Opinion
20-CV-9907 (JLR) (BCM)
05-10-2023
RUBEN RAMIREZ, Plaintiff, v. SAKE II JAPANESE RESTAURANT, INC., et al., Defendants.
REPORT AND RECOMMENDATION TO THE HON. JENNIFER L. ROCHON
BARBARA MOSES, United States Magistrate Judge.
In this action, filed pursuant to the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201 et seq., and N.Y. Labor Law (NYLL) § 190 et seq., plaintiff Ruben Ramirez seeks damages for unpaid minimum and overtime wages, statutory penalties, and related relief from defendants Sake II Japanese Restaurant, Inc. (Sake II) and Bi Shun Dong. Compl. (Dkt. 1) ¶¶ 1-2. Plaintiff's claims arose out of his work as a delivery driver for defendants' restaurant from 2012 to 2019.
On November 16, 2021, after defendants failed to answer the Complaint and failed to appear at a show-cause hearing, the Honorable Vernon S. Broderick, United States District Judge, issued a Default Judgment as to liability against Sake II and Dong (Dkt. 30) and referred the matter to me for an inquest on damages. (Dkt. 29.)
For the reasons set forth below, I recommend that plaintiff be awarded damages in the aggregate amount of $387,382 against both defendants, comprising: (a) $175,158 in compensatory damages for defendants' failure to pay required minimum and overtime wages; (b) $175,158 in liquidated damages for the wage violations; (c) $15,996 for defendants' failure to provide "spread of hours" pay; (d) $15,996 in liquidated damages for the spread of hours violations; (e) $4,582 in attorneys' fees; and (f) $492 in costs, plus prejudgment interest in the amount of $47.13 per day from February 25, 2017 to the date of entry of final judgment.
I. BACKGROUND
A. Factual Allegations
Defendants owned and operated a restaurant (the Restaurant) located at 690 E. 187th Street, Bronx, New York. Compl. ¶¶ 4, 15, 16. The individual defendant, Dong, was the "owner, or part owner and principal" of the corporate defendant, Sake II, and had "the power to hire and fire employees, set wages and schedules, and maintain their records." Id. ¶ 11. "[A]t all relevant times," Sake II had "gross revenues exceeding $500,000" and "used goods and materials produced in interstate commerce." Id. ¶¶ 6-7.
According to its website, the name of the Restaurant is "Sake II Japanese Restaurant." See Home, Sake II, https://sakeii.menucities.com/default.aspx (last visited April 24, 2023).
From October 2012 through May 2019, plaintiff worked as a delivery driver at the Restaurant. Compl. ¶ 16; see also Ramirez Decl. (Dkt. 34-2) ¶¶ 5-6. From 2014 through 2016, plaintiff worked from 11:00 a.m. until 11:00 p.m. three days per week, from 11:00 a.m. until 11:30 p.m. two days per week, and from 12:00 p.m. until 10:30 p.m. one day per week, resulting in a six-day, 71.5-hour work week. Compl. ¶¶ 19-21; see also Ramirez Decl. ¶¶ 7-9. From 2017 through May 30, 2019, in addition to these hours, plaintiff worked an additional shift, from 11:00 a.m. to 10:30 p.m., resulting in a seven-day, 83-hour work week. Compl. ¶¶ 19-21; see also Ramirez Decl. ¶¶ 7-9. Throughout his employment, plaintiff was compensated in cash, paid on the last day of each month and at the rate of $40 per day. Compl. ¶ 22; Ramirez Decl. ¶ 10.
Once in his pleading and once in his declaration, plaintiff stated that he worked at the Restaurant "through May 2020." Compl. ¶ 21; Ramirez Decl. ¶ 9. These appear to be typographical errors, because in every other instance he claims only to have worked through May 2019. I note as well that plaintiff's calculation of damages assumes that his employment concluded in May 2019. See Plaintiff's Proposed Findings of Fact and Conclusions of Law (Prop. Findings) (Dkt. 34) Ex. 3 (Damages Calculation).
Plaintiff alleges that that he "worked 73 hours per week" in the years 2014 through 2016. Compl. ¶ 21. However, the schedule he describes adds up to 71.5 hours per week. Id. ¶¶ 19-20; see also Ramirez Decl. ¶¶ 7-9. As a result, the Court calculates his damages during this period based on a 71.5-hour work week.
Plaintiff never received an "overtime 'bonus' for hours worked beyond 40 hours in a workweek," Compl. ¶ 23, was not paid the statutory minimum, id. ¶ 38, and was not provided "with an additional hour's pay at the New York minimum wage for each shift that exceeded ten hours." Compl. ¶ 25; see also Ramirez Decl. ¶¶ 10, 13. Further, defendants failed to furnish Ramirez with a "tip credit notice" or a "tip credit form." Compl. ¶¶ 28-29; see also Ramirez Decl. ¶ 14. They also failed to provide plaintiff with paystubs or any "wage acknowledgment notice." Compl. ¶¶ 26-27; see also Ramirez Decl. ¶ 14.
B. Procedural History
Plaintiff filed this action on November 24, 2020, alleging five claims against Sake II, Dong, and Brixia Lu: (1) failure to pay overtime compensation at the rate of one and one-half times his regular rate of pay for each hour worked that exceeded forty hours per work week, in violation of the FLSA, 29 U.S.C. § 207(a)(1), see Compl. ¶¶ 30-35; (2) failure to compensate at the New York minimum wage rate, in violation of NYLL § 652 and 12 N.Y. Comp. Codes R. & Regs. (NYCRR) § 146-1.2, see id. ¶¶ 36-40; (3) failure to pay overtime compensation at the rate of one and one-half times his regular rate of pay for each hour worked that exceeded forty hours per week, in violation of 12 NYCRR § 146-1.4, see id. ¶¶ 41-45; (4) failure to provide an additional hour's pay at the required minimum wage for each shift that was over 10 hours in duration, in violation of 12 NYCRR § 146-1.6, see id. ¶¶ 46-50; and (5) failure to provide the wage notices and wage statements required by the Wage Theft Prevention Act (WTPA), NYLL §§ 195(1), 195(3). See Id. ¶¶ 51-56.
