United States Court of Appeals For the First Circuit
Nos. 20-1097 20-1141
JOSE PINEDA, JOSE MONTENEGRO, MARCO LOPEZ, and JOSE HERNANDEZ, on behalf of themselves and all others similarly situated,
Plaintiffs, Appellees,
v.
SKINNER SERVICES, INC., d/b/a Skinner Demolition, THOMAS SKINNER, DAVID SKINNER, ELBER DINIZ, and SANDRO SANTOS,
Defendants, Appellants.
APPEALS FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS
[Hon. F. Dennis Saylor, IV, U.S. District Judge]
Before
Lynch, Thompson, and Kayatta, Circuit Judges.
Michael B. Cole, with whom Gregory J. Aceto and Aceto, Bonner & Cole, P.C. were on brief, for appellants. Jasper Groner, with whom Nathan P. Goldstein, Paige W. McKissock, and Segal Roitman, LLP were on brief, for appellees.
December 30, 2021 LYNCH, Circuit Judge. The district court entered a
preliminary injunction against Skinner Services, Inc., d/b/a
Skinner Demolition, Thomas Skinner, David Skinner, Elber Diniz,
and Sandro Santos (collectively, "Skinner"), finding Skinner
likely had violated state and federal wage laws as to its laborers
and was trying to transfer assets from the laborers' reach.
Skinner had created four separate entities after the laborers filed
this lawsuit, all of which the workers allege were used to
dissipate or hide assets. This injunction comes after the court
had held Skinner in contempt for retaliating against one of its
laborers who participated in this suit. Skinner appeals the
preliminary injunction.
Skinner's primary appellate argument, which is mistaken,
is based on an incorrect reading of the Supreme Court's holding in
Grupo Mexicano de Desarrollo S.A. v. Alliance Bond Fund, Inc., 527
U.S. 308 (1999). The Court held in Grupo Mexicano that federal
courts lack equitable jurisdiction under Federal Rule of Civil
Procedure 65 to enter preliminary injunctions that prevent the
transfer of assets pending the adjudication of a claim for money
damages. Id. at 333. Grupo Mexicano does not constrain the
district court's authority to grant analogous relief under Rule 64
when authorized by the law of the forum state, as is the case here.
The district court's entry of a preliminary injunction is affirmed.
- 2 - I. Background
Skinner Demolition is a company that performs demolition
work on construction sites throughout New England and other nearby
states. It is owned and managed by the individual defendants named
in this case. Jose Pineda, Jose Montenegro, Marco Lopez, and Jose
Hernandez (collectively, "Pineda") are former low-wage employees
of Skinner Demolition. They have sued Skinner on behalf of
themselves and other similarly situated workers for unpaid wages.
Pineda alleges two categories of violations: Skinner
unlawfully excluded from the workers' pay the time spent reporting
to and from Skinner Demolition's headquarters (the "Yard"),
despite apparently requiring the workers to so report daily
("Reporting Policy")1; and Skinner improperly deducted from each
worker approximately an hour of pay per week to pay for a uniform
laundering service ("Uniform Policy"). The workers' expert has
opined that these violations have resulted in between
approximately $400,000 and $650,000 in unpaid wages.
Pineda alleges that between August 2013 and January
2016, Skinner required the workers to report to the Yard each
1 This policy did not apply to laborers living in and around Boston, Massachusetts. Accordingly, the Reporting Policy- based FLSA collective and Rule 23 class exclude this group of laborers. See Pineda v. Skinner Servs., Inc. ("Pineda III"), No. 16-cv-12217, 2019 WL 3754015, at *1, *6, *11–12 (D. Mass. Aug. 8, 2019). These laborers were not excluded from the collective or class relating to the Uniform Policy which is next described. Id. at *10.
- 3 - morning to receive job assignments and collect tools and equipment.
