Wirtz v. First National Bank & Trust Co.

239 F. Supp. 613, 1965 U.S. Dist. LEXIS 6794
CourtDistrict Court, W.D. Oklahoma
DecidedMarch 25, 1965
DocketCiv. Nos. 9837, 63-310
StatusPublished
Cited by8 cases

This text of 239 F. Supp. 613 (Wirtz v. First National Bank & Trust Co.) is published on Counsel Stack Legal Research, covering District Court, W.D. Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wirtz v. First National Bank & Trust Co., 239 F. Supp. 613, 1965 U.S. Dist. LEXIS 6794 (W.D. Okla. 1965).

Opinion

DAUGHERTY, District Judge.

These consolidated cases consist of an action brought by the Secretary of Labor, in his official capacity, to enjoin future violations of the Fair Labor Standards Act of 1938, as amended, 29 U.S. C.A. § 201 et seq., by the defendants, First National Bank and Trust Company of Oklahoma City and the First National Management Corporation, and an action brought by Mabel V. Kirby, a former employee of the defendant, Management Corporation, to recover moneys due her as minimum and overtime wages plus a reasonable attorneys’ fees for said defendants’ failure to comply with the provisions of said Act. The specific violations deal with the failure on the part of the defendant, Management Corporation, to pay certain “maintenance” and/ or “service” employees the proper minimum and overtime wage as required by the said Act as amended in 1961.

The parties have filed a stipulation and a supplement thereto which along with two depositions and the answered interrogatories contain all the facts of this controversy. All parties at consolidated pre-trial hearing submitted the matter to the Court for decision on the foregoing.

The defendant Bank is a corporation organized under the National Banking Laws and is engaged in the commercial banking business. The defendant Management Corporation is an Oklahoma corporation engaged in the sole business of operating the First National Bank Building, the First National Office Building and the First National Parking Garage Building. The Bank is the sole owner and stockholder of the Management Corporation. There is a written contract between the Bank and the Management Corporation for the operation of the said buildings, all of which are solely owned by the Bank. Further, there is an oral lease from the Management Corporation to the Bank for the space occupied by [615]*615the Bank in the said buildings. The space occupied by the Bank is 158,549 square feet of 20.7 per cent of the 741,-238 total square feet of all three buildings. All insurance is carried jointly by the defendants and a third entity not material to this case. Actual title to the buildings involved is held by the Bank and the buildings are carried on the Bank’s books as an asset. Income from building rentals is shown on the books of the Bank as general earnings. Gross rentals for space in the buildings exceed $200,000 per month and the tenants include oil companies, insurance companies, law firms and many other diverse businesses, some of which are engaged in interstate commerce or in the production of goods therefor, as defined by the Act. The building manager is also a vice president of the Bank and receives a salary from both defendants. The Management Corporation’s sole income is $30,-000 per year which is paid to it as a fee by the Bank for the operation of the said buildings. The Bank employs an average of 440 employees, all of whom are engaged in interstate commerce or in the production of goods for interstate commerce as defined by the Act. The Management Corporation employs an average of 205 persons in the maintenance and operation of the involved buildings. There is no dispute that certain of said employees are not receiving the minimum and overtime wage required by the Act if coverage is present.

The primary assertion of the Secretary is that since the 1961 amendments to the Act became effective, the two defendants constitute an “enterprise engaged in commerce or in the production of goods for commerce” within the meaning of Sections 203(r) and 203 (s) of the Act so as to entitle the said “maintenance” and/or “service” people of the involved buildings to the monetary benefits of the Act.

The defendants counter with basically three contentions. First, they assert that the Management Corporation does not have any employees engaged in commerce or engaged in the production of goods for commerce, relying upon 10 East 40th St. Bldg., Inc. v. Callus, et al., 325 U.S. 578, 65 S.Ct. 1227, 89 L.Ed. 1806. Second, the defendants assert that they are not an “enterprise” within the meaning of the Act. And third, the defendants assert that rental income and bank income are not “sales” as that term is used in Sections 203 (k) and 203(s) (3) of the Act, and therefore, any enterprise is not in commerce.

The pertinent provisions of the Act are set out as follows:

“Sec. 203 (k) ‘Sale’ or ‘sell” includes any sale, exchange, contract to sell, consignment for sale, shipment for sale, or other disposition.”
“Sec. 203(r) ‘Enterprise’ means the related activities performed (either through unified operation or common control) by any person or persons for a common business purpose, and includes all such activities whether performed in one or more establishments or by one or more corporate or other organizational units including departments of an establishment operated through leasing arrangements, but shall not include the related activities performed for such enterprise by an independent contractor. * * *
“Sec. 203(s) ‘Enterprise engaged in commerce or in the production of goods for commerce’ means any of the following in the activities of which employees are so engaged, including employees handling, selling, or otherwise working on goods that have been moved in or produced for commerce by any person.”
“Sec. 203(s) (3) any establishment of any such enterprise, except establishments and enterprises referred to in other paragraphs of this subsection, which has employees engaged in commerce or in the production of goods for commerce if the annual gross volume of sales of such enterprise is not less than $1,000,000 * * *•
[616]*616“Sec. 206 (b) Every employer shall pay to each of his employees who in any workweek (i) is employed in an enterprise engaged in commerce or in the production of goods for commerce, as defined in section 3(s) (1), (2), or (4) [of this title] or by an establishment described in section 3(s) (3) or (5), and who, except for the enactment of the Fair Labor Standards Amendments of 1961, would not be within the purview of this section,” * * *.

The case of 10 East 40th St. Bldg., Inc. v. Callus, et al., supra, decided in 1945, held that the maintenance employees of a metropolitan office building occupied by various tenants, some of which were in commerce and some of which were not in commerce, were not covered by the Act, inasmuch as there was not present “a close and immediate tie” between the maintenance employees and the commerce activities emanating from the office building. The Callus case must be considered with the case of A. B. Kirschbaum Company v. Walling, 316 U.S. 517, 62 S.Ct. 1116, 86 L.Ed. 1638, which held that the maintenance employees of a building devoted entirely to manufacture for commerce were covered because there existed the necessary “close and immediate tie” with commerce and the case of Borden Company v. Borella, 325 U.S. 679, 65 S.Ct. 1223, 89 L.Ed.

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239 F. Supp. 613, 1965 U.S. Dist. LEXIS 6794, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wirtz-v-first-national-bank-trust-co-okwd-1965.