United States District Court, E.D. Louisiana
DESIREE BERGERON ET AL.
OCHSNER HEALTH SYSTEM ET AL.
ORDER & REASONS
M. AFRICK UNITED STATES DISTRICT JUDGE.
the Court is defendants' partial motion to dismiss the
named plaintiffs' third amended complaint
(“complaint”). The named plaintiffs
oppose the motion. For the foregoing reasons, the
Court will grant the motion in part and deny it in part.
named plaintiffs are current and former employees of
defendants Ochsner Health System and Ochsner Clinic
“Ochsner”). They include certified registered nurse
anesthetists, registered nurses, and nurse first
assistants-all full-time hourly positions involved in direct
nutshell, the named plaintiffs allege that Ochsner underpaid
them and similarly situated employees. In fact, Ochsner
has made partial payments of owed back wages.
to the named plaintiffs, for a number of years Ochsner failed
to correctly calculate employee weekly pay-both regular and
overtime-by excluding “shift differentials” and
“hourly on-call and callback pay” from
employees' regular rates of pay. Moreover, the named
plaintiffs allege that Ochsner “automatically
deduct[ed] lunch periods” from employees' shift
times even when employees worked during those periods, which
likewise shortchanged employees come payday.
named plaintiffs also allege that Ochsner failed to pay some
employees stipends and bonuses that Ochsner had agreed to pay
them. They further contend that these stipends
and bonuses should have been included in employees'
regular rates of pay for purposes of calculating overtime
pay, and that their exclusion from regular rates of pay
undervalued the overtime that employees were
named plaintiffs brought this lawsuit against Ochsner on
behalf of themselves, as well as similarly situated current
and former Ochsner employees. They allege that Ochsner's
underpayment of employees violated both the Fair Labor
Standards Act (“FLSA”) and the Employee
Retirement Income Security Act of 1974 (“ERISA”),
as well as Louisiana law. They seek to assert their FLSA
claims as a collective action under the FLSA, and assert
their ERISA and Louisiana law claims as class actions under
Rule 23 of the Federal Rules of Civil Procedure.
Federal Rule of Civil Procedure 12(b)(6), a district court
may dismiss a complaint, or any part of it, where a plaintiff
has not set forth well-pleaded factual allegations that would
entitle him to relief. See Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007); Cuvillier v.
Taylor, 503 F.3d 397, 401 (5th Cir. 2007). A
plaintiff's factual allegations must “raise a right
to relief above the speculative level.”
Twombly, 550 U.S. at 555. In other words, a
complaint “must contain sufficient factual matter,
accepted as true, to ‘state a claim to relief that is
plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 570)).
facially plausible claim is one where “the plaintiff
pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.” Iqbal, 556 U.S. at
678. If the well-pleaded factual allegations
“do not permit the court to infer more than the mere
possibility of misconduct, ” then “the complaint
has alleged-but it has not ‘show[n]'-‘that
the pleader is entitled to relief.'” Id.
at 679 (quoting Fed.R.Civ.P. 8(a)(2)) (alteration in
Rule 12(b)(6) motion to dismiss, a court limits its review
“to the complaint, any documents attached to the
complaint, and any documents attached to the motion to
dismiss that are central to the claim and referenced by the
complaint.” Lone Star Fund V (U.S.), L.P. v.
Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010);
see also Spivey v. Robertson, 197 F.3d 772, 774 (5th
Cir. 1999). In assessing the complaint, the Court must accept
all well-pleaded factual allegations as true and liberally
construe all such allegations in the light most favorable to
the plaintiff. Spivey, 197 F.3d at 774; Lowrey
v. Tex. A&M Univ. Sys., 117 F.3d 242, 247 (5th Cir.
1997). Where “the complaint ‘on its face show[s]
a bar to relief, '” then dismissal is the
appropriate course. Cutrer v. McMillan, 308 Fed.
App'x. 819, 820 (5th Cir. 2009) (quoting Clark v.
