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Wilson v. Hunam Inn, Inc.

United States District Court, D. Columbia.

September 1, 2015

SARA WILSON, On behalf of herself and all others similarly situated, Plaintiff,
HUNAM INN, INC., et al., Defendants

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          For SARA WILSON, Plaintiff: Kenneth C. Gauvey, The Law Practice of Ken C. Gauvey, LLC, Hyattsville, MD.

         For HUNAM INN, INC., doing business as COBALT/30 DEGREES, DONALD ERIC LITTLE, DAVID PERRUZZA, Defendants: Joseph Peter Harkins, Steven E. Kaplan, LEAD ATTORNEYS, LITTLER MENDELSON, P.C., Washington, DC.

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         Emmet G. Sullivan, United States District Judge.

         Plaintiff Sara Wilson, on behalf of herself and all others similarly situated, brings this action against Defendant Hunam Inn, Inc., and individual Defendants Donald Eric Little, and David Perruzza, alleging violations of the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201 et seq., and the D.C. Minimum Wage Act (DCMWA), D.C. Code § 32-1001 et seq. Defendants move for partial dismissal of Ms. Wilson's complaint, or in the alternative, for partial summary judgment. Upon consideration of the motion, the response and reply thereto, the entire record, and the applicable law, Defendants' motion is DENIED.

         I. BACKGROUND

         Ms. Wilson is a former bartender at a D.C. nightclub operated by Defendant Human Inn, Inc. Compl., ECF No. 1 at ¶ ¶ 1, 2. Human Inn, Inc. is a D.C. corporation doing business under the names " Cobalt" and " 30 Degrees." Id. at ¶ 2. Defendant Donald Eric Little is the sole owner and President of Human Inn, Inc. Id. at ¶ 3; see also Defs.' Mot., ECF No. 8-2 at ¶ 3. Defendant David Perruzza is a corporate officer at Human Inn, Inc., whose responsibilities include signing payroll checks. Compl., ECF No. 1 at ¶ 4; Defs.' Mot. at 8-2 at ¶ 4.

         Ms. Wilson alleges that while employed as a bartender at Cobalt, she was not paid minimum wage or overtime. Compl., ECF No. 1, at ¶ ¶ 14, 15. Ms. Wilson alleges that her employers used an invalid " tip pooling" arrangement to avoid paying their employees minimum wage. Id. at ¶ ¶ 18, 53, 55. While under certain circumstances the FLSA allows employers to pay " tipped employees" at an hourly rate below the minimum wage, Ms. Wilson argues that the tip pooling arrangement used at Cobalt failed to meet the statutory criteria. Id. at 56. First, Ms. Wilson alleges that under the tip pool system, she and the other bartenders were forced to share their tips with non-tipped employees, such as " bar backs" and " floor employees," who do not ordinarily receive tips from customers. Id. at ¶ 55. Second, at some point during Ms. Wilson's employ with Cobalt, the nightclub's cleaning staff was fired and Ms. Wilson and the other bartenders were required to assume additional cleaning duties, such as cleaning the nightclub bathrooms. Id. at ¶ ¶ 18-19. Ms. Wilson argues that these additional cleaning duties were not exempt from the minimum wage requirement and that the bartenders should have been paid minimum wage for time spent performing this work. Id. at ¶ 18. She further alleges that the Defendants failed to provide her adequate notice that she would be compensated under the " tipped employee" exemption to the FLSA's minimum wage requirement. Id. at ¶ 60. Finally, Ms. Wilson alleges that

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she worked an average of 32 to 42 hours per week, but was not compensated for overtime work. Id. at ¶ 19.

         On October 21, 2014, Defendants moved for partial dismissal of the Plaintiff's complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), or in the alternative, for partial summary judgment pursuant to Rule 56. Defs.' Mot., ECF No. 8-3. Defendants first move to dismiss Plaintiff's complaint as to Mr. Little and Mr. Perruzza, arguing that Mr. Little and Mr. Perruzza are not " employers" under the FLSA or DCMWA and therefore not liable under the law. Id. at 6-8. Second, Defendants argue that Ms. Wilson has failed to sufficiently plead a " willful" violation of the FLSA, and that therefore, Plaintiff's " third year" FLSA claims should be dismissed. Id. at 8-9.

         In the alternative, Defendants move for partial summary judgment. First, Defendants argue that Ms. Wilson never worked more than 40 hours per week and therefore, the Court should grant summary judgment for the Defendants on Ms. Wilson's overtime claims under the FLSA and DCMWA. Defs.' Mot., ECF No. 8-3 at 10-11. Second, Defendants rearticulate their claims that Mr. Little and Mr. Perruzza are not Ms. Wilson's employers and seek summary judgment as to themselves individually. Id. at 13-16.


         A. Motion to Dismiss

         A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) " tests the legal sufficiency of a complaint." Browning v. Clinton, 292 F.3d 235, 242, 352 U.S. App.D.C. 4 (D.C. Cir. 2002). A complaint must contain a " short and plain statement of the claim showing that the pleader is entitled to relief, in order to give the [D]efendant fair notice of what the . . . claim is and the grounds upon which it rests." Bell A. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (internal quotation marks omitted). While detailed factual allegations are not necessary, Plaintiff must plead enough facts to " raise a right to relief above the speculative level." Id.

         When ruling on a Rule 12(b)(6) motion, the court may consider " the facts alleged in the complaint, documents attached as exhibits or incorporated by reference in the complaint, and matters about which the Court may take judicial notice." Gustave-Schmidt v. Chao, 226 F.Supp.2d 191, 196 (D.D.C. 2002). The court must construe the complaint liberally in Plaintiff's favor and grant Plaintiff the benefit of all reasonable inferences deriving from the complaint. Kowal v. MCI Commc'ns Corp., 16 F.3d 1271, 1276, 305 U.S. App.D.C. 60 (D.C. Cir. 1994). The Court must not accept inferences that are " unsupported by the facts set out in the complaint." Id. " Nor must the court accept legal conclusions cast in the form of factual allegations." Id. " [O]nly a complaint that states a plausible claim for relief survives a motion to dismiss." Ashcroft v. Iqbal, 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).

         B. Motion for Summary Judgment

         Summary judgment is appropriate " if the movant shows that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). The party seeking summary judgment bears the " initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact." Celotex ...

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