Mooney v. Fresenius Med. Care Holdings

1

KATHLEEN MOONEY and NICKOLLE ADAM, individually and on behalf of all others similarly situated, Plaintiffs, v. FRESENIUS MEDICAL CARE HOLDINGS, INC., Defendant.

Civil Action No. 1:22-CV-12037-AK

United States District Court, D. Massachusetts

August 22, 2024

MEMORANDUM AND ORDER ON PLAINTIFFS MOTION FOR RECONSIDERATION

HON ANGEL KELLEY, UNITED STATES DISTRICT JUDGE

Plaintiffs Kathleen Mooney (“Mooney”) and Nickolle Adam (“Adam”), on behalf of themselves and those similarly situated, move this Court to reconsider its prior decision to grant Defendant's Motion to Dismiss and to request leave to amend the complaint once more.

I. BACKGROUND

Familiarity with the record, procedural history, and arguments presented as well as this Court's previous opinion [see Dkt. 74] is assumed. Thus, the Court only details the facts that are relevant to the instant motion.

A. Employment Relationship

Mooney and Adam alongside the putative class members (together “Plaintiffs”), are similarly situated healthcare workers who were employed at dialysis centers affiliated with Fresenius Medical Care Holdings, Inc. (“Fresenius Holdings”) across the country. [Dkt. 28 ¶ 43]. Mooney worked at Bio-Medical Applications of North Carolina, Inc. and Bio-Medical Applications of South Carolina, Inc. [Id. ¶ 45]. In the First Amended Complaint (“FAC”), Adam did not identify who her direct employers were in Idaho or Oregon because she did not know at the time. [Id. ¶ 48]. While the FAC listed potential employers [Id. ¶¶ 48, 51], Adam maintains she had no reason to believe she worked for “anyone other than the same Fresenius company in both states.” [Id. ¶ 13]. Fresenius Holdings subsequently identified Adam's local employers as “Renal Care Group Inc.” and “FMC Dialysis Servs Oregon LLC.”^[1] [Dkt 36-1 at 2].

To demonstrate Fresenius Holdings was their joint employer, Plaintiffs allege they:

• Applied for their positions on a “Fresenius” website;

• Received a call from and were interviewed and hired by a “Fresenius” employee;

• Trained at a “Fresenius” location;

• Had access to a “Fresenius” intranet containing “Fresenius” policies and procedures, including the policy for tardiness and paid time off;

• Received monthly required training materials via email from “Fresenius” at their “Fresenius” work email; and

• Received assistance from their managers at each “Fresenius location” to transfer between states and were not required to re-apply for employment when transferring.

[Dkt. 28 ¶¶ 12-13]. Plaintiffs further allege that, to varying degrees, Fresenius Holdings determined their work conditions by:

• crafting policies and procedures that staff were required to follow;

• determining education and licensing requirements;

• having the authority to reassign Plaintiffs to dialysis centers in different states;

• determining the start and end date of employees' work;

• determining that Plaintiffs would be paid hourly and would receive their paychecks on a bi-weekly basis; and

• maintaining employment records of Plaintiffs on their systems and servers, which were managed by Fresenius Holdings employees.

[Id. ¶¶ 67-71, 73-75, 77-79]. In its Motion to Dismiss Plaintiffs' First Amended Complaint (“Motion to Dismiss”), Fresenius Holdings argued it could not be Plaintiffs' direct employer because it has no employees and Plaintiffs merely put forth conclusory allegations insufficient to establish joint employer liability. [Dkt. 36 at 3, 6-7].

A. Procedural History and the Laughlin Decision

In recent years, plaintiffs across the country have sued Fresenius Holdings and its local entities for wage and hour violations under the Fair Labor Standards Act (“FLSA”) and related state statutes. See e.g., Azurin v. Bio-Med. Applications of California, Inc., No. 23-CV-11585 (D. Mass. July 14, 2023) (Kelley, J.); Laughlin v. Fresenius Med. Care Holdings, Inc., No. 23-CV-00180 (E.D. Wash. June 22, 2023); Ruggeri Sarigu v. Bio-Med. Applications of Illinois, Inc., No. 23-CV-04508 (N.D. Ill. July 12, 2023); Schuman v. FMS New York Serv., LLC, No. 23-CV-05731 (E.D.N.Y. July 28, 2023); see also Osei-Tutu v. Fresenius Med. Care Holdings, Inc., No. 7:22-CV-04992 (S.D.N.Y. Jan. 30, 2023); Reyes v. Fresenius Med. Care Holdings, Inc., No. 20-CV-706 (M.D. Fla. July 7, 2021).