On January 14 and 15, 2021, defendants Sake II and Dong were served with process but did not appear or answer the Complaint. On April 1, 2021, plaintiff requested, and the Clerk of Court issued, a certificate of default as to both defendants. (Dkts. 18-19.)
Individual defendant Dong was served in accordance with Fed R. Civ. P. 4(e)(1) and N.Y. C.P.L.R. (CPLR) § 308(2) by delivery of the summons and Complaint to Jane Smith (who identified herself as a "co-worker" of Dong), at the Restaurant, followed by mailing the papers to the same address. (Dkt. 16.) Corporate defendant Sake II was served in accordance with Fed.R.Civ.P. 4(h), CPLR § 311(a)(1), and N.Y. Bus. Corp. Law § 306(b)(1) by delivery of the summons and Complaint to an agent of the Secretary of State in Albany, New York. (Dkt. 17.)
There is no indication on the docket of this action that defendant Lu was ever served with process. On April 14, 2021, plaintiff voluntarily dismissed his claims against Lu, pursuant to Fed R. Civ. P. 41(a)(1)(A)(i), without prejudice. (Dkt. 20.)
On July 21, 2021, Judge Broderick directed plaintiff, "if he intends to seek a default judgment," to do so no later than August 3, 2021. (Dkt. 21.) On July 23, 2021, plaintiff moved by order to show cause for a default judgment against Sake II and Dong (Dkt. 22), relying on an affidavit signed by attorney Michael Samuel (Samuel Aff.) (Dkt. 23), which in turn attached the relevant pleadings, the certificate of default, a damages calculation, and attorney time records. On October 6, 2021, Judge Broderick issued the Order to Show Cause (OSC) (Dkt. 25), directing defendants to appear by telephone on November 12, 2021. On October 13, 2021, plaintiff served both defendants with the OSC, as well as the proposed default judgment, the Samuel affidavit, and its attachments, through personal delivery to Jane Doe (who identified herself as a "co-worker" of Dong) at the Restaurant. (Dkts. 27-28.)
On November 12, 2021, defendants failed to appear at the show-cause hearing, and on November 16, 2021, Judge Broderick issued the Default Judgment and referred the case to me for inquest. On February 4, 2022, I issued a Scheduling Order for a Damages Inquest (Sched. Order) (Dkt. 31), directing plaintiff to file proposed findings of fact and conclusions of law concerning all damages and other monetary relief sought in connection with the default judgment by March 7, 2022, and giving defendants until April 6, 2022 to respond if they wished. Sched. Order ¶¶ 1-2, 8. I further ordered plaintiff to serve his Proposed Findings, together with all supporting materials and a copy of the Scheduling Order, on the defaulted defendants, by mail, at their last known address. Id. ¶ 7.
On March 25, 2022, after requesting and obtaining an extension of his time to do so, plaintiff filed his Proposed Findings, together with his declaration, his damages calculation, and a certificate of service by mail (Dkt. 34-1). Plaintiff seeks a total of $644,647.24, comprising: (1) $35,640 in unpaid minimum wages; (2) $143,377.50 in unpaid overtime wages; (3) $16,007.57 in unpaid spread of hours compensation; (4) $374,042.57 in liquidated damages ($195,025.07 under the NYLL and $179,017.50 under the FLSA); (5) $10,000 under the WTPA; and (6) $12,201.03 in prejudgment interest through March 25, 2022. See Damages Calculation.
On September 26, 2022, this action was reassigned to the Honorable Jennifer L. Rochon, United States District Judge. (Dkt. 35.) On October 19, 2022, plaintiff submitted a "revised proposed default judgment as to damages" in the amount of $464,418.41, comprising: (1) $460,034.74 for the plaintiff and (2) $4,383.67 in attorneys' fees, costs, and disbursements. (Dkt. 37-1.) No further explanation or support for those figures was provided.
II. ANALYSIS
A. Legal Standards
1. Determining Liability
Following a default, all well-pleaded factual allegations in the complaint as to liability are "deemed admitted." S.E.C. v. Razmilovic, 738 F.3d 14, 19 (2d Cir.), as amended (Nov. 26, 2013); accord City of N.Y. v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir. 2011); Vt. Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 246 (2d Cir. 2004). However, a default "only establishes a defendant's liability if those allegations are sufficient to state a cause of action against the defendants." Gesualdi v. Quadrozzi Equip. Leasing Corp., 629 Fed.Appx. 111, 113 (2d Cir. 2015) (summary order). The court must therefore determine "whether the allegations in a complaint establish the defendants' liability as a matter of law." Id. (citing Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009)). If the well-pleaded factual allegations establish the defaulting party's liability, the only remaining issue is "whether plaintiff has provided adequate support for [the requested] relief[.]" Gucci Am., Inc. v. Tyrrell-Miller, 678 F.Supp.2d 117, 119 (S.D.N.Y. 2008) (citing Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999)).
