Holland v. Bordelon

CRYSTAL HOLLAND,Individually and on Behalf of All Others Similarly Situated PLAINTIFFS v. ROCK BORDELON, et al. DEFENDANTS

Case No. 4:20-cv-00344-KGB

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF ARKANSAS CENTRAL DIVISION

March 15, 2021

ORDER

Before the Court is a motion to dismiss filed by separate defendants Allegiance Hospital of North Little Rock, LLC, d/b/a NorthMetro Medical Center ("Allegiance") and Rock Bordelon (collectively, "separate defendants") (Dkt. No. 4). Plaintiff Crystal Holland filed a response (Dkt. No. 6), and separate defendants filed a reply (Dkt. No. 7-1). Also pending before the Court is a motion for leave to file first amended and substituted complaint (Dkt. No. 9). Separate defendants responded in opposition to the motion to amend (Dkt. No. 10). For the following reasons, the Court grants the motion to amend (Dkt. No. 10) and denies as moot separate defendants' pending motion to dismiss (Dkt. No. 4).

I. Background

Ms. Holland filed her original complaint in the Circuit Court of Pulaski County, Arkansas, and defendants removed the action to this Court, asserting that this Court has federal question jurisdiction pursuant to 28 U.S.C. § 1331 citing the Employee Retirement Income Security Act of 1947 ("ERISA"), 29 U.S.C. §§ 1001-1461, and the Class Action Fairness Act, 28 U.S.C. § 1332(d) (Dkt. Nos. 1, 3). In her original complaint, Ms. Holland brings this class action, individually and on behalf of all others similarly situated, against Rock Bordelon, Allegiance, T. Jason Reed, and Freedom Behavioral Hospital of Central Arkansas, LLC, for deprivation of "vacation time, sick time, and insurance coverage in violation of their contract and consideration with Defendants" (Dkt. No. 2, ¶ 20). Ms. Holland maintains that she and other similarly situated individuals who worked for defendants were promised sick and vacation time and had insurance premium payments withheld from their paychecks but were not paid their sick and vacation time and their insurance premiums did not secure them insurance (Id., ¶ 20). Ms. Holland asserts that these allegations constitute breach of contract, unjust enrichment, and a violation of the Arkansas Minimum Wage Act ("AMWA"), Arkansas Code Annotated § 11-4-201, et seq. (Id., ¶¶ 31, 40-54). As relief, Ms. Holland requests that defendants be required to account to her, class members, and the Court for all of the hours worked by her and the class members and all monies or time that should have been paid to them; certification of, and proper notice to, together with an opportunity to opt-out of the litigation, all qualifying current and former employees; judgment for damages for breach of contract and unjust enrichment; an order directing defendants to pay her and members of the class pre-judgment interest, reasonable attorney's fees, and all costs connected with this action; and such other and further relief as this Court may deem necessary, just, and proper (Id., at 9-10).

In her proposed first amended and substituted complaint, Ms. Holland proposes adding certain individual plaintiffs and adding defendants GPN/Jacksonville, LLC and Allegiance Health Management, Inc. (Dkt. No. 9, ¶ 2). Further, Ms. Holland proposes adding a Federal Rule of Civil Procedure 23 "sub-class of members who were employed by Defendants at their Jacksonville, Arkansas location and deprived of their pay in violation of the contract and consideration with Defendants, as well as minimum wages for July and August 2019." (Id., ¶ 3). In the proposed amended complaint, plaintiffs seek leave to add three additional claims for relief including but not limited to individual claims under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201, etseq., collective action claims for violations of the FLSA, and individual claims for violation of the AMWA (Id., ¶ 4).

II. Legal Standard

A court has discretion to grant leave to amend and must freely do so "when justice so requires." Fed. R. Civ. P. 15(a)(2); Becker v. Univ. of Neb. at Omaha, 191 F.3d 904, 907-08 (8th Cir. 1999). In interpreting Rule 15, the United States Supreme Court stated:

If the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded the opportunity to test his claims on the merits. In the absence of any apparent or declared reason—such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc.—the leave sought should, as the rules require, be "freely given."

Foman v. Davis, 371 U.S. 178, 182 (1962); see Becker, 191 F.3d at 907-08.

