1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA
9 Jose A Vega, No. CV-20-00284-TUC-RCC
10 Plaintiff, ORDER
11 v.
12 All My Sons Business Development LLC, et al., 13 Defendants. 14 On March 8, 2022, the Court held oral argument for the limited purpose of defining 15 the Fair Labor Standards Act (FLSA) Collective Action and Rule 23 Unpaid Wages Class 16 Action. The parties presented their arguments as to the applicable statutes of limitations at 17 the notice stage and the eligibility dates for both the conditionally certified collective and 18 the certified class action. (See Docs. 96–97.) 19 I. FLSA Collective Action 20 On February 1, 2022, the Court conditionally certified an FLSA collective action 21 based on Plaintiff Jose A. Vega's allegations that Defendants All My Sons Business 22 Development LLC, All My Sons Moving & Storage of Tucson LLC, and All My Sons 23 Moving & Storage of Phoenix LLC undercompensate helpers in violation of the FLSA. 24 (Doc. 93 at 6–7.) Nonetheless, the Court noted that it was not in a position to "specifically 25 define eligible employment dates for that collective" without additional briefing from the 26 parties. (Id. at 7.) Similarly, the Court required additional argument regarding the 27 applicable FLSA statute of limitations. (Id. at 7–8.) The Court ordered oral argument to 28 resolve these questions. 1 Plaintiff argues that the Court should permit notice of the FLSA collective action to 2 the broadest class of putative opt-in plaintiffs possible because the statute of limitations 3 continued to run while the motion to certify was pending and will continue to run for each 4 putative opt-in plaintiff until they have consented to join the action. (Doc. 96 at 2.) He 5 seeks to apply a three-year statute of limitations despite a lack of specific evidence at this 6 stage that Defendants acted to willfully violate the FLSA. (Id.) "At this initial stage," 7 Plaintiff asserts, "there is simply not sufficient evidence upon which to make a merits 8 determination as to whether a two or three year limitations period should apply." (Id.) 9 Nonetheless, he contends that he has made sufficient "allegations" of willfulness to support 10 application of a three-year period at the notice stage, with the possibility that the Court will 11 re-evaluate the appropriate statute of limitations after discovery. (Id. at 2–3.) 12 Plaintiff proposes that notice be sent to all individuals employed as helpers at All 13 My Sons Tucson any time between July 2, 2017 and the date notice is sent. (Id.) Plaintiff 14 asserts "[a] starting date of July 2, 2017 (3 years back from the date Plaintiff's Complaint was filed) allows for the most inclusive notice possible . . . ." (Id.) 15 Defendants argue that a two-year statute of limitations is appropriate because 16 Plaintiff has not presented "any evidence or facts" that Defendants willfully violated the 17 FLSA. (Doc. 97 at 2.) They appear to propose three different time frames, first asserting, 18 "a statute of limitations period of two years preceding the date of this Court's order on 19 conditional certification should apply," then stating, "the limitations period for the FLSA 20 collective action should only be two years from the date the consents are filed," and finally 21 noting, "[t]he notice should be limited to helpers who worked at [All My Sons] Tucson 22 during the two-year period prior to the notice being sent." (Id. at 2–3.) 23 A. Standard 24 An FLSA claim to recover wages must commence within two years of the alleged 25 violation. 29 U.S.C. § 255(a). Nonetheless, “a cause of action arising out of a willful 26 violation may be commenced within three years after the cause of action accrued.” Id. 27 (emphasis added). Under the FLSA, a named plaintiff's claim commences on the date the 28 complaint is filed. 