Walsh v. McDevitt

654 F.Supp.3d 744

Martin J. WALSH, Secretary of Labor, United States Department of Labor, Plaintiff, v. Lee A. MCDEVITT d/b/a Midwest Home Care, Defendant.

Case No. 21-CV-2225

United States District Court, C.D. Illinois, Urbana Division

Signed February 7, 2023

JoAnn GiYun Lim, U.S. Department of Labor Office of the Solicitor, Chicago, IL, for Plaintiff.

Andrew J. Martone, Matthew Blanton Robinson, Hesse Martone PC, St. Louis, MO, for Defendant.

ORDER

COLIN S. BRUCE, UNITED STATES DISTRICT JUDGE

Plaintiff, Martin J. Walsh, Secretary of Labor, United States Department of Labor, filed a Complaint alleging that Defendant, Lee A. McDevitt, d/b/a Midwest Home Care, committed multiple violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq. Specifically, Plaintiff alleged that Defendant and Midwest Home Care ("Midwest") violated Sections 206 (minimum wage), 207 (maximum hours/overtime), and 211 (recordkeeping) of the FLSA. Plaintiff seeks back wages from a period spanning between October 8, 2018, and January 3, 2021 ("the investigation period"), liquidated damages in the same amount, and injunctive relief.

Presently before the court are Motions for Summary Judgment filed by each party. Defendant filed his Motion for Summary Judgment (#17) on September 29, 2022; Plaintiff filed his Response (#20) on October 20, 2022; and Defendant filed a Reply (#22) on November 3, 2022. Plaintiff filed his Motion for Summary Judgment (#18) on September 30, 2022; Defendant filed his Response (#21) on October 21, 2022; and Plaintiff filed a Reply (#23) on November 4, 2022. For the reasons set forth below, Defendant's Motion for Summary Judgment (#17) is DENIED, and Plaintiff's Motion for Summary Judgment (#18) is GRANTED.

BACKGROUND

The following background facts are taken from the parties' Undisputed Statements of Material Facts in their Motions for Summary Judgment, the parties' Additional Facts in their respective Responses, and the materials attached by the parties to their filings.

Threshold Admissibility Issues

Before proceeding to the background facts, the court must address certain admissibility arguments raised by Defendant. Namely, Defendant contends that three affidavits relied upon by Plaintiff in his Undisputed Statement of Material Facts may not be relied upon at summary judgment.

Heffner and Walton Declarations

Plaintiff attached to his Motion for Summary Judgment declarations from two of Defendant's employees, Lori Heffner and Kala Walton.

Defendant objects to the use of the declarations on the grounds that Plaintiff failed to disclose either affiant in his disclosures under Federal Rule of Civil Procedure 26(a)(1). Moreover, Defendant argues, Plaintiff failed to produce the declarations in response to Defendant's request for production of witness statements. Defendant asserts that Plaintiff's failure to disclose the witnesses and their statements until after the discovery deadline was prejudicial in that it prevented him from adequately preparing for them, and was not harmless.

Under Federal Rule of Civil Procedure 26(a)(1)(A)(i), a party is obligated to include in its initial disclosures to the opposing party "the name and, if known, the address and telephone number of each individual likely to have discoverable information[.]" "If a party fails to provide information or identify a witness as required by Rule 26(a) or (e), the party is not allowed to use that information or witness to supply evidence on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is harmless." Fed. R. Civ. P. 37(c)(1).

Plaintiff asserts that he was entitled to withhold the names of Heffner and Walton in order to protect their identities pursuant to the informer's privilege.

In Plaintiff's initial disclosures, served on Defendant on December 6, 2021, Plaintiff averred that

Defendant's present and former employees . . . are likely to possess general knowledge of their employment relationship with defendant, including but not limited to, their job duties and responsibilities, the clients they were assigned to, their schedules and hours worked (including but not limited to any interrupted sleep time), and the goods and/or materials they handled to carry out their jobs, as well as defendant's pay and timekeeping practices.

Plaintiff did not disclose any specific names of employees. Plaintiff noted multiple times in his disclosure that he was not waiving the informer's privilege.

