Opinion
02 Civ. 5915 (DLC).
August 27, 2004
Eric Steinberg, Eastwood Scandariato Steinberg, North Bergen, NJ, Peter A. Cross, Jacob Medinger Finnegan LLP, New York, NY, for Plaintiff.
Peter A. Walker, Christopher Lowe, Seyfarth Shaw, New York, NY, for Defendant.
OPINION AND ORDER
On July 25, 2002, plaintiff Glen Jacobsen ("Jacobsen") commenced this collective action against Stop Shop Supermarket Company, LLC ("Stop Shop"), alleging violations of the overtime pay provisions of the Fair Labor Standards Act, 29 U.S.C. § 201et seq. (the "FLSA" or the "Act"). Stop Shop now moves for partial summary judgment, seeking an order (1) defining how the statute of limitations is calculated in a collective action brought under the FLSA, and (2) dismissing with prejudice from this action twelve plaintiffs whose claims it contends are wholly barred by the statute of limitations. For the reasons set forth below, the motion is granted.
Stop Shop originally sought to dismiss the claims of seventeen plaintiffs as time barred. The parties have since agreed to dismiss voluntarily the claims of five plaintiffs. The parties have dismissed the claims of Harold Grausam, Raquel Dias, and Boulem Kibboua because these individuals were never employed by Stop Shop as GM Managers. The claims of Arman Tougas and Sandra Goodwin Murphy have been dismissed because both employees were on leaves of absences during the entire relevant time period and never returned to work.
Background
Familiarity with the issues at stake in this litigation as described in the Opinion certifying the collective action is assumed. See Jacobsen v. Stop Shop Supermarket Co., No. 02 Civ. 5915 (DLC), 2003 WL 21136308 (S.D.N.Y. May 14, 2003). Only the facts relevant to this motion will be discussed here.
Starting in February 2000, Jacobsen was employed at Stop Shop's General Merchandise ("GM") Department. Over the course of his employment he worked in three different capacities: as a GM Manager Trainee, GM Manager Reserve, and GM Manager. Jacobsen asserts that, in each of those three positions, he was required to work a minimum of forty-seven hours each week without receiving overtime compensation as required by Section 207(a)(l) of the FLSA.
Stop Shop operates more than 500 grocery stores on the East Coast of the United States. Its GM Department is in charge of the non-food items sold in the stores.
On July 25, 2002, Jacobsen filed this collective action on behalf of himself and other similarly situated GM Manager Trainees, GM Reserve Managers, and GM Managers who were denied overtime compensation. Jacobsen alleges that Stop Shop willfully misclassified the three manager positions as exempt from the FLSA's overtime pay provisions.
At an initial pretrial conference held on September 20, 2002 (the "Conference"), the merits of the claims were discussed. At that time, the plaintiff was seeking to certify a class pursuant to Rule 23(b)(3), Fed.R.Civ.P., to bring a civil rights claim in connection with the defendant's use of employee photographs for advertising purposes, and was seeking to pursue a collective action for the FLSA claims. The defendant disputed,inter alia, that Jacobsen could adequately represent employees in all three positions or that a class should be certified. In order to determine the class certification issues as expeditiously as possible, discovery was bifurcated. Phase one was limited to discovery of Jacobsen's individual claims and whether he could serve as an adequate class representative. Depending on what was revealed by the initial discovery, the parties would then turn to phase two, which would center on the claims of other similarly situated Stop Shop employees. The rulings issued at the Conference were memorialized in a Scheduling Order dated September 23 (the "Order").
Jacobsen has since abandoned the civil rights claim.
Immediately following the Conference, Jacobsen served Stop Shop with initial discovery demands, which included a request for the names and addresses of employees in food departments as well as non-food departments. Jacobsen had never worked in Stop Shop's food department. Stop Shop objected to Jacobsen's request as exceeding the scope of initial discovery as defined in the Order. Over the next several months, the parties discussed with each other their respective positions on this and other discovery disputes. Through a letter of December 10, Jacobsen submitted a joint request for an extension of the discovery period. On December 17, in response to a letter request by Stop Shop, the Court held a telephone conference in order to resolve the discovery disputes. At that conference, the Court reaffirmed the Order, ruling that the first phase of discovery was limited to Jacobsen's claims and that Stop Shop was not required at that time to disclose the personal information of other potential plaintiffs.
In advance of a January 31, 2003 conference, plaintiff's counsel wrote to advise the Court of its belief that discovery had established that Jacobsen was an adequate representative for all three job positions in the GM Department, and that notice of the action be provided to all class members. As of the January 31 conference, Jacobsen was still pursuing a class action on the civil rights claim as well as the FLSA collective action. At the conference, the certification motion was scheduled to be filed on February 28.