29 U.S.C. § 256(a). However, an individual opt-in plaintiff's claim does 1 not commence until that plaintiff files written consent to join the collective action. 29 2 U.S.C. § 256(b). 3 An employer willfully violates the FLSA if “the employer ‘knew or showed reckless 4 disregard for the matter of whether its conduct was prohibited by the FLSA.’” Flores v. 5 City of San Gabriel, 824 F.3d 890, 906 (9th Cir. 2016) (quoting Chao v. A-One Med. Servs., 6 Inc., 346 F.3d 908, 918 (9th Cir. 2003)). Although the Court will not assume the employer’s 7 conduct was willful without specific evidence of a knowing violation or a reckless 8 disregard for compliance, see id., in this district, courts have noted that "it is better to be 9 overly inclusive at the notice stage." Rose v. Wildflower Bread Co., No. CV 09-1348-PHX- 10 JAT, 2010 WL 1781011, at *12 (D. Ariz. May 4, 2010), vacated on other grounds, 2011 11 WL 196842 (D. Ariz. Jan. 20, 2011) (approving notice to a collective of employees three 12 years prior to the filing of the complaint where plaintiff alleged defendant had misclassified 13 employees as exempt from overtime pay); Curphey v. F&S Mgmt. I LLC, No. CV-19- 14 05904-PHX-JJT, 2021 WL 487882, at *5 (D. Ariz. Feb. 10, 2021) (approving notice to a collective of employees three years prior to the filing of the complaint). 15 A court's decision to apply a three-year statute of limitations at the FLSA notice 16 stage "does not indicate a finding on willfulness." Rose, 2010 WL 1781011 at *12. The 17 appropriate statute of limitations may be challenged on summary judgment or on a motion 18 for decertification. Curphey, 2021 WL 487882, at *5; Smith v. Akal Sec. Inc., No. CV-18- 19 01117-PHX-SMB, 2019 WL 1932117, at *4 (D. Ariz. May 1, 2019) ("Should Defendant 20 file a decertification motion in the future, the Court will then, in light of the evidence 21 produced during discovery, reassess whether the two or three-year statute of limitations 22 should apply to Plaintiff's claims."). In Williams v. U.S. Bank Nat'l Ass'n, a district court 23 from the Eastern District of California applied a three-year statute of limitations at the 24 notice stage although the defendant argued that the plaintiffs had not presented sufficient 25 evidence of willfulness. 290 F.R.D. 600, 613 (E.D. Cal. 2013). The district court found that 26 plaintiffs had "sufficiently alleged" willfulness in the complaint and, more importantly, had 27 provided evidence that defendant "willfully declined to pay overtime wages." Id. at 613, 28 n.32. "The question of whether this is lawful or not," the court held, "is the ultimate 1 question to be decided by this court." Id. at 613 n. 32. 2 Furthermore, the notice anchor date, or date from which the court retroactively 3 applies the FLSA statute of limitations, differs among district courts. See, e.g., Chen v. 4 Kicho Corp., 18 CV 7413 (PMH) (LMS), 2020 WL 1900582, at *12 (S.D.N.Y. Apr. 17, 5 2020) (approving notice for all potential plaintiffs who worked for defendant between "the 6 present" and three years prior to the filing of the complaint); Hussein v. Capital Bldg. Servs. 7 Grp., Inc., 152 F. Supp. 3d 1182, 1195–96 (D. Minn. 2015) (approving notice for three 8 years prior to the date of the court's order conditionally certifying FLSA collective action); 9 Titchenell v. Apria Healthcare Inc., CV No. 11-568, 2011 WL 5428559, at *7 (E.D. Pa. 10 Nov.
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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA
9 Jose A Vega, No. CV-20-00284-TUC-RCC
10 Plaintiff, ORDER
11 v.
