Jimenez v. Best Behavioral Healthcare, Inc.

RAMON JIMENEZ, Plaintiff v. BEST BEHAVIORAL HEALTHCARE, INC. et al., Defendants

CIVIL ACTION No. 18-1003

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA

DECEMBER 3, 2019

MEMORANDUM

PRATTER, J.

By way of Memorandum Opinion dated June 4, 2019, the Court granted Plaintiff Ramon Jimenez's motion for summary judgment, finding that he was an employee under the Fair Labor Standards Act and therefore entitled to backpay and overtime pay in the amount of $8,170.75. In that Opinion, the Court also denied Defendant Best Behavioral Healthcare, Inc. and Defendant Dr. Amarilis LaFontaine's joint motion for summary judgment on Mr. Jimenez's claim for backpay under the Pennsylvania Wage Payment and Collection Law.¹

The parties have since stipulated to the dismissal of Mr. Jimenez's state law claim. Now, the Court is left to decide Mr. Jimenez's motions for (1) liquidated damages in the amount of $8,170.75 and (2) attorney fees in the amount of $66,130.00 and costs in the amount of $15,541.59. For the reasons that follow, the Court grants the motion for liquidated damages in its entirety and grants in part and denies in part the motion for attorney fees and costs.²

MOTION FOR LIQUIDATED DAMAGES

I. Parties' Arguments

With respect to the motion for liquidated damages, Mr. Jimenez contends that Best Behavioral Healthcare, Inc. cannot demonstrate its burden of subjective good faith and objective reasonableness, which it must do to avoid paying liquidated damages under the FLSA. In support, Mr. Jimenez points to the lack of any pleading of the good faith defense and further, the absence of evidence proffered to demonstrate objective reasonableness. Mr. Jimenez also claims Best Behavioral Healthcare, Inc. did not engage in any objective reasonableness because (1) it utterly failed to pay him for his work and (2) took no action to determine its compliance with the FLSA.

In rebuttal, Best Behavioral Healthcare, Inc. asserts it has demonstrated good faith and objective reasonableness because it hired Mr. Jimenez as a 1099 independent contractor pursuant to the typical industry practice. Moreover, it contends that it did not consider Mr. Jimenez an employee on reasonable grounds because it relied on advice from its CPA, and even Mr. Jimenez believed he was hired and would be paid as an independent contractor. Best Behavioral Healthcare, Inc. also argues that "unknown to Defendants, Plaintiff was submitting false and inaccurate time sheets to Defendants' funding source and he had no intention of correcting his work and only sought to be paid." Defs.' Response to Pl.'s Mot. for Liquidated Damages (Doc. No. 46), p. 2.

II. Discussion

Under the Fair Labor Standards Act, 29 U.S.C. § 203 et seq., an employer who violates the minimum and overtime wage provisions of the Act must make payment for unpaid wages and liquidated damages in the same amount. See Martin v. Cooper Elec. Supply Co., 940 F.2d 896, 907 (3d Cir. 1991) (citing 29 U.S.C. § 216(b)); see also Schonewolf v. Waste Mgnt., Inc., No. 17-3745, 2018 WL 1381133, at *5 (E.D. Pa. Mar. 19, 2018) (noting that liquidated damages under the FLSA are compensatory). Despite the mandatory language of the statute, a court may exerciseits discretion and limit or altogether decline to award liquidated damages if an employer shows that (1) it acted in good faith and (2) it had reasonable grounds for its action (here, not paying Mr. Jimenez for work he performed). Martin, 940 F.2d at 907. To meet this burden, an employer must show it took affirmative steps "to ascertain the Act's requirements[.]" Id. The employer's burden here is high, and "'[d]ouble damages are the norm.'" Id. (citing Walton v. United Consumers Club, Inc., 786 F.2d 303, 310 (7^th Cir. 1986)). "'If the employer fails to come forward with plain and substantial evidence to satisfy the good faith and reasonableness requirements, the district court [must grant] liquidated damages.'" Id. at 908 (citing Williams v. Tri-County Growers, Inc., 747 F.2d 121, 129 (3d Cir. 1984)). See Martin, 940 F.2d at 909-910 (reversing the district court's denial of liquidated damages primarily because the employer had not shown that it took proactive steps, by way of any analysis or inquiry, to ascertain whether the plaintiff was exempt from overtime pay under the FLSA).

The Court will grant the request for liquidated damages because Best Behavioral Healthcare, Inc. has not demonstrated it took any affirmative steps to ascertain the FLSA's requirements.

