Harrington v. Fb Hospitality, LLC

• Court: District Court, District of Columbia
• Decided: September 26, 2024
• Docket: Civil Action No. 2022-0689
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

BRENDAN HARRINGTON,

Plaintiff,

v. Civil Action No. 22-689 (TSC) DC WINERY, LLC d/b/a FIRST BATCH HOSPITALITY, et al.,

Defendants.

MEMORANDUM OPINION

Plaintiff Brendan Harrington sued DC Winery, LLC, along with two of its founders and

owners, Brian Leventhal and John Stires, for violations of the Fair Labor Standards Act

(“FLSA”) and the District of Columbia Minimum Wage Act (“DCMWA”). Before the court are

Defendants’ Motion to Dismiss Amended Complaint, ECF No. 42, and Plaintiff’s Renewed

Motion for Conditional Certification and Notice, ECF No. 41 (“Mot. for Certification”). For the

reasons set forth below, the court will DENY Defendants’ Motion, and will GRANT in part and

DENY in part Plaintiff’s Motion.

I. BACKGROUND

The court summarized Plaintiff’s allegations and the relevant legal framework under

FLSA and DCMWA in its prior Memorandum Opinion in this case. Harrington v. DC Winery,

LLC, No. 22-689 (TSC), 2023 WL 5561604, at *1–2 (D.D.C. Aug. 29, 2023) (ECF No. 38).

Because Plaintiff’s Amended Complaint does not meaningfully change that summary, the court

will not rehash it in detail here. In short, Plaintiff alleges that while he was employed as a server

and bartender, Defendants violated FLSA and DCMWA by: (1) failing to provide notice of the

Page 1 of 9 statutes’ tip credits and the operation of the tip pool; (2) requiring contributions to a tip pool with

ineligible participants; (3) deducting more tips than necessary to cover credit card processing

fees; and (4) requiring performance of non-tipped duties beyond what the statutes permit. See

id.; Pl.’s Am. Collective Action Compl. ¶¶ 6–7, ECF No. 40 (“Am. Compl.”).

“Plaintiff brings this action as a collective action under the FLSA to recover unpaid

wages, misappropriated tips, liquidated damages, attorneys’ fees, and costs on behalf of himself

and all others similarly situated.” Am. Compl. ¶ 9. He asks the court to conditionally certify the

collective action class as:

All individuals who worked as bartenders or servers for Defendants in the District of Columbia at any time during the three (3) year period preceding the filing of this lawsuit, and who were paid a direct cash subminimum hourly wage.

Mot. for Certification at 5. Plaintiff proposes contacting potential collective members using

several court-authorized notices to be sent by mail, e-mail, and text message. Id. at 14–15; see

id. Exs. 5–7 at App. 015–20. And he asks for an order requiring Defendants to provide “an

Excel file (.xls) containing the names, addresses, e-mail addresses, phone numbers, dates of

employment, and position(s) held of all putative collective members.” Id. at 2.

Defendants raise two objections at this stage. First, they move for partial dismissal of the

Amended Complaint, arguing that it does not plausibly allege that Defendants made illegal credit

card fee deductions from the tip pool. See Defs.’ Mem. in Supp. of Their Mot. to Dismiss Pl.’s

Am. Compl. at 5–7, ECF No. 42-1 (“MTD”). Second, they contend that Plaintiff’s proposed

conditional certification of a FLSA collective action is premature, overbroad, and otherwise

inappropriate for several reasons. See Defs.’ Mem. in Opp’n to Pl.’s Second Mot. for

Conditional Certification and Notice, ECF No. 43 (“Defs.’ Opp’n to Certification”).

Page 2 of 9 II. LEGAL STANDARDS

A motion to dismiss for failure to state a claim under Rule 12(b)(6) tests the legal

sufficiency of a complaint. Browning v. Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002). The court

does not assess the truth of what is asserted nor “whether a plaintiff has any evidence to back up

what is in the complaint.” Id. (citation omitted). “To survive a motion to dismiss, 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) (internal quotation omitted). “The

plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer

possibility that a defendant has acted unlawfully.” Id. (citation omitted). The court therefore

construes the complaint “in favor of the plaintiff, who must be granted the benefit of all

inferences that can be derived from the facts alleged.” Hettinga v. United States, 677 F.3d 471,

476 (D.C. Cir. 2012) (internal quotation marks omitted). This presumption does not apply,

however, to a “legal conclusion couched as a factual allegation.” Iqbal, 556 U.S. at 678

(quotation omitted). Accordingly, a complaint must offer more than “labels and conclusions” or

a “formulaic recitation of the elements of a cause of action.” Id. (quoting Bell Atlantic Corp. v.

Twombly, 550 U.S. 544, 555 (2007)).

