DeKeyser v. Thyssenkrupp Waupaca, Inc.

589 F.Supp.2d 1026

Ryan DeKEYSER, Thomas Cooper, Harley Granius and Carlo Lantz, on behalf of themselves and others similarly situated, Plaintiffs, v. THYSSENKRUPP WAUPACA, INC., d/b/a Waupaca Foundry, Inc., Defendant.

Case No. 08-C-488.

United States District Court, E.D. Wisconsin.

November 26, 2008.

COPYRIGHT MATERIAL OMITTED

Anne T. Regan, John Gordon Rudd, Jr., Ronald S Goldser, Zimmerman Reed PLLP, Minneapolis, MN, Kelly A. Swanson, T. Joseph Snodgrass, Troy F. Tatting, Larson King LLP, St. Paul, MN, for Plaintiffs.

Joseph Louis Olson, Paul E. Benson, Mitchell W. Quick, Michael Best & Friedrich LLP, Milwaukee, WI, for Defendant.

DECISION AND ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS

WILLIAM C. GRIESBACH, District Judge.

Plaintiffs Ryan DeKeyser, Thomas Cooper, Harley Granius and Carlo Lantz filed this lawsuit against Defendant Thyssenkrupp Waupaca, Inc., d/b/a Waupaca Foundry, Inc. ("Waupaca"). Plaintiffs have brought a collective action pursuant to the Fair Labor Standards Act of 1938 as Amended, 29 U.S.C. § 201, et seq. ("FLSA"), and a Wisconsin state law class action pursuant to Rule 23 of the Federal Rules of Civil Procedure and the Class Action Fairness Act, 28 U.S.C. § 1332(d) as Amended ("CAFA"). The four claims asserted by the plaintiffs under federal and Wisconsin law all relate to compensation for time spent by plaintiffs "donning and doffing gear and equipment, showering, and walking to and from the production floor." (Compl. ¶ 1.) Jurisdiction rests on 28 U.S.C. §§ 1331, 1332, 1337 and 1367.¹ The state law claims are based upon the Wisconsin wage and hour laws, Wis. Stat. chs. 103 and §§ 109.01-109.11, the Wisconsin Administrative Code and common law. The case is presently before the Court on a motion to dismiss filed by Waupaca. Waupaca contends that Plaintiffs fail to state a claim for which relief may be granted under Fed.R.Civ.P. 12(b)(6) and moves that three of the four claims advanced by the Plaintiffs be dismissed, along with a portion of the remaining claim. Plaintiffs opposed the motion. For the reasons stated herein, the motion to dismiss will be granted in part and denied in part. The relevant facts as alleged in the complaint are set forth below.

BACKGROUND

The named Plaintiffs in this action are current and former nonexempt hourly foundry workers who were or are employed by Waupaca at its foundries in Marinette or Waupaca, Wisconsin. (Compl. ¶¶ 1, 8-12.) The complaint contemplates three distinct classes of potential plaintiffs in addition to the named Plaintiffs: (1) the "FLSA class," those who were, are or will be employed by Waupaca as a foundry worker at any time within three years² prior to the complaint through the date of final disposition of the case; (2) the "Wisconsin class," those who were, are or will be employed by Waupaca as a foundry worker at any time within two years prior to the complaint through the date of final disposition of the case; and (3) other "similarly situated persons currently or formerly employed by Defendant in states other that the State of Wisconsin ..." (Compl. ¶¶ 2-4.)

The Plaintiffs allege that Waupaca, a member of a highly regulated industry, is required to provide proper environmental controls to protect worker safety and provide its workers the means to protect themselves from the dangers inherent in foundry work. (Compl. ¶ 22.) The complaint alleges that Waupaca has not fully compensated its employees for time spent "donning and doffing gear and equipment, showering, and walking to and from the production floor." (Compl. ¶ 1.) The Plaintiff alleges that Waupaca did not exercise good faith in "willfully failing to fully compensate its employees under the FLSA." (Compl. ¶ 25.) The four causes of action advanced by the Plaintiffs are: (1) violation of the FLSA for failure to pay overtime and failure to keep records of hours worked; (2) violation of Wisconsin Administrative Code DWD 274.03 for failure to pay overtime, and failing to keep records of hours worked in under Wisconsin Statutes § 103.74 and Wisconsin Administrative Code DWD 272.11³; (3) violation of Wisconsin Statutes § 109.03 for failure to pay all wages due, and failure to pay a minimum wage for each hour worked according to Wisconsin Administrative Code DWD 272.03; and (4) common law breach of contract for failure to pay Plaintiffs compensation for their work. (Compl. ¶¶ 41-2, 46, 48-9, 53, 55, 60-2.)