The workers were not told their assigned construction site before
arriving at the Yard. The workers also were required to report to
the Yard at the end of each workday to return the tools and
equipment. The Reporting Policy violations alleged under both
state and federal law are that, although the construction jobsites
could be anywhere between forty-five minutes and three hours' drive
from the Yard, the workers were not permitted to "punch in" to
begin paid work until they arrived at their first jobsite for the
day. These workers were also required to "punch out" when they
left their final construction site, before returning to the Yard.
Subject to rare exceptions, the workers were not paid for travel
time between the Yard and the construction sites.2
As to the Uniform Policy, the violations alleged are
that, from August 5, 2013 through the present, Skinner would deduct
approximately an hour of wages per week from certain employees'
paychecks for "uniform washing," regardless of how much the service
actually cost or whether the worker actually utilized the service.
Pineda states that Skinner "rarely washed Class Plaintiffs'
2 The workers who drove to and from Skinner Demolition headquarters (referred to as "Driver Plaintiffs") were occasionally, but not always, paid for up to an hour of travel each way, never more. The workers allege that Skinner also "would occasionally pay Driver Plaintiffs $20 per day for gas, regardless of how much gas Driver Plaintiffs used during the workday. Driver Plaintiffs often used more than $20 of gas in a given workday."
- 4 - uniforms or performed any other services in exchange for the
'uniform washing' fee."
A. Department of Labor Investigation
Between 2013 and 2015, the Wage and Hour Division of the
U.S. Department of Labor investigated the wage practices of
Skinner. Following that investigation, the primary investigator
prepared and submitted a ten-page report, concluding that Skinner
violated Sections 7 and 11 of the Fair Labor Standards Act, 29
U.S.C. § 201 et seq. ("FLSA"). The report stated that
the employees would show up at the [Yard], participate in "pre-tour" activities such as loading the truck with tools and other equipment and being assigned work, and then ride to the job site on the company vehicle, all at the instruction of the employer. All of this work was unpaid for the purposes of hours worked as defined under 29 CFR 785.38 (Travel that is all in the day's work). . . . Thus, employees are not punching in at the [Yard] as they should be, but rather, they are punching in some 2 hours later upon arrival at the job site, which is long after they've arrived at work and performed pre-tour activities.
The investigator estimated that Skinner owed a total of more than
$800,000 in back wages to over 100 employees. The Assistant
District Director thereafter ended the Department of Labor's
investigation due to the present litigation and a separate
complaint pending before the Equal Employment Opportunity
Commission.
- 5 - B. Procedural History
Pineda filed this action in 2016, alleging collective
claims under the FLSA, and class claims under the Massachusetts
Overtime Law, Mass. Gen. Laws ch. 151, §§ 1A & 1B, the
Massachusetts Fair Minimum Wage Act, Mass. Gen. Laws ch. 151, § 1,
et seq., the Massachusetts Wage Act, Mass. Gen. Laws ch. 149,
§ 148, and the Massachusetts Fair Wage Act, Mass. Gen. Laws. Ch.
151, § 19(5).
On September 6, 2017, the district court conditionally
certified the FLSA collective. The court thereafter entered a
protective order to prohibit Skinner from retaliating against any
workers who participate or assist in this litigation. Skinner,
having terminated one of its workers in August 2018 for opting
into the collective action and testifying favorably to the workers
in a deposition, was held in contempt of court in December 2018
for violating the protective order.
On August 8, 2019, the district court certified two
classes under Federal Rule of Civil Procedure 23 as to Pineda's
state law claims. The court observed as to the Reporting Policy
class, inter alia, that "[i]f, as plaintiffs allege, Skinner
required its laborers during the class period to report to the
Yard to load equipment and receive jobsite assignments without
compensation, that would likely be a clear violation of
Massachusetts wage laws." Pineda v. Skinner Servs., Inc. ("Pineda
- 6 - III"), No. 16-cv-12217, 2019 WL 3754015, at *6, *11–12 (D. Mass.
Aug. 8, 2019). The court added for the Uniform Policy class that
"plaintiffs have proffered evidence that their enrollment in the
[uniform washing] program was involuntary," and thus unlawful.
