Buchanan v. Watkins & Letofsky, LLP

• Court: District Court, D. Nevada
• Decided: March 29, 2021
• Docket: 2:19-cv-00226
• Status: Unknown

Opinion

1 UNITED STATES DISTRICT COURT

2 DISTRICT OF NEVADA

3 AMY BUCHANAN, ) 4 ) Plaintiff, ) Case No.: 2:19-cv-00226-GMN-VCF 5 vs. ) ) ORDER 6 WATKINS & LETOFSKY, LLP, a Nevada ) 7 Limited Liability Partnership, ) ) 8 Defendant. )

9 10 Pending before the Court is Defendant Watkins & Letofsky, LLP’s (W&L’s) Motion for 11 Summary Judgment, (ECF No. 28). Plaintiff Amy Buchanan (“Plaintiff”) filed a Response, 12 (ECF No. 33), and W&L filed a Reply, (ECF No. 34). For the reasons discussed below, the 13 Court GRANTS W&L’s Motion for Summary Judgment with respect to the federal claims and 14 REMANDS the remaining state law claims. 15 I. BACKGROUND 16 This case arises from Plaintiff’s allegations of workplace discrimination, unpaid wages, 17 and retaliation during her employment as an associate attorney with W&L, a Nevada limited 18 liability partnership and law firm. (Watkins Decl. ¶ 2, Ex. B to Mot. Summ. J. (“MSJ”), ECF 19 No. 28-3). In April 2016, Plaintiff began her employment for W&L, working on a full-time 20 basis consisting of forty-to sixty-hour work weeks, with a salary of $65,000 per year. 21 (Buchanan Dep. 141:1–4, 147:17–23, Ex. C to MSJ, ECF No. 28-4). Due to injuries sustained 22 in a motor vehicle accident, Plaintiff developed a musculoskeletal condition that causes her 23 stress, anxiety, depression, and migraine headaches, as well as inhibits her ability to sleep, think 24 clearly, and perform everyday tasks. (Buchanan Decl. ¶ 12, Ex. 1 to Resp., ECF No. 33-2). By 25 September 2016, Plaintiff’s medical condition rendered her unable to continue full-time work, 1 and Plaintiff voluntarily resigned from her position to undergo spinal surgery. (Id. ¶ 11); (2016 2 Resignation Letter, Ex. F to MSJ, ECF No. 28-7). 3 In December 2016, Plaintiff and W&L entered an agreement, under which, Plaintiff 4 would return to work on a part-time basis, limiting her workweek to twenty hours for a salary 5 of $32,500. (Buchanan Decl. ¶ 17, Ex. 1 to Resp.). Upon her return, W&L assigned Plaintiff a 6 volume of work that caused her to put in forty-to sixty-hour weeks, despite her only being paid 7 half of what full-time associate attorneys make. (Id. ¶ 19). Plaintiff also alleges W&L 8 manipulated her billable hour records in order to maintain Plaintiff’s ineligibility for 9 performance-based bonuses. (Id.). 10 On repeated occasions, W&L represented to Plaintiff that she would be paid for all hours 11 worked beyond the 20 hours per week recommended by Plaintiff’s doctor. (See, e.g., Text 12 Message, Ex. 15 to Resp, ECF No. 33-16); (Email, Ex. 7 to Resp, ECF No. 33-8). According 13 to Plaintiff, however, W&L has consistently declined to pay Plaintiff for her time and instead 14 forced her to rebate prior wages paid. (Buchanan Decl. ¶ 20, Ex. 1 to Resp.). After 15 complaining about her workload, W&L agreed to a compromise under which Plaintiff would 16 work thirty hours per week, beginning in March 2017. (Id. ¶ 21). W&L allegedly breached this 17 renewed agreement by assigning Plaintiff work requiring up to sixty hours per week. (Id. ¶ 22). 18 In May 2017, Plaintiff again expressed concerns about her workload to W&L and stated 19 that she needed to focus on her health. (May Resignation Emails WLLLP001364, Ex. G to 20 MSJ, ECF No. 28-8). W&L then placed Plaintiff on a medical leave of absence rather than 21 accommodating her request for a reduced work schedule. (Buchanan Decl. ¶ 23, Ex. 1 to 22 Resp.). At W&L’s request, Plaintiff supplied W&L with a letter from her doctor delineating

