George Hallak v. L3 Communications Corp.

490 F. App'x 2

• Court: Court of Appeals for the Ninth Circuit
• Decided: June 14, 2012
• Docket: 10-56100
• Status: Unpublished

Opinion

MEMORANDUM **

Plaintiffs appeal from the district court’s final judgment and orders dismissing their complaint with prejudice and without leave to amend. We affirm. Because the parties are familiar with the factual and procedural history of this case, we need not recount it here.

I

The district court did not err in concluding that the plaintiffs’ claims under the Fair Labor Standards Act of 1938 (“FLSA”), 29 U.S.C. § 201 et seq., are barred by the two-year statute of limitations on collective actions imposed by 29 U.S.C. § 255(a). Plaintiffs argue that the statute of limitations for collective actions under the FLSA is not applicable because their suit was filed as a consolidated action, not a collective action.

The term “collective action” is not defined under the FLSA. Legislative history, however, “indicates that Congress intended the term to apply only to a representative action.” Gray v. Swanney-McDonald, Inc., 436 F.2d 652, 655 (9th Cir. 1971); see also id. (“The Conference Report states that a ‘collective action [is] an action brought by an employee or employees for and in behalf of himself or themselves and other employees similarly situated’ ”) (quoting H.R.Rep. No. 326, 80th Cong., 1st Sess. p. 14) (alteration and emphasis in original).

The record shows that this action was brought in the name of plaintiffs who were suing in a representative capacity. The presence of blank spaces in the lists of plaintiffs filed with the district court and sent to the defendants suggests that plaintiffs intended to provide for future joinder of additional parties. Indeed, the caption contains numerous blank spaces for party names. As the district court observed, the possibility of such future joinder “would necessarily imply that the current plaintiffs are proceeding on their behalf.” Cf. Gray, 436 F.2d at 655 ((classifying FLSA suit brought by 12 tow truck drivers as a consolidated action because it “was not brought for the benefit of unnamed plaintiffs”) (emphasis added)). Plaintiffs themselves emphasized the representative nature of their suit in the record below. In a declaration opposing summary judgment, George Hallak, the only individual plaintiff whose name appeared in the caption of the complaint, described himself as the “lead plaintiff in this action.” Apart from Hal-lak’s declarations, no other individual claims appear anywhere in the record.

Furthermore, the district court judge originally assigned to this case issued a removal order that characterized the suit as an FLSA collective action. Plaintiffs never filed any motions contesting this characterization. Indeed, plaintiffs did not suggest that their suit was anything but a collective action until after defendants moved to dismiss their complaint because they had failed to meet the statutory deadline to file written consents from all individual plaintiffs represented in their suit. Because the statute of limitations to file a collective action had already run, plaintiffs could maintain their suit only by arguing that it was a consolidated action.

Given all of these factors, the district court did not err in classifying this case as a collective action.

II

The district court did not err in dismissing the fraud claim. Plaintiffs’ the ory was that the defendants committed fraud by leading plaintiffs to believe they were independent contractors rather than employees. However, fraud cannot be predicated upon misrepresentations of law. Miller v. Yokohama Tire Corp., 358 F.3d 616, 621 (9th Cir.2004).

Misrepresentations of law can result in actionable fraud in only “four special situations”: when “the party making the misrepresentation (1) purports to have special knowledge; (2) stands in a fiduciary or similar relation of trust and confidence to the recipient; (3) has successfully endeavored to secure the confidence of the recipient; (4) or has some other special reason to expect that the recipient will rely on his opinion.” Id.

None of these exceptions apply in the present case. Plaintiffs argue that the defendants were in a fiduciary relationship with their employees because the work environment was isolated. But there is no authority to support the proposition that working in a remote location creates a special fiduciary relationship that would overcome the general rule that misrepresentations of law do not constitute actionable fraud.

Ill

The district court did not abuse its discretion in denying plaintiffs leave to amend. Plaintiffs’ suit was properly classified as a collective action under the FLSA and therefore barred, due to their failure to timely file the required written consents from all individual plaintiffs. Thus, any attempt by plaintiffs to amend their FLSA claims would be futile.

Nor have plaintiffs suggested any amendments to their complaint that would save their fraud claims. Even in their proposed Second Amended Complaint, plaintiffs do not plead plausible allegations that could conceivably allow them to take refuge in any of the exceptions to the general rule that misrepresentations of law cannot form the basis of a fraud action. Accordingly, the district court did not abuse its discretion in denying leave to amend.

AFFIRMED.

** This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.