Shibetti v. Z Rest., Diner & Lounge

BONNIE SHIBETTI and KATRINA PUCCINI,individually and on behalf of all others similarly situated, Plaintiffs, v. Z RESTAURANT, DINER AND LOUNGE, INC.,ADEL FATHELBAB, ADAM FATHELBAB,KAMAL FATHELBAB, ESSAM ELBASSIONY,MIKO ENTERPRISES, LLC, MICHAEL SIDERAKIS, CHRISTOS SIDERAKIS,KONSTANTINOS SIKLAS, CROWN CROPSEY A VENUE LLC,LGMALONEY LLC, XYZ CORP(s) 1-5, and JOHN DOE(s) 1-5, Defendants.

18-CV-856 (ERK) (ST)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

August 30, 2019

REPORT AND RECOMMENDATION

TISCIONE, United States Magistrate Judge:

Plaintiffs Bonnie Shibetti and Katrina Puccini bring this action against the above-named Defendants alleging claims under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq., New York Labor Law ("NYLL"), N.Y. Lab. Law § 195(3), New York City Human Rights Law ("NYCHRL"), N.Y.C. Admin. Code, § 8-101 et seq., and New York common law. See Dkt. Nos. 1 (Complaint), 90 (Third Amended Complaint) ("TAC"). Plaintiffs seek to recover unpaid: minimum wages, overtime compensation, and spread-of-hours pay. In addition, Plaintiffs allege that Defendants have engaged in a practice of creating and maintaining a hostile work environment by refusing to take notice of, investigate, or discipline repeated acts of sexual assault and harassment taken by Kamal Fathalbab, a male supervisor, and other male employees against Shibetti, Puccini, and other female servers at the Parkview Diner. TAC ¶ 2. Plaintiffs also assert that Defendants unlawfully retaliated against Shibetti for engaging in protected activity, unlawfully discriminated against Puccini on the basis of her pregnancy status, and engaged in negligent hiring and supervision of various employees. TAC ¶¶ 3-4. On November 29, 2018, Defendant Z Restaurant, Diner and Lounge, Inc. ("Z Diner") filed a fully briefed Motion to Dismiss for Failure to State a Claim. See Dkt. Nos. 94, 96.¹ On February 27, 2019, the Honorable Edward R. Korman referred Z Diner's Motion to this Court for a report and recommendation. For the reasons set forth below, the Court respectfully recommends that Defendants' Motion be GRANTED in part and DENIED in part.

I. BACKGROUND²

Z Diner is a current or former owner, operator, licensor, licensee, lessee, or manager of a restaurant called Parkview Diner located in Brooklyn, New York. TAC ¶ 12. In June 2015, Shibetti was hired by Z Diner to work as a waitress at the Parkview Diner. TAC ¶ 48. During her training period, Shibetti worked three, eight-hour work shifts, for which she did not receive pay. TAC ¶ 50. Following the training period, Shibetti worked at the Diner on Wednesdays through Sundays, from approximately 9:00 a.m. to 6:00 p.m. TAC ¶ 51. From the beginning of her employment in June 2015 to her termination in April 2016, Shibetti was paid at a rate of $2.00 per hour; she was never paid for any hours she worked in excess of forty hours in a given workweek. TAC ¶ 54. The Complaint offers the following example as a typical workweek: "during the week of February 24-28, 2016, Shibetti was paid $80.00 for approximately forty-five (45) or more hours she worked at the Parkview Diner for an approximate effective rate of $1.78 per hour." TAC ¶ 54.

Shibetti also alleges that she was subject to a hostile work environment and other sexually discriminatory and retaliatory actions. TAC ¶ 64. Shibetti alleges that her direct supervisor,Kamal Fathelbab, sexually assaulted and harassed her on several occasions. TAC ¶ 65. On one occasion, Kamal Fathelbab followed Shibetti into the women's restroom, cornered her, and then pulled his penis out of his pants. TAC ¶ 66. During another instance, Kamal Fathalbab asked Shibetti to "touch his cock." TAC ¶ 67. Shibetti was "terrified, humiliated and distressed by these sexual assaults." TAC ¶ 68. Shibetti also learned that she was not the only victim—other female employees at the Diner told Shibetti that Kamal Fathelbab had subjected them to similar behavior. TAC ¶ 69. In addition, "other male employees" would touch Shibetti in sexually inappropriate ways and "leer and jeer" at her in a sexual manner. TAC ¶ 76.

Shibetti complained to her supervisors about the inappropriate behavior of Kamal Fathalbab and other male employees at the Diner. TAC ¶ 80. According to Shibetti, her supervisors simply laughed at her. TAC ¶ 81. In April 2016, Shibetti once again approached her supervisors, this time to request that she be paid "on the books," at an amount meeting or exceeding the minimum wage, plus regular wage statements. TAC ¶ 83. A few days later Shibetti was terminated from her position at the Diner. TAC ¶ 85.