Conversely, if the well-pleaded factual allegations in the complaint fail to state a claim upon which relief can be granted, no damages can be awarded, even if the post-default inquest submissions supply the missing information. See U.S. ex rel. Nat'l Dev. & Constr. Corp. v. U.S. Envtl. Universal Servs., Inc., 2014 WL 4652712, at *4 (S.D.N.Y. Sept. 2, 2014) ("[i]t is the . . . [c]omplaint, not the inquest submissions, that establishes defendants' liability") (quoting Gutman v. Klein, 2010 WL 4975593, at *10 (E.D.N.Y. Aug. 19, 2010)) (alteration in original); J & J Sports Prods., Inc. v. Abdelraouf, 2019 WL 457719, at *2 (E.D.N.Y. Feb. 5, 2019) ("It is the moving party's burden to demonstrate that it is entitled to recovery based on the factual allegations pleaded in the complaint.").
2. Determining Damages
Although the court must accept all well-pleaded facts as true when determining liability, it need not - and indeed cannot - rely on the allegations in plaintiff's pleading to establish his damages. Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992). Rather, plaintiff is required to substantiate his damages claim with "admissible, authenticated evidence." McLaughlin v. Barron, 2018 WL 1872535, at *2 (S.D.N.Y. Jan. 24, 2018), report and recommendation adopted, 2018 WL 993627 (S.D.N.Y. Feb. 20, 2018); see also House v. Kent Worldwide Mach. Works, Inc., 359 Fed.Appx. 206, 207 (2d Cir. 2010) (summary order) ("[T]here must be a basis upon which the court may establish damages with reasonable certainty.").
Where, as here, the defendants have failed to produce any employment records, the court may credit the plaintiff's "recollections regarding [his] hours and pay in conducting its inquest." Coley v. Vannguard Urb. Improvement Ass'n, Inc., 2018 WL 1513628, at *7 (E.D.N.Y.), as amended (Mar. 29, 2018). However, "the Court must ensure that Plaintiffs' approximations and estimates are reasonable and appropriate." Id.; see also Jemine v. Dennis, 901 F.Supp.2d 365, 378 (E.D.N.Y. 2012) (finding that plaintiffs' method of estimating hours worked by averaging the hours listed in the available payroll records with the hours recalled and described in plaintiffs' declarations was reasonable where defendants failed to maintain adequate records).
B. Jurisdiction and Venue
I am satisfied that this Court has subject matter jurisdiction over plaintiff's claims. As plaintiff sues under a federal statute - the FLSA - subject matter jurisdiction is properly based on 28 U.S.C. § 1331. The Court may exercise supplemental jurisdiction over his state law claims, which arise out of the same facts and circumstances, pursuant to 28 U.S.C. § 1367.
I am also satisfied as to personal jurisdiction over the defendants, which is "a necessary prerequisite to entry of a default judgment." Reilly v. Plot Commerce, 2016 WL 6837895, at *2 (S.D.N.Y. Oct. 31, 2016) (quoting Sheldon v. Plot Commerce, 2016 WL 5107072, at *6 (E.D.N.Y. Aug. 26, 2016), report and recommendation adopted, 2016 WL 5107058 (E.D.N.Y. Sept. 19, 2016)). Defendants were properly served with process, see n.5, supra, but failed to answer or otherwise respond, thereby waiving any argument regarding the Court's personal jurisdiction over them. See Fed.R.Civ.P. 12(h)(1)(B); Hamilton v. Atlas Turner, Inc., 197 F.3d 58, 62 (2d Cir. 1999). Similarly, defendants have waived any objections to venue, see Fed.R.Civ.P. 12(b)(3), 12(h)(1)(B), which in any event is appropriate because the Restaurant is in this District. See Compl. ¶ 4; 28 U.S.C. § 1391(b)(2).
C. Statute of Limitations
The statute of limitations under the FLSA is two years, see 29 U.S.C. § 255(a), unless the violations were "willful," in which case the limitations period increases to three years. Id.; see also McLaughlin v. Richland Shoe Co., 486 U.S. 128, 129 (1988). A violation is willful if "the employer either knew or showed reckless disregard for the matter of whether its conduct was prohibited[.]" McLaughlin, 486 U.S. at 133. In this case, plaintiff alleges willfulness generally, with no supporting facts. See Compl. ¶ 24. However, "a defendant's default, in itself, may suffice to support a finding of willfulness." Gonzalez Mercedes v. Tito Transmission Corp., 2018 WL 7291452, at *4 (S.D.N.Y. Dec. 6, 2018) (quoting Santillan v. Henao, 822 F.Supp.2d 284, 297 (E.D.N.Y. 2011)), report and recommendation adopted sub nom. Mercedes v. Tito Transmission Corp., 2019 WL 102007 (S.D.N.Y. Jan. 4, 2019). Therefore, the statute of limitations for plaintiff's FLSA claim is three years, meaning that he can recover damages under the FLSA for work performed on and after November 24, 2017.
The statute of limitations for claims under the NYLL is six years, regardless of willfulness. See NYLL § 198(3). Therefore, plaintiff can recover damages under the NYLL for work performed on or after November 24, 2014.
