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Smith v. Dasuya Enterprises, LLC

United States District Court, E.D. Louisiana

January 14, 2020

CRYSTAL SMITH, ET AL.
v.
DASUYA ENTERPRISES LLC, ET AL.

         SECTION: “J” (1)

          ORDER & REASONS

          CARL J. BARBIER, UNITED STATES DISTRICT JUDGE

         Before the Court are a Motion to Conditionally Certify FLSA Collective Action and to Facilitate Notice (Rec. Doc 67) filed by Plaintiffs Crystal Smith and Tiffany Earin, an opposition thereto (Rec. Doc. 72) filed by all Defendants, and a reply (Rec. Doc. 81) by Plaintiffs. Having considered the motion and memoranda, the record, and the applicable law, the Court finds that the motion should be GRANTED.

         FACTS AND PROCEDURAL BACKGROUND

         This is a collective action filed by Plaintiffs under the Fair Labor Standards Act of 1938 (“FLSA”), 29 U.S.C. § 201 et seq. Plaintiffs bring this suit on behalf of themselves and all others similarly situated to recover allegedly unpaid minimum wages and overtime wages for work they performed for Defendant Dasuya Enterprises, LLC (“Dasuya”), which owns or operates Subway franchises in New Orleans and Jefferson Parish. Dasuya was allegedly founded in 2014 by Defendants Minakshi Pandit and Hanu Kaushal in order for Kaushal and his wife, Defendant Sandal Kaushal, to operate a Subway restaurant on Jefferson Highway. Defendant Rohin Sharma is alleged to be the owner of the franchise agreement for that location and to have been involved in the day-to-day operation of the business along with his wife, Defendant Harpreet Sharma. At some point in 2018, after this lawsuit was filed, Minakshi Pandit and Hanu Saushal were removed as members of Dasuya and Rohin Sharma became the sole member of Dasuya. In July 2018, Rohin Sharma and Minakshi Pandit are alleged to have transferred their interest in Dasuya to Defendants Jasbir Kaur and Narinder Singh, who currently operate the business.

         Plaintiffs allege that they and their coworkers were employed by Defendants as hourly employees and were regularly required to work off the clock hours, for which they were not paid. Plaintiffs further allege that they and their coworkers regularly worked in excess of forty hours per week. Plaintiffs claim that Defendants willfully failed to pay them and other similarly situated employees for every hour worked, thereby reducing their rate of pay to below the federal minimum wage, in violation of 29 U.S.C. § 206, and willfully failed to pay overtime wages for hours worked in excess of forty hours per week, in violation of 29 U.S.C. § 207. Accordingly, Plaintiffs seek to recover unpaid wages, interest, liquidated damages, and reasonable attorney's fees and costs on behalf of themselves and other similarly situated employees who worked for Defendants during the past three years.

         Plaintiffs also assert individual claims against Defendants. Plaintiff Smith brings a retaliation claim for her termination allegedly because she attempted to make a worker's compensation claim. Plaintiff Earin asserts a pregnancy discrimination claim challenging her termination. Finally, both Smith and Earin assert a claim for failure to pay final wages.

         PARTIES' ARGUMENTS

         Plaintiffs seek to maintain their FLSA claim as a collective action pursuant to 29 U.S.C. § 216(b) and move the Court to conditionally certify a collective class of Defendants' employees limited to the following:

All persons employed by Defendants since December 2016 who were paid on an hourly basis but were required to work off the clock hours for which they were not paid, thereby depriving them of the federal minimum wage and/or were not paid at an overtime rate of one and one-half times their hourly rate of pay for each hour worked in excess of 40 per week in violation of the Fair Labor Standards Act, 29 U.S.C. 201, et seq.[1]

         Plaintiffs argue that the allegations in their pleadings as well as their attached sworn declarations[2] demonstrate clear violations of the FLSA attributable to Defendants' policies and practices that applied to all hourly employees. Plaintiffs contend that this information establishes that there is a group of similarly situated individuals entitled to receive notice of this lawsuit. Plaintiffs request that the Court approve the proposed notice and opt-in form, allow Plaintiffs to notify potential opt-in plaintiffs, and direct Defendants to provide the names, telephone numbers, email addresses, and last known mailing addresses of potential opt-in members.

         Defendants oppose conditional certification, arguing that Plaintiffs are not covered by the FLSA. They contend that enterprise coverage does not apply because none of the Defendants have had a gross revenue exceeding $500, 000 and that individual coverage does not apply because Plaintiffs were not engaged in interstate commerce.

         In their reply, Plaintiffs first contend that the Court should not consider merits-based arguments on FLSA coverage at the conditional certification stage. Plaintiffs next argue that they are covered individually by the FLSA because they handled credit card, check, and cash transactions that originated from out of state and also used materials and equipment that originated from out-of-state vendors. Finally, Plaintiffs assert that Defendants have provided no evidence of their income to demonstrate that enterprise coverage does not apply.[3]

         LEGAL STANDARD

         The FLSA “establishes the general rule that employees must receive overtime compensation at one and one-half times the regular rate for hours worked in excess of 40 hours during a seven-day workweek.” McGavock v. City of Water Valley, 452 F.3d 423, 424-25 (5th Cir. 2006) (citing 29 U.S.C. § 207). The FLSA affords workers a right of action for violations of this rule. 29 U.S.C. § 216(b). Such workers may sue individually or collectively on behalf of “themselves and other employees similarly situated.” Id. “District courts are provided with discretionary power to implement the collective action procedure through the sending of notice to potential plaintiffs.” Lima v. Int'l Catastrophe Sols., Inc., 493 F.Supp.2d 793, 797 (E.D. La. 2007). The notice must be “timely, accurate, and informative.” Id. (citing Hoffman-La Roche, Inc., ...


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