Luna-Reyes v. RFI Constr., LLC

57 F.Supp.3d 495

Joaquin LUNA–REYES, on behalf of himself and all others similarly situated, Plaintiff

v.RFI CONSTRUCTION, LLC, Rupert Burrows, and William Warrick, Defendants.

No. 1:14cv235.

United States District Court, M.D. North Carolina.

Signed Nov. 3, 2014.

Jimmy Derek Braziel, Lee & Braziel, LLP, Dallas, TX, Gilda A. Hernandez, Law Offices of Gilda A. Hernandez, PLLC, Apex, NC, for Plaintiff.

Theodore C. Edwards, II, Kilpatrick Townsend & Stockton LLP, Raleigh, NC, Kip Nelson, Smith Moore Leatherwood LLP, Greensboro, NC, Defendant.

MEMORANDUM OPINION AND ORDER

THOMAS D. SCHROEDER, District Judge.

This is an action by Plaintiff Joaquin Luna–Reyes under the Fair Labor Standards Act (FLSA) of 1938, 29 U.S.C. §§ 201 et seq., and the North Carolina Wage and Hour Act (NCWHA), N.C. Gen.Stat. §§ 95–25.1 et seq. Before the court are two motions: Defendants RFI Construction, LLC (“RFI Construction”) and Rupert Burrows (collectively the “RFI Defendants”) move to dismiss the complaint for lack of subject matter jurisdiction and, alternatively, failure to state a claim upon which relief can be granted pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6), respectively (Doc. 14); and Luna–Reyes moves for leave to file a surreply pursuant to Local Rule 7.6 (Doc. 24). For the reasons set forth below, the RFI Defendants' Rule 12(b)(1) motion will be denied and their Rule 12(b)(6) motion will be treated as a motion for more definite statement under Rule 12(e) and will be granted. Luna–Reyes' motion for leave to file a surreply will be denied.

I. BACKGROUND

The facts, viewed in the light most favorable to Luna–Reyes, are as follows:

Defendant RFI Construction is a North Carolina limited liability company. (Doc. 13 (“Compl.”) ¶ 7.) Defendant Burrows is its owner and CEO and handles its day-to-day business, including approving employees' pay.¹ (Id. ¶ 34.) RFI Construction and Burrows “hired” Defendant William Warrick² “to perform subcontracted work for those two Defendants for projects on which RFI was working.” (Id. ¶ 35.) At some time before October 2013, Warrick contacted Luna–Reyes to work for “Defendants” and “controlled Plaintiff's work activities and compensation.” (Id.)

For approximately the entire month of October 2013, Luna–Reyes worked as an hourly-paid (non-salaried) carpenter at a construction site in Durham. (Id. ¶¶ 5, 21–22.) He could not hire someone else to perform his job or serve as his replacement. (Id. ¶ 25.) His job neither required a high degree of skill nor was the job for any specific project or time. (Id. ¶¶ 26, 29.) Rather, when hired, Luna–Reyes expected to work “for the company” for an indefinite period of time. (Id. ¶ 29.)

The complaint makes repeated references to “Defendants” without specifying which allegedly took what action. According to Luna–Reyes, “Defendants controlled all aspects” of his work, which was conducted under “Defendants' ” employees' supervision. (Id. ¶¶ 23, 26, 28.) Warrick, however, “controlled [his] work activities and compensation.” (Id. ¶ 35.) “Defendants” also set his hourly pay and maintained his payroll records. (Id. ¶¶ 24, 33.) Finally, “Defendants” provided him with the specialized equipment required for his work. (Id. ¶ 27.)

Luna–Reyes alleges that he was paid the same hourly rate for all hours he worked, even when they exceeded forty per week. (Id. ¶ 30.) He further alleges that he was not paid at all for at least one week. (Id.) He finally alleges that other hourly-paid laborers and installers of “Defendants” faced the same issues with their pay. (Id.)

Luna–Reyes filed his original complaint on March 20, 2014, naming only RFI Construction as Defendant and asserting two causes of action. (Doc. 1.) RFI Construction answered on April 22, 2014. (Doc. 9.) Luna–Reyes then filed an amended complaint on May 16, 2014, adding Burrows and Warrick as Defendants. (Doc. 13.) Warrick has yet to be served.

RFI Defendants now move to dismiss Luna–Reyes' claims for lack of subject-matter jurisdiction and for failure to state a claim. (Docs. 14.) Plaintiff has responded (Doc. 20), and RFI Defendants have replied (Doc. 22). Plaintiff also moves for leave to file a surreply. (Doc. 24.) RFI Defendants have responded to the motion for leave to file a surreply (Doc. 25), and Plaintiff has replied (Doc. 26.). The motions are now ripe for consideration.

II. ANALYSIS

A. Motion for Leave to File Surreply

Luna–Reyes moves for leave to file a surreply (Doc. 24) to RFI Defendants' reply brief (Doc. 22), citing Local Rule 7.6. (See Doc. 24 ¶ 4.) A surreply is not generally allowed under this district's Local Rules. See Local Rule 7.3; DiPaulo v. Potter, 733 F.Supp.2d 666, 670 (M.D.N.C.2010). However, Local Rule 7.6 provides that “[i]f an evidentiary objection is raised by the moving party in its reply memorandum, the nonmoving party may file a surreply memorandum pursuant to this subparagraph within seven (7) days addressing only the evidentiary objection.” L.R. 7.6 (effective March 1, 2014). Luna–Reyes contends that he meets this standard because RFI Defendants' reply brief raised “evidentiary objections” to the facts in the declaration he submitted in response to their motion to dismiss on subject-matter jurisdiction grounds.

