Imbarrato v. Banta Mgmt. Servs.

PATRICK IMBARRATO and NICK PRAINO,on behalf of themselves and all others similarly situated, Plaintiffs, v. BANTA MANAGEMENT SERVICES, INC.,BANTA BWW MDT, LLC, BANTA BWW ON,LLC, BANTA NINE MALL, LLC, BANTA BWW NB, LLC,GEORGE BANTA, SR., and GEORGE BANTA, JR., Defendants.

No. 18-cv-5422 (NSR)

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

March 20, 2020

OPINION & ORDER

NELSON S. ROMÁN, United States District Judge

Plaintiffs Patrick Imbarrato and Nick Praino¹ bring this action against Banta Management Services, Inc. ("Banta Management"), Banta BWW MDT, LLC ("Banta Middletown"), Banta BWW ON, LLC ("Banta Oneonta"), Banta Nine Mall, LLC ("Banta Wappingers Falls"), Banta BWW NB, LLC ("Banta Poughkeepsie," and together with Banta Management, Banta Middletown, Banta Oneonta, and Banta Wappingers Falls," Corporate Defendants"), George Banta, Sr., and George Banta, Jr., asserting claims under the Fair Labor Standards Act ("FLSA") and the New York Labor Law ("NYLL"). (ECF No. 1.) Before the Court is Defendants 'motion to partially dismiss the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (ECF No. 33.) Plaintiffs oppose the motion. (ECF No. 35.) For the following reasons, Defendants ' motion is GRANTED IN PART and DENIED IN PART.

BACKGROUND²

Defendant Banta Management is a family-run real estate development and management company based in Poughkeepsie, New York. (Compl. ¶ 2.) Buffalo Wild Wings ("BWW") is a casual dining restaurant and sports bar franchise with locations across the United States and other countries. (Id. ¶ 3.) Banta Management owns and operates three BWW franchises in the state of New York: one in Middletown, one in Wappingers Falls, and one in Oneonta. (Id.)

Plaintiffs are former servers at the BWW in Middletown. (Id. ¶¶ 21, 27.) Plaintiff Imbarrato worked at the Middletown BWW from in or around August 2013 through February 8, 2018. (Id. ¶ 21.) Plaintiff Praino worked at the Middletown BWW from in or around May 2013 through November 2013 and from in or around December 2014 through February 2015. (Id. ¶ 27.) Plaintiffs bring this action on behalf of themselves and other similarly situated tipped employees who worked at BWW restaurants owned by Defendants³ from October 3, 2013, through the present.⁴ (Id. ¶ 113.)

Plaintiffs allege that Defendants failed to provide them with proper minimum wages and overtime wages under federal and state law. Throughout Plaintiffs' employment, Defendants applied a tip credit to the minimum wage rate paid to Plaintiffs. (Id. ¶¶ 129, 136.) However, Plaintiffs performed non-tip-producing side-work for more than 20% of the time worked and/or two hours on a consistent basis, including pre-shift side-work, running side-work, and closing side-work. (Id. ¶¶ 130, 137.) Defendants did not notify Plaintiffs of the tip credit provisions of the FLSA or NYLL. (Id. ¶¶ 129, 136.) Furthermore, Defendants failed to pay Plaintiff Imbarrato overtime wages when he worked over 40 hours per week, and failed to pay either Plaintiff spread-of-hours pay or call-in pay as required by the NYLL. (Id. ¶¶ 132-33, 138-39.) Defendants also failed to furnish Plaintiffs with proper wage notices and wage statements listing rates paid, gross wages, and tip allowance, as required by the NYLL. (Id. ¶¶ 134-35, 140-41.)

In addition to suing Corporate Defendants, Plaintiffs seek to hold George Banta, Sr. ("Banta Sr."), the founder and owner of BWW, and his son George Banta, Jr. ("Banta Jr."), the Vice President of Banta Management, individually liable for violations of the FLSA and NYLL. (Id. ¶¶ 86, 100.) Plaintiffs allege that Corporate Defendants, Banta Sr., and Banta Jr. jointly employed Plaintiffs and are Plaintiffs' employers under the FLSA and NYLL. (Id. ¶¶ 32-35.) Plaintiffs also seek to hold the top ten shareholders of Banta Management jointly and severally liable for unpaid wages pursuant to New York Business Corporation Law ("NY BCL") § 630, and the top ten members of the remaining Corporate Defendants jointly and severally liable for unpaid wages pursuant to New York Limited Liability Company Law ("NY LLCL") § 609. (Id. ¶¶ 44, 53, 62, 71, 80.)

Defendants now move to partially dismiss the Complaint. (See Defs. Mem. in Support of Mot. to Dimiss ("Defs. Mot.") (ECF No. 34).) Specifically, Banta Sr. and Banta Jr. move to dismiss all claims against them, and all Defendants move to dismiss Plaintiffs' NYLL claims arising from Defendants' failure to provide Plaintiffs with proper wage notices and statements. Defendants also move to dismiss Plaintiffs' claims under NY BCL § 630 and NY LLCL § 609.

