Abugeith et al v. Flowers Foods, Inc et al, No. 4:2017cv02934 - Document 28 (S.D. Tex. 2018)
Court Description: MEMORANDUM OPINION AND ORDER denying 24 Opposed MOTION for Reconsideration AND MOTION for Sanctions (Signed by Judge Sim Lake) Parties notified. (aboyd, 4)
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Abugeith et al v. Flowers Foods, Inc et al Doc. 28 United States District Court Southern District of Texas ENTERED IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION MAJDI ABUGEITH and JIMMY BREWER, Individually and on Behalf of All Others Similarly Situated, Plaintiffs, v. FLOWERS FOODS, INC. and FLOWERS BAKING CO. OF HOUSTON, LLC, Defendants. July 11, 2018 David J. Bradley, Clerk § § § § § § § § § § § § CIVIL ACTION NO. H-17-2934 MEMORANDUM OPINION AND ORDER Plaintiffs Majdi Abugeith and Jimmy Brewer ("Plaintiffs"), on behalf of themselves and other similarly situated individuals, sued defendants Flowers Foods, Inc. and Flowers Baking Co. of Houston, LLC (collectively "Flowers" or "Defendants") under the Fair Labor Standards Act ("FLSA") . 1 Pending before the court is Plaintiffs' Emergency Motion for Reconsideration, and Plaintiffs' Motion for Sanctions ("Motion for Reconsideration") Plaintiffs' Motion for Sanctions, Temporary and Permanent Injunction, (Docket Entry No. 24) and Temporary Restraining Order, and Motion for Court Issued Notice to Current and Putative Plaintiffs of Improper Actions by Defendants ("Motion for Sanctions") 1 See Plaintiffs' Entry No. 1. Original (Docket Entry No. 24-9). Complaint ("Complaint") , For Docket Dockets.Justia.com the reasons stated below, the court will deny both of Plaintiffs' motions. I. Factual and Procedural Background The factual history of this case is explained in a prior opinion. 2 Flowers Plaintiffs executed a distributor agreement and signed Baking Co. of Houston, LLC Distributor Agreement ("Amendment") arbitration clause 3 -- ("Company") Amendment to -- which included a mandatory and Plaintiffs each signed an Arbitration Agreement contained in Exhibit 2 of the Amendment. 4 Plaintiffs filed this action on September 29, 2017, seeking overtime wages, liquidated damages, attorney's fees, behalf of Defendants Procedure themselves filed a 12(b) (1), and a and costs under the FLSA on putative motion pursuant 12(b) (3), and to class of Federal distributors. 5 of Civil seeking 12(b) (6) Rules an order dismissing the lawsuit and requiring Plaintiffs to arbitrate their claims 2 with Defendants. 6 On May 15, 2018, the court granted Memorandum Opinion and Order, Docket Entry No. 22. 3 Exhibits A and B to Appendix of Motion to Dismiss, or in the Alternative, to Compel Individual Arbitration ("Defendants' Appendix"), Docket Entry No. 5-1, pp. 4-7, 13-16. 4 See Arbitration Agreement, Entry No. 5-1, pp. 8-10, 17-19. 5 Exhibit 2 to Amendment, Complaint, Docket Entry No. 1, pp. 12-13 Relief. 6 ~ Docket 59 and Prayer for See Defendants' Motion to Dismiss or, In the Alternative, to Compel Individual Arbitration ("Motion to Dismiss"), Docket Entry No. 5, p. 2. -2- Defendants' Motion to Dismiss. 7 Because the court concluded that the Arbitration Agreement and the delegation clause and classaction waiver within the Arbitration Agreement were enforceable, the court dismissed this action and compelled Plaintiffs to arbitrate this dispute individually. 8 On June Reconsideration 12, 2018, and Plaintiffs Motion for filed Sanctions their urging Motion the for court to reconsider its Memorandum Opinion and Order granting Defendant's Motion to Dismiss, to impose sanctions against Defendants for improper conduct, and to issue a temporary restraining order and a preliminary injunction. 9 Defendants filed a response on June 26, 2018, opposing Plaintiffs' motion. 10 II. A. Analysis Reconsideration Under Rule 59(e) Plaintiffs argue that recently discovered information and the need to prevent manifest injustice require that the court reconsider its order compelling arbitration and dismissing the 7 Memorandum Opinion and Order, Docket Entry No. 22, p. 11. 8 Id. at 10. 9 Motion for Reconsideration, Docket Entry No. 24, pp. 31-33; Motion for Sanctions, Exhibit 9 to Motion for Reconsideration, Docket Entry No. 24-9, p. 23. 10 See Defendants' Response to Plaintiffs' Emergency Motion for Reconsideration, and Plaintiffs' Motion for Sanctions ("Defendants' Response"), Docket Entry No. 25. -3- action. 11 Defendants respond that Plaintiffs fail to satisfy the requirements of Rule 59 (e) . 