One of these cases, Laughlin v. Fresenius Medical Care Holdings, Inc., No. 23-CV-0180 (E.D. Wash. June 22, 2023), involves factual allegations remarkably similar to the ones before this Court. The named plaintiff, Laughlin, is a registered nurse who alleges Renal Care Group, Inc. (“RCG”), her direct employer, and Fresenius Holdings are both jointly liable for violating the Washington Minimum Wage Act. Laughlin v. Fresenius Med. Care Holdings, Inc., No. 23-CV-00180, 2023 WL 7093801, at *1 (E.D. Wash. Oct. 26, 2023) (“Laughlin I”). According to her, the two defendants automatically deducted meal breaks from her time worked and failed to pay her for this time. Id. In October 2023, the Laughlin court held that the plaintiff pled with insufficient specificity that Fresenius Holdings was a joint employer because she “offer[ed] nothing but conclusory statements that Fresenius retains the ability to hire or fire employees, supervised and controlled her work, made decisions about the rate of payment, or maintained records applicable to her employment.” Id. at *5. By failing to assert sufficient factual allegations to support the factors of the Ninth Circuit's “economic realities” test, the court dismissed the claims against Fresenius Holdings, making RCG the only remaining defendant. Id. at *5-6. Laughlin, who had not previously filed an amended complaint, was granted leave to amend to “factually clarify her claim that Fresenius is a joint employer.” Id. at *6. The plaintiffs then filed an amended complaint against Fresenius Holdings and RCG, and Fresenius Holdings subsequently filed a motion to dismiss the amended complaint.

On January 25, 2024, this Court granted Fresenius Holdings' Motion to Dismiss the Amended Complaint. [Dkt. 74]. This Court held that Adam had not identified her direct employer, making her unable to represent similarly situated class members. [Id. at 6]. Given the remarkable similarity between the facts alleged in Laughlin and the ones here, this Court found the reasoning in Laughlin I to be persuasive and held that Mooney did not allege sufficient facts to establish Fresenius Holdings was her joint employer. [Id. ¶ 9]. Because Fresenius Holdings is the only defendant here, the case was dismissed in its entirety and promptly closed. [Dkt 75].

Five days later, the court in Laughlin denied Fresenius Holdings' motion to dismiss the plaintiffs' first amended complaint. Laughlin v. Fresenius Med. Care Holdings, Inc., No. 2:23-CV-00180, 2024 WL 347155, at *1 (E.D. Wash. Jan. 30, 2024) (“Laughlin II”). Since Laughlin I, the plaintiffs had added three significant factual allegations to their amended complaint: 1) “Laughlin's offer letter was on Fresenius letterhead;” 2) “Fresenius instructed Laughlin and the Putative Class Members to identify themselves as Fresenius employees;” and 3) “RCG pays [the putative class members], but Fresenius does everything else.” Id. at *3-4. As a backdrop to this last claim was the plaintiffs' contention that Fresenius Holdings determined how the meal break and deduction as well as the different pay rates applied to plaintiffs. Id. at *1, *7. In Laughlin II, the court re-assessed whether Fresenius Holdings was Laughlin's joint employer and held that she plausibly alleged that Fresenius Holding “controlled the nature” of class members' work; it had “the power to determine the pay rates or methods” of class members; its “premises and equipment are used for the work;” and the “service rendered [is] an integral part of [Fresenius Holdings'] business.” Id. at *6-8. Taken together, the court concluded that “[p]laintiff has set forth enough facts to draw an inference that the ‘economic reality' of the RCG and Fresenius business relationship could be categorized as joint employers.” Id. at *8.

Plaintiffs' Motion for Reconsideration in this case was filed a month later. [Dkt. 78].

II. LEGAL STANDARD

Under Fed. R. Civ. P 59(e), a motion for reconsideration is “not a promising vehicle for revisiting a party's case and rearguing theories previously advanced and rejected.” Palmer v. Champion Mortg., 465 F.3d 24, 30 (1st Cir. 2006). Instead, this motion is “an extraordinary remedy which should be used sparingly.” Id. Accordingly, a “district court has substantial discretion and broad authority to grant or deny” a motion for reconsideration. Ruiz Rivera v. Pfizer Pharms., LLC, 521 F.3d 76, 81 (1st Cir. 2008). Motions for reconsideration are proper in a very limited set of circumstances, such as “manifest errors of law or fact, newly discovered or previously unavailable evidence, manifest injustice, and an intervening change in controlling law.” Marie v. Allied Home Mortg. Corp., 402 F.3d 1, 7 n.2 (1st Cir. 2005) (citation omitted). Plaintiffs argue that this Court's decision to dismiss Adam and the putative class members' claims was “manifest error [of law] and clearly unjust.” [Dkt. 78 at 1]. A finding of manifest injustice “requires a definite and firm conviction that a prior ruling on a material matter is unreasonable or obviously wrong.” Ellis v. United States, 313 F.3d 636, 648 (1st Cir. 2002). III. DISCUSSION

Plaintiffs assert that reconsideration is appropriate for three reasons. First, this Court erred in its dismissal of Adam on the grounds that she did not identify her direct employer in the FAC. [Dkt. 78 at 2]. Second, Mooney's claim should have survived the Defendant's Motion to Dismiss because the amended complaint before the court in Laughlin II was similar...