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Randle v. Metropolitan Transit Authority of Harris County

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

April 25, 2019

HUBERT RANDLE on behalf of himself individually, and ALL OTHERS SIMILARLY SITUATED Plaintiffs,
v.
METROPOLITAN TRANSIT AUTHORITY OF HARRIS COUNTY Defendant.

          MEMORANDUM AND ORDER

          Lee H Rosenthal Chief United States District Judge

         Hubert Randle sued the Metropolitan Transit Authority of Harris County (Metro), alleging a failure to pay the overtime wages required under the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. (Docket Entry Nos. 1, 61). Randle drove vehicles for Metro's METROLift program. Metro moved to dismiss and to compel Randle to arbitrate his claim based on an arbitration clause in Randle's contract with Yellow Cab that gave him the right to drive for METROLift. (Docket Entry No. 95). The court granted Metro's motion and dismissed the litigation, without prejudice, in favor of arbitration. (Docket Entry No. 96). Randle asks this court to alter that ruling or, in the alternative, to equitably toll limitations. Randle also seeks leave to substitute Tameika Kirby as the named plaintiff. Metro responded to both motions, Randle replied, Metro surreplied, and Randle filed supplemental authority. (Docket Entry Nos. 97-102, 105, 111-13).

         After reviewing the parties' motions, responses, and replies; the record; and the applicable law, the court denies the motion to alter or amend the judgment and to equitably toll limitations, and denies the motion to substitute the named plaintiff. (Docket Entry Nos. 97, 98). The reasons for these rulings are set out below.

         I. Background

         The critical background facts are drawn from the record and set out in the court's Memorandum and Opinion granting Metro's motion to dismiss in favor of arbitration and need not be repeated here. (Docket Entry No. 95). Randle alleged that Metro had denied him overtime wages and misclassifed him as an exempt worker, in violation of the FLSA. Randle was a driver for the METROLift program, a paratransit service operating in the Houston area. Metro does not directly contract with drivers for the METROLift program, but instead contracts with the Greater Houston Transportation Company, which in turn contracts with companies like Yellow Cab Paratransit Services to hire independent contractors to drive specific METROLift routes. Randle had contracts with the Greater Houston Transportation Company and Yellow Cab (the “Yellow Cab Contracts”) to drive as an independent contractor for METROLift under the Greater Houston Transportation Company's contract with Metro. (See Docket Entry No. 74-2). Randle did not sue Yellow Cab.

         Randle's Yellow Cab Contracts included arbitration clauses. Metro, a nonsignatory to those contracts, moved to dismiss the litigation and to compel arbitration. (Docket Entry No. 24). The court granted Randle leave to amend and to substitute a party who was not subject to a similar arbitration clauses, but Randle did not do so in his amended complaint. (Docket Entry Nos. 58, 61). After Metro again moved to dismiss and to compel arbitration, and Randle responded, the court dismissed the litigation in favor of arbitration. (Docket Entry Nos. 74, 78, 79, 87, 94-96). Randle's motions to amend the judgment and to substitute the party plaintiff followed. (Docket Entry Nos. 97, 98).

         II. The Relevant Legal Standards

         A. The Motion for Reconsideration

         A party may move to alter judgment under Federal Rule of Civil Procedure 59(e) if the motion is filed with 28 days of the court's ruling. Demahy v. Schwarz Pharm. Inc., No. 11-31073, 2012 WL 5261492, at *2 n.2 (5th Cir. Oct. 25, 2012) (citing Tex. A&M Research Found. v. Magna Transp., Inc., 338 F.3d 394, 400 (5th Cir. 2003)). A Rule 59(e) motion “calls into question the correctness of a judgment.” Templet v. HydroChem Inc., 367 F.3d 473, 478-79 (5th Cir. 2004). A Rule 59(e) motion “‘must clearly establish either a manifest error of law or fact or must present newly discovered evidence' and ‘cannot be used to raise arguments which could, and should, have been made before the judgment issued.'” Rosenzweig v. Azurix Corp., 332 F.3d 854, 863-64 (5th Cir. 2003) (quoting Simon v. United States, 891 F.2d 1154, 1159 (5th Cir. 1990)).