On April 11, Jacobsen's motion to certify a collective action pursuant to the FLSA was fully briefed. Through an Opinion of May 14, the Court authorized a Notice of Pendency ("the Notice") to allow potential class members to "opt-in" to the class. See Jacobsen, 2003 WL 21136308, at *1. On June 13, Jacobsen mailed the Court-approved Notice to 739 putative class members. Pursuant to the Notice, Stop Shop employees who had worked as managers in the GM Department at anytime after July 18, 1999 were permitted to join the collective action by filing a consent with the Clerk of Court before August 15, 2003 (the "opt-in period"). On August 7, Jacobsen's motion to extend the opt-in period was denied. As of August 15, 199 individuals had opted into the action.
Unlike the opt-out provision of class actions filed pursuant to Fed.R.Civ.P. 23(b)(3), the FLSA requires plaintiffs affirmatively to opt-in to a collective action. 29 U.S.C. § 216(b).
In May 2004, the parties reached a settlement with respect to the claims of the GM Manager Trainees and GM Reserve Managers. The only claims that remain active in this lawsuit are those of the GM Managers, 110 of whom have filed a consent to join this action. A trial of the claims of the GM Managers is scheduled for September 2004.
The parties agree that, under the FLSA, the statute of limitations with respect to an individual's claim is not tolled until he or she files a written consent to join the collective action. Stop Shop asserts that the claims of twelve GM Manager plaintiffs are thus wholly barred by the statute of limitations. None of the twelve plaintiffs worked as a GM Manager at any time during the three years preceding the date on which he or she filed a consent to join this collective action.
Stop Shop assumes for the purposes of this motion that a three-year statute of limitations applies to collective actions brought under the FLSA. A suit under the FLSA must be commenced within two years after the cause of action has accrued, unless a plaintiff can show that a defendant's violation of the Act was willful, in which case a three-year state of limitation applies. 29 U.S.C. § 255.
Jacobsen contends that the statute of limitations should be equitably tolled, or that Stop Shop should be equitably estopped from asserting a statute of limitations defense. According to Jacobsen, equitable relief is appropriate in this action because (1) Stop Shop's classification of its GM Managers as exempt from the FLSA rendered the plaintiffs unaware of their right to overtime compensation and to participate in this lawsuit; (2) Stop Shop delayed identifying all the potential plaintiffs in response to Jacobsen's initial discovery demands, thereby delaying the filing of consents by nine to ten months; and (3) Stop Shop failed to raise such a defense "at the time the Court and counsel diligently worked towards preparing a clear and concise Notice" to be sent to potential class members.
Discussion
Summary judgment may not be granted unless the submissions of the parties taken together "show 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." Rule 56(c), Fed.R.Civ.P. The moving party bears the burden of demonstrating the absence of a material factual question, and in making this determination the court must view all facts in the light most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). When the moving party has asserted facts showing that the non-movant's claims cannot be sustained, the opposing party must "set forth specific facts showing that there is a genuine issue for trial," and cannot rest on the "mere allegations or denials" of the movant's pleadings. Rule 56(e), Fed.R.Civ.P.; accord Burt Rigid Box, Inc. v. Travelers Property Cas. Corp., 302 F.3d 83, 91 (2d Cir. 2002).
Where the parties' legal claims do not share common issues of fact with the equitable claims or defenses, the court decides the equitable claims. Pauling v. Secretary of Dept. of Interior, 71 F. Supp. 2d 231, 233 (S.D.N.Y. 1999) (collecting cases). Here, the factual disputes relate only to whether certain equitable doctrines should toll the statute of limitations, and thus, will be decided by the Court.
A. Equitable Tolling
"Equitable tolling allows courts to extend the statute of limitations beyond the time of expiration as necessary to avoid inequitable circumstances." Johnson v. Nyack Hospital, 86 F.3d 8, 12 (2d Cir. 1996). The doctrine only should be applied, however, in "rare and exceptional circumstances in which a party is prevented in some extraordinary way from exercising his rights." Zerilli-Edelglass v. New York City Transit Authority, 333 F.3d 74, 80 (2d Cir. 2003) (citation omitted) (emphasis supplied). Equitable tolling is generally considered appropriate in situations where the complainant has "actively pursued his judicial remedies by filing a defective pleading during the statutory period, or where the complainant has been induced or tricked by his adversary's misconduct into allowing the filing deadline to pass." Irwin v. Department of Veterans Affairs, 498 U.S. 89, 96 (1990) (emphasis supplied). See also Dodds v. Cigna Secs., Inc., 12 F.3d 346, 350 (2d Cir. 1993).
When determining whether equitable tolling is applicable, a court must consider whether the person seeking application of the equitable tolling doctrine (1) has acted with reasonable diligence during the time period she seeks to have tolled, and (2) has proved that the circumstances are so extraordinary that the doctrine should apply.Zerilli-Edelglass, 333 F.3d at 80-81 (citation omitted).
Jacobsen has not shown that the twelve plaintiffs acted with reasonable diligence in seeking to litigate their FLSA claims within the three years following the conclusion of their employment as GM Managers. For example, Jacobsen does not argue that the plaintiffs filed timely but defective claims or consents to join this lawsuit. Jacobsen also cannot point to any trickery or affirmative deception, or to any "extraordinary" behavior, on the part of Stop Shop that impeded the plaintiffs' ability to file timely consents.
