalf of Themselves and All Other Similarly Situated Individuals, Plaintiffs, v. Shaum's Casablanca d/b/a Lady Godivas/Casablanca, Defendant.
REPORT OF MAGISTRATE JUDGE
Kevin F. McDonald United States Magistrate Judge
This matter is before the court on the plaintiffs' motion for notice to potential plaintiffs and for conditional certification (doc. 15). This motion was referred to the undersigned by order of the Honorable Timothy M. Cain, United States District Judge (doc. 36).
BACKGROUND AND FACTUAL ALLEGATIONS
Sidney Jones and Crystal Williams (hereinafter “the named plaintiffs”) bring this action pursuant to the Fair Labor Standards Act (“FLSA”) (doc. 1). The named plaintiffs allege that they were employed by Shaum's Casablanca d/b/a Lady Godivas/Casablanca (hereinafter “Lady Godivas”) as exotic dancers during at least the time period of August 2019 to the filing of this action (id. at 1). The named plaintiffs allege that they were incorrectly classified as independent contractors, which resulted in Lady Godivas failing to provide wages or compensation for hours they worked or performed at Lady Godivas in violation of the minimum wage compensation mandate of the FLSA (id. at 1-9).
On August 31, 2022, the named plaintiffs filed a motion seeking conditional certification of the putative FLSA class members (doc. 15). Lady Godivas filed a response in opposition to the named plaintiffs' motion on September 22, 2022 (doc. 24), to which the named plaintiffs replied on September 29, 2022 (doc. 25). Thus, the named plaintiffs' motion is now ripe for review.
APPLICABLE LAW AND ANALYSIS
The FLSA permits a plaintiff to bring a collective action on behalf of herself and other individuals who are “similarly situated.” 29 U.S.C. § 216(b). The FLSA's collective action provision states:
An action . . . may be maintained against any employer . . . by any one or more employees for and in behalf of himself or themselves and other employees similarly situated. No employee shall be a party plaintiff to any such action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought.Id. The Supreme Court of the United States has held that, in order to expedite the manner in which collective actions under the FLSA are assembled, “district courts have discretion in appropriate cases to implement . . . § 216(b) . . . by facilitating notice to potential plaintiffs.” Hoffman-La Roche, Inc. v. Sperling, 493 U.S. 165, 169 (1989); see also Shaffer v. Farm Fresh, Inc., 966 F.2d 142, 147 (4th Cir. 1992), cert. denied, 506 U.S. 1021 (1992).
When assessing whether an FLSA claim should proceed as a collective action, district courts in this circuit have traditionally employed a two-stage process. See Amoko v. N&C Claims Serv, Inc., 577 F.Supp.3d 408, 413-14 (D.S.C. 2021). In the first stage, usually initiated pre-discovery and referred to as the “notice stage,” the court makes a determination of whether a plaintiff has demonstrated that potential plaintiffs are similarly situated, such that a court-facilitated notice to putative class members would be appropriate. See Pelczynski v. Orange Lake Country Club, Inc., 284 F.R.D. 364, 367-68 (D.S.C. 2012). If the court determines that the potential plaintiffs are “similarly situated,” the action is conditionally certified, a court-approved notice is sent to potential opt-in plaintiffs, and the action proceeds as a representative action throughout discovery. Id. at 368. At the second stage of collective certification, a defendant may move to decertify the collective action after discovery, and the court applies a heightened standard to evaluate whether the plaintiffs are similarly situated to the extent that a collective action would be the appropriate vehicle for relief. See Amoko, 577 F.Supp.3d at 413-14 (internal citations omitted). If the court finds during this second stage that the plaintiffs are not similarly situated, the court may decertify the class, dismiss the opt-in plaintiffs' claims without prejudice, and permit the named plaintiff(s) to proceed on individual claims. Id.