12 All My Sons Business Development LLC, et al., 13 Defendants. 14 On March 8, 2022, the Court held oral argument for the limited purpose of defining 15 the Fair Labor Standards Act (FLSA) Collective Action and Rule 23 Unpaid Wages Class 16 Action. The parties presented their arguments as to the applicable statutes of limitations at 17 the notice stage and the eligibility dates for both the conditionally certified collective and 18 the certified class action. (See Docs. 96–97.) 19 I. FLSA Collective Action 20 On February 1, 2022, the Court conditionally certified an FLSA collective action 21 based on Plaintiff Jose A. Vega's allegations that Defendants All My Sons Business 22 Development LLC, All My Sons Moving & Storage of Tucson LLC, and All My Sons 23 Moving & Storage of Phoenix LLC undercompensate helpers in violation of the FLSA. 24 (Doc. 93 at 6–7.) Nonetheless, the Court noted that it was not in a position to "specifically 25 define eligible employment dates for that collective" without additional briefing from the 26 parties. (Id. at 7.) Similarly, the Court required additional argument regarding the 27 applicable FLSA statute of limitations. (Id. at 7–8.) The Court ordered oral argument to 28 resolve these questions. 1 Plaintiff argues that the Court should permit notice of the FLSA collective action to 2 the broadest class of putative opt-in plaintiffs possible because the statute of limitations 3 continued to run while the motion to certify was pending and will continue to run for each 4 putative opt-in plaintiff until they have consented to join the action. (Doc. 96 at 2.) He 5 seeks to apply a three-year statute of limitations despite a lack of specific evidence at this 6 stage that Defendants acted to willfully violate the FLSA. (Id.) "At this initial stage," 7 Plaintiff asserts, "there is simply not sufficient evidence upon which to make a merits 8 determination as to whether a two or three year limitations period should apply." (Id.) 9 Nonetheless, he contends that he has made sufficient "allegations" of willfulness to support 10 application of a three-year period at the notice stage, with the possibility that the Court will 11 re-evaluate the appropriate statute of limitations after discovery. (Id. at 2–3.) 12 Plaintiff proposes that notice be sent to all individuals employed as helpers at All 13 My Sons Tucson any time between July 2, 2017 and the date notice is sent. (Id.) Plaintiff 14 asserts "[a] starting date of July 2, 2017 (3 years back from the date Plaintiff's Complaint was filed) allows for the most inclusive notice possible . . . ." (Id.) 15 Defendants argue that a two-year statute of limitations is appropriate because 16 Plaintiff has not presented "any evidence or facts" that Defendants willfully violated the 17 FLSA. (Doc. 97 at 2.) They appear to propose three different time frames, first asserting, 18 "a statute of limitations period of two years preceding the date of this Court's order on 19 conditional certification should apply," then stating, "the limitations period for the FLSA 20 collective action should only be two years from the date the consents are filed," and finally 21 noting, "[t]he notice should be limited to helpers who worked at [All My Sons] Tucson 22 during the two-year period prior to the notice being sent." (Id. at 2–3.) 23 A. Standard 24 An FLSA claim to recover wages must commence within two years of the alleged 25 violation. 29 U.S.C. § 255(a). Nonetheless, “a cause of action arising out of a willful 26 violation may be commenced within three years after the cause of action accrued.” Id. 27 (emphasis added). Under the FLSA, a named plaintiff's claim commences on the date the 28 complaint is filed. 29 U.S.C. § 256(a). However, an individual opt-in plaintiff's claim does 1 not commence until that plaintiff files written consent to join the collective action. 29 2 U.S.C. § 256(b). 