Jacobsen points out that Stop Shop classified GM Managers as "exempt" under the FLSA. He complains that the erroneous classification concealed from the plaintiffs their right to join this lawsuit. Classifying a job as exempt from the FLSA's overtime pay requirements is not "extraordinary" conduct such that the doctrine of equitable tolling should apply. To hold that "a failure to disclose that an employee is entitled to overtime pay is sufficient to work an equitable toll would be tantamount to holding that the statute is tolled in all or substantially all cases seeking unpaid overtime." Patraker v. Council on Environment of New York City, No. 02 Civ. 7283 (LAK), 2003 WL 22703522, *2 (S.D.N.Y. Nov. 17, 2003).
Jacobsen also argues that Stop Shop did not immediately identify all the potential plaintiffs in response to Jacobsen's initial discovery demands, thereby delaying the filing of the plaintiffs' consent forms. According to Jacobsen, had Stop Shop supplied the names and addresses of all potential plaintiffs at the time Jacobsen served his initial discovery demand on September 20, 2002, the consent forms would have been filed nine to ten months earlier. Jacobsen contends that if the statute of limitations ran from October 20, the day the response to this demand was due, seven of the twelve barred employees could participate in this litigation.
Jacobsen has not shown that Stop Shop engaged in any "extraordinary" behavior or any trickery with respect to its obligation to provide the names of potential class members. At the time Jacobsen served Stop Shop with this discovery demand, Jacobsen was pursuing a broader range of claims than he ultimately chose to press, and the focus of discovery was to determine as quickly as possible the dimensions of the class he could appropriately represent. In these circumstances, it was not feasible to mail a Notice of Pendency before a class determination was made, and Jacobsen never suggested otherwise. Stop Shop supplied Jacobsen with the names and addresses of potential class managers shortly following certification of the class on May 14, 2003, and Jacobsen mailed the Notice to potential class members less than one month later. Jacobsen does not dispute that Stop Shop has complied with court orders at every stage of this litigation.
B. Equitable Estoppel
The doctrine of equitable estoppel also does not apply to extend the statute of limitations in this case. The doctrine of equitable estoppel can be raised only "where the enforcement of the rights of one party would work an injustice upon the other party due to the latter's justifiable reliance upon the former's words or conduct." Marvel Characters, Inc. v. Simon, 310 F.3d 280, 292 (2d Cir. 2002) (citation omitted). Under federal law, applicable here because Jacobsen's claim is brought under a federal statute, "a party can be estopped from pursuing a claim where: (1) the party makes a misrepresentation of fact to another party with reason to believe that the other party will rely on it; (2) the other party relies on the misrepresentation to his detriment." Id.
Jacobsen cannot point to any misrepresentation by Stop Shop regarding its reliance on a statute of limitations defense. Stop Shop raised the defense in its initial Answer and in its Answer to the Amended Complaint. Jacobsen asserts that Stop Shop should have reminded him at the time that the parties were preparing the Notice that it would be relying on a statute of limitations defense. Since only a few weeks had passed between the certification of the class and the finalization of the Notice, it is difficult to perceive how the plaintiffs were prejudiced. In any event, at no time did Stop Shop make a misrepresentation regarding its intention to assert a statute of limitation defense as to specific plaintiffs once individual employment circumstances were established.
Jacobsen suggests that the Notice was misleading when it advised its readers of their "right to join" the lawsuit without a discussion of the statute of limitations defense, and lays responsibility for this defect at the defendant's feet. The Notice was not misleading. Among other things, it advised its readers that:
The purpose of this Notice is to advise you of the pendency of this lawsuit and of certain rights you may have with respect to this lawsuit. This Notice is not an expression by the Court of any opinion as to the merits of any claims or any defenses asserted by any party to this lawsuit.
(Emphasis supplied.)
In sum, Jacobsen has not shown that Stop Shop affirmatively deceived its employees with respect to this lawsuit, used "extraordinary" means to prevent its employees from timely filing their consent forms, or misrepresented its intent to pursue a statute of limitations defense. Accordingly, equitable principles do not operate to toll the statute of limitations in this action.
Conclusion
For the reasons stated above, the defendant's motion for partial summary judgment is granted. For purposes of this action, the statute of limitations with respect to an individual's claim continues to run until the individual filed with the Clerk of Court a written consent to join the FLSA collective action. Twelve plaintiffs are dismissed from this action on the ground that their claims are wholly barred by the statute of limitations: Ida Bryan, Cheri Cardinal, William Chin, Michael Collins, Jennifer Crabb, Jacqueline Kelly, Christopher Kerr, Mathew Lyon, Jacob Miller, Robert Paulson, Nancy Taylor, and Sanford Weindruch.
SO ORDERED.