         The court has “considerable discretion” in addressing a motion for reconsideration. Templet, 367 F.3d at 479. Changing an order or judgment under Rule 59(e) is an “extraordinary remedy” that courts use sparingly. Id.; see also 11 Charles Alan Wright, Arthur Miller & Mary Kay Kane, Federal Practice and Procedure § 2810.1 (3d ed. 2018). The Rule 59(e) standard “favors denial of motions to alter or amend a judgment.” S. Constructors Grp., Inc. v. Dynaelectric Co., 2 F.3d 606, 611 (5th Cir. 1993). A motion to reconsider may not be used to relitigate matters. raise arguments, or present evidence that could have been litigated, raised, or presented before the judgment or order was entered. Wright et al. § 2810.1.

         B. Equitable Tolling

         “The doctrine of equitable tolling preserves a plaintiff's claims when strict application of the statute of limitations would be inequitable.” United States v. Patterson, 211 F.3d 927, 930 (5th Cir. 2000) (quoting Davis v. Johnson, 158 F.3d 806, 810 (5th Cir. 1998)). The doctrine applies in “rare and exceptional circumstances, ” Teemac v. Henderson, 298 F.3d 452, 457 (5th Cir. 2002) (quoting Davis, 158 F.3d at 811), and is available only when a plaintiff diligently pursues his or her rights. Caldwell v. Dretke, 429 F.3d 521, 530 n.23 (5th Cir. 2005); see also Pacheco v. Rice, 966 F.2d 904, 906-07 (5th Cir. 1992) (equitable tolling is justified “when, despite all due diligence, a plaintiff is unable to discover essential information bearing on the existence of his claim”). Plaintiffs must demonstrate why a case should be exempt from the standard FLSA rule by showing that despite diligently pursuing their rights, they were “unable to discover essential information bearing on the existence of their claim.” Pacheco, 966 F.2d at 906-07.

         C. Substitution of a Named Plaintiff

         Leave to amend should “be freely given when justice so requires.” Fed.R.Civ.P. 15(a). District courts have discretion to determine whether justice requires granting leave. Zenith Radio Corp. v. Hazeltine Research, Inc., 401 U.S. 321, 330 (1971); Daves v. Payless Cashways, Inc., 661 F.2d 1022, 1024 (5th Cir. 1981). “A district court must possess a ‘substantial reason' to deny a request for leave to amend, but ‘leave to amend is by no means automatic.'” Jones v. Robinson Prop. Grp., L.P., 427 F.3d 987 (5th Cir. 2005) (citing Lyn-Lea Travel Corp. v. Am. Airlines, 283 F.3d 282, 286 (5th Cir. 2002); Halbert v. City of Cherman, 33 F.3d 526, 529 (5th Cir. 1994)). The factors “includ[e] undue delay, bad faith or dilatory motive on the part of the movant, repeated failures to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, and futility of the amendment.” Id. (citing Dussouy v. Gulf Coast Inv. Corp., 660 F.2d 594, 598 (5th Cir. 1981)).

         Each motion and issue is analyzed under the applicable legal standard.

         III. The Motion to Reconsider the Court's Order Dismissing the Litigation in Favor of Arbitration

         Randle argues that his motion to alter the judgment is “to correct error” and “prevent manifest injustice.” (Docket Entry No. 97 at 4). He argues that the court erred because: (1) direct-benefits estoppel does not apply to his claims against Metro; and (2) the arbitration clauses limit his substantive rights under the FLSA. (Id. at 4-5). Metro responds that Randle should have asserted each argument earlier and that he has not shown a manifest error of law. (Docket Entry No. 99 at 10).

         1. Randle's Argument Is Not Properly Raised in His ...


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