The underlying concern of the informer's privilege "is the common-sense notion that individuals who offer their assistance to a government investigation may later be targeted for reprisal from those upset by the investigation." Dole v. Loc. 1942, Int'l Bhd. of Elec. Workers, AFL-CIO, 870 F.2d 368, 372 (7th Cir. 1989). "The most effective means of protection, and by derivation the most effective means of fostering citizen cooperation, is bestowing anonymity on the informant, thus maintaining the status of the informant's strategic position and also encouraging others similarly situated who have not yet offered their assistance." Id. "In civil cases the privilege, which limits the right of disclosure usually called for by the Federal Rules of Civil Procedure, is arguably greater, since not all constitutional guarantees which inure to criminal defendants are similarly available to civil defendants." Id. (cleaned up). A government party need not make any threshold showing of potential retaliation in order to invoke the privilege; rather, "the government is granted the privilege as of right." Id.

The informer's privilege is applicable to Heffner and Walton. By providing statements to the Department of Labor, they were unquestionably assisting the government in its investigation of Defendant. Plaintiff was therefore entitled to invoke the privilege as of right. Id. While the informer's privilege must yield in certain circumstances, the court notes that Defendant has made no such argument (nor, for that matter, any argument relating to the informer's privilege), despite that privilege having been raised by Plaintiff at least as early as December 6, 2021.

The court also finds that the non-disclosure of Heffner and Walton's names in discovery was harmless, such that a sanction of nonadmissibility under Rule 37(c)(1) would be inappropriate. See Mid-America Tablewares, Inc. v. Mogi Trading Co., Ltd., 100 F.3d 1353, 1363 (7th Cir. 1996) ("The determination of whether a Rule 26(a) violation is justified or harmless is entrusted to the broad discretion of the district court.").

First, Plaintiff did disclose that Defendant's employees would have discoverable information, and Defendant must surely be aware of the identities of his past and present employees, such that he had ample opportunity to depose them.

More specifically, both Heffner and Walton were listed in an exhibit attached to the Complaint as among the 56 former and current employees to whom back pay was owed, further directing Defendant's attention to them.

Finally, and most importantly, the substance of the two declarations in question concerns the affiants' job responsibilities as well as Defendant's payroll and scheduling practices. While Defendant broadly asserts that he was unable "to adequately prepare" for the declarations, he fails to elaborate. The declarations contain only information of which Defendant would have been well aware, and precisely the type of information described in Plaintiff's initial disclosures, leaving the court unable to conclude that he suffered any particular prejudice.

Accordingly, the court finds that the declarations of Heffner and Walton will be considered at summary judgment.

Svacina Affidavit

Plaintiff also attached to his Motion for Summary Judgment an affidavit sworn by Todd Svacina, an investigator with the Wage and Hour Division of the Department of Labor. In the affidavit, signed on September 30, 2022, Svacina detailed the steps taken in the course of his investigation, including summaries of interviews with Defendant and certain employees of Midwest. The affidavit also sets out Svacina's method for calculating back wages.

Defendant contends that the Svacina affidavit "is inadmissible because it is not based on personal knowledge." He argues that the affidavit "is based on Svacina's review of documents and interviews with individuals" and therefore amounts to "inadmissible hearsay that cannot form the basis for a summary judgment affidavit."

Defendant has not specified which portions of Svacina's wide-ranging affidavit constitute hearsay. His reference to Svacina's "review of documents" suggests that Svacina's back wage calculations are somehow hearsay, or perhaps based on hearsay. But those calculations were based only on payroll records disclosed by Defendant and basic math. Defendant's argument on this point—if he is, in fact, intending to make such an argument—is not sufficiently developed for this court to address it. See M.G. Skinner & Assocs. Ins. Agency, Inc. v. Norman-Spencer Agency, Inc., 845 F.3d 313, 321 (7th Cir. 2017) ("Perfunctory and undeveloped arguments are waived, as are arguments unsupported by legal authority.").

The portions of Svacina's affidavit in which he summarizes or excerpts his interviews with some Midwest employees would appear to be a more obvious basis for a hearsay objection. Indeed, the affidavit contains summaries of statements from nine current (at the time of the interview) employees of Defendant, detailing each employee's job responsibilities, work schedule, timekeeping, breaks, and sleep. Though Defendant's argument is undeveloped and unsupported by any specific legal citation on this point as well, the court will consider whether those excerpted statements are admissible for the truth of the matters asserted.

Under the Federal Rules of Evidence, a statement is not hearsay where it is offered against the opposing party and "was made by the party's agent or employee on a matter within the...