Yu Peng Lu v. Nisen Sushi of Commack, LLC

REPORT AND RECOMMENDATION

TISCIONE, United States Magistrate Judge:

Plaintiff Yu Peng Lu ("Lu") brought this action against NISEN SUSHI OF COMMACK, LLC, doing business as NISEN SUSHI ("Nisen Sushi"), TOM LAM, individually, and ROBERT BEER, individually (collectively, "Defendants") for alleged violations of the Fair Labor Standards Act ("FLSA") 29 U.S.C. §§201 et seq. and the New York Labor Law ("NYLL") §§190 et seq. See Compl. ¶1. Plaintiff now moves for a default judgment against Defendants and seeks unpaid overtime wages due under the FLSA and NYLL, unpaid spread of hours damages under NYLL and its regulations, liquidated damages, pre- and post-judgment interest, attorneys' fees and costs. See Mot. Default J., ECF No. 15 at 1; Pl.'s Mem. of Law in Support of the Motion for Default Judgment ("Pl.'s Mem. of L."), ECF No. 16 at 4-5.

For the reasons discussed below, I respectfully recommend that Plaintiff's motion be granted against Defendants Nisen Sushi and Tom Lam for violations of the FLSA and NYLL, and that this Court award Plaintiff damages in the amount of $248,536.47. I further recommend that Plaintiff's claims against Defendant Robert Beer be dismissed.

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Unless otherwise stated, all statements in this section are based on Plaintiff's allegations in the Complaint, Motion for Default, and accompanying documents. Defendant Nisen Sushi is a New York corporation operating a Japanese sushi restaurant at 5032 Jericho Turnpike, Commack, NY 11725. Compl. ¶ 9. Plaintiff was employed by Defendants as a teriyaki chef from in or around January 2013 to on or around August 3, 2014, and then from on or around April 1, 2016 to in or around November 11, 2018. Id. ¶¶ 8, 25, 26. The following table summarizes the allegations in the Complaint surrounding Plaintiff's work hours and the amount he was paid during the relevant periods of his employment. Id. ¶¶ 29-32; see Attorney Affidavit in Support of Mot. for Default J. ("Attorney Aff."), Ex. 7 (Calculation of Damages), ECF No. 17-7.

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Plaintiff alleges that he was not paid overtime wages and the spread of hours pay. Id. ¶¶ 35-36. Plaintiff also alleges that Defendants maintained a fraudulent time-card punching policy that required Plaintiff to punch less hours than the number of hours actually worked, and that Plaintiff was required to sign wage receipts that did not reflect the actual number of hours he worked. Id. ¶¶ 33-34.

According to the Complaint, during the relevant times Defendant Tom Lam ("Lam") was an owner, officer, shareholder, and manager of Nisen Sushi, and he had the power to hire and fire employees, determine employee wages, establish employee work schedules, and maintain employment records of Defendants' employees. Id. ¶ 14. Defendant Robert Beer ("Beer") was also an owner, officer, and shareholder of Nisen Sushi who has an ownership interest over Nisen Sushi and control over its operations. Id. ¶ 15.

Plaintiff filed his initial complaint on December 17, 2018. Id. The Complaint was properly served on the Defendants, but they failed to respond. See Executed Summonses, ECF No. 8-10. The Clerk noted their default on April 2, 2019. Entry of Default, ECF No. 13. On July 16, 2019, Plaintiff filed the instant motion for Default Judgment and proof of service along with affidavits and documents in support of his damages and attorney's fees. Mot. Default J., ECF No. 15-18. In his motion, Plaintiff seeks a total amount of $244,008.44 in damages including overtime wages, spread of hour pay, liquidated damages, statutory damages for failure to provide wage notices and wage statement, and pre-judgment interest. Pl.'s Mem. of L. at 10-11. He also requests attorney's fees in the amount of $8,640.00 and costs in the amount of $690.00. Id. at 13-14.

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I. Default Judgment

Rule 55 of the Federal Rules of Civil Procedure calls for a two-step process for obtaining a default judgment. See Priestley v. Headminder, Inc., 647 F.3d 497, 504 (2d Cir. 2011). First, the plaintiff must request entry of default by the Clerk of the Court. Id. (citing Fed. R. Civ. P. 55(a)). Once default has been entered against the non-responsive parties, the plaintiff "must apply to the court for a default judgment." Fed. R. Civ. P. 55(b)(2). Once the plaintiff meets these requirements, the court must accept the factual allegations in the plaintiff's complaint as true and must draw all reasonable inferences in the plaintiff's favor. Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009). Then, the court must determine whether these facts establish the Defendants' liability as a matter of law. City of N.Y. v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir. 2011). The court, however, "need not credit the plaintiff's legal conclusions." Priestley, 647 F.3d at 504.