D. Liability for Minimum Wage and Unpaid Overtime Violations
To state an FLSA wage claim, a plaintiff must allege: (1) that he was an employee of each defendant sued; (2) that his work "involved inte[r]state activity"; and (3) that he "worked hours for which [he] did not receive minimum and/or overtime wages." Pineda v. Tokana Cafe Bar Restorant Inc., 2017 WL 1194242, at *2 (S.D.N.Y. Mar. 30, 2017) (citing Zhong v. August August Corp., 498 F.Supp.2d 625, 628 (S.D.N.Y. 2007)); see also 29 U.S.C. §§ 206(a), 207(a)(1), 206(s)(1). "The requirements to make out a claim under the NYLL mirror the FLSA in most respects," Reyes v. Lincoln Deli Grocery Corp., 2018 WL 2722455, at *3 (S.D.N.Y. June 5, 2018), order clarified, 2018 WL 3105070 (S.D.N.Y. June 25, 2018), except that the NYLL "does not require a plaintiff to show that the employer was involved in interstate commerce or had $500,000 in minimum annual sales," as required for the "interstate commerce" element of an FLSA claim. Id. (citing 29 U.S.C. § 203(s)(1)(A)).
1. Employee-Employer Relationship
The FLSA defines "employer" as "any person acting directly or indirectly in the interest of an employer in relation to an employee[.]" 29 U.S.C. § 203(d). The Supreme Court has emphasized that this is an expansive definition with "striking breadth." Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 326 (1992). Moreover, "an individual may simultaneously have multiple employers for the purposes of the FLSA, in which event, all joint employers are responsible, both individually and jointly, for compliance with all of the applicable provisions of the FLSA." Martin v. Sprint United Mgmt. Co., 273 F.Supp.3d 404, 421 (S.D.N.Y. 2017) (quoting 29 C.F.R. § 791.2(a)) (cleaned up).
To determine whether a plaintiff is an "employee" of a particular "employer" for FLSA purposes, courts examine the "economic reality" of the working relationship. Irizarry v. Catsimatidis, 722 F.3d 99, 104 (2d Cir. 2013). In the Second Circuit, courts examine four nonexclusive factors to assess the "economic reality" of an alleged employment relationship, including: "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." Id. at 105 (quoting Barfield v. N.Y. City Health & Hosps. Corp., 537 F.3d 132, 142 (2d Cir. 2008)). The inquiry considers the "totality of circumstances," so "no single factor is dispositive." Feng Chen v. Patel, 2019 WL 2763836, at *5 (S.D.N.Y. July 2, 2019).
Similarly, under the NYLL, the definition of "employer" is very broad, see NYLL § 190(3) ("employer" means "any person, corporation, limited liability company, or association employing any individual in any occupation, industry, trade, business or service"), and the crucial inquiry in determining whether an employer-employee relationship exists is the "degree of control exercised by the purported employer over the results produced or the means used to achieve the results." Hart v. Rick's Cabaret Int'l, Inc., 967 F.Supp.2d 901, 923 (S.D.N.Y. 2013) (citing Bynog v. Cipriani Grp., Inc., 1 N.Y.3d 193, 198, 770 N.Y.S.2d 692, 695 (2003)). Although the New York Court of Appeals "has not yet answered the question of whether the test for 'employer' status is the same under the FLSA and the NYLL," Camara v. Kenner, 2018 WL 1596195, at *7 (S.D.N.Y. Mar. 29, 2018) (citing Irizarry, 722 F.3d at 117), "[t]here is general support for giving [the] FLSA and the New York Labor Law consistent interpretations . . . [a]nd there appears to have never been a case in which a worker was held to be an employee for purposes of the FLSA but not the NYLL (or vice versa)." Hart, 967 F.Supp.2d at 924 (internal citations omitted); see also Burns v. Scott, 2022 WL 10118491, at *7 (S.D.N.Y. Oct. 17, 2022) (same), reconsideration denied, 2022 WL 18858909 (S.D.N.Y. Nov. 9, 2022).
I am satisfied that, for purposes of both the FLSA and the NYLL, plaintiff has adequately pleaded that he was employed by both defendants. Plaintiff alleged that Dong was an owner (or part owner) and principal of the corporate defendant, Sake II, and that he had the power to hire and fire employees, determine their wages, establish their schedules, and maintain their employment records. Compl. ¶¶ 11, 15. These facts, taken as true for purposes of the inquest, meet the economic reality test under federal and state law. Moreover, Sake II had gross sales in excess of $500,000, see Compl. ¶ 6, and was thus engaged in commerce for purposes of the FLSA.
2. Unpaid Minimum and Overtime Wages
The federal minimum wage between November 24, 2017 and May 30, 2019 was (and remains) $7.25 per hour. 29 U.S.C. § 206(a)(1). Under the NYLL, however, the minimum wage in New York City increased during the relevant portion of plaintiff's employment. From November 24, 2014 through December 31, 2014, the applicable minimum wage was $8 per hour. NYLL § 652(1). The minimum increased to $8.75 on January 1, 2015, and to $9 on January 1, 2016. Beginning on January 1, 2017, the New York City minimum wage increased to $11 per hour for "large" employers, defined as those with 11 or more employees, and to $10.50 for "small" employers, with 10 or fewer employees. NYLL § 652(1)(a)(i)-(ii). As of January 1, 2018, large employers in New York City were required to pay employees $13 per hour and small employers were required to pay $12 per hour. Id. Finally, on January 1, 2019, the New York City minimum wage rose to $15 per hour (where it remains today) for large employers, and to $13.50 per hour for small employers. Id.; see also 12 NYCRR § 146-1.2.
Under both federal and state law, an employer is required to pay an overtime rate of one and one-half times the employee's "regular rate" of pay, for hours worked in excess of 40 per week. 29 U.S.C. § 207(a)(1); 12 NYCRR § 146-1.4. An employee's "regular rate" of pay, which describes the total weekly wages received by the plaintiff for the hours worked in a given period, is "derived by dividing the total amount of wages received in a work week by forty[.]" Baltierra v. Advantage Pest Control Co., 2015 WL 5474093, at *5 (S.D.N.Y. Sept. 18, 2015). To state an unpaid overtime claim, "a plaintiff must allege only that [he] worked compensable overtime in a workweek longer than forty hours, and that [he] was not properly compensated for that overtime." Tackie v. Keff Enters. LLC, 2014 WL 4626229, at *3 (S.D.N.Y. Sept. 16, 2014) (citing Nakahata v. N.Y.-Presbyterian Healthcare Sys., Inc., 723 F.3d 192, 199-201 (2d Cir. 2013)).