Id. at *11 (emphasis in original).
As these proceedings were taking place, the four
individual defendants created four new entities: Skinner Disposal
(organized on January 3, 2017); Skinner Consulting (organized on
March 16, 2017); Skinner Staffing (organized on April 21, 2017);
and 155 Shakedown Street (organized on December 11, 2017). The
workers have alleged that Skinner created these entities in order
to "transfer corporate assets and prevent [p]laintiffs from
recovering damages should they prevail on their claims." The
record discloses the following about these entities.
Skinner Disposal was created to provide "roll-off
dumpster services," a service also provided by Skinner Demolition.
Skinner Disposal primarily served one client: Skinner Demolition.
Its only employees were defendants Thomas Skinner and Sandro Santos
and those "borrowed" from Skinner Demolition. All employees were
paid through Skinner Demolition's payroll, and Skinner Demolition
covered additional expenses for Skinner Disposal. In February
2019, Skinner Disposal was sold for several million dollars.3
3 Less than two months after this sale, Skinner reported to the court that paying approximately $46,000 into escrow would
- 7 - Pineda contends the company "was created by Defendants for the
purpose of transferring and sheltering their assets."
Skinner states that Skinner Consulting provided
"construction consulting for estimating projects and project
management." Skinner Demolition was a client of Skinner
Consulting, and Skinner Consulting's sole owner, officer,
director, and employee was David Skinner, who was paid $10,000
each month by Skinner Demolition. Pineda alleges the company
"operated as merely a vehicle through which Skinner Demolition
funneled money to David." The company was dissolved by August
2019.
There is no evidence the remaining two entities, Skinner
Staffing and 155 Shakedown Street, ever became operational.
In September 2019, Skinner filed three summary judgment
motions. Pineda filed a memorandum in opposition in October 2019,
together with a motion for preliminary injunction, prejudgment
attachment, attachment by trustee process, or discovery in the
alternative. In the motion for injunctive relief, the workers
argued that they had "reasonable concern that [d]efendants will
accelerate any efforts to insulate their individual and corporate
assets to avoid a meaningful recovery for [p]laintiffs." The
district court held a hearing on the pending motions in December
make it difficult for Skinner to make payroll and meet its obligations to creditors.
- 8 - 2019. The motion for a preliminary injunction was allowed on
December 23, 2019, Pineda v. Skinner Services, Inc. ("Pineda IV"),
No. 16-cv-12217, 2019 WL 8262655, at *3-4 (D. Mass. Dec. 23, 2019),
after which Skinner appealed and moved for reconsideration. The
motion for reconsideration was denied in January 2020, Pineda v.
Skinner Services, Inc. ("Pineda VI"), No. 16-cv-12217, 2020 WL
1310035 (D. Mass. Jan. 24, 2020), and another appeal followed.
The preliminary injunction orders "Skinner Demolition,
and all persons or entities with knowledge of this Order acting in
concert with them" to:
- [R]estrain[] from selling, transferring, or otherwise conveying any assets of Skinner [Demolition], except in the ordinary course of business, unless the net value of the assets of Skinner [Demolition] will be at least $1,425,000 regardless of any such sale, transfer, or conveyance[;]
. . .
- [P]rovide reasonable advance notice to plaintiffs for any sale, transfer, or conveyance of any asset having a value of more than $25,000; and
- [W]ithin 21 days of this order, provide an accounting of the sale, transfer, or conveyance of any asset having a value of more than $25,000 from November 2, 2016, to the date of this order.4
4 The court's order further directed a writ of attachment to issue pursuant to Mass. R. Civ. P. 4.1(c) as to the physical, tangible property of Skinner Demolition in the amount of $1.425 million. Pineda IV, 2019 WL 8262655, at *4. Skinner does not challenge in this appeal that portion of the order for jurisdictional reasons. See Charlesbank Equity Fund II v. Blinds
- 9 - Pineda IV, 2019 WL 8262655, at *3. In a January 2020 Memorandum
and Order, the district court "stayed" the accounting provisions
in part pending appeal, authorizing Skinner to provide the
accounting only to the court for in camera review. See Pineda v.
