Arifatmi v. Lucky Dragon, LLC et al, No. 2:2015cv01101 - Document 26 (E.D. La. 2016)
Court Description: ORDER granting in part and denying in part 11 Motion for Summary Judgment. Signed by Judge Sarah S. Vance on 4/11/2016. (mmm)
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Arifatmi v. Lucky Dragon, LLC et al Doc. 26 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA BAMBANG ARIFATMI CIVIL ACTION VERSUS NO. 15-110 1 LUCKY DRAGON, LLC d/ b/ a GEISHA SUSHI BISTRO AND XIUFEI ZHANG SECTION “R” (1) ORD ER AN D REASON S Plaintiff Bam bang Arifatm i m oves the Court for sum m ary judgm ent on his claim that defendant Lucky Dragon, LLC (d/ b/ a Geisha Sushi Bistro) willfully violated the Fair Labor Standards Act, 29 U.S.C. § 20 1, et seq., by failing to pay Arifatm i m inim um wage. 1 For the following reasons, the Court grants sum m ary judgm ent on the issue of liability, but denies summ ary judgm ent on the issues of willfulness and dam ages. I. BACKGROU N D From March 20 11 to March 20 15, plaintiff Bam bang Arifatm i worked as a server in defendant Lucky Dragon, LLC’s restaurant, Geisha Sushi 1 R. Doc. 11. Dockets.Justia.com Bistro. 2 During Arifatm i’s em ployment, Lucky Dragon did not pay him m inim um wage; Arifatm i was paid in tips only. 3 According to Lucky Dragon, Arifatm i is the restaurant owner’s friend. 4 While Arifatm i worked at Geisha Sushi Bistro, he was in the United States on an F-1 Student Visa, which requires the visa-holder to obtain authorization before working in the United States. 5 Lucky Dragon admits that it did not pay Arifatm i m inim um wage because Arifatm i “failed to secure the proper work authorization.”6 According to the m anager of Geisha Sushi Bistro, Arifatm i was the only server who did not receive a regular m inim um wage. 7 Arifatm i also asked the m anager “every . . . five [to] six months” why he did not receive a check like the other servers. 8 Lucky Dragon argues that this 2 R. Doc. 11, Exhibits A-B, D-F (Hourly Sum m aries, 20 11-20 15); R. Doc. 11, Exhibit H at 3, Answer to Interrogatory No. 8 (“[P]laintiff was designated as a server.”). 3 See, e.g., R. Doc. 14-2 at 1 (Affidavit of Iva Octavia, co-owner of Lucky Dragon, LLC) (“We allowed the plaintiff to work and he was com pensated via tips earnings.”). 4 Id. 5 Id. 6 Id. 7 R. Doc. 11, Exhibit C, at 65-66 (Deposition of Anthon y Taylor, m an ager of Geisha Sushi Bistro). 8 Id. at 64. was a “practical” arrangem ent to help the restaurant owner’s friend while he was in school and that Lucky Dragon thought it had com plied with the Act. 9 After Arifatm i stopped working at Geishi Sushi Bistro, he filed this lawsuit against Lucky Dragon and defendant Xiufei Zhang, alleging that defendants willfully violated the m inim um wage and tip credit provisions of the Fair Labor Standards Act and retained im proper “kickbacks.”10 Arifatm i now m oves for sum m ary judgm ent against Lucky Dragon on the alleged violations of the m inim um wage and tip credit provisions of the Act. II. LEGAL STAN D ARD Sum m ary judgment is warranted when “the m ovant shows that there is no genuine dispute as to any m aterial fact and the m ovant is entitled to judgm ent as a m atter of law.” Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 10 69, 9 R. Doc. 14-2 at 1-2; R. Doc. 11, Exhibit C, at 63 (“I was under the influence of [sic] we’re n ot going to file any taxes on him or an ything to help him out . . . to help him out because of school.”). 10 See R. Doc. 1. Arifatm i originally filed his com plain t as a “Collective Action Com plaint.” No other putative plaintiff has opted-in to the suit, however, and Arifatm i’s sum m ary judgm en t argum ents are particular to him . See generally Cam eron -Gran t v. Maxim Healthcare Servs., Inc., 347 F.3d 1240 , 1249 (11th Cir. 20 0 3) (“Under § 216(b), the action does not becom e a ‘collective’ action unless other plaintiffs affirm atively opt into the class by giving written and filed consent.”). 10 75 (5th Cir. 1994). When assessing whether a dispute as to any m aterial fact exists, the Court considers “all of the evidence in the record but refrain[s] from m aking credibility determ inations or weighing the evidence.” Delta & Pine Land Co. v. Nationw ide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 20 0 8). All reasonable inferences are drawn in favor of the nonm oving party, but “unsupported allegations or affidavits setting forth ‘ultim ate or conclusory facts and conclusions of law’ are insufficient to either support or defeat a m otion for sum m ary judgment.” Galindo v. Precision Am . Corp., 754 F.2d 1212, 1216 (5th Cir. 1985); see also Little, 37 F.3d at 10 75. “No genuine dispute of fact exists if the record taken as a whole could not lead a rational trier of fact to find for the non-m oving party.” EEOC v. Sim baki, Ltd., 767 