Amoco Prod. Co., 794 F.2d 967, 970 (5th Cir. 1986)).
seeks partial dismissal of the named plaintiffs'
complaint. Specifically, Ochsner seeks dismissal of the named
plaintiffs' Louisiana Wage Payment Act
(“LWPA”) claims; state law claims to the extent
that they request unpaid overtime wages; and all ERISA
claims. Ochsner also seeks to strike the named
plaintiffs' state law class action
allegations. Lastly, Ochsner suggests that the
possibility of double recovery by the named plaintiffs at the
end of the litigation warrants the dismissal of certain
Court will address each of Ochsner's arguments in turn.
argues that the named plaintiffs' claims under the LWPA
should be dismissed for failure to make demand for payment
prior to the commencement of the present
litigation. For their part, the named plaintiffs
contend in their complaint that the complaint itself
“serves as amicable demand” in satisfaction of
LWPA's main purpose “is to compel an employer to
pay the earned wages of an employee promptly after his
dismissal or resignation and to protect discharged Louisiana
employees from unfair and dilatory wage practices by
employers.” Slaughter v. Bd. of Supervisors of S.
Univ. and Agric. and Mech. College, 76 So.3d 438, 446
(La. Ct. App. 1st Cir. 2011). To that end, the LWPA obligates
an employer to quickly pay an employee whatever amount the
employee is due upon her discharge or resignation. La. R.S.
§ 23:631(A)(1)(a)-(b); see also Becht v. Morgan
Building & Spas, Inc., 843 So.2d 1109, 1111 (La.
2003) (noting that the LWPA “creates liability for an
employer who fails to timely pay wages owed to an employee
after the employee voluntarily [or involuntarily] leaves
employment”). To state a claim for unpaid wages under
the LWPA, an employee must allege “i) that [the
defendant] was her employer, ii) that the employee/employer
relationship ceased to exist, iii) that at the time that the
employee/employer relationship ended she was owed wages, and
iv) that [the defendant] failed to submit the owed wages
within the statutorily mandated 15 days.” Dillon v.
Toys R Us-Delaware Corp., No. 2016-0983, 2017 WL
2351490, at *2 (La. Ct. App. 4th Cir. May 31, 2017).
LWPA also punishes employers who fail to promptly pay their
any employer who fails or refuses to comply with [that
obligation] shall be liable to the employee either for ninety
days wages at the employee's daily rate of pay, or else
for full wages from the time the employee's demand for
payment is made until the employer shall pay or tender the
amount of unpaid wages due to such employee, whichever is the
lesser amount of penalty wages.
Id. § 23:632(A). In addition to penalty wages,
the LWPA provides that a court shall award
“[r]easonable attorney fees” to an employee who
files a “well-founded suit for any unpaid wages
whatsoever, ” as long as the employee waits at least
three days between “making the first demand following
discharge or resignation” and filing suit. Id.
Louisiana Supreme Court has held that “[i]n order to
recover penalty wages and attorney's fees under [the
LWPA], the claimant must show that (1) wages were due and
owing; (2) demand for payment was made where the employee was
customarily paid; and (3) the employer did not pay upon
demand.” Becht, 843 So.2d at 1112; see
also Wortham v. Acadia Healthcare, LLC, 160 So.3d 602,
605 (La. Ct. App. 3rd Cir. 2015) (noting that a plaintiff
“has the burden of proving” each of the elements
of the Becht standard); cf. Alumbaugh v. Global
Data Sys., Inc., No. 08-1281, 2008 WL 5377673, at *6
(La. Ct. App. 1st Cir. 2008) (concluding that plaintiff made
a prima facie showing that penalty wages were owed
under the Becht standard, because plaintiff
“made written demand” to defendant's
“Payroll Administrator/Human Resources for [defendant]
at [defendant's] place of business”). “Being
penal in nature, ” the penalty wages provision of the
LWPA “must be strictly construed” and
“yield to equitable defenses.” Kaplon v.