A plaintiff asserting violations of FLSA and DCMWRA’s minimum-wage provisions

may seek to bring a “collective action” on behalf of themself and other “similarly situated”

employees. 29 U.S.C. § 216(b); D.C. Code § 32-1308(a)(1)(C). Such collective actions are “not

subject to the numerosity, commonality, and typicality rules of a class action under Federal Rule

of Civil Procedure 23.” Thompson v. Linda & A., Inc., 779 F. Supp. 2d 139, 143 (D.D.C. 2011)

(quotation omitted). “Instead, a collective action has only two threshold requirements: The

plaintiff must show that she is similarly situated to the other members of the proposed class, and

those other members must ‘opt in’ to the proposed class.” Id. (quotation omitted). “This Page 3 of 9 showing ‘has been described as not particularly stringent, fairly lenient, flexible, and not

heavy,’” and may “be satisfied based on pleadings and affidavits.” Rivera v. Power Design, Inc.,

172 F. Supp. 3d 321, 325 (D.D.C. 2016) (first quoting Dinkel v. MedStar Health, Inc., 880 F.

Supp. 2d 49, 53 (D.D.C .2012); then quoting Blount v. U.S. Sec. Assocs., 945 F. Supp. 2d 88, 93

(D.D.C. 2013)).

“To determine whether a class should be certified under the FLSA, a court will usually

proceed in two steps.” Thompson, 779 F. Supp. 2d at 143. First, the plaintiff “must make a

modest factual showing sufficient to demonstrate that they and potential plaintiffs together were

victims of a common policy or plan that violated the law.” Id. (quotation omitted). If they do,

“the class is ‘conditionally certified’ and the members of the class are given notice of the

collective action and an opportunity to ‘opt in’ to the litigation.” Id. (quotation omitted). Then,

after discovery concludes, the defendant(s) “may move to decertify the class in light of the

record that was developed during the discovery period,” and the court determines whether the

proposed class members are in fact similarly situated. Id. (quotation omitted).

III. DISCUSSION

A. Motion to Dismiss

Defendants move to “dismiss the Amended Complaint with prejudice insofar as it alleges

Defendants illegally withheld credit card tips.” MTD at 2. Plaintiff originally alleged only that

the credit card tip deduction was “in violation of the amount permitted to be deducted under the

FLSA,” Compl. ¶ 55, ECF No. 1, which the court considered a “legal conclusion couched as a

factual allegation,” Harrington, 2023 WL 5561604, at *5 (quotation omitted). Accordingly, the

court dismissed that part of the Complaint, but granted Plaintiff leave to amend it “to provide

greater specificity (even if estimated) about the amount of tips withheld to cover credit card fees,

or at the very least to allege a basis for his contention that they were excessive.” Id. Plaintiff Page 4 of 9 now alleges that “upon information and belief, Defendants unlawfully retained a portion of . . .

tips in excess of the actual credit card processing fees Defendants paid and incurred in their

transactions and with credit card processer.” Am. Compl. ¶ 76.

The amended allegations, while relatively generic, are enough to survive a motion to

dismiss. To be sure, they still do not “show what percentage of tips Defendants allegedly

withheld to offset credit card fees,” such as by detailing “the value of gross tips earned, amount

or percentage of tips Defendants allegedly withheld, or amounts of credit card fees allegedly

incurred.” MTD at 6. But as Plaintiff notes, “the employer is obviously in the best position to

know the terms of its own credit card agreements,” so it makes little sense at the pleadings stage

to require him to guess at “information . . . exclusively in Defendants’ possession.” Pl.’s Opp’n

to Second Mot. to Dismiss at 12, ECF. No. 45 (first quotation citing Widjaja v. Kang Yue USA

Corp., No. 09–CV–2089 (RRM) (CLP), 2011 WL 4460642, at *7 (E.D.N.Y. Sept. 26, 2011)).

More importantly, however, Plaintiff has replaced a legal conclusion about the tip deduction’s

legality with a factual assertion about the deduction’s quantity exceeding the processing fees.

That provides at least some “basis for his contention that [the deductions] were excessive” under

the law. Harrington, 2023 WL 5561604, at *5. The court will therefore deny Defendants’

Motion to Dismiss these allegations.

B. Motion for conditional certification

Plaintiff has met the requirements for conditionally certifying a collective action by

demonstrating that he is similarly situated to the members of the proposed class. Thompson, 779

F. Supp. 2d at 143. That class would include “[a]ll individuals who worked as bartenders or

servers for Defendants in the District of Columbia at any time during the three (3) year period

preceding the filing of this lawsuit, and who were paid a direct cash subminimum hourly wage.”

Mot. for Certification at 5. Plaintiff brought this suit in March 2022, and worked for Defendants Page 5 of 9 during that preceding three-year period—from “approximately February 2020 until December

2021.” Am. Compl. ¶ 28. He alleges that Defendants also employed “other individuals as

bartenders and servers” during that three-year period “and paid them all a subminimum wage per

hour.” Id. ¶ 29. He also proffers declarations to that effect from himself and two other

employees. See Pl.’s App’x in Supp. of Mot. for Conditional Certification and Notice, Exs. 1–3

at App. 001–09, ECF No. 41-1. These submissions readily constitute the “modest factual

showing sufficient to demonstrate” that Plaintiff and the other proposed class members “were

victims of a common policy or plan that violated the law.” Thompson, 779 F. Supp. 2d at at

143(quotation omitted).

