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Vaughn v. The Document Group Inc.

United States District Court, S.D. Texas, Houston Division

April 20, 2017

EUGENE VAUGHN, Individually and on behalf of all others similarly situated, Plaintiff,
v.
THE DOCUMENT GROUP INC., Defendant.

          MEMORANDUM AND ORDER

          NANCY F. ATLAS SENIOR UNITED STATES DISTRICT JUDGE.

         This Fair Labor Standards Act (“FLSA”) case is before the Court on the Motion for Conditional Certification and for Notice to Putative Class Members (“Motion”) [Doc. # 9] filed by Plaintiff Eugene Vaughn. Defendant The Document Group, Inc. (“TDG”) filed a Response [Doc. # 11], Vaughn filed a Reply [Doc. # 12], and TDG filed a Sur-Reply [Doc. # 814].[1] Having carefully reviewed the record and the applicable legal authorities, the Court concludes that the pending Motion should be granted. The Court will conditionally certify a class consisting of “all current and former Manual Laborers and Scanner Operators who were classified as independent contractors and who worked for The Document Group on or after April 20, 2014, and worked more than forty hours in a week but were not paid overtime pay at the rate of one and one-half times their regular hourly rate.”

         I. BACKGROUND

         TDG provides litigation support services to law firms and their clients, including copying, scanning, organizing, and storing records (“litigation support work”).[2] TDG asserts, and Vaughn does not dispute, that the volume of documents and the timeframe in which TDG is tasked to complete its litigation support work differ from project to project.[3] It is also undisputed that certain of the individuals hired by TDG to perform the litigation support work are classified as employees of TDG, while others are classified as independent contractors. TDG asserts, without challenge, that it supplements its workers' ranks as needed to assist with high-volume projects that have tight deadlines.[4]

         Vaughn alleges that from March, 2016, until October 4, 2016, he performed litigation support work, including scanning, printing, and binding documents for TDG.[5] Vaughn, whom TDG classified as an independent contractor, filed this lawsuit under the FLSA, alleging that he regularly worked in excess of forty hours and was not paid overtime wages for the hours worked in a week in excess of forty. Vaughn now seeks conditional certification of a class comprised of all Manual Laborers and Scanner Operators (“litigation support workers”) TDG employed as independent contractors within the past three years, which class the Court interprets to be limited to those who worked in excess of forty hours in a week and were not paid overtime at the rate of one and one-half times their regular hourly rate.[6]

         Vaughn, in support of his Motion, relies on evidence, such as his own affidavit and the affidavit of another worker TDG classified as an independent contractor. The Motion has been fully briefed and is now ripe for decision.

         II. APPLICABLE LEGAL PRINCIPLES

         A. FLSA Obligations

         The FLSA provides that “no employer shall employ any of his employees . . . for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.” 29 U.S.C. § 207(a)(1). An employee may sue his employer under the FLSA on “behalf of himself ... and other employees similarly situated.” 29 U.S.C. § 216(b). Similarly situated employees can “opt-in” to a lawsuit under § 207(a) to benefit from a judgment.

         B. Standard for Conditional Certification

         When considering whether to certify a lawsuit under the FLSA as a collective action, courts in this federal district generally use a “two-stage approach.” See Austin v. Onward, LLC, 161 F.Supp.3d 457, 461 (S.D. Tex. 2015); see also Caballero v. Kelly Servs., Inc., Civil Action No. H-14-1828, 2015 WL 12732863, *3 (S.D. Tex. Oct. 5, 2015); Diaz v. Applied Machinery Corp., Civil Action No. H-15-1282, H-15-2674, 2016 WL 3568087, *4 (S.D. Tex. June 24, 2016); Walker v. Honghua Am., LLC, 870 F.Supp.2d 462, 465 (S.D. Tex. 2012). At the first stage, the Court decides whether to conditionally certify a class into which individuals may opt if they seek to benefit and be bound by the outcome of the case. At this stage, in essence, the Court is deciding whether to issue notice to potential class members. See Walker, 870 F.Supp.2d at 465. The second stage occurs when discovery is largely complete. If it chooses, the defendant may move to “decertify” the conditionally certified class. See Id. at 466. “Neither stage of certification is an opportunity for the court to assess the merits of the claim by deciding factual disputes or making credibility determinations.” McKnight v. D. Houston, Inc., 756 F.Supp.2d 794, 802 (S.D. Tex. 2010).

         At the notice stage, the Court's decision is generally based on the pleadings, affidavits, and other limited evidence. Mooney v. Aramco Servs. Co., 54 F.3d 1207, 1214 (5th Cir. 1995), overruled on other grounds by Desert Palace, Inc. v. Costa, 539 U.S. 90 (2003); Walker, 870 F.Supp.2d at 465. At this stage, the plaintiff is required to show that “(1) there is a reasonable basis for crediting the assertions that aggrieved individuals exist, (2) that those aggrieved individuals are similarly situated to the plaintiff in relevant respects given the claims and defenses asserted, and (3) that those individuals want to opt-in to the lawsuit.” Walker, 870 F.Supp.2d at 465-66; see also Andel v. Patterson-UTI Drilling Co., LLC, 280 F.R.D. 287, 289 (S.D. Tex. 2012). “Although collective actions under the FLSA are generally favored, the named plaintiff(s) must present some factual support for the existence of a class-wide policy or practice.” Carey v. 24 Hour Fitness USA, Inc., 2012 WL 4857562, at *1 (S.D. Tex. Oct. 11, 2012) (citing Walker, 870 F.Supp.2d at 466). Conclusory allegations that other employees are similarly situated are insufficient to justify conditional certification. Rodriguez v. Flower Foods, Inc., Civil Action No. 4:16-CV-245, 2016 WL 7210943, at *2 (S.D. Tex. Dec. 13, 2016).[7]