However, the United States Court of Appeals for the Fifth Circuit recently issued an opinion rejecting the two-stage approach to collective action certification. Swales v. KLLM Transp. Servs. L.L.C., 985 F.3d 430 (5th Cir. 2021). In Swales, the Fifth Circuit found that instead of issuing a conditional certification, the district court should determine what facts and legal considerations will be material to determining whether groups of employees are similarly situated and authorize preliminary discovery on that material, with a final certification motion to be determined once the preliminary discovery has been completed. Id. at 441. Nevertheless, Swales is not binding on this court, and the Fourth Circuit has yet to decide this issue. Further, other courts within this circuit have rejected the more stringent approach to certification under Swales, with the exception of one case. See Staley v. UMAR Servs., Inc., C/A No. 1:21-cv-00042, -- F.Supp.3d ---, 2022 WL 4450642, at *2 n.1 (collecting cases in the Fourth Circuit declining to adopt Swales) (citing Santos v. E&R Servs., Inc., C/A No. DLB-20-2737, 2021 WL 6073039, at *3 (D. Md. Dec. 23, 2021); Amoko, 577 F.Supp.3d at 414; Ison v. Markwest Energy Partners, LP, C/A No. 3:21-cv-0333, 2021 WL 5989084, at *4 (S.D. W.Va. Dec. 17, 2021)); see also Thomas v. Maximus, C/A No. 3:21-cv-498 (DJN), 2022 WL 1482010, at *3 (E.D. Va. May 10, 2022) (collecting cases and recognizing no compelling reason “to deviate from twenty years of established precedent” because Swales is not binding precedent, other courts in the Fourth Circuit have rejected the application of Swales, and based upon an absence of guidance from the Fourth Circuit or the Supreme Court), interlocutory appeal of conditional certification denied C/A No. 22-185 (4th Cir. July 7, 2022). But see Mathews v. USA Today Sports Media Grp., LLC, et al., C/A No. 1:22-cv-01407-TSE-JFA, at doc. 33 (E.D. Va. Apr. 14, 2023) (adopting the Fifth Circuit's approach in Swales in denying motion for conditional certification). In passing, Lady Godivas references Swales, but proffers no basis for this court to adopt the holding in Swales (doc. 24 at 11). In light of the foregoing, the undersigned recommends that the district court decline to abandon the two-stage approach to collective action certification adopted by courts in this District and the majority of courts in this Circuit.
Thus, the undersigned will evaluate whether the named plaintiffs have met their burden pursuant to the more lenient standard. Under that standard, a court should conditionally certify a collective action and authorize notice where the proposed class members “share common underlying facts and do not require substantial individualized determinations for each class member.” See Turner v. BFI Waste Servs., LLC, 268 F.Supp.3d 831, 835 (D.S.C. 2017) (internal citations and quotation marks omitted). The burden of demonstrating that a plaintiff and putative class members are “similarly situated” is fairly lenient and requires “only a modest factual showing that members of the proposed class are ‘victims of a common policy or plan that violated the law.'” Id. (internal citations omitted). In evaluating whether a plaintiff has carried its burden, the court evaluates the pleadings and affidavits submitted by a plaintiff. Amoko, 577 F.Supp.3d at 415 (internal citations omitted).
In the instant matter, the named plaintiffs allege that they and similarly situated individuals who worked as exotic dancers at Lady Godivas were misclassified as independent contractors instead of employees (doc. 1). In support of their motion, each of the named plaintiffs submitted declarations attesting to the allegations set forth in the complaint regarding their employment at Lady Godivas (docs. 15-2; 15-3). Specifically, the named plaintiffs attest that they and the proposed class members performed the same or similar job duties, they were all misclassified by Lady Godivas as non-employee independent contractors, Lady Godivas failed to pay the named plaintiffs and proposed class members wages for hours worked, the named plaintiffs and proposed class members are each owed FLSA minimum wage compensation for all hours each individual worked or performed as exotic dancers at or in Lady Godivas / Casablanca Gentlemen's Club during the period August 2019 through the present, and the named plaintiffs and the proposed class members were similarly harmed by Lady Godivas' class-wide misclassification and unlawful pay practices in violation of the FLSA (docs. 15-2; 15-3).
Lady Godivas argues, however, that conditional certification is not appropriate because named plaintiff Sidney Jones was never an exotic dancer at Lady Godivas, named plaintiff Crystal Williams was only an exotic dancer for two days, the economic realities test does not support conditional certification, and because Lady Godivas is not an employer covered under the FLSA (doc. 24 at 6-11). As an initial matter, although Lady Godivas attached exhibits in opposition to the named plaintiffs' motion, Lady Godivas has not supported its assertions regarding the named plaintiffs (such as whether Sidney Jones was an exotic dancer at Lady Godivas and how long Crystal Williams was an exotic dancer at Lady Godivas) in those documents (see docs. 24-1; 24-2; 24-3). Additionally, although Lady Godivas attached declarations to its response in opposition, the declarations by individuals employed as exotic dancers at Lady Godivas appear to be “happy camper” declarations (see docs. 24-1; 24-2). These types of declarations are generally entitled to little or no weight at the conditional certification stage, “given the risk that the employer secured such declarations through explicit or implicit coercion.” Chapman v. Saber Healthcare Grp., LLC, C/A No. 2:20-cv-00106, -- F.Supp.3d ---, 2022 WL 3686477, at *8 (E.D. Va. Aug. 25, 2022) (internal citations and quotation marks omitted). Accordingly, the declarations provided by Lady Godivas do not provide a basis for denying the named plaintiffs' motion for conditional certification.
