Indergit v. Rite Aid Corp.

293 F.R.D. 632, 2013 WL 5380253, 2013 U.S. Dist. LEXIS 138614
CourtDistrict Court, S.D. New York
DecidedSeptember 26, 2013
DocketNo. 08 Civ. 9361 (JPO)
StatusPublished
Cited by17 cases

This text of 293 F.R.D. 632 (Indergit v. Rite Aid Corp.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Indergit v. Rite Aid Corp., 293 F.R.D. 632, 2013 WL 5380253, 2013 U.S. Dist. LEXIS 138614 (S.D.N.Y. 2013).

Opinion

OPINION AND ORDER

J. PAUL OETKEN, District Judge:

Plaintiff Yatram Indergit, on behalf of himself and others similarly situated, asserts claims against Rite Aid corporation, Rite Aid of New York, Inc., and Frank Offer (together, “RA”), alleging that RA failed to compensate its store managers (“SMs”) for overtime hours, in violation of both the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq. (“FLSA”), and the New York Labor Law §§ 650 et seq. (“NYLL”). Prior to discovery, in June 2010, Judge Paul G. Gardephe conditionally certified the FLSA class of RA store managers, granting Indergit’s motion for court-authorized notice. Indergit v. Rite Aid Corp., Nos. 08 Civ. 9361(PGG), 08 Civ. 11364QPGG), 2010 WL 2465488 (S.D.N.Y. June 16, 2010). Before the Court are RA’s motion to decertify the FLSA class on the ground that discovery has revealed that the plaintiffs constituting the class are not “similarly situated,” as required by FLSA, for purposes of the misclassification inquiry, as well as Plaintiffs motion to certify a class of New York plaintiffs pursuant to Federal Rule of Civil Procedure 23. For the reasons that follow, Plaintiffs motion is granted as to liability and Defendants’ motion is denied.

I. Background

[636]*636A. Factual Background1

RA, a large drugstore chain, operates nearly 5,000 stores nationwide and approximately 328 stores in New York. RA’s stores are divided into districts, which in turn are broken into regions and group levels that report to each district. There are currently 14 regions and 8 groups of RA stores. The stores within each district are managed by district managers (“DMs”), who report to regional vice presidents.

SMs are tasked with managing their individual RA store, and the SM position is described by RA as a salaried, full-time, FLSA-exempt role with a self-determined work pace and a moderate level of supervision. (Ex. D.)2 Among the SMs’ “essential duties” are “maintaining proper accountability for cash handling and company banking,” ensuring that the store meets “retail budgeted sales, margin, labor, expenses, and overall P & L [referring to profit and loss] monthly results,” hiring and training new employees, and maintaining “merchandise standards” in accordance to company policy and best practices. (Id.) According to the RA job description, SMs, who themselves report to the DMs, are also responsible for “directly supervising” store associates and carrying out “supervisory responsibilities in accordance with Rite Aid policies and applicable laws.” (Id.)

Prior to 2009, RA classified all of its SMs as exempt employees under FLSA. That year, however, RA engaged in a restructuring, reclassifying 1,847 SMs as non-exempt, while 2,944 remained exempt. According to RA, the reclassification of its SMs had “nothing to do with this lawsuit,” but instead was a response to the fact that the company was “bleeding money” and was, for a time, “on the verge of bankruptcy.” (Oral Argument Transcript, Dkt. No. 237 (“Tr”), at 23:4-10.) According to Plaintiff, this restructuring only emphasizes the misclassification of the current, exempt SMs, as RA engaged in this reorganization based on store volume ranges and applied its results nationwide, without regard to the attributes of a particular region, store, or SM.

According to Plaintiff, the SMs are repeatedly mandated by company fiat to perform menial, non-exempt tasks without payment of overtime wages, in violation of both NYLL and FLSA. Plaintiffs characterize their role as that of Potemkin leaders; while their job description suggests a managerial position imbued with discretion and responsibility, Plaintiffs claim they are mere automatons, whose choices are carefully circumscribed by corporate policies and micromanaging DMs, “[r]egardless of store location, size, volume, staffing, or any other variable____” (Id. at 5:21-22.) Whereas Plaintiffs portray an indistinguishable army of SMs who are only delusionally in charge of the stores in which they work, RA suggests that not only do its SMs possess significant and meaningful discretion, but also that this discretion is exercised so differently and is so contingent on myriad, divergent factors—such as a DM’s management style or the store’s location—that it renders the SMs’ claims unsuitable for classwide resolution.

[637]*637B. Procedural Background

Indergit filed his Complaint in this action on October 31, 2008. (Dkt. No. 1.) RA answered in January 2009 (Dkt. No. 8), and Indergit later filed an Amended Complaint in March 2009 (Dkt. No. 17). Indergit’s original claim was asserted on behalf of both SMs and Assistant Store Managers (“ASMs”), though he had not himself served as an ASM. On March 27, 2009, RA filed a motion for partial judgment on the pleadings, seeking dismissal of Indergit’s allegations relating to ASMs. (Dkt. Nos. 24, 25.) Judge Gardephe granted RA’s motion as to Indergit’s FLSA claim for conduct prior to October 31, 2005, but otherwise denied the motion. (Dkt. No. 36.) In July 2009, Indergit filed a motion to conditionally certify the FLSA class in this ease. (Dkt. No. 56.) RA also moved, in August 2009, for summary judgment on the merits of Plaintiffs FLSA, NYLL, and injunctive relief claims. (Dkt. No. 71.) On March 31, 2010, Judge Gardephe granted in part and denied in part Defendants’ motion for summary judgment, dismissing Plaintiffs retaliation claims and his personal claims for injunctive relief, while otherwise denying the motion. (Dkt. No. 92.) In June 2010, Judge Gardephe outlined his reasoning for granting Indergit’s motion for court-authorized notice to potential FLSA opt-in plaintiffs, determining that RA’s managers were sufficiently similarly situated to permit conditional certification. (Dkt. No. 103.)

The instant motion for decertification was filed on January 23, 2013. (Dkt. No. 218.) Plaintiffs filed their motion for class certification that same day. (Dkt. No. 220.) The Court held oral argument on the fully briefed motions on July 9, 2013.

II. Legal Standard

A. FLSA Exemptions3

The FLSA is a remedial statute, designed to combat, and eliminate, “labor conditions detrimental to the maintenance of the minimum standard of living necessary for health, efficiency, and general well-being of workers____” 29 U.S.C. § 202(a). Intrinsic to this mission is the concept of “guarantee[d] compensation for all work or employment engaged in by employees covered by the Act.” Reich v. New York City Transit Authority, 45 F.3d 646, 649 (2d Cir.1995) (quotations and citation omitted). As a general rule, the FLSA requires all employers to pay employees overtime wages for all hours worked in excess of 40 hours per week so long as the employees are not “exempt” under one of the statutory categories. 29 U.S.C. § 207; see also Jacob v. Duane Reade, Inc. (“Jacob I”), No. 11 Civ. 160(JPO), 2012 WL 260230, at *2 (S.D.N.Y.

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Bluebook (online)
293 F.R.D. 632, 2013 WL 5380253, 2013 U.S. Dist. LEXIS 138614, Counsel Stack Legal Research, https://law.counselstack.com/opinion/indergit-v-rite-aid-corp-nysd-2013.