United States District Court, W.D. Louisiana, Lafayette Division
REPORT AND RECOMMENDATION
B. WHITEHURST, UNITED STATES MAGISTRATE JUDGE
the undersigned, on referral from the district judge, is a
Rule 12(b)(6) Motion To Dismiss filed by Defendant Conrad
Industries Inc. (“Conrad”) [Rec. Doc. 14], an
Opposition filed by Plaintiffs, Luis Vasquez Sanchez
(“Sanchez”) and Jesus Elias Sanchez Escobar
(“Escobar”), on behalf of themselves and other
persons similarly situated [Rec. Doc. 16], and Conrad's
Reply thereto [Rec. Doc. 19]. Defendants move the Court for
dismissal of Plaintiffs claims under the Fair Labor Standards
Act, 29 U.S.C. § 201, et seq. (“FLSA”). For
the reasons set out below, it is recommended that
Defendant's Motion To Dismiss be denied.
case involves two Plaintiffs' allegations of unpaid wages
in violation of the Fair Labor and Standard Act,
(“FLSA”), 29 U.S.C. § 203. Plaintiffs both
allege that they were hired by Conrad as
“employees” as that term is defined in the FLSA,
29 U.S.C. § 203(e). Conrad is a corporation in the
business of boat construction and the owner and/or operator
of shipyards. R. 1, ¶¶ 23, 24. Plaintiffs were
hired to work as painters and blasters on Conrad's ships
located in its shipyards in St. Mary Parish, Louisiana.
Id. at ¶¶ 14, 15, 17, 19, 20, 22.
Plaintiffs allege that Sanchez was employed from
approximately June 2012 to February 2015 and Escobar from
approximately September 2013 to July 2015. Id. at
allege they were paid $18.00 per hour at the beginning of
their employment and then $20.00 per hour for the remainder
of their employment. They further allege they were paid a
rate of $20.00 at the beginning and then $22.00 for every
hour worked in excess of 40 in a work week-rather than
overtime of one and one half times their hourly rate.
Id. at ¶¶ 16, 21. They allege they worked
on average 70 hours per week. Id. at ¶ 32.
Plaintiffs further allege that Conrad specifically issues
identification cards to all workers and supervised and
documented their hours of work at its shipyards, but uses
third party labor brokers to avoid paying them overtime of
one and one half times their hourly rate for hours they work
over 40 per week. Id. at ¶¶ 25, 26, 31,
maintain that Conrad willfully violated their rights under
the FLSA because it knew or showed reckless disregard for the
fact that Conrad's use of third-party labor brokers to
avoid paying them overtime violated the FLSA. Id. at
¶ 33. Further, Plaintiffs contend that Conrad wrongly
treated other similarly situated employees as exempt from the
FLSA's overtime requirements by paying them through third
party labor brokers. Id. at ¶¶ 34-36.
Accordingly, Plaintiffs filed this action on August 20, 2017,
seeking to recover unpaid overtime wages, interest,
liquidated damages, and attorneys' fees and costs on
behalf of themselves and other similarly situated employees
who worked for Defendants.
OF THE PARTIES
contends that Plaintiffs have not provided factual support
sufficient under the “economic reality” test to
show that an employer-employee relationship existed between
Plaintiffs and Conrad. In particular it contends that
Plaintiffs have failed to sufficiently allege Conrad was
their employer; that Plaintiffs' activities were covered
by the FLSA; that Conrad violated the FLSA; and the amount of
overtime compensation due. Conrad states that it has no
record of Plaintiffs ever working on their shipyards. Conrad
further contends that Plaintiff's allegations of the use
of unnamed labor brokers is beyond the scope of the FLSA.
argue that their Complaint meets each of the “economic
reality” test's requirements for alleging a claim
for unpaid overtime wages under the FLSA. Plaintiffs further
argue that Conrad's attempt to have the collective action
dismissed is premature, as certification has not yet
occurred. Finally, Plaintiff's assert that their
allegations as to the third party labor brokers is support
for their claims of repeated violations of the FLSA, and not
a separate cause of action as Conrad suggests.
Federal Rules of Civil Procedure permit a defendant to seek
dismissal of a complaint based on the "failure to state
a claim upon which relief can be granted." FED. R. CIV.
P. 12(b)(6). However, a motion to dismiss under Rule 12(b)(6)
"is viewed with disfavor and is rarely granted."
Turner v. Pleasant, 663 F.3d 770, 775 (5th Cir.
2011). Dismissal is appropriate only if the complaint fails
to plead "enough facts to state a claim to relief that
is plausible on its face." Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007). To satisfy this
standard, the complaint must provide more than conclusions,
but it "need not contain detailed factual
allegations." Colony Ins. Co. v. Peachtree Constr.,
Ltd., 647 F.3d 248, 252 (5th Cir. 2011). Yet, it must
allege enough facts to move the claim "across the line
from conceivable to plausible." Twombly, 550
U.S. at 570. Determining whether the plausibility standard
has been met is "a context-specific task that requires
the reviewing court to draw on its judicial experience and
common sense." Ashcroft v. Iqbal, 556 U.S. 662,
FLSA provides that “[a]ny employer who violates the
provisions of section 6 or section 7 of the Act ... shall be
liable to the employee or employees affected in the amount of
... their unpaid minimum wages, or their unpaid overtime
compensation.” 29 U.S.C. § 216(b). “An
employee bringing an action for unpaid overtime compensation
must first demonstrate by a preponderance of the evidence:
(1) that there existed an employer-employee relationship
during the unpaid overtime periods claimed; (2) that the
employee engaged in activities within the coverage of the
FLSA; (3) that the employer violated the FLSA's overtime
wage requirements; and (4) the amount of overtime
compensation due.” Johnson v. Heckmann Water Res.
(CVR), Inc., 758 F.3d 627, 630 (5th Cir. 2014). Here,
Conrad essentially argues that Plaintiffs have failed to
sufficiently state a claim for relief under the FLSA as to
(1) the existence of an employer-employee relationship and
(2) violation of FLSA's overtime wage requirements. The
Court will address these issues as follows.
The Employer-Employee ...