In response to the named plaintiffs' motion, Lady Godivas - in passing - requests that the instant matter be dismissed (doc. 24 at 12). However, the matter before the court involves the conditional certification of a collective action under the FLSA, not whether the named plaintiffs' complaint states a claim for relief (see doc. 15). As such, even if conditional certification is denied, because the named plaintiffs may proceed with their individual claims, Amoko, 577 F.Supp.3d at 413-14, Lady Godivas' request for dismissal should be denied.
As noted, Lady Godivas also argues that conditional certification is improper based on the economic realities test and because Lady Godivas is not an employer subject to the FLSA (doc. 24 at 7-10). However, the economic realities test - as recognized in the cases relied upon by Lady Godivas - is one that is considered by the courts at the dispositive motions stage, not the conditional certification stage currently before the court. See Foster v. Gold & Silver Private Club, Inc., C/A No. 7:14-cv-698-GEC, 2015 WL 8489998, at *2-5 (W.D. Va. Dec. 9, 2015) (evaluating economic realities test in considering a partial motion for summary judgment filed by the plaintiffs); McFeeley v. Jackson Street Entm't, LLC, 47 F.Supp.3d 260 (D. Md. 2014) (applying economic realities test in considering a motion for summary judgment). Indeed, a court need not “engage in resolving factual disputes, decide substantive issues going to the merits of the case, or make credibility determinations” during the conditional certification stage. McNeil v. Faneuil, Inc., C/A No. 4:15-cv-00081, 2016 WL 11673838, at *3 (E.D. Va. Aug. 3, 2016) (internal citations and quotation marks omitted). Instead, the court evaluates whether the plaintiff has submitted evidence establishing at least “a colorable basis for their claim that a class of similarly situated plaintiffs exist.” Id. (internal citations and quotation marks omitted). As such, based on the allegations in the complaint and the declarations of the named plaintiffs, the undersigned finds that the named plaintiffs have met the lenient standard at this stage for demonstrating that the potential opt-in plaintiffs are similarly situated and recommends that the named plaintiffs' motion for conditional certification be granted and that the conditionally certified class include all individuals who worked or performed as exotic dancers at or in the Lady Godivas / Casablanca Gentlemen's Club from August 2019 through the present.
Because the undersigned recommends that conditional certification is appropriate and Lady Godivas has not identified any disagreements with the proposed notice or manner of distribution proposed by the named plaintiffs, the undersigned recommends that the notice and manner of distribution proposed by the named plaintiffs be adopted by the court (see docs. 15-4 at 2-5; 15-5 at 2).
CONCLUSION AND RECOMMENDATION
Now, therefore, based upon the foregoing, IT IS HEREBY RECOMMENDED that the named plaintiffs' motion for notice to potential plaintiffs and for conditional certification (doc. 15) be granted and notice to the putative class members be adopted by the court and issued as set forth by the named plaintiffs in document numbers 15-4 at 2-5 and 15-5 at 2.
IT IS SO RECOMMENDED.
The attention of the parties is directed to the important notice on the next page.
Notice of Right to File Objections to Report and Recommendation
The parties are advised that they may file specific written objections to this Report and Recommendation with the District Judge. Objections must specifically identify the portions of the Report and Recommendation to which objections are made and the basis for such objections. “[I]n the absence of a timely filed objection, a district court need not conduct a de novo review, but instead must ‘only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.'” Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310 (4th Cir. 2005) (quoting Fed.R.Civ.P. 72 advisory committee's note).
Specific written objections must be filed within fourteen (14) days of the date of service of this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b); see Fed.R.Civ.P. 6(a), (d). Filing by mail pursuant to Federal Rule of Civil Procedure 5 may be accomplished by mailing objections to:
Robin L. Blume, Clerk United States District Court 250 East North Street, Room 2300 Greenville, South Carolina 29601
Failure to timely file specific written objections to this Report and Recommendation will result in waiver of the right to appeal from a judgment of the District Court based upon such Recommendation. 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140 (1985); Wright v. Collins, 766 F.2d 841 (4th Cir. 1985); United States v. Schronce, 727 F.2d 91 (4th Cir. 1984).