To the extent Best Behavioral Healthcare, Inc. relies on industry practice to demonstrate that it met its burden, as a matter of law, that argument fails. See Keeley v. Loomis Fargo & Co., 183 F.3d 257, 270 (3d Cir. 1999) (noting that Third Circuit precedent "provide[s] that reasonable good faith is not shown when an employer does not inquire about the law's requirements, simply follows an industry trend of not complying with the law, or violates the law in order to remain competitive.")

Moreover, some courts have rejected reliance on an accountant's advice to show good faith and reasonableness, where the proponent of such reliance failed to identify any actual advice thatwas attempted to be followed. See, e.g., Acosta v. Maranto, No. 15-1378, 2018 WL 1997770, *8 (W.D. Ok. Apr. 27, 2018) (rejecting the employers' proffer of reliance on a CPA's advice because the employers failed to point to any particular advice of the CPA that was allegedly honestly followed). Like the employers in Acosta v. Maranto, Best Behavioral Healthcare, Inc. does not provide any evidence of specific advice, let alone of whether the advice related at all to the requirements of the FLSA. Thus, Best Behavioral Healthcare, Inc. has not demonstrated it took an "affirmative act," by way of analysis or inquiry, to ensure compliance with the FLSA, and the Court awards liquidated damages as mandated by the FLSA in the amount of $8,170.75 to Mr. Jimenez.³

MOTION FOR ATTORNEY FEES AND COSTS

I. Parties' Arguments

As to the motion for attorney fees and costs, Mr. Jimenez asserts his request for attorney fees is reasonable because he is seeking reimbursement for only substantive work done, specifically not seeking fees related to paralegal, clerical, redundant, unnecessary work, or travel. Nor is he seeking fees for work performed related to the state law claim that he voluntarily dismissed. Mr. Jimenez also asserts he only requests costs permitted by statute.

In response, Best Behavioral Healthcare, Inc. contends that Mr. Jimenez's motion for fees must be denied because Mr. Jimenez was awarded de minimis damages. In the alternative, Best Behavioral Healthcare, Inc. asserts that should the Court award fees, the amount should be reducedbecause Mr. Jimenez prevailed only partially, and further, the fee motion requests excessive and vague fees.

As to costs, Best Behavioral Healthcare, Inc. seeks a reduction of $13,048.59 for costs related to the depositions of Dr. Willie Brown, Mark Purdy, Jenny Ramirez, Marilyn Salcedo, and Dominique Dominiquez because these depositions purportedly did not help advance Mr. Jimenez's claims. Best Behavioral Healthcare, Inc. also asserts, generally as to all the costs requested, that they are not sufficiently detailed and because Mr. Jimenez's victory was limited, costs should be reduced accordingly.

In reply, Mr. Jimenez opposes the notion that his damages award is de minimis, because unlike the cases relied on by Best Behavioral Healthcare, Inc., he was awarded 100% of his damages sought at summary judgment. Mr. Jimenez also argues that his victory was not partial, and he has not requested fees related to his state law claim. According to Mr. Jimenez, Best Behavioral Healthcare, Inc. also has failed to meet its burden in identifying specific objections to the fees. As to Best Behavioral Healthcare, Inc.'s arguments on costs, he contends that all of the witnesses' depositions referenced by the defendants in fact either helped Mr. Jimenez prevail at summary judgment or would have been used at trial.

II. Discussion

Under the FLSA, the prevailing plaintiff is awarded attorney fees and costs. See 29 U.S.C. § 216(b) ("The court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorneys' fee to be paid by the defendant, and costs of the action.") A court calculates the appropriate fee award by "'multiplying the number of hours reasonably expended on the litigation [by] a reasonable hourly rate,'" which is called the "lodestar." Tobin v. Haverford Sch., 936 F. Supp. 284, 287 (E.D. Pa. 1996). Part and parcel to the determination ofwhether to award fees, a court must also decide the reasonableness of both the number of hours expended and the proposed hourly rate. Id. at 288.

The Third Circuit Court of Appeals has explained that a fee petition ought to include "some fairly definite information as to the hours devoted to various general activities, e.g., pretrial discovery, settlement negotiations, and the hours spent by various classes of attorneys, e.g., senior partners, junior partners, associates." Keenan v. City of Philadelphia, 983 F.2d 459, 473 (3d Cir. 1992) (internal citations omitted). However, "it is not necessary to know the exact number of minutes spent nor the precise activity to which each hour was devoted nor the specific attainments of each attorney." Id. Rather, the appellate court has found "sufficient specificity where the computer-generated time sheet provided 'the date the activity took place.'" Id.

When challenging fee petitions, a party must "submit briefs that identify the portion of the fee request being challenged and state the grounds for the challenge with sufficient specificity to give the fee applicants notice that they must defend the contested portion of their fee petition." Bell v. United Princeton Properties, Inc., 884 F.2d 713, 715 (3d Cir. 1989). While a district court has "a positive and affirmative function in...