12 "Under Rule 59(e), amending a judgment is appropriate (1) where there has been an intervening change in the controlling lawi (2) where the movant presents newly discovered evidence that was previously unavailablei or (3) to correct a manifest error of law or fact." 597 Alexander v. Wells Fargo Bank, N.A., 867 F.3d 593, (5th Cir. 2017) (quotations and citations omitted). Motions under Rule 59(e) "should not be used to raise arguments that were Quinn v. presented or could have been presented in the past." Guerrero, 863 F.3d 353, 360 (5th Cir. 2017). "The district court has considerable discretion in deciding whether to reopen a case under Rule 59 {e) " Edward H. Bohlin Co., Inc., 6 F.3d 350, 355 (5th Cir. 1993). Inc. v. Banning Co., Nevertheless, "[t]he court must strike the proper balance between two competing imperatives: (1) finality, and (2) the need to render just decisions on the basis of all the facts." Id. Plaintiff Abugeith signed the Amendment on December 5, 2015, and signed the Arbitration Agreement on September 29, Plaintiff Brewer signed the Amendment on December 3, signed the Arbitration Agreement on September 2016. 2015, 29, and 2016. 13 11 Motion for Reconsideration, Docket Entry No. 24, p. 3. 12 Defendants' Response, Docket Entry No. 25, p. 17. 13 Exhibi ts A and B to No. 5-1, pp. 7, 10, 16, 19. Defendants' -4- Appendix, Docket Entry Plaintiffs argue that because nearly a year had elapsed between Plaintiffs' signing of Arbitration Agreement, the "[i] t Amendment is and apparent the that signing of Defendants the were scheming and actively involved in improper and illegal conduct that demonstrates the active, ongoing interference perpetuated by Defendants in this current lawsuit." 14 Plaintiffs also argue that newly discovered evidence shows that Defendants used coercive and intimidating tactics to obtain employee signatures on the Amendment and the Arbitration Agreement. 15 In support, Plaintiffs attach eight employee affidavits , 16 two of which were signed after the court issued its Memorandum Opinion and Order on May 15, 2018. 17 Plaintiffs argue that they belong to the same class of people pressured into signing the Arbitration Agreement as the employees for whom Plaintiffs have provided affidavits. 18 Plaintiffs' arguments that the one year that elapsed between their signing of the Amendment and the Arbitration Agreement is evidence of Defendants' improper conduct have no merit. Plaintiffs had this information, at the latest, when Defendants attached the 14 Motion for Reconsideration, Docket Entry No. 24, p. 5. 15 Id. at 4-5. 16 See Exhibits 1-6, 11-12 to Motion for Reconsideration, Docket Entry Nos. 24-1, 24-2, 24-3, 24-4, 24-5, 24-6, 24-11, 24-12. 17 See Affidavit of Pablo Silva, Exhibit 11 to Motion for Reconsideration, Docket Entry No. 24-11 (signed June 6, 2018); Affidavit of Michael Forney, Exhibit 12 to Motion for Reconsideration, Docket Entry No. 24-12 (signed May 24, 2018) 18 Motion for Reconsideration, Docket Entry No. 24, p. 6. -5- agreements to its Motion to Dismiss on November 1, 2017. Plaintiffs have provided no excuse for their failure to raise this argument in response. Nor have Plaintiffs presented any evidence that they were coerced into signing the Arbitration Agreement. the contrary, To Defendants provided evidence that Plaintiffs knew that they had the option not to sign the Arbitration Agreement and knew that two lawsuits Plaintiffs may be Defendants' against eligible to Defendants join. 19 were pending Plaintiffs argue that that "irreparable tactics" were "meant to interfere with Plaintiffs' ability to join the aforementioned Texas lawsuits, as well as interfere with the instant suit." 20 Yet Plaintiffs have not attached their own affidavits and have not presented any other evidence that they were personally harassed, coerced, or intimidated by these tactics causing them to unwillingly sign the Amendment and the Arbitration Agreement. were newly discovered evidence, Moreover, even if they none of the attached affidavits mention Plaintiffs Abugeith and Brewer. Because Plaintiffs have provided no newly discovered evidence establishing that they did not voluntarily sign the Amendment or the Arbitration Agreement, 19 Declaration of Charles Palmer Rich ("Rich Declaration") , Exhibit 1 to Defendants' Response, Docket Entry No. 25-1, pp. 5-6 ~ 13; Memorandum from President of Flowers re Amendment, attached to Rich Declaration, Docket Entry No. 25-1, p. 60. 20 Plaintiffs' Reply to Defendants' Response to Plaintiffs' Emergency Motion for Reconsideration and Motion for Sanctions ("Plaintiffs' Reply"), Docket Entry No. 26, p. 4. -6- the court concludes that Plaintiffs are not entitled to Rule 59(e) relief. B. Motion for Sanctions Plaintiffs issue a request that the court suspend arbitration and temporary restraining order, injunction, a temporary and permanent and a notice to current and putative plaintiffs of Defendants' actions. 