Rimkus Consulting Grp., Inc., of La., 39 So.3d 725, 733
(La. Ct. App. 4th Cir. 2010). For example, a court cannot
award penalty wages where a “bona fide dispute exists
over the amount of wages due.” Id.
starters, demand is not required to assert a claim for unpaid
wages under the LWPA. See La. R.S. §
23:631(A)(1)(a)-(b); Schuyten v. Superior Sys.,
Inc., 952 So.2d 98 (La. Ct. App. 1st Cir. 2007)
(“The duty to pay the actual wages due is not dependent
on the employee making a demand for payment.”); see
also Dillon, 2017 WL 2351490, at *2 (explaining the
elements of a LWPU unpaid wages claim). As such, an
employee's alleged failure to make demand prior to filing
suit does not merit dismissal of an LWPA claim for unpaid
for penalty wages and attorney's fees is a different
matter, as demand is required to recover them. See
Becht, 843 So.2d at 1112 (explaining the elements of a
claim for penalty wages and attorney's fees under the
LWPA). The named plaintiffs do not dispute that they did not
make a pre-suit demand for wages. Rather, they argue that the
filing of the complaint itself constitutes making the
statutorily required demand on Ochsner.
one of the elements of a claim for penalty wages and
attorney's fees- on which the named plaintiffs have the
burden of proof-is that “demand for payment was made
where the employee was customarily paid.”
Id. (emphasis added). Suffice it to say,
Ochsner's employees are not customarily paid in Section I
of the U.S. District Court at 500 Poydras Street. As such,
the named plaintiffs have failed to allege facts necessary to
support a required element of a claim for penalty wages and
attorney's fees-and so they have failed to state a claim
upon which relief can be granted. Therefore, the Court will
dismiss the named plaintiffs' claims for penalty wages
and attorney's fees under the LWPA.
Ochsner argues that the named plaintiffs' state law
claims, including the remaining LWPA claims, should be
dismissed to the extent that those claims seek payment of
overtime wages. According to Ochsner, Louisiana law does not
mandate the payment of overtime wages and such
wages cannot be recovered via the named plaintiffs' state
review of the complaint reveals that the named plaintiffs
explicitly exclude payment of unpaid overtime wages from the
damages sought pursuant to those state law
claims. The named plaintiffs have therefore
addressed Ochsner's concern.
also argues that the Court should dismiss the named
plaintiffs' ERISA claims. The named plaintiffs allege
that Ochsner 1) breached its fiduciary duty under ERISA by
failing to credit overtime compensation and other wages
toward employees' benefits under the Ochsner-sponsored
employee benefit plan (“plan”), and 2) failed to
maintain accurate plan records as required by ERISA. (Ochsner
does not argue that the plan is not subject to ERISA.)
contends that, even if the named plaintiffs' allegations
are true and Ochsner withheld wages and overtime
compensation, “this was a corporate business
decision” and not a decision that Oschner made in the
capacity of an ERISA fiduciary. Moreover, Ochsner argues
that the named plaintiffs base their ERISA recordkeeping
claim on Ochsner's alleged “failure to record
and/or report all of the hours worked, ” although they
admit that benefits under the plan were based on
compensation, not hours. Lastly, Ochsner asserts that-even if
the named plaintiffs have stated otherwise viable ERISA
claims-the named plaintiffs did not exhaust their
administrative remedies prior to filing the present action.
enacted ERISA to ‘protect . . . the interests of
participants in employee benefit plans and their
beneficiaries' by setting out substantive regulatory
requirements for employee benefit plans and to
‘provid[e] for appropriate remedies, sanctions, and
ready access to the Federal courts.'” Aetna
Health Inc. v. Davila, 542 U.S. 200, 208 (2004) (quoting
29 U.S.C. § 1001(b)) (alteration in original). To that
end, ERISA provides that a plan fiduciary “shall
discharge his duties with respect to a plan solely in the
interest of the participants and beneficiaries, ” as
well as “for the exclusive ...