3 An employer willfully violates the FLSA if “the employer ‘knew or showed reckless 4 disregard for the matter of whether its conduct was prohibited by the FLSA.’” Flores v. 5 City of San Gabriel, 824 F.3d 890, 906 (9th Cir. 2016) (quoting Chao v. A-One Med. Servs., 6 Inc., 346 F.3d 908, 918 (9th Cir. 2003)). Although the Court will not assume the employer’s 7 conduct was willful without specific evidence of a knowing violation or a reckless 8 disregard for compliance, see id., in this district, courts have noted that "it is better to be 9 overly inclusive at the notice stage." Rose v. Wildflower Bread Co., No. CV 09-1348-PHX- 10 JAT, 2010 WL 1781011, at *12 (D. Ariz. May 4, 2010), vacated on other grounds, 2011 11 WL 196842 (D. Ariz. Jan. 20, 2011) (approving notice to a collective of employees three 12 years prior to the filing of the complaint where plaintiff alleged defendant had misclassified 13 employees as exempt from overtime pay); Curphey v. F&S Mgmt. I LLC, No. CV-19- 14 05904-PHX-JJT, 2021 WL 487882, at *5 (D. Ariz. Feb. 10, 2021) (approving notice to a collective of employees three years prior to the filing of the complaint). 15 A court's decision to apply a three-year statute of limitations at the FLSA notice 16 stage "does not indicate a finding on willfulness." Rose, 2010 WL 1781011 at *12. The 17 appropriate statute of limitations may be challenged on summary judgment or on a motion 18 for decertification. Curphey, 2021 WL 487882, at *5; Smith v. Akal Sec. Inc., No. CV-18- 19 01117-PHX-SMB, 2019 WL 1932117, at *4 (D. Ariz. May 1, 2019) ("Should Defendant 20 file a decertification motion in the future, the Court will then, in light of the evidence 21 produced during discovery, reassess whether the two or three-year statute of limitations 22 should apply to Plaintiff's claims."). In Williams v. U.S. Bank Nat'l Ass'n, a district court 23 from the Eastern District of California applied a three-year statute of limitations at the 24 notice stage although the defendant argued that the plaintiffs had not presented sufficient 25 evidence of willfulness. 290 F.R.D. 600, 613 (E.D. Cal. 2013). The district court found that 26 plaintiffs had "sufficiently alleged" willfulness in the complaint and, more importantly, had 27 provided evidence that defendant "willfully declined to pay overtime wages." Id. at 613, 28 n.32. "The question of whether this is lawful or not," the court held, "is the ultimate 1 question to be decided by this court." Id. at 613 n. 32. 2 Furthermore, the notice anchor date, or date from which the court retroactively 3 applies the FLSA statute of limitations, differs among district courts. See, e.g., Chen v. 4 Kicho Corp., 18 CV 7413 (PMH) (LMS), 2020 WL 1900582, at *12 (S.D.N.Y. Apr. 17, 5 2020) (approving notice for all potential plaintiffs who worked for defendant between "the 6 present" and three years prior to the filing of the complaint); Hussein v. Capital Bldg. Servs. 7 Grp., Inc., 152 F. Supp. 3d 1182, 1195–96 (D. Minn. 2015) (approving notice for three 8 years prior to the date of the court's order conditionally certifying FLSA collective action); 9 Titchenell v. Apria Healthcare Inc., CV No. 11-568, 2011 WL 5428559, at *7 (E.D. Pa. 10 Nov. 8, 2011) (approving notice for three years before the date notice is issued); Rose, 2010 11 WL 1781011 at *12 (approving notice for individuals who worked for defendant on or after 12 three years before filing the complaint). 13 B. Analysis 14 Here, the Court finds that a three-year statute of limitations is appropriate at the notice stage. Plaintiff has alleged willfulness and has put forth sufficient allegations that 15 Defendants willfully implemented the helper compensation policies. The question of 16 whether these policies violate the FLSA is the ultimate question for decision in this case. 17 Nonetheless, in line with other courts in this district, the Court will approve the broadest 18 notice possible on conditional certification. The applicable statute of limitations and 19 whether a finding of willfulness is supported by the evidence can be reevaluated on 20 summary judgment or decertification. Accordingly, the potential opt-in plaintiffs for the 21 FLSA Collective Action include all individuals employed as helpers at All My Sons 22 Moving & Storage of Tucson between July 2, 2017 and the date that notice is sent. 23 C. Proposed Notice 24 On March 7, 2022, the parties filed a Joint Notice Regarding FLSA Collective 25 