21 Courts have broad authority to govern the conduct of counsel and parties in collective actions. S. Ct. 2193, 2200 (1981). Gulf Oil Co. v. Bernard, 101 The court may limit communications with potential class members where there is a "clear record" of abuse. Id. Injunctive relief should only be granted when the movant has clearly met its burden to establish (1) that it will prevail on the merits, a substantial likelihood (2) a substantial threat that irreparable injury will result if the injunction is not granted, (3) that threatened (4) the threatened harm the injunction that granting the interest. injury to may the do movant to the outweighs the defendant, and injunction will not disserve the public Anderson v. Jackson, 556 F.3d 351, 360 (5th Cir. 2009) (citing Canal Authority of State of Florida v. Callaway, 489 F.2d 567, 572 (5th Cir. 1974). Plaintiffs' request for sanctions is based on Defendants' . that was wholly intended to "illegal and improper conduct 21 Motion for Sanctions, Exhibit 9 to Motion for Reconsideration, Docket Entry No. 24-9, pp. 2-3. -7- discourage and deter Plaintiffs and others from joining otherwise participating in the current litigation." 22 or Plaintiffs argue that Defendants created a "coercive atmosphere" that "calls into question the voluntary nature of the waivers." 23 In support, Plaintiffs cite the same affidavits attached to their Motion for Reconsideration. 24 that Defendants Again Plaintiffs fail to present any evidence pressured them to sign the Amendment or the Arbitration Agreement, that Plaintiffs felt increased pressure from the "coercive atmosphere" to sign the Amendment, or that Defendant engaged in Plaintiffs. other sanctionable behavior towards these two Therefore, the court will not impose sanctions against Defendants. Plaintiffs restraining threatening, also order urge to to issue a Defendants "from in the court prohibit discriminating or retaliating against temporary any way Plaintiffs because they filed an opt-in form in the above-reference case, or because Plaintiffs participate in this lawsuit. " 25 Plaintiffs argue that "by deterring participation in Plaintiffs' federal lawsuit, Defendants to private are right impairing of Plaintiffs' action that ability the FLSA 22 Id. at 3 (emphasis in original omitted) . 23 Id. at 16. 24 See id. at 19-21. 25 Id. at 22. -8- exercise guarantees the all employees. By doing so, Defendants are interfering with Plaintiffs' right of meaningful access to the courts." 26 Defendants have not impaired Plaintiffs' ability to seek relief under the FLSA because Plaintiffs brought this action and may now seek complete relief in arbitration. Corp. v. (1985) Soler Chrysler-Plymouth, Inc., See Mitsubishi Motors 105 S. Ct. 3346, 3354 ("By agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute; it only submits to their resolution in an arbitral, rather than a judicial, forum."). Defendants have not deprived Plaintiffs of the constitu- tional right of access to the courts because Plaintiffs voluntarily agreed to arbitrate their claims. 129 S. Ct. 1456, 1469 (2009) See 14 Penn Plaza LLC v. Pyett, (explaining that although parties may not waive substantive statutory rights, they may waive "the right Moreover, to seek relief from a court in the first instance"). Plaintiffs have provided no evidence retaliatory actions against them that for Defendants bringing took any this action. Therefore, there is no substantial risk that irreparable harm will occur and any injunctive relief as to these Plaintiffs is not appropriate. Because Defendants impaired Plaintiffs directed Plaintiffs' any have failed sanctionable right to to provide conduct relief, the Plaintiffs' Motion for Sanctions. 26 Id. at 23 (internal citations omitted). -9- evidence towards court that them will or deny III. Conclusion For the reasons set forth above, Plaintiffs' Emergency Motion for Reconsideration, and Plaintiffs' Motion for Sanctions (Docket Entry No. 24) is DENIED; and Plaintiffs' Motion for Sanctions, Temporary Restraining Order, Temporary and Permanent Injunction, and Motion Plaintiffs for of Court Improper Issued Notice Actions by to Current Defendants and Putative (Docket Entry No. 24-9) is DENIED. SIGNED at Houston, Texas, on this the 11th day of July, 2018. SIM LAKE UNITED STATES DISTRICT JUDGE -10-
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