Futility, one of the reasons that may prevent an amendment, exists when the claim would not withstand a motion to dismiss for failure to state a claim upon which relief can be granted. Cornelia I. Crowell GST Trust v. Possis Med., Inc., 519 F.3d 778, 781-83 (8th Cir. 2008) (evaluating "futility" of asserted claims under Fed. R. Civ. P. 12(b)(6) standard). Futility determinations utilize the Twombly "plausibility" standard under Rule 12(b)(6). Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556-57 (2007)). A party moving to amend under Rule 15(a) must support its claim with sufficient specificity to raise a right to relief above the speculative level and to raise a reasonable expectation that discovery will reveal the evidence of the claim. See Twombly, 550 U.S. at 555.

To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). A claim isfacially plausible "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556). "While a complaint attacked by a [Federal] Rule [of Civil Procedure] 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitle [ment] 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 (citations omitted). "[T]he complaint must contain facts which state a claim as a matter of law and must not be conclusory." Briehl v. General Motors Corp., 172 F.3d 623, 627 (8th Cir. 1999) (citing Frey v. City of Herculaneum, 44 F.3d 667, 671 (8th Cir. 1995)). "When ruling on a motion to dismiss, the district court must accept the allegations contained in the complaint as true and all reasonable inferences from the complaint must be drawn in favor of the nonmoving party." Young v. City of St. Charles, 244 F.3d 623, 627 (8th Cir. 2001).

At this stage of the litigation, the Court also observes that the Federal Rules of Civil Procedure explicitly allow parties to include in their pleadings demands for alternative relief, "set out 2 or more statements of a claim or defense alternatively or hypothetically," and "state as many separate claims or defenses as it has, regardless of consistency." Fed. R. Civ. P. 8(a)(3); 8(d)(2), (3).

"[A]s a general proposition, if a defendant files a Motion to Dismiss, and the plaintiff later files an Amended Complaint, the amended pleading renders the defendant's motion to dismiss moot." Oniyah v. St. Cloud State Univ., 655 F. Supp. 2d 948, 958 (D. Minn. 2009) (citing Pure Country, Inc. v. Sigma Chi Fraternity, 312 F.3d 952, 956 (8th Cir. 2002) ("If anything, [plaintiff's] motion to amend the complaint rendered moot [defendant's] motion to dismiss the original complaint."); Standard Chlorine of Del., Inc. v. Sinibaldi, 821 F. Supp. 232, 239-40 (D. Del. 1992)(finding that plaintiff's filing of an amended complaint rendered defendant's motion to dismiss moot)).

III. Futility

Separate defendants oppose Ms. Holland's motion to amend based on a claim of futility (Dkt. No. 10). Separate defendants assert that they have an outstanding motion to dismiss and that the Court should rule on that motion so that no futile claims are asserted in the amended complaint (Dkt. No. 10, ¶ 5).

In their motion, separate defendants move to dismiss Ms. Holland's original complaint for failure to state a claim pursuant to Rule 12(b)(6) (Dkt. No. 4). Separate defendants assert that no provision of the AMWA allows for Ms. Holland's claims (Id., ¶ 3). Additionally, separate defendants assert that Ms. Holland fails to state a claim for breach of contract and that the claim for unjust enrichment also fails (Id., ¶ 4). Separate defendants also assert in their briefing on the motion to dismiss preemption and failure to state a claim against Mr. Bordelon in his individual capacity (Dkt. No. 5, at 4-5). In response, Ms. Holland argues that the facts pleaded in her complaint are sufficient to state a claim for minimum wage violations of the AMWA by defendants and to put defendants on notice of her claims against them (Dkt. No. 6, at 2). Ms. Holland asserts that her AMWA claims should not be dismissed because her complaint meets the pleading standards set by district courts both in the Eighth Circuit and elsewhere (Id.). Ms. Holland asserts that her breach of contract claim is pleaded specifically and mirrors the claims pleaded in two recent Supreme Court of Arkansas cases with the equivalent type of contract for employee leave time (Id., at 7). Finally, Ms. Holland argues that her unjust enrichment claim is properly pleaded and falls under an exception to the general rule that unjust enrichment cannot lie when a written contract exists (Id., at 8).

A. AMWA

Under the AWMA, "[a]n employee may bring an action for equitable and monetary relief against an employer . . . if the employer pays the employee...