United States District Court, Eastern District of Louisiana
May 4, 2015
DE IVORY SMITH, ET AL.
MANHATTAN MANAGEMENT COMPANY, LLC, ET AL.
ORDER AND REASONS
I. NATURE OF MOTION AND RELIEF SOUGHT
Before the Court is Defendants’, Manhattan Management Company, LLC and Berk-Cohen Associates, L.L.C., “Motion for Summary Judgment” (Rec. Doc. 13), which seeks dismissal of Plaintiffs’, De Ivory Smith, Marlie Trujillo, and putative class members, Fair Labor Standards Act (“FLSA”) claims under the “waiting to be engaged doctrine” and “homeworker’s exception.” Plaintiffs oppose the motion (Rec. Doc. 15), Defendants have filed a Reply (Rec. Doc. 17), and Plaintiffs have filed a Sur-Reply (Rec. Doc. 22). For reasons that follow, IT IS ORDERED THAT Defendants’ Motion is DENIED, without prejudice to re-urge following focused discovery to be pursued between the parties.
II. FACTS AND PROCEDURAL HISTORY
Plaintiffs De Ivory Smith and Marlie Trujillo resided and worked as after-hours telephone dispatchers at the Forest Isles Apartment Complex owned and operated by Defendants in Algiers, Louisiana. (Rec. Doc. 1). When the Forest Isles maintenance office is closed on nights and weekends, residents can report maintenance issues and other concerns by calling a designated telephone number or submitting an on-line service request. (Rec. Doc. 13-1 at 1). These requests are received by a dispatcher who routes the request to an appropriate service technician. Id. After-hours dispatchers, such as Plaintiffs here, are generally residents of the complex and work from their apartments. (Rec. Doc. 13-1 at 1). They are paid a flat rate of pay for each night or weekend shift in the form of a “rent credit” of $20 per weeknight shift and $40 per weekend shift. (Rec. Doc. 13-1 at 2). Plaintiffs filed the instant putative class action complaint on their own behalves and those of all similarly situated individuals who worked as “apartment dispatchers, life guards or security personnel” and were compensated under the same arrangement between September 2011 and the present. (Rec. Doc. 1). They seek recovery of compensation allegedly owed under the minimum wage and overtime provisions of the FLSA. (Rec. Doc. 1).
III. CONTENTIONS OF MOVANTS
Defendants move for summary judgment dismissing Plaintiffs’ claims under Fed.R.Civ.P. 56 on the grounds that no genuine issues of material fact exist and that they are entitled to judgment as a matter of law. Defendants argue Plaintiffs’ claims fail under the “waiting to be engaged” doctrine and the “homeworker’s exception” to the hourly rate requirements of the FLSA. They argue Fifth Circuit precedent firmly establishes that telephone dispatchers such as Plaintiffs, who work from home, and who are allegedly allowed to pursue personal and social activities while on duty, are not entitled to compensation for their idle time and may be paid a flat rate of pay. (Rec. Doc. 13-2 at 6)(citing Halferty v. Pulse Drug Co., 864 F.2d 1185 (5th Cir. 1989). In addition, Defendants argue “payment of a reasonable flat rate per shift” is proper under the “homeworker’s exception” to the FLSA. (Rec. Doc. 13-2 at 9)(citing Halferty, 864 F.2d at 1191 (quoting 29 C.F.R. § 785.23)). Finally, Defendants argue summary judgment is proper at this stage of the proceedings because the issue of whether an employee’s idle time is compensable is often a legal question, rather than a factual one, and the pleadings reveal that the parties agree as to those facts material to a determination of compensability. (Rec. Doc. 19 at 3)(citing Bright v. Houston Nw. Med. Ctr. Survivor, Inc., 934 F.2d 671, 674-75 (5th Cir. 1991)).
IV. CONTENTIONS OF OPPONENTS
In opposition, Plaintiffs argue Defendants have failed to carry their burden of proving by a preponderance of the evidence that their employees fall within an exception to the hourly rate requirements of the FLSA. (Rec. Doc. 15 at 5)(citing Vela v. City of Houston, 276 F.3d 659, 666-67 (5th Cir. 2001)). They argue that factual issues persist as to whether they are covered by the FLSA exceptions cited by Defendants and further that Defendants’ summary judgment motion is premature because discovery had not begun by the time of its filing. Should the Court conclude that the affidavit evidence submitted in connection with the instant pleadings does not reveal genuine issues of material fact, Plaintiffs request that the Court defer ruling on Defendants’ motion for summary judgment until discovery has been completed. (Rec. Doc. 15 at 18).