Defendants’ arguments against certification are unpersuasive. Their contention that it

should wait until the court resolves their Motion to Dismiss is now moot; as explained in the

previous section, the court is denying that motion. See Defs.’ Opp’n to Certification at 4–6. And

there is “no authority” for their claim that “the named plaintiff in a collective action must have

been employed throughout the entire putative class period.” Stephens v. Farmers Rest. Grp., 291

F. Supp. 3d 95, 120 (D.D.C. 2018); see Defs.’ Opp’n to Certification at 6–9. The allegations that

Defendants maintained unlawful policies during the employment of Plaintiff and the other two

declarants means that it is not “pure speculation” that the same policies affected other similarly

situated employees around the same time. Stephens, 291 F. Supp. 3d at 116 (quotation omitted).

That is enough to satisfy Plaintiff’s relatively lenient burden for conditional certification. The

three-year period preceding the filing of this case appropriately bounds the proposed class.

Defendants’ arguments regarding the statute of limitations do not bar certification—at

least at this stage. For starters, they assert that the statute of limitations should be two years

rather than three because Plaintiff has not demonstrated that the allegedly unlawful practices

Page 6 of 9 were willful. Defs.’ Opp’n to Certification at 9 (citing 29 U.S.C. § 255). But the Amended

Complaint alleges that willfulness, see Am. Compl. ¶ 61, and “when willfulness is disputed,

courts typically apply the three-year limitations period in defining the scope of a collective

action.” Meyer v. Panera Bread Co., 344 F. Supp. 3d 193, 209 (D.D.C. 2018) (quotation

omitted). At the summary judgment stage, Defendants may revisit this issue and seek to prove

that any violations of FLSA or DCMWA were not willful. Similarly, the issue of whether the

statute of limitations should be equitably tolled for any opt-in plaintiffs is best resolved later.

Even assuming that “the statute of limitations continues to run until [opt-in plaintiffs]

affirmatively join the action,” Stephens, 291 F. Supp. 3d at 120, that potentially three-year period

has not yet elapsed for opt-in plaintiffs from the months leading up to this case being filed in

March 2022. And in any event, the court is not well positioned to decide whether equitable

tolling is warranted for any additional plaintiffs until they materialize and show cause for it.

Accordingly, the court will defer consideration of the need for equitable tolling until after the

opt-in period and discovery are complete.

Defendants’ objections to the proposed notice period and method do not prevail either.

First, they seek a “60-day or shorter opt-in period rather than the requested 90 days.” Defs.’

Opp’n to Certification at 12. The cases cited by the parties suggest that opt-in periods between

60 and 90 days are both regularly granted. See id. at 11–12; Pl.’s Reply in Supp. of Renewed

Mot. for Conditional Certification and Notice at 13–14, ECF No. 44 (“Pl.’s Reply for

Certification”). Because Defendants have not articulated any prejudice that would result from

the additional 30 days, the court will grant the full 90 days requested. Second, Defendants

protest the request for employees’ phone numbers and the proposal to notify potential collective

members via text message. Defs.’ Opp’n to Certification at 12–13. Text message notifications

Page 7 of 9 are especially appropriate for employees with high rates of turnover and address changes, as in

the restaurant industry, and any privacy intrusion can be minimized by limiting the number of

messages sent. See Pl.’s Reply for Certification at 11–13 (collecting cases). Plaintiff’s proposal

of one initial notice and one reminder notice by text message is reasonable.

Finally, the court will grant Defendants’ request for an opportunity to meet and confer

with Plaintiffs regarding the proposed notices. Defendants point out that the notices “contain

several allegations that Plaintiff never made in his Complaint, nor in any pleadings to date:

specifically, the allegations that Defendants required employees to ‘(2) pay for mandatory

uniforms [and] (3) pay for business-related items or expenses (check presenters, pens, or wine

keys).’” Defs.’ Opp’n to Certification at 13 (citing Pl.’s Mot. for Certification, Exs. 5, 6 at App.

015–19). Plaintiff did not respond to that point. Accordingly, the court will order the parties to

meet, confer, and report back with respect to those terms in the notices. Defendants may raise

other concerns with the notices during that conferral, and Plaintiff must consider them in good

faith. But if the parties cannot come to agreement on certain points, the court will look with

disfavor on further substantive objections from Defendants that could have been raised in this

round of briefing.

IV. CONCLUSION

For these reasons, the court will DENY Defendants’ Motion to Dismiss Plaintiff’s

Amended Complaint, ECF No. 42, and will GRANT in part and DENY in part Plaintiff’s

Renewed Motion for Conditional Certification and Notice, ECF No. 41. Specifically, the court

will (1) conditionally certify the collective action class proposed by Plaintiff, (2) approve

Plaintiff’s proposed timing and method of notice, (3) order Defendants to produce contact

information for putative collective action class members within 14 days, and (4) order the parties

to meet and confer regarding the language and formatting of the notices to be sent to potential Page 8 of 9 collective action class members, then file a motion proposing the renewed notices and any

objections within 21 days. A corresponding order will accompany this Memorandum Opinion.

Date: September 26, 2024

Tanya S. Chutkan TANYA S. CHUTKAN United States District Judge

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