Skinner Servs., Inc. ("Pineda V"), No. 16-cv-12217, 2020 WL
1308086, at *1 (D. Mass. Jan. 23, 2020).
II. Discussion
Skinner uses a "belt and suspenders" approach to
challenging the preliminary injunction. We take each argument in
turn.
A. Legal Standards
Our review of a district court's decision to grant a
preliminary injunction is for abuse of discretion. OfficeMax,
Inc. v. Levesque, 658 F.3d 94, 97 (1st Cir. 2011). "Within that
framework, however, findings of fact are reviewed for clear error
and issues of law are reviewed de novo." Braintree Lab'ys, Inc.
v. Citigroup Glob. Marks. Inc., 622 F.3d 36, 41 (1st Cir. 2010)
(quoting United States v. Weikert, 504 F.3d 1, 6 (1st Cir. 2007)).
Under Massachusetts law, a party seeking a preliminary
injunction must meet a three-part test: (1) that he likely is to
To Go, Inc., 370 F.3d 151, 156 (1st Cir. 2004) ("It is common ground that -- at least in the absence of special circumstances -- federal appellate courts lack jurisdiction to undertake interlocutory review of orders granting prejudgment attachments.").
- 10 - succeed on the merits, (2) that he likely will suffer irreparable
harm in the absence of the preliminary relief, and
(3) that the risk of irreparable harm outweighs the potential harm
to the nonmoving party if the injunction is awarded. Mass. Port
Auth. v. Turo Inc., 166 N.E.3d 972, 978 (Mass. 2021).
B. The District Court had the Authority to Enter the Preliminary Injunction
Skinner's primary appellate argument is that, based on
the Supreme Court's decision in Grupo Mexicano, the district court
was without authority to grant preliminary relief enjoining
Skinner from using its assets pending the adjudication of Pineda's
wage and hour claims. See 527 U.S. at 333.
i. Grupo Mexicano Did Not Limit the District Court's Authority to Act Under Rule 64
Skinner's argument that the preliminary injunction,
which was issued under Massachusetts law, contravenes the holding
in Grupo Mexicano is without merit. The Supreme Court held in
Grupo Mexicano that federal courts have "no authority [under Rule
65] to issue a preliminary injunction preventing petitioners from
disposing of their assets pending adjudication of respondents'
. . . claim for money damages." 527 U.S. at 333. The Court based
its analysis upon the historical powers of federal courts of
equity, which the Court found did not extend to the issuance of
such preliminary injunctions. See id. at 319-22. The Court
explicitly did not consider the argument that such a preliminary
- 11 - injunction was available under the law of the forum state pursuant
to Rule 64. Id. at 318 n.3; see also id. at 330–31 (noting that
Rule 64 authorizes the use of state prejudgment remedies).
Here, the district court correctly held that it was
authorized by Rule 64 and Massachusetts law to issue the
preliminary injunction. Rule 64 provides that in any federal
action, "every remedy is available that, under the law of the state
where the court is located, provides for seizing a person or
property to secure satisfaction of the potential judgment." Fed.
R. Civ. P. 64(a). Many courts have interpreted this Rule to
include injunctive relief under state law. See, e.g. U.S. ex rel.
Rahman v. Oncology Assocs., 198 F.3d 489, 501 (4th Cir. 1999)
("[T]he scope of [Rule] 64 incorporates state procedures
authorizing any meaningful interference with property to secure
satisfaction of a judgment, including any state-authorized
injunctive relief for freezing assets."); see also Hendricks v.