ANALYSIS

A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the complaint to state a claim upon which relief may be granted. See Fed.R.Civ.P. 12(b)(6). Rule 8(a)(2) mandates that a claim contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). The Supreme Court has held that a complaint must contain factual allegations which are enough "to raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1965, 167 L.Ed.2d 929 (2007). In ruling on a motion to dismiss under Rule 12(b)(6), a court must view the plaintiff's factual allegations and any inferences reasonably drawn from them in a light most favorable to the plaintiff. Yasak v. Retirement Bd. of the Policemen's Annuity and Benefit Fund of Chi., 357 F.3d 677, 678 (7th Cir.2004).

I. Preemption

In its motion to dismiss, Waupaca contends that Plaintiffs' second, third and fourth causes of action, all based upon claims made under Wisconsin law,⁴ are preempted by the FLSA. (Def.'s Br. 12.) Waupaca contends that the state law claims are preempted both procedurally and substantively. Procedurally, Waupaca argues that the procedural collective action requirements of the FLSA impliedly preempt Plaintiffs' effort to proceed on their state law claims as a class action under Rule 23. Fed.R.Civ.P. 23. The FLSA provides that no employee can be a party to an action under the FLSA without the consent of the employee and thus requires that any collective action proceed on an "opt-in" basis. 29 U.S.C. § 216(b). The procedure of certifying a class action for state wage and overtime claims under Rule 23, on the other hand, operates on an "opt-out" basis, where an employee not wishing to be bound by the adjudication on the merits must elect to be excluded from the proceedings. Waupaca argues that the two procedures are irreconcilable and that the FLSA procedurally preempts state law claims under Rule 23. Substantively, Waupaca argues that Plaintiffs' state statutory and common law claims are subsumed within the FLSA claim, as the Plaintiffs seek compensation for time spent donning and doffing gear and equipment, showering, and walking to and from the production floor. Because there is nothing to suggest that claims under Wisconsin law provide greater protection or remedies than those offered by the FLSA, Waupaca asserts they are preempted.

Federal law can preempt and thus invalidate state law. Congressional power to preempt state law is derived from the Supremacy Clause of Article VI of the Constitution. U.S. Const. art. VI, cl. 2. The question of whether federal law preempts state law is one of congressional intent. English v. General Elec. Co., 496 U.S. 72, 78-79, 110 S.Ct. 2270, 110 L.Ed.2d 65 (1990). "Preemption can take on three different forms: express preemption, field preemption, and conflict preemption." Aux Sable Liquid Prods. v. Murphy, 526 F.3d 1028, 1033 (7th Cir.2008) (citation omitted). Field preemption and conflict preemption are forms of implied preemption. Gade v. Nat'l Solid Wastes Mgmt. Assoc., 505 U.S. 88, 98, 112 S.Ct. 2374, 120 L.Ed.2d 73 (1992). Field preemption exists "when federal law so thoroughly occupies a legislative field as to make it reasonable to infer that Congress left no room for the states to act." Aux Sable Liquid Prods., 526 F.3d at 1033 (internal quotation and citations omitted). Conflict preemption "exists if it would be impossible for a party to comply with both local and federal requirements or where local law `stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.'" Aux Sable Liquid Prods., 526 F.3d at 1033 (internal quotation and citations omitted). "A state law also is pre-empted if it interferes with the methods by which the federal statute was designed to reach this goal." Int'l Paper Co. v. Ouellette, 479 U.S. 481, 494, 107 S.Ct. 805, 93 L.Ed.2d 883 (1987). Regardless of the form of preemption in question, the "ultimate task in any pre-emption case is to determine whether state regulation is consistent with the structure and purpose of the statute as a whole." Gade, 505 U.S. at 98, 112 S.Ct. 2374.

It is clear that in enacting the FLSA, Congress did not explicitly preempt state wage and hour laws. Indeed, the FLSA contains a "savings clause" that expressly allows states to provide workers with more beneficial minimum wages and maximum workweeks than those mandated by the FLSA itself. See 29 U.S.C. § 218(a) ("No provision of this chapter or of any order thereunder shall excuse noncompliance with any ... State law or municipal ordinance establishing a minimum wage higher than the minimum wage established under this chapter or a maximum workweek lower than the maximum workweek established under this chapter...."). Given this express statement of Congress' intent not to displace state laws granting workers higher minimum wages or a shorter maximum workweek, it is clear that the FLSA would preempt only state laws that mandated lower minimum wages or longer maximum workweeks. Since the parties agree that the Wisconsin wage and hour laws, Wis. Stat. chs. 103 and 104 and §§ 109.01-109.11, are not less generous than those of the FLSA, it seems clear that the FLSA does not displace the state law. Rather, it would seem that state law may offer an alternative legal basis for equal or more generous relief for the same alleged wrongs.

It thus follows that Waupaca's substantive...