23 her work-related limitations. (Doctor Letter WLLLP001244, Ex. G to MSJ). In response, 24 W&L allegedly cancelled her health insurance. (Id.¶ 25). Once Plaintiff confronted W&L 25 about the cancellation, W&L reinstated her health insurance. (Id.). 1 Upon determining that her requests for unpaid wages were futile, Plaintiff filed a 2 complaint for wages with the Nevada Labor Commissioner (the “Labor Commissioner”). 3 (Buchanan Decl. ¶ 27, Ex. 1 to Resp.). On November 16, 2017, after acknowledging it knew of 4 the complaint with the Labor Commissioner, W&L told Plaintiff that her health insurance 5 would be canceled as of November 30, 2017. (Id.). According to Plaintiff, this “effectively 6 communicated that [her] employment was terminated as of that date.” (Id.). On September 1, 7 2018, Plaintiff filed a charge of discrimination under the Americans with Disabilities Act 8 (“ADA”) with the U.S. Equal Employment Opportunity Commission. (Charge of Discrim., Ex. 9 14 to Resp., ECF No. 33-15). 10 Plaintiff originally filed the instant action against W&L in Clark County District Court. 11 (Pet. Removal, ECF No. 1). W&L subsequently removed to this Court based on federal 12 question jurisdiction. Plaintiff’s First Amended Complaint alleges seven causes of action: (1) 13 Breach of Contract; (2) Breach of the Implied Covenant of Good Faith and Fair Dealing; (3) 14 Violation of NRS 608.190; (4) Wages Due and Owing under NRS 608.040 and NRS 608.050; 15 (5) Retaliatory Discharge in Violation of Public Policy under Nevada law; (6) Discrimination 16 under the Americans with Disabilities Act (“ADA”), 42 U.S.C § 12101, et seq.; and (7) 17 Retaliation under the ADA. (First. Am. Compl. ¶¶ 31–101, ECF No. 7). On August 15, 2019, 18 this Court dismissed Plaintiff’s fifth cause of action for retaliatory discharge. (Order, ECF No. 19 13). W&L now moves for summary judgment on the remaining claims. (See generally MSJ, 20 ECF No. 28). 21 II. LEGAL STANDARD 22 The Federal Rules of Civil Procedure provide for summary adjudication when the

23 pleadings, depositions, answers to interrogatories, and admissions on file, together with the 24 affidavits, if any, show that “there is no genuine dispute as to any material fact and the movant 25 is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). Material facts are those that 1 may affect the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 2 (1986). A dispute as to a material fact is genuine if there is a sufficient evidentiary basis on 3 which a reasonable fact-finder could rely to find for the nonmoving party. See id. “The amount 4 of evidence necessary to raise a genuine issue of material fact is enough ‘to require a jury or 5 judge to resolve the parties’ differing versions of the truth at trial.’” Aydin Corp. v. Loral 6 Corp., 718 F.2d 897, 902 (9th Cir. 1983) (quoting First Nat’l Bank v. Cities Serv. Co., 391 U.S. 7 253, 288–89 (1968)). “Summary judgment is inappropriate if reasonable jurors, drawing all 8 inferences in favor of the nonmoving party, could return a verdict in the nonmoving party’s 9 favor.” Diaz v. Eagle Produce Ltd. P’ship, 521 F.3d 1201, 1207 (9th Cir. 2008) (citing United 10 States v. Shumway, 199 F.3d 1093, 1103–04 (9th Cir. 1999)). A principal purpose of summary 11 judgment is “to isolate and dispose of factually unsupported claims.” Celotex Corp. v. Catrett, 12 477 U.S. 317, 323–24 (1986). 13 In determining summary judgment, a court applies a burden-shifting analysis. “When 14 the party moving for summary judgment would bear the burden of proof at trial, it must come 15 forward with evidence which would entitle it to a directed verdict if the evidence went 16 uncontroverted at trial. In such a case, the moving party has the initial burden of establishing 17 the absence of a genuine issue of fact on each issue material to its case.” C.A.R. Transp. 18 Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (citations omitted). In 19 contrast, when the nonmoving party bears the burden of proving the claim or defense, the 20 moving party can meet its burden in two ways: (1) by presenting evidence to negate an 21 essential element of the nonmoving party’s case; or (2) by demonstrating that the nonmoving 22 party failed to make a showing sufficient to establish an element essential to that party’s case