Unlike allegations pertaining to liability, allegations in the complaint relating to damages are not deemed admitted upon entry of a default; instead, the court considers whether the plaintiff "has met the burden of proving damages to the court with 'reasonable certainty.'" J & J Sports Prods., Inc. v. LX Food Grocery Inc., No. 15-CV-6505 (NGG) (PK), 2016 U.S. Dist. LEXIS 162711, at *4 (E.D.N.Y. Nov. 23, 2016) (quoting Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 155 (2d Cir. 1999)). A court need not conduct an evidentiary hearing to determine damages "as long as it ensured that there was a basis for the damages specified in the default judgment." Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., Div. of Ace Young Inc., 109 F.3d 105, 111 (2d Cir. 1997) (quoting Fustok v. ContiCommodity Services, Inc., 873 F.2d 38, 40 (2d Cir. 1989)). "Detailed affidavits and other documentary evidence can suffice in lieu of an evidentiary hearing." Llolla v. Karen Gardens Apartment Corp., No. 12-CV-1356 (MKB) (JO),

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2014 U.S. Dist. LEXIS 44884, at *5-7 (E.D.N.Y. Mar. 10, 2014) (internal citations omitted). When defendants default in an action brought pursuant to the FLSA, the plaintiff's recollection and estimates of hours worked are presumed to be correct. Id. (citations omitted).

II. FLSA and NYLL

A. Elements

Under the FLSA, "employers," defined as "any person acting directly or indirectly in the interest of an employer in relation to an employee[.]" 29 U.S.C. § 203(d). To fall within the scope of the FLSA's wage and overtime protections, an employee must show that he was "engaged in commerce or in the production of goods for commerce," or that his employer was "an enterprise engaged in commerce or in the production of goods for commerce." 29 U.S.C. §§ 206(a), 207(a)(1); see also Jacobs v. N.Y. Foundling Hosp., 483 F. Supp. 2d 251, 257-58 (E.D.N.Y. 2007). The FLSA mandates that an employer pay certain minimum wages as well as a premium overtime rate (at least 150 percent of their regular rate of pay) to employees for hours worked above 40 hours per week. 29 U.S.C. §§ 206(a), 207(a)(1).

Further, an employer is required to "make, keep, and preserve" records of employee wages, hours, and employment conditions. 29 U.S.C. § 211(c). An employee bringing an action for unpaid overtime compensation under the FLSA has the burden of proving that he performed work for which he was not properly compensated, but where an employer fails to keep the required records, the plaintiff can prove his claim by producing "sufficient evidence to show the amount and extent of that work [which he was not compensated for] as a matter of just and reasonable inference" which may be established solely through his or her own recollection. See Reich v. S. New Eng. Telecomms. Corp., 121 F.3d 58, 66 (2d Cir. 1997) (quoting Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687-88 (1946)).

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The relevant provisions of the NYLL mirror the FLSA in the definition of employment. The NYLL also requires employers to pay employees a one-hundred-fifty percent (150 %) premium for overtime work. See 12 N.Y.C.R.R. § 142-2.2; Kotuwage v. NSS Petroleum, Inc., No. 15-CV-4374 (FB) (ST), 2018 U.S. Dist. LEXIS 21917, at *13 (E.D.N.Y. Feb. 8, 2018); see also Williams v. Epic Sec. Corp., 358 F. Supp. 3d 284, 293 (S.D.N.Y. 2019) ("liability under the FLSA and the NYLL is in large part coextensive.").

Additionally, under the NYLL an employee is entitled to spread of hours pay, which is not required under the FLSA. 12 N.Y.C.R.R. §142-2.4. Spread of hours is the time between the beginning and end of the Plaintiff's workday, including time off for meals. Id. at §142-2.18. For any work day that an employee works for more than ten (10) hours, an employer is required to provide an additional one (1) hour's pay at the minimum wage rate set forth in that year.

Also, the NYLL was amended by the Wage Theft Prevention Act ("WTPA") in 2011 and 2015 to require employers to provide a written "wage notice" to employees containing specific categories of information regarding the employee's wages "at...