Bank of Am. N.A., 408 F.3d 1127, 1139 (9th Cir. 2005) (applying
California standard for preliminary injunction under Rule 64);
Coley v. Vannguard Urban Improvement Assoc., Inc., No. 12-cv-5565,
2016 WL 7217641, at *6 (E.D.N.Y. Dec. 13, 2016) (same for New York)
(collecting cases). This court also has recognized as much in
dicta. See Micro Signal Rsch. Inc. v. Otus, 417 F.3d 28, 33 n.3
(1st Cir. 2005) ("Appellants might have argued that injunctive
relief in these circumstances is beyond the historic role of
- 12 - equity, see Grupo Mexicano[], but that case involved only federal
equity power and a claimed breach of contract. In this diversity
case, state law may arguably govern . . . ." (citations omitted));
Charlesbank Equity Fund II v. Blinds To Go, Inc., 370 F.3d 151,
161 (1st Cir. 2004) ("The Court's reasoning [in Grupo Mexicano]
supports the continued vitality of Rule 64.").
Skinner's fall-back argument is that a district court's
power to enter a preliminary injunction under Rule 64, if any, is
limited to cases brought to federal court under diversity
jurisdiction. This argument is unsupported and unpersuasive.
Nothing in Rule 64 indicates that the power to rely upon the forum
state's law to "secure satisfaction of the potential judgment"
turns on the basis for the district court's subject-matter
jurisdiction. And Skinner cites no case law so limiting the scope
of Rule 64.
Skinner further argues the preliminary injunction
entered here was not permitted by Massachusetts law. It contends
that the same limitations on federal equity jurisdiction discussed
in Grupo Mexicano confine Massachusetts state courts sitting in
equity, and the preliminary injunction here constitutes a
"creditor's bill" that cannot be issued prejudgment. Skinner
points to no Massachusetts appellate court decision adopting its
- 13 - argument.5 And there is good reason for that, because we have
found no such support in the caselaw.
The weight of Massachusetts authority indicates that the
Supreme Judicial Court of Massachusetts would permit the
preliminary injunction at issue here. Under Massachusetts law,
trial courts are afforded "broad discretion to grant or deny
injunctive relief." Lightlab Imaging, Inc. v. Axsun Techs., Inc.,
13 N.E.3d 604, 614 (Mass. 2014). Contrary to Skinner's position,
this discretion historically has included the authority to enter
a preliminary injunction restraining defendants' assets in
circumstances similar to the case at bar. See, e.g., Bos. Athletic
Assoc. v. Int'l Marathons, Inc., 467 N.E.2d 58, 62 (Mass. 1984)
(affirming preliminary relief enjoining the dispersal of
defendant's funds); R.G. v. Hall, 640 N.E.2d 492, 494 (Mass. App.
Ct. 1994) (indicating a court's authority to sequester defendant's
assets up to the amount plaintiffs may reasonably recover); Riley
5 In support instead, Skinner cites a line of non-binding trial court decisions issued by a single Superior Court judge holding that preliminary injunctions enjoining the dispersal of assets is unavailable under the equity powers of Massachusetts state courts. See SW Invs., Inc. v. 75 Sydney St., LLC, No. 2184- cv-00338, 2021 WL 5626284, at *1–2 (Mass. Super. Ct. Apr. 6, 2021) (Salinger, J.); Anaesthesia Assocs. of Mass., PC v. Plexus Anesthesia Servs. of Mass., PC, 34 Mass. L. Rptr. 668, 2018 WL 1863660, at *2–3 (Mass. Super. Ct. Feb. 21, 2018) (Salinger, J.); ABCD Holdings, LLC v. Hannon, No. 1684-cv-01840, 2016 WL 4211501, at *2 (Mass. Super. Ct. June 27, 2016) (Salinger, J.); Interisle Consulting Grp., LLC v. Galaxy Internet Servs., Inc., 32 Mass. L. Rptr. 177, 2014 WL 3816557, at *1–2 (Mass. Super. Ct. June 16, 2014) (Salinger, J.).
- 14 - v. Mechs. Bank, 395 N.E.2d 889, 890 (Mass. App. Ct. 1979)
(affirming entry of preliminary injunction restricting defendant
from selling or transferring certain assets).6
The district court correctly asserted its authority
under Rule 64 and Massachusetts law to enjoin Skinner from
dissipating its assets to avoid payment of any judgment against
Skinner.