Puccini also worked as a server at the Diner. TAC ¶ 87. Following her start in late 2015, she worked one, 4-hour training shift, for which she did not receive pay. TAC ¶ 89. In 2015 and 2016, Puccini worked at the Diner on Wednesdays and Thursdays, from approximately 5:00 p.m. to 12:00 a.m.; Fridays, from 9:00 p.m. to 6:00 a.m., Saturdays, from 6:00 p.m. to 6:00 a.m.; and Sundays, from 5:00 p.m. to 12:00 a.m. TAC ¶ 90. At all times, Puccini was paid at a rate of $5.00 per hour and never paid any wages for any hours worked in excess of forty hours in a workweek. TAC ¶ 93.

In August 2016, Puccini was abruptly removed from the work schedule without notice. TAC ¶ 98. At the time, she was approximately six months pregnant. TAC ¶ 98. When Puccini asked Adel Fathelbab why he had removed her from the schedule, he allegedly said, "You're having the baby soon. Come back after you give birth." TAC ¶ 99. Puccini, who had "fully intended on continuing work up until she gave birth, was humiliated and distressed by being removed from the schedule solely because she was pregnant." TAC ¶ 100. Puccini returned towork at the Diner in 2017 following the birth of her child. TAC ¶ 101.

Puccini was also allegedly subjected to a hostile work environment, sexual harassment, and retaliation. TAC ¶¶ 104-06. For instance, Kamal Fathalbab routinely showed pornographic photographs to Puccini and other female servers. TAC ¶ 109. Kamal Fathalbab even solicited sexually explicit photographs from Puccini, at times through lewd text message requests. TAC ¶ 107. On one occasion, Kamal Fathalbab drove Puccini to a hotel and told her that they should "get a room." TAC ¶ 108. Following Puccini's rejection of Kamal Fathalbab's unwanted sexual advances, he allegedly retaliated by scheduling her for fewer work shifts. TAC ¶ 110.

On February 8, 2018, Shibetti filed the initial Complaint. See Dkt. No. 1. An Amended Complaint was filed on March 2, 2018, and a Second Amended Complaint was filed on June 29, 2018. See Dkt. Nos. 6, 77. On September 5, 2018, Shibetti's counsel moved to amend the complaint again. See Dkt. No. 85. Attached to the motion was a copy of the proposed Third Amended Complaint. See Dkt. No. 85, Attachment #1. On October 3, 2018, during a hearing on the record, the Court granted counsel's request for leave to amend the complaint (Dkt. No. 89 (Minute Entry)), and on October 12, 2018, Shibetti filed the Third Amended Complaint, adding Katrina Puccini as a plaintiff in the action. See Dkt. No. 90. In lieu of an answer, Defendant Z Diner filed a motion to dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). See Dkt. No. 94.

II. DISCUSSION

A. Standard of Review

When a party moves to dismiss a case under Rule 12(b)(6), a court must determine whether the complaint states a legally cognizable claim by offering allegations that, if true, would show that the plaintiff is entitled to relief. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557 (2007); see also Lundy v. Catholic Health Sys. of Long Island Inc., 711 F.3d 106, 113 (2d Cir. 2013). "To survive a motion to dismiss, a complaint must contain 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 Twombly, 550 U.S. at 570); accord LLM Bar Exam, LLC v. Barbri, Inc., 922 F.3d 136,140 (2d Cir. 2019). Under Rule 8(a)(2), a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief."

In evaluating a motion to dismiss, courts use a "two-pronged approach" to determine whether a plaintiff has "nudged" his or her claims "across the line from conceivable to plausible." Iqbal, 556 U.S. at 679, 680.

First, the court must accept all factual allegations as true and draw all reasonable inferences in favor of the non-moving party, and second, only a complaint that states a plausible claim for relief survives a motion to dismiss, and this determination is a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.

Jackson v. Wells Fargo Home Mortg., No. 15-CV-5062 (PKC) (ST), 2018 WL 8369422, at *3 (E.D.N.Y. Aug. 10, 2018) (quoting Iqbal, 556 U.S. at 678, 679) (brackets and other citations omitted).

B. Analysis

I. Plaintiffs' Third Amended Complaint was Changed in Violation of the Court's Order

Defendants assert that the Third Amended Complaint must be dismissed because it was substantively altered from the Proposed Class Action Complaint that was attached to Plaintiffs' Motion to Amend. By changing the Proposed Complaint, Defendants argue that Plaintiffs' counsel went beyond the Court's order granting leave to amend the complaint. Although I agree that Plaintiffs' counsel violated the Court's order, dismissal is an overly drastic remedy in this circumstance.

On September 5, 2018, Plaintiffs submitted a motion to "request leave to file and serve the enclosed proposed Third Amended Collective and Class Action Complaint . . . ." Dkt. No. 85, at 1. Attached to the motion was a Proposed Class Action Complaint, as well as a Proposed Revised Scheduling Order. See Dkt. No. 85, Exhs. A & B. Defendants opposed the motion. Dkt. No. 86. The Court held an in-person hearing on October 3, 2018. Dkt. No. 89. During the hearing, Defendants' counsel...