LEGAL STANDARD

Under Rule 12(b)(6), the inquiry is whether the complaint "contain[s] sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)); accord Hayden v. Paterson, 594 F.3d 150, 160 (2d Cir. 2010). "While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations." Id. at 679. To survive a motion to dismiss, a complaint must supply "factual allegations sufficient 'to raise a right to relief above the speculative level.'" ATSI Commc ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87, 98 (2d Cir. 2007) (quoting Twombly, 550 U.S. at 555). The Court must take all material factual allegations as true and draw reasonable inferences in the non-moving party's favor, but the Court is '"not bound to accept as true a legal conclusion couched as a factual allegation,'" or to credit "mere conclusory statements" or "[t]hreadbare recitals of the elements of a cause of action." Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). In determining whether a complaint states a plausible claim for relief, a district court must consider the context and "draw on its judicial experience and common sense." Id. at 662. A claim is facially plausible when the factual content pleaded allows a court "to draw a reasonable inference that the defendant is liable for the misconduct alleged." Id. at 678.

DISCUSSION

I. Liability of Individual Defendants

Banta Sr. and Banta Jr. (together, the "Individual Defendants"), move to dismiss Plaintiffs' FLSA and NYLL claims as against them for failure to state a claim upon which relief can be granted. Specifically, they assert that the Complaint is deficient insofar as it does not adequately allege an employer-employee relationship between the Individual Defendants and Plaintiffs. (Defs. Mot. at 5-9.) The Court disagrees.

The FLSA defines "employer" as "any person acting directly or indirectly in the interest of an employer in relation to an employee." 29 U.S.C. § 203(d). "The Supreme Court has emphasized that is an expansive definition with 'striking breadth.'" Hart v. Rick's Cabaret Intern., Inc., 967 F. Supp. 2d 901, 938-39 (S.D.N.Y. 2013) (quoting Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 326 (1992)). The "overarching concern is whether the alleged employer possessed the power to control the workers in question." Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132, 139 (2d Cir. 1999) (citation omitted).

In order for an individual defendant to be an employer, there must be more than just "[e]vidence that [the] individual is an owner or officer of a company, or otherwise makes corporate decisions that have nothing to do with an employee's function. . . . Instead, to be an 'employer,' an individual defendant must possess control over a company's actual 'operations' in a manner that relates to a plaintiff's employment." Irizarry v. Catsimatidis, 722 F.3d 99, 109 (2d Cir. 2013). "[T]he determination of whether an employer-employee relationship exists for purposes of the FLSA should be grounded in economic reality rather than technical concepts." Id. at 104 (citation and internal quotation marks omitted).

To determine whether an individual defendant is an employer under the FLSA, courts must apply the Second Circuit's four-factor test to determine the "economic reality" of the employment relationship, which considers whether the alleged employer "(1) had the power to hire and fire the employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records." Carter v. Dutchess Community College, 735 F.2d 8, 12 (2d Cir. 1984) (quoting Bonnette v. Calif. Health & Welfare Agency, 704 F.2d 1465, 1470 (9th Cir. 1983)). These factors are intended to be "nonexclusive and overlapping," and are to be applied in a manner that ensures that the economic reality test is "sufficiently comprehensive and flexible to give proper effect to the broad language of the FLSA." Irizarry, 722 F.3d at 105 (citation and internal quotation marks omitted). "No one of the four factors standing alone is dispositive. . . . Instead, the 'economic reality' test encompasses the totality of circumstances, no one of which is exclusive." Herman, 172 F.3d at 139 (citing Brock v. Superior Care, Inc., 840 F.2d 1054, 1059 (2d Cir. 1988)). Notwithstanding the flexibility of the economic reality test, however, a plaintiff must do more than recite the language of the test to plausibly allege that an individual defendant qualifies as an employer. See Bravo v. Established Burger One LLC, No. 12-CV-9044(CM), 2013 WL 5549495, at *7 (S.D.N.Y. Oct. 8, 2013) (collecting cases).

The NYLL's definition of "employer" is "nearly identical" to that of the FLSA, and the analysis of the employment relationship under both statutes is based on the same factors. See Fermin v. Las Delicias Peruanas Restaurant, Inc., 93 F. Supp. 3d 19, 37 (E.D.N.Y. 2015); Copantitla v. Fiskardo Estiatorio, Inc., 788 F. Supp. 2d 253, 308 n. 21 (S.D.N.Y. 2011); see also Mahoney v. Amekk Corp., No. 14-CV-4131, 2016 WL 6585810, at *9 (E.D.N.Y. Sept. 30, 2016) (collecting cases holding that the FLSA and NYLL are interpreted consistently with one another on the...