The court is not persuaded. RFI Defendants' reply brief argued that Luna–Reyes' declaration “does nothing more than recite the general conclusions of the Amended Complaint.” (Doc. 22 at 5.) To accept Luna–Reyes' characterization of this as an evidentiary objection would authorize the filing of a surreply whenever the evidence submitted falls short. That is not the purpose of the rule. Moreover, the court cannot say that fairness dictates that the surreply be allowed. Luna–Reyes had a fair opportunity to file whatever factual proof he wished in response to the motion to dismiss.

Luna–Reyes' motion for leave to file a surreply is therefore denied.

B. Motion to Dismiss

1. Subject–Matter Jurisdiction

RFI Defendants first seek to dismiss Luna–Reyes' claims for want of subject-matter jurisdiction under Rule 12(b)(1) on the ground that they, as Defendants, do not qualify as “employers” under the FLSA. “[I]f there is no employer, ” they contend, “there is no subject matter jurisdiction under the FLSA.” (Doc. 15 at 5.) Luna–Reyes argues that he has sufficiently alleged and demonstrated subject-matter jurisdiction at this stage. However, the parties misperceive the issue.

The Fourth Circuit provides two avenues for a defendant to challenge subject-matter jurisdiction under Rule 12(b)(1) :

First, it may be contended that a complaint simply fails to allege facts upon which subject matter jurisdiction can be based. In that event, all the facts alleged in the complaint are assumed to be true and the plaintiff, in effect, is afforded the same procedural protection as he would receive under a Rule 12(b)(6) consideration. Second, it may be contended that the jurisdictional allegations of the complaint were not true. A trial court may then go beyond the allegations of the complaint and in an evidentiary hearing determine if there are facts to support the jurisdictional allegations.

Adams v. Bain, 697 F.2d 1213, 1219 (4th Cir.1982) (footnote omitted). Here, RFI Defendants pursue the latter and argue that Luna–Reyes' factual allegations are false. (See Doc. 22 at 4.)

As a general rule, when subject-matter jurisdiction is challenged, the party asserting jurisdiction, Luna–Reyes, bears the burden of establishing it. Adams, 697 F.2d at 1219. “[W]here the jurisdictional facts are intertwined with the facts central to the merits of the dispute,” the factual dispute should be resolved in a proceeding on the merits. Id. And “unless the jurisdictional allegations are clearly immaterial or wholly unsubstantial and frivolous,” resolution of factual disputes should occur “only after appropriate discovery.” Kerns v. United States, 585 F.3d 187, 193 (4th Cir.2009) (citing Bell v. Hood, 327 U.S. 678, 682, 66 S.Ct. 773, 90 L.Ed. 939 (1946) ). It is on this point that the parties have focused their arguments. RFI Defendants argue that determining whether they are “employers” under the FLSA does not overlap with the merits of Luna–Reyes' claims. (Doc. 15 at 4–9.) Conversely, Luna–Reyes argues that “whether a defendant is an ‘employer’ also relates to the threshold substantive question” of his claims. (Doc. 20 at 9.) Unfortunately, both parties' arguments rely on older cases which rest on a now-faulty assumption: that determining whether a defendant is an “employer” under the FLSA is a jurisdictional fact. It is not.

In Arbaugh v. Y & H Corp., 546 U.S. 500, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006), the Supreme Court created a bright-line rule that “when Congress does not rank a statutory limitation on coverage as jurisdictional, courts should treat the restriction as nonjurisdictional in character.”Id. at 516, 126 S.Ct. 1235. That is, unless “the Legislature clearly states that a threshold limitation on a statute's scope shall count as jurisdictional,” that limitation “is an element of a plaintiff's claim for relief, not a jurisdictional issue.” Id. at 515–16, 126 S.Ct. 1235 (footnote omitted). Applying this rule, the Court held that Title VII's requirement that a defendant have at least fifteen employees to qualify as an “employer” was not “jurisdictional” but rather “an element of a plaintiff's claim for relief.” Id. at 516, 126 S.Ct. 1235.

The Arbaugh rule extends beyond Title VII's fifteen-employee requirement and even Title VII itself. See, e.g., Union Pac. R.R. Co. v. Bhd. of Locomotive Engineers, 558 U.S. 67, 81–86, 130 S.Ct. 584, 175 L.Ed.2d 428 (2009) (holding that a procedural rule under the Railway Labor Act requiring proof of a pre-arbitration settlement conference is not jurisdictional under Arbaugh ); Reynolds v. Am. Nat'l Red Cross, 701 F.3d 143, 155 (4th Cir.2012) (“[T]he issue of whether the Chapter is an ‘employer’ under the ADA is non-jurisdictional in nature.”); Murphy–Taylor v. Hofmann, 968...