C. The District Court did not Abuse its Discretion
Skinner next challenges the preliminary injunction on
the ground that, in this case which the district court has been
presiding over for years, the court failed to set forth the
specific factual findings upon which it based its decision to enter
a preliminary injunction. Skinner argues the district court failed
to satisfy its obligation under Federal Rule of Civil Procedure
52, leaving the parties only to speculate as to the court's
reasoning. Skinner adds that the district court abused its
discretion by concluding that Pineda made the requisite
6 Unpublished Superior Court decisions have reached the same result. See, e.g., Berardi Lending, LLC v. LS Southfield, LLC, No. 1884-cv-02184, 2018 Mass. Super. LEXIS 230, *6–7 (Mass. Super. Ct. Aug. 24, 2018) (unpublished); Marino, P.C. v. PJD Ent. of Worcester, Inc., No. 981211B, 1998 WL 1181259, at *1 (Mass. Super. Ct. July 14, 1998) (unpublished); see also Commonwealth v. Caliri, 10 N.E. 3d 671 (Table), 2014 WL 2815527, *1–3 (Mass. App. Ct. June 24, 2014) (unpublished) (affirming a contempt order relating to a preliminary injunction which enjoined defendant from dissipating his assets).
- 15 - demonstrations of likelihood of success and irreparable harm, and
by not requiring the workers to post a bond pursuant to Rule 65(c).
Pineda disagrees and argues the district court's factual
findings are clear from the record and the "extensive findings of
fact issued by the [d]istrict [c]ourt on numerous other [m]otions
brought by the parties." Pineda further contends that the workers
proffered proof sufficient to show they likely will succeed on the
merits and would suffer irreparable harm if the preliminary
injunction did not issue. The workers add that the court
appropriately declined to require a bond in this case.
This court holds that Pineda presented ample evidence
from which the district court reasonably could determine that
Pineda demonstrated a reasonable likelihood of success on the
merits of the workers' claims; Pineda likely will suffer
irreparable harm because Skinner "may dissipate or conceal [its]
assets to avoid judgment"; and, the balance of the equities weigh
in Pineda's favor, warranting the preliminary injunction entered
in this case. Pineda IV, 2019 WL 8262655, at *1. This evidence,
together with the other testimonial and documentary evidence
submitted in this well-traveled case, supports the district
court's entry of the preliminary injunction.
To the extent Rule 52(a) requires fact-findings in
support of a preliminary injunction, "appellate courts are not
overly demanding where the evidence [in the record] makes clear
- 16 - what the court has implicitly found." Micro Signal, 417 F.3d at
32. We can affirm the result where, as here, "the basis for the
court's decision is clear" and the "record gives substantial and
unequivocal support for the ultimate conclusion." Reich v.
Newspapers of New England, Inc., 44 F.3d 1060, 1078–79 (1st Cir.
1995) (quoting Unt v. Aerospace Corp., 765 F.3d 1440, 1444 (9th
Cir. 1985)). In a case such as this, where the district court has
been handling it for years, has received substantial testimonial
and documentary evidence in connection with the preliminary
injunction motion and other motions, and has held a hearing on the
matter, the court's sparse written factual findings will not be
fatal to its entry of a preliminary injunction. See id. at 1079
("[A]nemic factual findings are not fatal to the decision so long
as a complete understanding of the issues may be had from the
record on appeal."); see, e.g., Pineda v. Skinner Services, LLC
("Pineda I"), No. 16-cv-12217, Dkt. No. 69 (D. Mass. Sept. 6, 2017)
(granting conditional class certification); Pineda v. Skinner
Services, LLC ("Pineda II"), No. 16-cv-12217, 2018 WL 10579448 (D.