Plaintiff alleges that throughout his employment, and regardless of the number of hours he worked, he was paid at a constant rate of $40 per day. Compl. ¶¶ 22-23; see also Ramirez Decl. ¶ 10. Thus, between November 24, 2014 and December 31, 2016, when he worked six days per week, his weekly pay was $240 (6 x $40) and his "regular hourly rate" was $6 ($240 ÷ 40). Thereafter, when he worked seven days per week, his weekly pay was $280 (7 x $40) and his regular hourly rate was $7 ($280 ÷ 40). Unless defendants permissibly took a "tip credit" - which according to plaintiff they did not, see Compl. ¶¶ 28-29, Ramirez Decl. ¶ 14 - plaintiff's regular hourly rate was always below the federal and state minimum wage. Thus, plaintiff has adequately alleged that he was paid an hourly rate below the minimum wage required by both federal and New York law. However, plaintiff provides no information about the number of employees at the Restaurant. Therefore, in calculating his NYLL damages, the Court necessarily applies the minimum wage rates applicable to small employers in New York City.
The FLSA permits an employer to pay a lower, tip-credited wage to employees in tipped jobs, but only if, inter alia, the employer provides the employee with written or oral notice explaining the calculation. 29 U.S.C. § 203(m)(2)(A). Similarly, the NYLL permits an employer to "take a credit towards the basic minimum hourly rate if a service employee or food service worker receives enough tips and if the employee has been notified of the tip credit as required in [12 NYCRR § 146-2.2]. Such employees shall be considered 'tipped employees.'" 12 NYCRR § 146-1.3. To take advantage of the NYLL "tip credit," an employer must provide a written notice explaining (and calculating) the credit, in English and the workers' primary language, and must keep the employee's signed acknowledgement of receipt of such notice for six years. Id. § 146-2.2(a), (c).
Plaintiff further alleges that from November 24, 2014 through December 31, 2016, he worked 71.5 hours per week, and from January 1, 2017 through May 30, 2019, he worked 83 hours per week, without any overtime premium. Compl. ¶¶ 19-21; see also Ramirez Decl. ¶¶ 9-10, 13. Thus, plaintiff has adequately stated a claim for unpaid overtime wages under the FLSA and the NYLL.
E. Damages
1. Unpaid Minimum and Overtime Wages
Plaintiff has submitted admissible evidence, in the form of his own sworn declaration, supporting his claims for unpaid minimum and overtime wages. Plaintiff attests that he consistently worked more than 40 hours per week throughout his employment at the Restaurant, at an hourly wage that was always below the minimum required by federal and state law, and that he never received overtime pay. Ramirez Decl. ¶¶ 9, 10, 13. Plaintiff further attests that he was never notified that his tips were being included as an offset for wages. Id. ¶14.
Although plaintiff is eligible to recover damages under both the FLSA and the NYLL, he "may not recover twice." Gonzalez Mercedes, 2018 WL 7291452, at *5 (quoting Cao v. Wu Liang Ye Lexington Rest., Inc., 2010 WL 4159391, at *3 (S.D.N.Y. Sept. 30, 2010)). Rather, plaintiff "may recover under the statute which provides the greatest amount of damages." Id. (quoting Wicaksono v. XYZ 48 Corp., 2011 WL 2022644, at *3 (S.D.N.Y. May 2, 2011), report and recommendation adopted, 2011 WL 2038973 (S.D.N.Y. May 24, 2011). In this case, that statute is the NYLL. Consequently, for the first forty hours he worked each week, plaintiff is entitled to recover the difference between his actual hourly rate and the required minimum rate of pay under state law for the relevant period. For his hours in excess of forty, he is entitled to 1.5 times the required minimum rate of pay under state law.
As noted above, plaintiff attests that, from November 24, 2014 through December 31, 2016, he worked from 11:00 a.m. until 11:00 p.m. three days per week, from 11:00 a.m. until 11:30 p.m. two days per week, and from 12:00 p.m. until 10:30 p.m. once a week, resulting in a six-day, 71.5-hour work week. Ramirez Decl. ¶¶ 7-8. During this period, plaintiff was paid at a rate of $40 per day, or $240 per week, which computes to $6 per hour for the first 40 hours and nothing thereafter. Id. ¶ 10. Under the NYLL, plaintiff should have been paid an extra $2 per hour for the first 40 hours per week ($80 per week), and $12 per hour for his overtime hours ($378 per week), throughout calendar year 2014. Therefore, for the period November 24, 2014 through December 31, 2014 (five weeks plus two days), he is owed $2,421.
Yearly totals are rounded to the nearest dollar.
In 2015, plaintiff should have been paid an extra $2.75 per hour for the first 40 hours per week ($110 per week) and $13.125 per hour for his overtime hours ($413 per week). Therefore, for the period January 1, 2015 through December 31, 2015 (52 weeks), he is owed $27,196.
In 2016, plaintiff should have been paid an extra $3 per hour for the first 40 hours per week ($120 per week) and $13.50 for his overtime hours ($425 per week). Therefore, for the period January 1, 2016 through December 31, 2016 (52 weeks), he is owed $28,340.