Action Notice and Consent Form. (Doc. 98.) In accordance with the Court's February 1, 26 2022 order (Doc. 93), the parties submitted the agreed upon Notice of Collective Action 27 Lawsuit (Doc. 98-1) and Consent to Opt-In Form (Doc. 98-2). The Court will approve this 28 agreed upon language. The only information absent from these proposed documents is the 1 eligibility period for the collective. As the Court indicated above, this period shall extend 2 from July 2, 2017 to the date that notice is sent. 3 Furthermore, as the Court previously held, Plaintiff is authorized to send the 4 approved notice to potential opt-in plaintiffs simultaneously via first-class mail, email, and 5 text message. (Doc. 93 at 9.) "Any opt-in plaintiffs who choose to participate shall file their 6 consents no later than 90 days from the date notice is sent." (Id.) Finally, Defendants "shall 7 produce to Vega, within 10 days of the date [of this order], a computer-readable data file 8 containing the names, last known mailing addresses, last known email addresses, last 9 known phone numbers, and dates of employment for all potential members of the collective 10 action." (Id.) 11 II. Rule 23 Class Action – Unpaid Wages Class 12 On February 1, 2022, the Court also certified the Unpaid Wages Class under Federal 13 Rule of Civil Procedure 23(b)(3). (Doc. 93 at 26–27.) The Court concluded, however, that 14 it required additional clarification to properly define the eligible employment dates for the class. (Id. at 27–28.) Thus, the Court held oral argument to resolve this open question. 15 Plaintiff argues the Unpaid Wages Class should include all individuals who worked 16 as helpers between July 2, 2017 and the date notice is sent. (Doc. 96 at 3.) Although 17 Plaintiff's various claims under Arizona law have different statutes of limitations, Plaintiff 18 urges the Court to apply a notice period of three years for a willful violation of A.R.S. § 19 23-364(H). (Id. at 4.) Plaintiff argues that "[t]his would also avoid the need for two Rule 20 23 notice periods – one for unpaid regular time claims (one year) and one for minimum 21 wage claims (three years)." (Id.) 22 Additionally, Plaintiff asks the Court to postpone sending notice of the Rule 23 class 23 action until after the close of discovery. (Id.) To do otherwise would, Plaintiff asserts, risk 24 limiting the scope of the class and cut off relief to potential class members. (Id.) Plaintiff 25 further contends that early notice would cause unnecessary confusion if the class were 26 decertified later. (Id.) If the Court prefers to send Rule 23 notice immediately, Plaintiff asks 27 for 14 days to file a motion for notice approval. (Id.) 28 Defendants argue that only a two-year statute of limitations should apply to the Rule 1 23 class because A.R.S. § 23-364(H) imposes a two-year limit unless the violation was 2 willful. (Doc. 97 at 3.) For the same reasons that Defendants argue the Court cannot 3 conclude any FLSA violation was willful at this stage, Defendants argue that there was no 4 willful violation of Arizona wage laws. (Id.) Defendants further argue that Plaintiff has not 5 offered any evidence that would entitle him to equitable tolling. (Id. at 4.) 6 A. Standard 7 There is a one-year statute of limitations for unpaid straight time wage claims under 8 A.R.S. § 12-541(5). Redhair v. Kinerk, Beal, Schmidt, Dyer & Sethi, P.C., 183 P.3d 544, 9 550 (Ariz. Ct. App. 2008). However, a claim for unpaid minimum wages "may be 10 commenced no later than two years after a violation last occurs, or three years in the case 11 of a willful violation." A.R.S. § 23-364(H). 12 Under Rule 23, "[c]ommencement of a class action suspends the applicable statute 13 of limitations as to all asserted members of the class who would have been parties had the 14 suit been permitted to continue as a class action." Am. Pipe & Constr. Co. v. Utah, 414 U.S. 538, 554 (1974). Rule 23(c)(2)(B) provides that "[f]or any class certified under Rule 15 23(b)(3) . . . the court must direct to class members the best notice that is practicable under 16 the circumstances, including individual notice to all members who can be identified 17 through reasonable effort." "Notice must be 'timely, accurate, and informative.'" Fowler v. 18 Union Pac. R.R. Co., No. EDCV 17-02451 JGB (SPx), 2018 WL 6318836, at *11 (C.D. 19 Cal. July 23, 2018) (quoting Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 172 20 (1989)). 