23 on which that party will bear the burden of proof at trial. See Celotex Corp., 477 U.S. at 323– 24 24. If the moving party fails to meet its initial burden, summary judgment must be denied and 25 1 the court need not consider the nonmoving party’s evidence. See Adickes v. S.H. Kress & Co., 2 398 U.S. 144, 159–60 (1970). 3 If the moving party satisfies its initial burden, the burden then shifts to the opposing 4 party to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. 5 Zenith Radio Corp., 475 U.S. 574, 586 (1986). To establish the existence of a factual dispute, 6 the opposing party need not establish a material issue of fact conclusively in its favor. It is 7 sufficient that “the claimed factual dispute be shown to require a jury or judge to resolve the 8 parties’ differing versions of the truth at trial.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors 9 Ass’n, 809 F.2d 626, 631 (9th Cir. 1987). However, the nonmoving party “may not rely on 10 denials in the pleadings but must produce specific evidence, through affidavits or admissible 11 discovery material, to show that the dispute exists,” Bhan v. NME Hosps., Inc., 929 F.2d 1404, 12 1409 (9th Cir. 1991), and “must do more than simply show that there is some metaphysical 13 doubt as to the material facts.” Orr v. Bank of America, 285 F.3d 764, 783 (9th Cir. 2002) 14 (internal citations omitted). “The mere existence of a scintilla of evidence in support of the 15 plaintiff's position will be insufficient.” Anderson, 477 U.S. at 252. In other words, the 16 nonmoving party cannot avoid summary judgment by relying solely on conclusory allegations 17 that are unsupported by factual data. See Taylor v. List, 880 F.2d 1040, 1045 (9th Cir. 1989). 18 Instead, the opposition must go beyond the assertions and allegations of the pleadings and set 19 forth specific facts by producing competent evidence that shows a genuine issue for trial. See 20 Celotex Corp., 477 U.S. at 324. 21 At summary judgment, a court’s function is not to weigh the evidence and determine the 22 truth but to determine whether there is a genuine issue for trial. See Anderson, 477 U.S. at 249.

23 The evidence of the nonmovant is “to be believed, and all justifiable inferences are to be drawn 24 in his favor.” Id. at 255. But if the evidence of the nonmoving party is merely colorable or is 25 not significantly probative, summary judgment may be granted. See id. at 249–50. 1 III. DISCUSSION 2 A. ADA Claims 3 Plaintiff argues that W&L denied her request for a reasonable disability accommodation, 4 and, in retaliation for making such a request, ultimately terminated her employment, in 5 violation of the Americans with Disabilities Act (“ADA”), 42 U.S.C § 12101, et seq. (Compl. 6 ¶¶ 77–101). To counter, W&L claims that the ADA is inapplicable here, because W&L has 7 less than 15 employees. (MSJ 8:17–9:25). 8 The ADA provides that “[n]o covered entity shall discriminate against a qualified 9 individual on the basis of disability in regard to . . . the hiring, advancement, or discharge of 10 employees, employee compensation, job training, and other terms, conditions, and privileges of 11 employment.” 42 U.S.C § 12112. An employer is a “covered entity” under the ADA, and an 12 employer is defined as “a person engaged in an industry affecting commerce who has 15 or 13 more employees for each working day in each of 20 or more calendar weeks in the current or 14 preceding calendar year.” 12111(2), (5)(a). In other words, the ADA is inapplicable to “very 15 small businesses.” Clackamas Gastroenterology Associates, P.C. v. Wells, 538 U.S. 440, 441 16 (2003). To determine the number of employees employed by an employer, courts utilize the 17 payroll method, which looks to whether the employer has an employment relationship with its 18 alleged employees during the time in question by identifying each individual on the payroll list. 19 See Walters v. Metro. Educ. Enters., 519 U.S. 202, 206–07 (1997) (“the employment 20 relationship is most readily demonstrated by the individual’s appearance on the employer’s 21 payroll”). 22 However, when an employer has fewer than 15 employees, plaintiffs wishing to bring a