Mass. Dec. 10, 2018) (granting plaintiffs' motion for contempt of
court); Pineda III, 2019 WL 3754015 (granting plaintiffs' motion
for class certification); Pineda IV, 2019 WL 8262655 (entering
preliminary injunction); Pineda V, 2020 WL 1308086 (granting in
part denying in part defendants' motion to stay preliminary
injunction); Pineda VI, 2020 WL 1310035 (denying defendants'
- 17 - motion for reconsideration concerning the preliminary injunction);
see also Pineda v. Skinner Services, LLC ("Pineda VII"), No. 16-
cv-12217, 2020 WL 5775160 (D. Mass. Sept. 28, 2020) (denying, for
the most part, defendants' motions for summary judgment). The
district court was not required to repeat its factual findings in
each and every memorandum and order entered in this case.
Further, based on this record, the district court did
not abuse its discretion in concluding that Pineda likely was to
succeed on the merits of his FLSA and Massachusetts state law
claims. As the court observed in addressing Pineda's motion for
class certification, several workers have testified to the
Reporting Policy, Pineda III, 2019 WL 3754015, at *1-2, and Skinner
has produced no corroborated evidence to the contrary, id. at *7
(regarding defendants' testimonies that no Reporting Policy
existed, "defendants have not produced any corroborating evidence
. . . ."). The court has also acknowledged that the workers have
proffered testimony concerning the involuntary nature of the
Uniform Policy, id. at *3, and evidence showing that the primary
investigator in the Wage and Hour Division of the Department of
Labor concluded that Skinner violated certain sections of the FLSA,
id. at *3.7
7 Skinner's argument that the workers have failed to show a likelihood of success on the merits because the workers did not file a summary judgment motion and have conceded that fact issues remain for the jury is misplaced. The argument conflates the
- 18 - It likewise was not an abuse of discretion for the
district court to conclude that Pineda would be irreparably harmed
absent the preliminary relief. Although "[t]he possibility that
a defendant may not have assets on the day of judgment may not
automatically make out a showing of irreparable injury," this court
has observed that "the story is quite different where there is a
strong indication that the defendant may dissipate or conceal
assets." See Micro Signal, 417 F.3d at 31. And the record here
shows that, soon after Pineda filed suit, Skinner formed multiple
companies closely associated with Skinner Demolition, which Pineda
alleges were created to dissipate assets. One of these companies
transferred $10,000 per month to defendant David Skinner before
dissolving. Another provided services to Skinner Demolition that
previously were provided by Skinner Demolition, and then was sold
for $3.4 million. Shortly after this sale, Skinner reported to
the court that it would suffer financial hardship if required to
pay into escrow $46,165.17 -- approximately one percent of the
sale price -- to satisfy the district court's contempt order. The
court could reasonably take into account the dubious nature of the
argument. Moreover, Pineda proffered additional evidence that
standards for summary judgment and a preliminary injunction. Compare Charlesbank, 370 F.3d at 162 (likelihood of success on the merits); with Velazquez-Ortiz v. Vilsack, 657 F.3d 64, 70 (1st Cir. 2011) (no genuine dispute of material fact warranting judgment as a matter of law).
- 19 - "Skinner [Demolition] may have plans to declare bankruptcy and
form a new company because of this lawsuit" and has considered
transferring its assets to avoid paying a judgment to the laborers.
The district court was well within its discretion to conclude that
there was a likelihood that Skinner was taking steps to conceal or
dissipate its assets.8
Nor did the district court abuse its discretion in not
requiring the laborers, who are low-wage workers, to post a
million-dollar bond pursuant to Fed. R. Civ. P. 65(c). The bond
requirement is not jurisdictional, see Aoude v. Mobil Oil Corp.,
862 F.2d 890, 895–96 (1st Cir. 1988), and Skinner has failed to
show how it has been harmed without the bond, see Jorgensen v.