         To be “similarly situated, ” there must be “substantial allegations that potential members ‘were together the victims of a single decision, policy, or plan.'” McKnight, 756 F.Supp.2d at 801 (quoting Mooney, 54 F.3d at 1213). Certification should be denied “‘if the action arises from circumstances purely personal to the plaintiff, and not from any generally applicable rule, policy, or practice.'” Id. (quoting England v. New Century Fin. Corp., 370 F.Supp.2d 504, 507 (M.D. La. 2005)). Where minimal evidence is advanced at the notice stage, the conditional class determination “is made using a fairly lenient standard, and typically results in ‘conditional certification' of a representative class” that provides potential class members with notice and the opportunity to opt in. See Id. (quoting Mooney, 54 F.3d at 1214 n.8); see also Walker, 870 F.Supp.2d at 465.

         III. ANALYSIS

         A. Evidence that Other Aggrieved Individuals Exist

         To satisfy the first element under the analysis Vaughn need only show that there is a reasonable basis for believing that other aggrieved individuals exist. See Heeg, 907 F.Supp.2d at 862. In addition to his own affidavit, Vaughn has submitted an affidavit from Naseem Roberson, in which Roberson affirms his intention to join the lawsuit as a plaintiff.[8] Roberson, like Vaughn, states that he performed litigation support work for TDG and that TDG classified Roberson as an independent contractor and did not pay him overtime wages.[9] Roberson also states that he estimates at least fifteen TDG workers whose duties were similar to those Roberson performed and who were not paid overtime for hours worked in excess of forty, and identifies three by name.[10] TDG does not challenge Vaughn or Roberson's averments that other aggrieved individuals exist. The Court finds that Vaughn has provided sufficient evidence to credit his assertion that aggrieved individuals exist. See Heeg, 907 F.Supp.2d at 862; cf. Rodriguez, 2016 WL 7210943, at *2 (“[t]o show that there are similarly situated employees, a plaintiff would ideally produce affidavits from potential class members affirming their intention to join the lawsuit.” (citing McKnight, 756 F.Supp.2d at 805 (S.D. Tex. 2010)).[11] The first element for conditional certification is satisfied.

         B. Existence of Similarly Situated Individuals

         As noted, Vaughn seeks conditional certification of a class comprised of all litigation support workers TDG employed as independent contractors within the past three years.[12] Vaughn alleges he and the other putative class members are similarly situated because, first, “Defendant has a common policy of mischaracterizing workers as independent contractors and thereby paying them straight time instead of the statutorily required overtime pay for hours worked above forty (40) each week[], ” and, second, “Plaintiff and putative class members performed the same job duties and were paid straight time instead of time and a half for overtime hours worked.”[13] These arguments are intertwined and will be addressed in tandem.

         TDG disputes that conditional certification is warranted. TDG asserts that Vaughn fails to identify “a single decision, policy or plan that TDG purportedly subjected Plaintiff and putative class members to in their relationship with TDG.”[14]Moreover, TDG argues, the similarity determination requires an individualized analysis that renders this suit inappropriate for class action.[15]

         To be “similarly situated, ” there must be “‘substantial allegations that potential members were together the victims of a single decision, policy, or plan.'” Caballero v. Kelly Servs., Inc., Civil Action No. H-14-1828, 2015 WL 12732863, at *3 (S.D. Tex. 2015) (quoting McKnight, 756 F.Supp.2d at 801). Additionally, “[f]or the class representative to be considered similarly situated to the potential opt in class members, the class representative must be similarly situated in terms of job requirements and similarly situated in terms of payment provisions.” Vanzzini v. Action Meat Distribs., Civil Action No. H-11-4173, 2012 WL 1941763, at *3 (S.D. Tex. May 29, 2012) (quoting Ryan v. Staff Care, Inc., 497 F.Supp.2d 820, 825 (N.D. Tex. 2007)). “Plaintiffs ‘need only show that their positions are similar, not identical, to putative plaintiffs.'” Walker, 870 F.Supp.2d at 468 (quoting Jesiek v. Fire Pros, Inc., 275 F.R.D. 242, 246 (W.D. Mich. 2011)). However, “if the job duties among potential members of the class vary significantly, then class certification should not be granted.” See Dreyer, 2008 WL 5204149, at *2 (emphasis in original).

         The Court determines that Vaughn and members of the putative class are sufficiently similarly situated to one another with respect to their work for TDG and TDG's pay practices to satisfy this factor. Vaughn has adequately alleged a TDG policy with respect to the putative class, namely, that TDG misclassified certain litigation support workers as independent contractors in order to avoid paying those individuals overtime.[16] Vaughn also has adduced evidence of similarity in job requirements and pay provisions among the class, pointing to spreadsheets supplied to Vaughn by TDG in the course of litigation that detail the job descriptions of and pay accorded to prospective members.[17]See Diaz, 2016 WL 3568087, at *8-9; Heeg, 907 F.Supp.2d at 865. In 2017, for example, the job requirements of litigation support workers TDG classified as independent contractors are described as “[s]can despeckle, ...


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