Henderson v. Enterprises

TARA HENDERSON, Plaintiff, v. KOLLER ENTERPRISES, d/b/a Koller-Craft South, Defendant.

Case No.: 4:15-cv-01522-SGC

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ALABAMA MIDDLE DIVISION

March 10, 2017

MEMORANDUM OPINION AND ORDER

On September 28, 2015, Defendant Koller Enterprises, Inc. ("Defendant") filed a motion to dismiss. (Doc. 6). Plaintiff Tara Henderson ("Plaintiff") responded (Doc. 16), and Defendant replied (Doc. 23). For the reasons that follow, the motion to dismiss will be denied.

I. BACKGROUND AND RELEVANT FACTS

On September 3, 2015, Plaintiff filed this action seeking a declaration that she is entitled to recover against Defendant as a successor to liability incurred by Mid-South Electronics, Inc. ("Mid-South"). (Doc. 17-1 at 2).¹ Plaintiff began working for Mid-South in 1992 and remained employed there until she was fired on September 14, 2012. (Doc. 17-1 at 2). On September 27, 2012, Plaintiff filed an EEOC charge, alleging race and sex discrimination. (Id.). Plaintiff claims she was fired for being "out of work" when, in fact, she was absent due to a seriousmedical condition. (Id. at 2-3). Plaintiff alleges she informed Mid-South she was taking FMLA leave because of her condition before she was fired. (Id. at 3).

On March 31, 2013, Defendant purchased the assets of Mid-South. (Id.). As part of the sale, Defendant was made aware of Plaintiff's EEOC charge and the allegations it contained. (Id.). Defendant took over the operations of Mid-South and continued operating the facility without interruption. (Id.). According to Defendant's website, its Gadsden, Alabama facility "has been in continuous operation for over 40 years providing plastic injection molding and electromechanical/mechanical assembly services to the Appliance, Automotive, Lighting, Telecommunications and Lawn & Garden industries." (Id.) Defendant produces the same or similar products to the ones Mid-South produced. (Id.). Several employees were retained after the sale. (Id.). A former Mid-South Vice President stated, "[T]he majority of people stayed over." (Id. at 3-4). This included supervisors and salaried and hourly employees. (Id. at 4).

On June 21, 2013, Plaintiff filed suit against Mid-South, asserting several claims, including violations of the Family and Medical Leave Act, 28 U.S.C. § 2611 et seq. ("FMLA"). See Henderson v. Mid-South Electronics, Inc., No. 4:13-cv-01166-KOB (N.D. Ala. filed June 21, 2013).² Henderson I was pending at the time this action was filed. At a pretrial conference in Henderson I, Plaintiff's counsel learned from Mid-South's counsel that Mid-South would likely have "little or no ability" to provide relief in the event of a judgment in Plaintiff's favor. (Doc. 17-1 at 5). Plaintiff alleges Defendant attempted in its sale contract with Mid-South to purchase only Mid-South's assets and disclaim its liabilities. (Id.). Plaintiff was not a party to the sale contract. (Id.).

Following a bench trial, another judge in this district found Mid-South liable for race discrimination and violations of the FMLA. See Henderson I at Doc. 58. The court awarded back pay from September 12, 2012, through December 7, 2012, including interest. Id. Plaintiff was further awarded liquidated and compensatory damages. Id. Judgment was entered in favor of Plaintiff on her FMLA interference and race discrimination claims for a total of $18,948.62. See id. at Doc. 63. Later, she was awarded attorneys' fees and costs for a total of $194,782.15. See id. at Doc. 69. Plaintiff continues to seek discovery as to execution of the judgment. See id. at Doc. 75.

Plaintiff seeks: (1) a declaration that Defendant's predecessor violated the FMLA; (2) a permanent injunction enjoining Defendant from continuing these violations; (3) an order requiring Defendant to make Plaintiff whole; and (4) such other relief as the cause of justice may require, including but not limited to attorneys' fees and expenses. (Doc. 17-1 at 9).

II. STANDARD OF REVIEW

Defendant moves for dismissal pursuant to Rules 12(b)(1) (subject matter jurisdiction), 12(b)(6) (failure to state a claim), and 12(b)(7) (failure to join a necessary party under Rule 19) of the Federal Rules of Civil Procedure.