Cassiday, 320 F.3d 906, 919 (9th Cir. 2003). See also Int'l Assoc.
of Machinists and Aerospace Workers v. E. Airlines, 925 F.2d 6, 9
(1st Cir. 1991) (finding "ample authority for the proposition that
the provisions of Rule 65(c) are not mandatory and that a district
court retains substantial discretion to dictate the terms of an
injunction bond."). To the contrary, Skinner has represented that
"Skinner Demolition is a significant ongoing concern with $7-8
8 Skinner's argument that the accounting provision constitutes an abuse of discretion because it is a mandatory preliminary injunction subject to a heightened standard also falls short. The "affirmative" act of submitting an accounting to the court is de minimus and used only to maintain the status quo. See Braintree Lab'ys, 622 F.3d at 40–41 (applying a heightened standard for mandatory preliminary injunctions because they "alter[] rather than preserve[] the status quo.").
- 20 - million dollars in gross annual revenues," and that any judgment
against it "would only represent a fraction of Skinner Demolition's
worth." Further, the district court had tailored the injunction
and conditioned the attachment so that they caused no demonstrative
damage to Skinner. See Pineda IV, 2019 WL 8262655, at *2–3.
Skinner finally argues, unsuccessfully, that the
district court lacked jurisdiction to enter any injunction as it
did here due to the anti-injunction provisions of the Norris-
LaGuardia Act, 29 U.S.C. §§ 107 and 113 (the "Act"). Whether or
not the premise is correct that the Act's anti-injunction language
would prevent the entry of a state law preliminary injunction, it
is clear the Act has no applicability here.
The Norris-LaGuardia Act governs injunctions in cases
"involving or growing out of a labor dispute," 29 U.S.C. § 107,
and not actions for unpaid wages under the FLSA. The Act defines
"labor disputes" to include "any controversy concerning terms or
conditions of employment, or concerning the association or
representation of persons negotiating, fixing, maintaining,
changing, or seeking to arrange terms or conditions of employment."
Id. § 113(c). By contrast, the FLSA protects the statutory --
rather than contractual -- rights of individual workers to
guaranteed compensation for all work performed. See Barrentine v.
Arkansas-Best Freight Sys., Inc., 450 U.S. 728, 741 (1981); see
also 29 C.F.R. § 785.7 (requiring that employees covered by the
- 21 - FLSA be paid for "all the time during which an employee is
necessarily required to be on the employer's premises, on duty or
at a prescribed work place").
While no circuit court has addressed directly whether a
claim for unpaid wages under the FLSA constitutes a "labor dispute"
as defined by the Norris-LaGuardia Act, in these circumstances, we
agree with the district courts that have rejected such arguments.
See, e.g., Mitchell v. Barbee Lumber Co., 35 F.R.D. 544, 547 (S.D.
Miss. 1964); Bowe v. Judson C. Burns, Inc., 46 F. Supp. 745, 746–
47 (E.D. Pa. 1942); see also In re Piccinini, 35 F.R.D. 548, 550–
51 (W.D. Pa 1964) ("The [statutory] responsibility of an employer
to . . . pay minimum wages, or to pay proper overtime wages to
employees properly entitled under the [FLSA] is not related to
employer-employee negotiations or their disputes.").9
We hold the strictures of the Norris-LaGuardia Act do
not govern the subject preliminary injunction issued against an
employer in this case for unpaid wages. The district court had
federal question jurisdiction over this case pursuant to 28 U.S.C.
9 Also relevant, several courts have entered preliminary injunctions in FLSA actions without mention of the Norris- LaGuardia Act. See, e.g., Mullins v. City of New York, 626 F.3d 47, 53–56 (2d Cir. 2010); Scalia v. Unforgettable Coatings, Inc., 455 F. Supp. 3d 987, 993–94 (D. Nev. 2020); Acosta v. Austin Elec. Servs. LLC, 322 F. Supp. 3d 951, 955-62 (D. Ariz. 2018); see also Haitayan v. 7-Eleven, Inc., 762 F. App'x 393, 395 (9th Cir. 2019) (unpublished) (vacating the denial of preliminary injunctive relief in an FLSA action).
- 22 - § 1331 and could enter injunctive relief under Rule 64 and
Massachusetts law without first holding an evidentiary hearing.
III. Conclusion
Affirmed. Costs are awarded to the Pineda parties.
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