Beginning on January 1, 2017, plaintiff worked an additional day, from 11:00 a.m. to 10:30 p.m., resulting in a seven-day, 83-hour work week. Ramirez Decl. ¶¶ 7-9. During this period, plaintiff was paid at a rate of $40 per day, or $280 per week, which computes to $7 per hour for the first 40 hours and nothing thereafter. Id. ¶¶ 7, 10. Under the NYLL, plaintiff should have been paid an extra $3.50 per hour for the first 40 hours per week ($140 per week) and $15.75 per hour for his 43 overtime hours ($677 per week) throughout calendar year 2017. Therefore, for the period January 1, 2017 through December 31, 2017 (52 weeks), he is owed $42,484.
In 2018, plaintiff should have been paid an extra $5 per hour for the first 40 hours per week ($200 per week) and $18 per hour for his 43 overtime hours ($774 per week). Therefore, for the period January 1, 2018 through December 31, 2018 (52 weeks), he is owed $50,648.
Finally, in 2019, plaintiff should have been paid an extra $6.50 per hour for the first 40 hours per week ($260 per week) and $20.25 per hour for his 43 overtime hours ($870.75 per week). Therefore, for the period January 1, 2019 through May 30, 2019 (21 weeks and two days), plaintiff is owed $24,069.
All told, plaintiff is owed $175,158 in unpaid minimum and overtime wages for the period November 24, 2014 through May 30, 2019.
3. Spread of Hours Pay
Under the NYLL, an employee paid at the minimum wage (or less) is entitled to an extra hour of pay, at the applicable minimum wage rate, for each day in which the "spread of hours," or the "length of the interval between the beginning and end of [plaintiff's] workday," is greater than ten. 12 NYCRR § 146-1.6. Plaintiff attests that all of his shifts were longer than ten hours. Ramirez Decl. ¶¶ 8-9. As noted above, he worked six shifts per week in 2014 through 2016 (entitling him to six extra hours of pay each week at the then-prevailing New York minimum wage rate) and seven shifts per week beginning in 2017 (entitling him to seven extra hours of pay each week at the then-prevailing New York minimum wage rate).
Consequently, plaintiff is owed $15,996 in spread of hours damages.
Specifically, $256 for November 24, 2014 through December 31, 2014; $2,730 for January 1, 2015 through December 31, 2015; $2,808 for January 1, 2016 through December 31, 2016; $3,822 for January 1, 2017 through December 31, 2017; $4,368 for January 1, 2018 through December 31, 2018; and $2,012 for January 1, 2019 through May 30, 2019.
4. Liquidated Damages
Plaintiff requests "stacked" liquidated damages, in the amount of 100% of his actual unpaid wages, under both federal and state law. Prop. Findings at 7, ¶ 21; see also Damages Calculation. However, the law in our Circuit is clear that a plaintiff suing under the FLSA and the NYLL may only recover liquidated damages once, under one of the two statutes. Liability for liquidated damages may be avoided if the employer can demonstrate that it acted in "good faith." NYLL § 198(1-a). However, because a showing of good faith is an affirmative defense under the NYLL, a defaulting defendant cannot carry that burden. See Tackie, 2014 WL 4626229, at *4 (citing Jaramillo v. Banana King Rest. Corp., 2014 WL 2993450, *5 (E.D.N.Y. July 2, 2014)).
See Chowdhury v. Hamza Express Food Corp., 666 Fed.Appx. 59, 60 (2d Cir. 2016) (summary order) ("New York's law does not call for an award of New York liquidated damages over and above a like award of FLSA liquidated damages"). Although Chowdhury is non-precedential, it has been uniformly followed by the district courts within our Circuit. See, e.g., Polanco v. Bensonhurst Rest. Corp., 2021 WL 1254445, at *3 (E.D.N.Y. Apr. 5, 2021) ("[D]uplicative liquidated damages may not be awarded for the same course of conduct under both the FLSA and the NYLL.").
"The amount of liquidated damages is equal to 100% of the amount owed to the Plaintiffs in unpaid wages, which includes unpaid minimum wage, unpaid overtime, and unpaid spread-of-hours." Villanueva v. 179 Third Ave. Rest Inc., 500 F.Supp.3d 219, 239 (S.D.N.Y. 2020)), report and recommendation adopted sub nom. Villanueva v. 179 Third Ave. Rest. Inc., 2021 WL 2139441 (S.D.N.Y. May 26, 2021). Therefore, plaintiff is entitled to 100% of his unpaid minimum wage and overtime damages as liquidated damages, equivalent to $175,158. Plaintiff is also entitled to 100% of his unpaid spread of hours pay as liquidated damages, equivalent to $15,996.
5. Statutory Penalties
The WTPA requires employers to provide a written statement "with every payment of wages" that includes, inter alia, the dates worked during that pay period, the rate or rates of pay and the basis thereof, gross wages, deductions, allowances, and net wages. NYLL § 195(3). Additionally, "at the time of hiring," employers must provide a written wage notice - in English and in the employee's "primary language" - that includes, among other things, "the rate or rates of pay and basis thereof, whether paid by the hour, shift, day, week, salary, piece, commission, or other," and any "allowances, if any, claimed as part of the minimum wage," including tip allowances. NYLL § 195(1). An employee may recover statutory damages of $250 for each workday that his employer failed to provide the wage statement required by § 195(3), and $50 for each workday that his employer failed to provide the wage notice required by § 195(1), not to exceed damages of $5,000 for each violation. NYLL § 198(1-b), (1-d).
