employees at parking facilities near Los Angeles International Airport. The Court weighed the factors set forth in Airways Parking, supra, and found coverage under the FLSA.
The defendants claim Airways Parking and Continental Parking are inapposite because of the lack of dependence of the defendants' garages on an interstate facility and the absence of special contractual relationships with the city government that characterized those cases. Although these are differences, they are not controlling.
The defendants' garages operate in the downtown business section of Washington, D.C. Admittedly they do not depend on one interstate facility for their revenue. It cannot be argued, however, that the defendants' employees do not facilitate interstate travel by commuters and shoppers from the surrounding Maryland and Virginia suburbs and by tourists from around the United States. Defendant Manning in his deposition admits that the garages sell monthly parking contracts to commuters (pp. 13-14), have contracts for parking with several hotels (pp. 14-15), and many downtown businesses (pp. 15-16). These contracts clearly facilitate the interstate transactions and are entwined with the continuous stream of interstate commerce. Moreover, given the unique geographic status of Washington, D.C., a common sense approach to interstate commerce requires the conclusion that the employees of the defendants are engaged in commerce. Interstate commerce would be impeded without the employees' activity.
The presence of competing parking facilities is irrelevant. Reliance on the lack of competition in Airways Parking and Continental Parking was only to demonstrate the relationship of the lots to the interstate facility. In the instant case the relationship of the lots to interstate travel has been shown previously. Defendants cannot claim exemption from the FLSA because of competition if they are otherwise found to be engaged in commerce. The Court finds that the defendants' employees are engaged in commerce and that the defendants are an enterprise engaged in commerce within the meaning of section 3(s) (1) and thus subject to the overtime pay provisions of section 7(a) (1) of the FLSA.
Need for an Injunction
The Secretary seeks an injunction to insure the defendants' future compliance with the FLSA. The issuance of an injunction is discretionary with the trial court, but an injunction works no hardship on an employer because it merely requires him to do what the FLSA demands anyway -- to comply with the law. Shultz v. Hinojosa, 432 F.2d 259, 267 (5th Cir. 1970). "The minimal inconvenience to the employer balanced against the difficulty of enforcing the Act to the public benefit, argues strongly for issuance of an injunction." Wirtz v. B.B. Saxon Co., 365 F.2d 457, 463 (5th Cir. 1966). Once past violations have been established, only the most compelling circumstances will require reversal of the issuance of an injunction. Gulf King Shrimp Co. v. Wirtz, 407 F.2d 508, 517 (5th Cir. 1969). If an employer has been previously investigated, an injunction is legally demanded if the violations are plain, and deal with easily understandable matters. Shultz v. Hinojosa, supra, at 260. The facts of this case mandate that an injunction be issued.
The individual defendants have been investigated before by the Secretary for overtime compensation violations at one of the defendant garages. By a stipulation of dismissal filed March 20, 1970, in Shultz v. S & M Enterprises, Civil Action No. 1836-69 (D.D.C.), the defendants promised future compliance with the overtime pay provisions of the FLSA at each of the three garages involved in the present suit. The Secretary then agreed to dismiss the case without seeking an injunction. Neither of the individual defendants took any steps to bring the garages into compliance with the FLSA (Swagart Deposition p. 36, Manning Deposition pp. 18-20). By their adoption of the Secretary's statement of material facts not in issue, they have admitted that they did not pay overtime compensation to their employees after the stipulation was entered into, although they assert in affidavits filed in support of their cross-motion for summary judgment that they are now in compliance.
The individual defendants have taken a reckless and cavalier attitude towards their responsibilities under the FLSA. Their continued violations of the law after the prior investigation require that an injunction be issued to compel future compliance so that the purposes of the FLSA are not subverted. Shultz v. Parke, 413 F.2d 1364, 1368 (5th Cir. 1969), on remand sub nom. Hodgson v. Parke, 324 F. Supp. 1297, 1300 (S.D. Tex. 1971).
The Secretary seeks the payment of back wages for the three years prior to the date of filing suit under the provision of 29 U.S.C. § 255(a) (1970) which extends the statute of limitations from two to three years for willful violations. The defendants claim that any failure to come into compliance with the FLSA was the result of misunderstandings and ordinary negligence. The facts outlined above clearly demonstrate that the defendants made no efforts to come into compliance with the FLSA, but rather disregarded their duties under it. As the Fifth Circuit held in Coleman v. Jiffy June Farms, Inc., 458 F.2d 1139, 1142 (5th Cir.), cert. denied, 409 U.S. 948, 34 L. Ed. 2d 219, 93 S. Ct. 292 (1972), violations are willful when
there is substantial evidence in the record to support a finding that the employer knew or suspected that his actions might violate the FLSA. Stated most simply, we think the test should be: Did the employer know the FLSA was in the picture?
The prior investigation by the Secretary put the defendants on notice that the FLSA "was in the picture." When coupled with their failure to implement steps to come into compliance with the FLSA, the evidence is substantial that the violations were willful within the meaning of the statute and thus are subject to the three year period of limitations. Cf. Hodgson v. Veterans Cleaning Service, Inc., 351 F. Supp. 741, 746-47 (M.D. Fla. 1972).
The defendants have claimed a right to set off certain claims already paid, note 3 supra. The parties will submit an appropriate Order within 10 days of the date of this Opinion incorporating any setoff to which the defendants are entitled.