23 claim under the ADA may assert that the employer is so interconnected with another employer 24 that the two form a single entity for the purposes of counting the total number of employees. 25 See Anderson v. Pacific Maritime Ass’n, 336 F.3d 924, 928–29 (9th Cir. 2003). While the 1 Ninth Circuit has not specifically delineated a test to determine whether two separate entities 2 are actually operating as a single employer for the purposes of the ADA, “courts generally use 3 Title VII precedent to interpret ADA claims.” See Garity v. APWU Nat’l Labor Org., 828 F.3d 4 848, 858 n.9 (9th Cir. 2016). Title VII of the Civil Rights Act of 1964 also requires employers 5 to have at least 15 employees to fall within the purview of the statute. See 42 U.S.C. § 6 2000e(b). When single employer issues arise in Title VII jurisprudence, the Ninth Circuit 7 utilizes the integrated enterprise test to determine whether two separate entities operate as a 8 single employer. See Anderson, 336 F.3d at 929. When considering the two entities, the 9 integrated enterprise test requires courts to evaluate four factors: (1) interrelation of operations; 10 (2) common management; (3) centralized control of labor relations; and (4) common ownership 11 and financial control. See Kang v. U. Lim. America, Inc., 296 F.3d 810, 815–16 (9th Cir. 2002). 12 “The third factor, centralized control of labor relations, is the ‘most critical’” to the analysis. Id. 13 (quoting Hukill v. Auto Care, Inc., 192 F.3d 437, 442 (4th Cir. 1999)). 14 Here, Plaintiff recognizes that W&L alone did not have 15 employees for the requisite 15 time period under the ADA, but asserts that W&L meets the employee minimum when 16 combined with its California affiliated firm: Watkins & Letofsky, a California Limited Liability 17 Partnership (“W&L California”). (Resp. 20:10–23:6, ECF No. 33). W&L claims that it is not 18 an integrated enterprise with W&L California for the purposes of the ADA, but even if it was, 19 W&L and W&L California never had a combined roster of 15 employees for at least 20 weeks 20 during the period at issue in this case. (Reply 13:1–17:27, ECF No. 34). 21 1. Interrelation of Operations 22 “Evidence of interrelated operations can include common offices, long distance

23 shipping, bank accounts, payroll preparation, and shared facilities.” See NLRB v. Transcon. 24 Theaters Inc., 568 F.2d 125, 129–30 (9th Cir.1978). For example, in Kang, the Ninth Circuit 25 1 found that the two entities in question had interrelated operations because they shared a facility 2 and the financial accounts used to fund payroll and bills. Kang, 296 F.3d 810, 815–16. 3 Plaintiff claims that W&L and W&L California have interrelated operations because 4 they share an email server, phone number, and website, and both LLPs handle payroll using 5 PAYCHEX, a payroll company. (Resp. 21:4–24); (Watkins Decl. ¶ 24, Ex. K to Reply). 6 However, the website address provided as evidence by Plaintiff indicates that W&L and W&L 7 California have separate offices and phone numbers: a Nevada address and phone number for 8 W&L and a California address and phone number for W&L California. See Watkins & 9 Letofsky, LLP, www.wl-llp.com (last visited March 13, 2021). Further, to show that W&L and 10 W&L California share payroll, Plaintiff cites a document from PAYCHEX, certifying the 11 number of employees employed by both W&L and W&L California. (See Employee Count 12 Records, Ex. J to MSJ, ECF No. 28-11). While this document may indicate that both W&L and 13 W&L California utilize PAYCHEX’s services for their payroll preparation, it provides no 14 evidence of any financial information demonstrating that both LLPs use the same account to 15 pay their employees or other bills. In fact, Daniel Watkins, a founding partner of both W&L 16 and W&L California, testified that the two separate business entities have separate incomes, 17 keep sperate ledgers of income and expenses, and pay their respective taxes separately. 18 (Watkins Decl. ¶ 4, Ex. K to Reply, ECF No.34-2). Without any evidence of shared facilities 19 or intermingled accounts, the interrelation of operations factor does not tip strongly in 20 Plaintiff’s favor. See Kang, 296 F.3d 810, 815–16. 21 2. Common Management 22 As to the second factor, W&L admits that both W&L and W&L California are managed