A. Rule 12(b)(1)—Subject Matter Jurisdiction

Rule 12(b)(1) motions to dismiss for lack of subject matter jurisdiction are asserted on either facial or factual grounds. Carmichael v. Kellogg, Brown & Root Svcs., Inc. 572 F.3d 1271, 1279 (11th Cir. 2009) (citing Morrison v. Amway Corp., 323 F.3d 920, 925 n.5 (11th Cir. 2003)). Facial challenges are based solely on the allegations in the complaint, and as with a motion to dismiss under Rule 12(b)(6), the court must accept the complaint's allegations as true. Id.

B. Rule 12(b)(6)—Failure To State A Claim

In ruling on a motion to dismiss brought pursuant to Rule 12(b)(6), the court must accept the factual allegations set forth in the complaint as true. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Swierkiewicz v. Sorema N.A., 534 U.S. 506, 508 n.1, (2002); see also Lotierzo v. Woman's World Med. Ctr., Inc., 278 F.3d 1180, 1182 (11th Cir. 2002). In addition, all reasonable inferences should be drawn in favor of the plaintiff. See Omar ex. rel. Cannon v. Lindsey, 334 F.3d 1246, 1247 (11th Cir. 2003) (per curiam). Nonetheless, the plaintiff must still meet some minimal pleading requirements. Jackson v. Bellsouth Telecomm., 372 F.3d 1250, 1262-63 (11th Cir. 2004) (citations omitted). Indeed, while "[s]pecific facts are not necessary[,]" the complaint should " 'give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.'" Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per curiam) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Further, the plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556).

A "plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555 (internal quotations omitted); see also Jackson, 372 F.3d at 1262 (explaining that "[c]onclusory allegations, unwarranted deductions of facts or legal conclusions masquerading as facts will not prevent dismissal") (internal citation and quotations omitted). Indeed, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions," which simply are "not entitled to [an] assumptionof truth." Iqbal, 556 U.S. at 678, 680. Thus, in ruling on a motion to dismiss, the Court must determine whether the complaint contains "sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Id. at 678 (quoting Twombly, 550 U.S. at 570).

C. Rule 12(b)(7)—Failure To Join A Necessary Party

Rule 12(b)(7) calls for dismissal of an action when the plaintiff has failed to join an indispensable party under Rule 19. FED. R. CIV. P. 12(b)(7). Rule 19 sets forth a two-part analysis. Laker Airways, Inc. v. British Airways, PLC, 182 F.3d 843, 847 (11th Cir. 1999). First, the court determines whether the party in question should be joined—i.e., whether that person is a "necessary party." Id. A person is a necessary party where:

A. in that person's absence, the court cannot accord complete relief among existing parties; or

B. that person claims an interest relating to the subject of the action and is so situated that disposing of the action in the person's absence may:

(i) as a practical matter impair or impede the person's ability to protect the interest; or

(ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest.

FED. R. CIV. P. 19(a)(1). If a person who is necessary has not been joined, the court "must order that the person be made a party." Id. If the necessary person cannot be joined, the court analyzes the factors outlined in Rule 19(b) to determine whether "in equity and good conscience the action should proceed among the parties before it, or should be dismissed." Laker, 182 F.3d at 847 (quoting Rule 19(b)).

D. FMLA Liability

Liability may be imposed under the FMLA against an "employer" who denies the rights created by that statute. 29 U.S.C. § 2617(a)(1). This includes damages as well as equitable relief. Id. "Employer" is defined by the FMLA to include "any successor in interest of anemployer," as well as "any person who acts, directly or indirectly, in the interest of an employer to any of the employees of such employer." 29 U.S.C. § 2611(4)(A)(ii). The FMLA itself does not define the term "successor in interest," and the Eleventh Circuit has not yet provided guidance on the term. Wright v. Sandestin Investments, LLC, 914 F. Supp. 2d 1273, 1279 (N.D. Fla. December 12, 2012). However, the applicable labor regulation sets forth factors for determining whether an entity is a "successor in interest." Id. 29 C.F.R § 825.107 states:

For purposes of FMLA, in determining whether an employer is covered because it is a "successor in interest" to a covered employer, the factors . . . to be considered include:

1. Substantial continuity of the same business operations;

2. Use of the same plant;

3. Continuity of the work force;

4. Similarity of jobs and working conditions;

5. Similarity of supervisory personnel;

6. Similarity in machinery, equipment, and production methods;

7. Similarity of products or services; and

8. The ability of the predecessor to provide relief.

29 C.F.R. § 825.107(a). Further, "[n]otice may be relevant . . . in determining successor liability for violations of the predecessor." Id....