21 B. Analysis 22 The Court, after conducting an in-depth analysis as required by Rule 23, certified 23 the Unpaid Wages Class under Rule 23(b)(3) to seek to recover unpaid and untimely wages 24 to the extent they may be owed pursuant to A.R.S. §§ 23-350–65. (See Doc. 93 at 19–28.) 25 The Court, having considered the parties' arguments regarding the applicable statute of 26 limitations, now defines the Unpaid Wages Class to include individuals who worked as 27 helpers at All My Sons Moving & Storage of Tucson between July 2, 2017 and the date 28 notice is sent. As with the FLSA claims, the Court finds that a three-year period from the 1 date of the complaint is appropriate where, as here, Plaintiff has made allegations of 2 willfulness but there is not sufficient evidence currently before the Court to make a merits 3 determination on willfulness. 4 The Court does not find it necessary, however, to postpone notice of the class action 5 until the close of discovery. Instead, to facilitate the timely notice that is required, the Court 6 will grant Plaintiff's request for 14 days to file a Motion for Notice Approval. 7 Rule 23(g)(1) further requires the Court to appoint class counsel. Fed. R. Civ. P. 8 23(g)(1). The Court must consider "(i) the work counsel has done in identifying or 9 investigating potential claims in the action; (ii) counsel's experience in handling class 10 actions, other complex litigation, and the types of claims asserted in the action; (iii) 11 counsel's knowledge of applicable law; and (iv) the resources that counsel will commit to 12 representing the class." Id. 13 The Court appoints Patricia Nicole Syverson and Ty Derek Frankel of Bonnett 14 Fairbourn Friedman & Balint PC to represent the Unpaid Wages Class. Upon moving for class certification, Plaintiff provided the Court with information regarding the experience 15 and qualifications of Patricia Nicole Syverson, Ty Derek Frankel, and the firm Bonnett 16 Fairbourn Friedman & Balint PC in litigating class action lawsuits as well as wage and 17 hour litigation. (See Doc. 54-14.) The Court previously indicated that it is satisfied, based 18 on this information, that Plaintiff's counsel has the requisite experience, knowledge, and 19 resources to litigate these claims. (See Doc. 93 at 26.) Moreover, the Court finds that 20 Plaintiff's counsel has done significant work identifying and investigating the claims. 21 For the foregoing reasons, 22 IT IS ORDERED: 23 (1) The proposed Notice of Collective Action Lawsuit (Doc. 98-1) and Consent to 24 Opt-In to Lawsuit (Doc. 98-2) are approved. 25 (2) Within 10 days of the date of this order, Defendants shall produce to Plaintiff a 26 computer-readable data file containing the names, last known mailing addresses, 27 last known email addresses, last known phone numbers, and dates of 28 employment for all potential opt-in plaintiffs in the collective action, including 1 all individuals who worked as helpers for All My Sons Moving & Storage of 2 Tucson between July 2, 2017 and the date notice is sent. 3 (3) Plaintiff is authorized to send the approved notice to potential opt-in plaintiffs 4 simultaneously via first-class mail, email, and text message. 5 (4) The Unpaid Wages Class is defined to include individuals who worked as 6 helpers at All My Sons Moving & Storage of Tucson between July 2, 2017 and 7 the date notice is sent. 8 (5) The Court appoints Patricia Nicole Syverson and Ty Derek Frankel of Bonnett 9 Fairbourn Friedman & Balint PC to represent the Unpaid Wages Class. 10 (6) Within 14 days of the date of this order, Plaintiff must file a Motion for Notice 11 Approval with regard to the Rule 23 Unpaid Wages Class. 12 Dated this 8th day of March, 2022. 13 14 15 / Dp N- 16 Honorable Raner ©. Collins 17 merior United States District Judge 18 19 20 21 22 23 24 25 26 27 28
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