In federal court, however, a plaintiff may not automatically collect a statutory penalty upon proof of the corresponding statutory violation. In order to establish standing under the "cases and controversies" clause, see U.S. Const. Art. III § 2, he must first demonstrate that he suffered a "concrete and particularized injury" as a result of the violation. TransUnion LLC v. Ramirez, 141 S.Ct. 2190, 2203 (2021); see also id. at 2205 (because the existence of a statutory prohibition or obligation does not "simply enact an injury into existence," Article III standing "requires a concrete injury even in the context of a statutory violation") (quoting Spokeo, Inc. v. Robins, 578 U.S. 330, 341 (2016)). Put another way, to demonstrate the required concrete and particularized "injury in fact," a plaintiff "cannot solely rely on the fact that the defendant committed a statutory violation." Neor v. Acacia Network, Inc., 2023 WL 1797267, at *4 (S.D.N.Y. Feb. 7, 2023) (dismissing WTPA claims where the complaint did not "allege any harm stemming from a lack of accurate wage notices or statements").
Here, as in Neor, plaintiff alleges that defendants never provided the required wage statements or wage notices, Compl. ¶¶ 26-27, but does not allege any facts showing that the lack of paystubs or written wage notices confused him about the manner in which his pay was computed or caused any other "injury in fact." Consequently, plaintiff cannot recover the $10,000 in statutory damages he seeks under the WTPA. See Neor, 2023 WL 1797267, at *4; see also Sanchez v. Ms. Wine Shop Inc., 2022 WL 17368867, at *9 (E.D.N.Y. Nov. 30, 2022) (rejecting plaintiff's claim for statutory damages under the WTPA on inquest after default because "the allegations of the Complaint fail to establish a concrete injury resulting from Defendants' alleged failure to provide wage statements"); Hernandez v. 99 Thai Playground LLC, 2022 WL 18539303, at *7 (S.D.N.Y. Nov. 28, 2022) (same result, where plaintiff alleged "only a technical statutory violation [of the WTPA], and not a physical, monetary, or cognizable harm"), report and recommendation adopted, 2023 WL 1400626 (S.D.N.Y. Jan. 31, 2023).
6. Prejudgment Interest
In addition to liquidated damages, a plaintiff may recover prejudgment interest on his unpaid minimum and overtime wages under NYLL § 198(1-a). Andrade v. 168 First Ave Rest. Ltd., 2016 WL 3141567, at *10 (S.D.N.Y. June 3, 2016), report and recommendation adopted, 2016 WL 3948101 (S.D.N.Y. July 19, 2016) (citing Reilly v. Natwest Mkts. Grp. Inc., 181 F.3d 253, 265 (2d Cir. 1999)). This is because - unlike liquidated damages - prejudgment interest is intended to "compensate a plaintiff for the loss of use of money." Reilly, 181 F.3d at 265 (quoting Chandler v. Bombardier Capital Inc., 44 F.3d 80, 83 (2d Cir. 1994)). However, "prejudgment interest applies only to the amount of compensatory damages, and excludes the amount of liquidated damages." Xochimitl v. Pita Grill of Hell's Kitchen, Inc., 2016 WL 4704917, at *18 (S.D.N.Y. Sept. 8, 2016) (quoting Maldonado v. La Nueva Rampa, Inc., 2012 WL 1669341, at *11 (S.D.N.Y. May 14, 2012)), report and recommendation adopted, 2016 WL 6879258 (S.D.N.Y. Nov. 21, 2016).
New York's prejudgment interest rate is 9% per annum, see CPLR § 5004, and is computed "on a simple interest basis." Marfia v. T.C. Ziraat Bankasi, 147 F.3d 83, 90 (2d Cir. 1998). "Where such damages were incurred at various times, interest shall be computed upon each item from the date it was incurred or upon all of the damages from a single reasonable intermediate date." CPLR § 5001(b); see also Marfia, 147 F.3d at 91 ("New York law leaves to the discretion of the court the choice of whether to calculate prejudgment interest based upon the date when damages were incurred or 'a single reasonable intermediate date,' which can be used to simplify the calculation."). In NYLL cases, courts often calculate prejudgment interest from the midpoint of the plaintiff's employment. See Gunawan v. Sake Sushi Rest., 897 F.Supp.2d 76, 93 (E.D.N.Y. 2012) (collecting cases). The median date of the period for which plaintiff is owed damages is February 25, 2017. Interest has been accruing since that date at the rate of $47.13 per day ($191,154 x .09/365), and will continue to accrue at that rate until judgment is entered.
F. Attorneys' Fees and Costs
Ramirez was represented throughout this litigation by Michael Samuel and Andrew Beresin of Samuel & Stein, who request a total of $4,582 in attorneys' fees. Prop. Findings at 8, ¶ 30. Both the FLSA and the NYLL allow a successful plaintiff to recover reasonable attorneys' fees. 29 U.S.C. § 216(b); NYLL §§ 198, 663. To determine a "presumptively reasonable fee," the court multiplies the hours counsel reasonably spent on the litigation by a reasonable hourly rate. Millea v. Metro-North R. Co., 658 F.3d 154, 166 (2d Cir. 2011) (citing Arbor Hill Concerned Citizens Neighborhood Assoc. v. Cnty. of Albany, 522 F.3d 182, 183 (2d Cir. 2008)). "The presumptively reasonable fee boils down to what a reasonable, paying client would be willing to pay, given that such a party wishes to spend the minimum necessary to litigate the case effectively." Simmons v. New York City Transit Auth., 575 F.3d 170, 174 (2d Cir. 2009) (internal quotations omitted).