F.3d 475, 481 (5th Cir. 20 14). In nonjury cases, such as this one, 11 where the judge is the ultim ate finder of fact, “more lenient standard for sum mary judgment” is appropriate. U.S. Fid. & Guar. Co. v. Planters Bank & Trust Co., 77 F.3d 863, 865 (5th Cir. 1996). Specifically, at the sum m ary judgment stage of a bench trial, the judge m ay have “the lim ited discretion to decide that the same evidence, presented to him or her as trier of fact in a plenary trial, could not possibly 11 R. Doc. 24 at 3 (“Trial will com m en ce . . . before the District J udge without a jury.”). lead to a different result.” Id. at 866. That is, “if there are no issues of witness credibility, the court m ay conclude on the basis of the affidavits, depositions, and stipulations before it, that there are no genuine issues of m aterial fact, even though decision m ay depend on inferences to be drawn from what has been incontrovertibly proved.” Id. Thus, “if a trial on the merits will not enhance the court's ability to draw inferences and conclusions,” then the court should draw those inferences “without resort to the expense of trial.” In re Placid Oil Co., 932 F.2d 394, 398 (5th Cir. 1991). III. D ISCU SSION The Fair Labor Standards Act generally provides that an em ployer shall pay its employees wages “not less than . . . $ 7.25 an hour.”12 See 29 U.S.C. § 20 6(a)(1). For “tipped em ployees,” like restaurant servers, 13 the Act allows the em ployer to pay wages below the m inim um hourly wage of $ 7.25, so long as the employer supplem ents the difference with the employees’ tips. See 29 12 Lucky Dragon does n ot dispute that it is subject to the Act. Com pare R. Doc. 11-10 (Plaintiff’s Statem ent of Undisputed Material Facts), w ith, R. Doc. 14-1 (Defendant’s Con tested Issues of Material Fact). 13 A “tipped em ployee” is “any em ployee engaged in an occupation in which he custom arily and regularly receives m ore than $ 30 a m onth in tips.” 29 U.S.C. § 20 3(t). “There is no dispute that . . . waiters[] are ‘tipped em ployees.’” Montan o v. Mon trose Restaurant Assocs., Inc., 80 0 F.3d 186, 189 (5th Cir. 20 15). U.S.C. § 20 3(m ). This exception to the general m inim um wage requirem ent is known as the “tip credit.” See generally Montano v. Montrose Restaurant Assocs., Inc., 80 0 F.3d 186, 188 (5th Cir. 20 15). An em ployer is eligible for the tip credit, as it applies to a particular em ployee, only if he informs that em ployee of the tip credit provision of the Act and allows the em ployee to retain all of his tips. See 29 U.S.C. § 20 3(m); Montano, 80 0 F.3d at 188. Even when the tip credit applies, the em ployer shall not pay his em ployees an hourly wage less than $ 2.13. 29 C.F.R. § 531.50 . If an employer violates these m inim um wage provisions, he is liable to the wronged em ployee for “the am ount of [the em ployee’s] unpaid m inim um wages,” as well as “an additional equal am ount as liquidated dam ages.” 29 U.S.C. § 216(b); see also Arriaga v. Fla. Pac. Farm s, LLC, 30 5 F.3d 1228, 1237 n.11 (11th Cir. 20 0 2) (noting that the em ployer is required to reimburse an employee only “up to the point that the m inim um wage is met”). The em ployer is generally liable for the unpaid wages due under the Act for the two years preceding suit. See 29 U.S.C. § 255(a) (im posing two-year statute of lim itations period). If the em ployer willfully violated the Act, however, the em ployer is liable for the em ployee’s unpaid wages for the three years preceding suit. See id. (“[A] cause of action arising out of a willful violation m ay be com menced within three years . . . .”); Saizan v. Delta Concrete Prods. Co., Inc., 448 F.3d 795, 80 1 n.31 (5th Cir. 20 0 6) (“The willfulness of a particular violation determ ines the duration of tim e for which com pensation is recoverable.”). An em ployer “willfully” violates the Act when he either knows or “shows reckless disregard for . . . whether [his] conduct was prohibited.” Ikossi-Anastasiou v. Bd. of Supervisors of La. Stat Univ., 579 F.3d 546, 552 (5th Cir. 20 0 9) (quoting McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133 (1988)). “For exam ple, em ployers act willfully when they know their pay structures violate the FLSA or ignore com plaints brought to their attention.” Moham m adi v. Nw abuisi, 60 5 F. App’x 329, 332 (5th Cir. 20 15) (citing Ikossi-Anastasiou, 579 F.3d at 553 & n.24). To prove willfulness, the em ployee m ust do m ore than show that his em ployer knowingly engaged in conduct that is ultim ately deem ed to violate the Act. The em ployee m ust show that the employer knew (or recklessly disregarded), at the tim e of engaging in the conduct, that this conduct violated the Act. See IkossiAnastasiou, 579 F.3d at 553 & n.24 (distinguishing between willful and nonwillful violations of the FLSA). An em ployer’s “good faith but incorrect assumption” that he has complied with the Act does not constitute a willful violation. Johnson v. Big Lots Stores, Inc., 60 4 F. Supp. 2d 90 3, 924 (E.D. La. 20 0 9) (collecting cases). Even unreasonableness is insufficient to establish that an em ployer willfully violated the Act. Id. Here, it is undisputed that Lucky Dragon did not pay Arifatm i the requisite m inim um wage. Indeed, Lucky Dragon adm its that it did not pay Arifatm i any wages at all and instead com pensated him only in tips. 14 As a “tipped employee,” Arifatm i was entitled to an hourly wage of at least $ 2.13. See 29 C.F.R. § 531.50 . Lucky Dragon’s argum ent that it did not pay Arifatm i m inim um wage because, as a student visa-holder, he “failed to secure the proper work authorization and docum entation” is no excuse. 15 “[I]t is wellestablished that the protections of the Fair Labor Standards Act are applicable to citizens and aliens alike and whether the alien is docum ented or undocum ented is irrelevant.” In re Rey es, 814 F.2d 168, 170 (5th Cir. 1987); accord Patel v. Quality Inn S., 846 F.2d 70 0 , 70 6 (11th Cir. 1988) (“[U]ndocumented workers are ‘em ployees’ within the m eaning of the FLSA . . . .”). Lucky Dragon’s argum ents that Arifatm i agreed to this “practical arrangement” and that Arifatm i ultim ately earned m ore per hour than the statutory m inim um wage are legally imm aterial as well. The Act requires an 14 R. Doc. 14-2 at 1 (“Plaintiff . . . was com pensated via tips earn ings. . . . The [t]wo dollars and thirteen cents ($ 2.13)[,] defined as cash wages, was not im plem en ted . . . .”). 15 See R. Doc. 14 at 4. em ployer applying the “tip credit” to pay his employees an hourly wage of at least $ 2.13. Gray v. Pow ers, 673 F.3d 352, 354 (5th Cir. 20 12) (“Tipped em ployees m ust receive a wage equal to the m inim um wage, though tips can be counted . . . as long as the em ployer pays the tipped employee a m inim um of $ 2.13 per hour.”). An em ployee cannot “abridge[] by contract or otherwise waive[]” his right to a m inim um wage from his em ployer “because this would nullify the purposes of the statute and thwart the legislative policies it was designed to effectuate.” See Barrentine v. Arkansas-Best Freight Sy s., Inc., 450 U.S. 728, 740 (1981) (collecting cases). Therefore, the Court finds sum m ary judgment warranted on the issue of Lucky’s Dragon’s liability. Regarding whether Lucky Dragon’s violation was willful, however, the Court finds that Arifatm i has failed to show that there is no genuine dispute of m aterial fact. Arifatm i argues that Lucky Dragon’s willfulness is dem onstrated by the restaurant’s paying its other servers the federallym andated $ 2.13 per hour and by the restaurant’s adm itting that it com pensated Arifatm i in only tips while he was in the United States on a student visa. 16 This is insufficient. Though Lucky Dragon has adm itted to conduct that violates the Act, Arifatmi has not shown that Lucky Dragon 16 R. Doc. 11-1 at 9. knew at the tim e that this conduct was unlawful. See Ikossi-Anastasiou v. Bd. of Supervisors of La. Stat Univ., 579 F.3d 546, 553 & n.24 (5th Cir. 20 0 9) (distinguishing between em ployer’s knowledge that its pay scale is unfair and knowledge that its pay scale is illegal). Further, Iva Octavia, co-owner of Lucky Dragon, declares in an affidavit that she thought paying Arifatm i only in tips complied with the Act because Arifatm i had not obtained the proper work authorization from the Governm ent. 17 As noted, a “good faith but incorrect assumption” of com pliance—even an unreasonable one—is insufficient to prove an em ployer willfully violated the Act. See Johnson v. Big Lots Stores, Inc., 60 4 F. Supp. 2d 90 3, 924 (E.D. La. 20 0 9) (collecting cases). Because resolution of this factual dispute turns on the witness’s credibility, sum m ary judgm ent is not warranted on this point. See U.S. Fid. & Guar. Co. v. Planters Bank & Trust Co., 77 F.3d 863, 865 (5th Cir. 1996) (allowing the court in a nonjury case to draw inferences from sum m ary judgment evidence so long as “there are no issues of witness credibility”). Because the em ployer’s willfulness “determ ines the duration of tim e for which com pensation is recoverable,” 17 R. Doc. 14-2 at 1-2. sum m ary judgment is also unwarranted on the issue of dam ages. See Saizan v. Delta Concrete Prods. Co., Inc., 448 F.3d 795, 80 1 n.31 (5th Cir. 20 0 6). IV. CON CLU SION For the foregoing reasons, the Court GRANTS IN PART and DENIES IN PART Arifatm i’s Motion for Summ ary J udgm ent against Defendant Lucky Dragon, LLC d/ b/ a Geisha Sushi Bistro. 11th New Orleans, Louisiana, this _ _ _ day of April, 20 16. ____________________________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE
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