23 by Daniel Watkins and Brian Letofsky, since they are the only partners of both firms. (See 24 Reply 13:28–14:10). Accordingly, the Court finds that this factor strongly favors Plaintiff’s 25 contention that W&L and W&L California operate as a common enterprise. 1 3. Centralized Control of Labor Relations 2 The third, and “single most important factor,” equates to “day-to-day . . . control of labor 3 relations.” J.M. Tanaka Constr., Inc. v. Nat’l Labor Relations Bd., 675 F.2d 1029, 1033–34 (9th 4 Cir. 1982). This includes an assessment of who has the authority to make personnel decisions, 5 such as hiring and firing, and control daily business procedures. See, e.g., Mel O v. Flynn 6 Group, Inc., No. 2:16-cv-1712-JCM-NJK, 2018 WL 2284373, at *4 (D. Nev. Feb. 2, 2018); 7 Vandermeer v. Douglas County, 15 F. Supp. 2d 970, 977 (D. Nev. 1998). 8 Plaintiff asserts that there is a centralized control of labor relations at W&L and W&L 9 California because Daniel Watkins and Brian Letofsky make the decisions regarding 10 “employment matters,” such as “hiring and firing of employees, employee discipline, 11 performance evaluations, awards, promotions and demotions, scheduling, work assignments, 12 training, and compensation,” for both firms. (Resp. 22:8–22). However, Plaintiff neglects to 13 point to any evidence supporting these assertions. Providing mere conclusory allegations 14 without factual data, as Plaintiff has done here, is not enough to survive summary judgment. 15 See Taylor, 880 F.2d at 1045. Because of this lack of evidence, the third factor does not weigh 16 in Plaintiff’s favor to establish that W&L and W&L California are an integrated enterprise. 17 4. Common Ownership and Financial Control 18 Finally, Plaintiff claims that it is “beyond dispute” that W&L and W&L California are 19 both owned by Daniel Watkins and Brian Letofsky. (Resp. 22:23–23:2). The Court agrees that 20 W&L and W&L California are certainly owned by the same individuals. However, Plaintiff 21 has provided no financial information and does not even speculate about the financial control of 22 either firm. As noted above, Daniel Watkins testified that W&L and W&L California maintain

23 separate incomes and ledgers, making it difficult for the Court to conclude that the two firms 24 have unilateral financial control without evidence to the contrary. (Watkins Decl. ¶ 4, Ex. K to 25 Reply). Therefore, this factor does not weigh strongly in Plaintiff’s favor. 1 While Plaintiff has provided some evidence that W&L and W&L California have 2 common ownership and management, these factors alone cannot establish that the two firms are 3 a common enterprise, especially when considering that Plaintiff provided no evidence showing 4 centralized control of labor relations, which is the most probative factor in the analysis. See 5 Kang, 296 F.3d at 815–16. See also Vandermeer, 15 F. Supp. 2d at 977 (“such overlap of 6 management-level officials alone would not necessarily preclude a finding that [the two 7 entities] are separate employers”). Additionally, Plaintiff neglected to name W&L California 8 as a defendant in this case and did not proffer the integrated enterprise theory until responding 9 to the present Motion, which further weakens the argument that the two firms form a single 10 employer. See Mel O, 2018 WL 2284373, at *4. 11 In sum, Plaintiff has failed to provide enough evidence for the Court to conclude that 12 W&L and W&L California operate as an integrated enterprise, or that a genuine issue of 13 material fact exists on the matter. As such, the Court will not consider W&L and W&L 14 California to be an integrated enterprise for the purposes of the employee count under the 15 ADA; the Court will only consider the employee count at W&L in Nevada. Because W&L 16 only had two employees during 2016 and 2017, the ADA does not apply to W&L. (See Walker 17 Decl. ¶ 22, Ex. K to Reply (“During the time in question, the only people employed by W&L, a 18 Nevada limited liability partnership, included Eran Forster and Plaintiff.)). The Court grants 19 summary judgment in favor of W&L with regards to Plaintiff’s ADA claims. 20 Because the Court grants summary judgment in favor of W&L on Plaintiff’s ADA 21 claim, the only cause of action arising under federal law, there are no remaining claims over 22 which the court has original jurisdiction. While a court can exercise supplemental jurisdiction

23 over state law claims, it may decline to do so where “all claims over which it has original 24 jurisdiction” have been dismissed. 28 U.S.C. § 1367(c)(3). See also Kohler v. Flava Enterprises 25 Inc., 826 F. Supp. 2d 1221, 1232 (S.D. Cal. 2011) (declining to exercise supplemental 1 jurisdiction over the plaintiff’s remaining state law claims after granting summary judgment in 2 favor of the defendant as to the only federal claim, which arose under the ADA). Here, the 3 Court declines to exercise supplemental jurisdiction over Plaintiff’s remaining state law claims 4 and remands the case to state court. 5 IV. CONCLUSION 6 IT IS HEREBY ORDERED that W&L’s Motion for Summary Judgment, (ECF No. 7 28), is GRANTED with respect to Plaintiff’s sixth and seventh causes of action, which arise 8 under the ADA. 9 IT IS FURTHER ORDERED that this matter is REMANDED to the Eighth Judicial 10 District Court, Clark County, Nevada. The Clerk is directed to close the case. 11 DATED this _2_9___ day of March, 2021. 12 13 ___________________________________ Gloria M. Navarro, District Judge 14 United States District Court 15 16 17 18 19 20 21 22 23 24 25