1. Reasonable Hourly Rate
In determining whether an hourly rate is reasonable, "the court should apply the prevailing rate within the district for similar services by lawyers of comparable experience and skill." Galeana v. Lemongrass on Broadway Corp., 120 F.Supp.3d 306, 323 (S.D.N.Y. 2014) (citing Gierlinger v. Gleason, 160 F.3d 858, 882 (2d Cir. 1998)). Attorney Samuel, who had 15 years of experience litigating wage and hour cases (as of March 25, 2022), seeks a rate of $450 per hour; attorney Beresin, who had three years of wage and hour litigation experience (as of March 25, 2022), seeks a rate of $325 per hour. Prop. Findings at 7, ¶ 30.
Courts within this District typically "award fees [at] rates between $250.00 and $450.00 per hour in FLSA cases, deeming the upper range appropriate for the most experienced FLSA litigators." Lee v. Mani & Pedi Inc., 2022 WL 3645118, at *4 (S.D.N.Y. Aug. 24, 2022). In a recent wage and hour case involving the same lawyers now before this Court, the Hon. Lewis J. Liman, United States District Judge, found a $450 hourly rate for attorney Samuel and a $400 hourly rate for attorney Beresin to be reasonable. See Rodriguez v. New Generation Hardware Store Corp., 2023 WL 1516908, at *5 (S.D.N.Y. Feb. 3, 2023). I concur that $450 per hour is reasonable for Samuel, and since Beresin seeks $75 less per hour than he received in Rodriguez, I find his $325 per hour rate to be reasonable as well.
Rodriguez was filed in 2022. Thus, attorney Beresin was somewhat more experienced when he worked on that case than when he worked on the instant action in 2020 and 2021.
2. Reasonable Hours
An application for attorneys' fees must include "contemporaneous time records" that specify "the date, the hours expended, and the nature of the work done." Raja v. Burns, 43 F.4th 80, 87 (2d Cir. 2022) (quoting New York State Ass'n for Retarded Children, Inc. v. Carey, 711 F.2d 1136, 1148 (2d Cir. 1983)). In this case, counsel's original default papers include a dated time log reflecting that Samuel spent 3 hours and 50 minutes working on this case and that Beresin spent 6 hours and 40 minutes on this case, for a lodestar of $3,891.67. Samuel Aff ¶ 23 & Ex. G (Dkt. 237) at ECF p. 1. In his inquest materials, plaintiff requests another $715 in fees, reflecting the additional 2 hours and 12 minutes of work performed by Beresin in connection with plaintiff's proposed findings of fact and conclusions of law. Prop. Findings at 8, ¶ 30. In total, plaintiff's attorneys worked for 12 hours and 42 minutes on this case, for which they seek an award of $4,582 in fees. Id. The time spent by plaintiff's counsel in this action - including the work needed to move for a default judgment and comply with my inquest requirements - is reasonable. See Zhen Ming Chen v. Y Cafe Ave B Inc., 2019 WL 2324567, at *5 (S.D.N.Y. May 30, 2019) (28.4 hours of work were reasonable in an FLSA/NYLL case in which defendants defaulted); Tackie, 2014 WL 4626229, at *7 (25.29 hours were reasonable in an FLSA/NYLL case in which defendants defaulted). Thus, plaintiff should receive the full $4,582 that he requests in attorneys' fees.
$3,891.67 plus $715 equals $4,606.67, not $4,582. Thus, counsel appear to have shorted themselves $24.67. The Court declines to correct this error.
3. Costs
In addition to attorneys' fees, plaintiff is entitled to an award of $492 in costs, reflecting the filing fee for this action and a service fee of $92, for which plaintiff submitted an invoice. Samuel Aff ¶ 24 & Ex. H (Dkt. 23-8).
III. CONCLUSION
For the reasons set forth above, I recommend, respectfully, that plaintiff be awarded damages in the aggregate amount of $387,382, against both defendants, comprising: (a) $175,158 in compensatory damages for defendants' failure to pay required minimum and overtime wages; (b) $175,158 in liquidated damages for the wage violations; (c) $15,996 for defendants' failure to provide "spread of hours" pay; (d) $15,996 in liquidated damages for the spread of hours violations; (e) $4,582 in attorneys' fees; and (f) $492 in costs, plus prejudgment interest in the amount of $47.13 per day from February 25, 2017 to the date of entry of final judgment.
The Clerk of Court is respectfully directed to mail copies of this Report and Recommendation to the defaulted defendants, addressed as follows:
Sake II Japanese Restaurant, Inc.
Bi Shun Dong c/o Sake II Japanese Restaurant
690 E. 187th Street
Bronx, NY 10458
NOTICE OF PROCEDURE FOR FILING OF OBJECTIONS TO THIS REPORT AND RECOMMENDATION
The parties shall have fourteen days from the service of this report and recommendation to file written objections pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure. See also Fed.R.Civ.P. 6(a), (d). A party may respond to another party's objections within fourteen days after being served with a copy. Fed.R.Civ.P. 72(b)(2). Any such objections shall be filed with the Clerk of the Court, with courtesy copies delivered to the Hon. Jennifer L. Rochon at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, New York, New York 10007. Any request for an extension of time to file objections must be directed to Judge Rochon. Failure to file timely objections will result in a waiver of such objections and will preclude appellate review. See Thomas v. Arn, 474 U.S. 140, 155 (1985); Frydman v. Experian Info. Sols., Inc., 743 Fed.Appx. 486, 487 (2d Cir. 2018) (summary order); Wagner & Wagner, LLP v. Atkinson, Haskins, Nellis, Brittingham, Gladd & Carwile, P.C., 596 F.3d 84, 92 (2d Cir. 2010).