V. RULE 56 SUMMARY JUDGMENT STANDARD
Summary judgment is proper if the pleadings, depositions, interrogatory answers, and admissions, together with any affidavits, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56; see also Celotex Corp. v. Catrett, 477 U.S. 317, 327 (1986). A genuine issue exists if the evidence would allow a reasonable jury to return a verdict for the nonmovant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Although the Court must consider the evidence with all reasonable inferences in the light most favorable to the nonmoving party, the nonmovant must produce specific facts to demonstrate that a genuine issue exists for trial. Webb v. Cardiothoracic Surgery Assocs. of N. Texas, 139 F.3d 532, 536 (5th Cir. 1998). The moving party bears the initial responsibility of informing the district court of the basis for its motion. Celotex, 477 U.S. at 323. The movant must point to “portions of ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits’ which it believes demonstrate the absence of a genuine issue of material fact.” Id. (citing Fed.R.Civ.P. 56). If and when the movant carries this burden, the nonmovant must then go beyond the pleadings and use affidavits, depositions, interrogatory responses, admissions, or other evidence to establish a genuine issue. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). “[W]here the non-movant bears the burden of proof at trial, the movant may merely point to an absence of evidence, thus shifting to the non-movant the burden of demonstrating by competent summary judgment proof that there is an issue of material fact warranting trial. . . . Only when ‘there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party’ is a full trial on the merits warranted.” Lindsey v. Sears Roebuck and Co., 16 F.3d 616 (5th Cir. 1994). Accordingly, conclusory rebuttals of the pleadings are insufficient to avoid summary judgment. Travelers Ins. Co. v. Liljeberg Enter., Inc., 7 F.3d 1203, 1207 (5th Cir. 1993). If, however, a nonmovant shows by affidavit or declaration that, for specified reasons, it cannot present facts essential to justify its opposition, the court may: (1) defer considering the motion or deny it; (2) allow time to obtain affidavits or declarations or to take discovery; or (3) issue any other appropriate order. Fed R. Civ. P. 56(d).
The provisions of the FLSA are presumed to apply to employees such as Plaintiffs. Vela v. City of Houston, 276 F.3d 659, 666 (5th Cir. 2001). Defendants are entitled to rebut this presumption by establishing, for example, that the “waiting to be engaged” doctrine or “homeworker’s exception” applies. See Meza v. Intelligent Mexican Marketing, Inc., 720 F.3d 577, 581 (5th Cir. 2013)(“The employer must prove facts by a preponderance of the evidence that show the exemption is ‘plainly and unmistakably’ applicable.”) The critical issue in determining application of the former is “whether the employee can use [idle] time effectively for his or her own purposes.” Halferty v. Pulse Drug Co., 864 F.2d 1185, 1189 (5th Cir. 1989)(citing 29 C.F.R. §§ 785.16-.17). As to the latter, “[w]here an employee performs services for his employer at home and yet has long periods of uninterrupted leisure during which he can engage in the normal activities of living, . . . any reasonable agreement of the parties for determining the number of hours worked” is acceptable. Halferty v. Pulse Drug Co., 864 F.2d at 1190 (citing Department of Labor, Wage and Hour Administrator Opin. Letter (March 18, 1968)(Clarence T. Lunquist, Administrator)). “This agreement should take into account not only the actual time spent in answering the calls, but also some allowance for the restriction on the employee’s freedom to engage in personal activities resulting from the duty of answering the telephone.” Id.
While a determination as to an employee’s entitlement to compensation for leisure time may be largely a legal question, such legality necessarily turns on the establishment of predicate facts; namely, the employee’s job description, duties, limitations, frequency and duration of work, etc. See, e.g., Bright v. Houston Nw. Med. Ctr. Survivor, Inc., 934 F.2d 671, 674-75 (5th Cir. 1991)(en banc)(finding resolution of legal issue of compensability of “on-call time” appropriate in summary judgment context, but reviewing significantly more record evidence than presently before this Court in order to make such a determination). Defendants move the Court for summary judgment prior to the start of discovery, and prior even to the Court’s having held a Rule 16 Preliminary Conference. In support of their motion they proffer the largely conclusory declaration of Stephen Enslow, a so-called “asset manager” employed by Defendants, which purports to set forth the various living activities able to be pursued by telephone dispatchers while on call. (Rec. Doc. 13-4). Enslow largely omits any reference to the basis for his supposed personal knowledge of such activities, other than that he is “familiar with the day to day operations of Forest Isle.” Id. Plaintiffs, in turn, protest the prematurity of Defendants’ motion and offer their own declarations, which contest their ability to pursue normal living activities during on-call periods. (Rec. Docs. 15-1, 15-2). While a determination of the applicability of exceptions to the minimum wage and overtime provisions of the FLSA may certainly be properly resolved via summary proceedings, a necessary prerequisite to determining a plaintiff’s entitlement to compensation for leisure time is, of course, the establishment of the existence of any such leisure time in the first instance. In the context of the “waiting to be engaged” exception, additional evidence is then required to determine the extent to which any idle time is properly characterized as predominately for the benefit of the plaintiff or employer. As to the homeworker’s exception, the “reasonableness” of any flat-fee arrangement between the parties necessarily requires evidence beyond the mere existence of such an arrangement.
These issues alone reveal that summary judgment is inappropriate at this juncture and fact issues prevent the Court from granting Defendants’ motion. Even if the evidence presently before the Court failed to demonstrate the existence of sufficient factual disputes to prevent summary judgment, denial of Defendants’ motion would be warranted on the basis of Plaintiffs’ proper showing under Rule 56(d) of the need to conduct additional discovery and their compliance with the procedural requisites of that rule. The parties shall continue to pursue discovery and may file appropriate dispositive motions, if any, at a later date pursuant to the Court’s Scheduling Order.
In light of the marked prematurity of Defendants’ summary judgment motion and the existence of factual issues at this juncture, IT IS ORDERED THAT Defendants’ motion is DENIED. The Court does not suggest that any presently persisting evidentiary and factual issues may not be resolved prior to trial such as to permit resolution by way of an appropriate pre-trial dispositive motion, but merely that such is not the current state of affairs. The parties shall continue to pursue focused discovery, particularly with respect to issues regarding leisure time of putative class members. Defendants may re-urge their motion at an appropriate time thereafter.