Gomez Martinez et al v. Spice Place, Inc., et al, No. 1:2012cv00503 - Document 24 (S.D.N.Y. 2013)
Court Description: OPINION re: 11 MOTION to Dismiss the Amended Complaint filed by Spice Thai Hot & Cool LLC, Yongyut Limleartvate, Spice Avenue Inc., Spice West, Inc., Kitlen Management, Inc., Spice Corner 236 Inc., Bangkok Palace II, Inc., Kittigorn Lirtpanaruk, Sp ice City, Inc. For the reasons set forth above, the Amended Complaintis dismissed to the extent that it asserts claims seeking collective action or class action certification for any period of time prior to December 11, 2009. Leave to replead within twenty days is granted. (Signed by Judge Robert W. Sweet on 6/11/2013) (cd)
Download PDF
<![CDATA[
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------------------x JUAN CARLOS GOMEZ MARTINEZ, et al., Plaintiffs, -against- 12 Civ. 503 OPINION SPICE AVENUE INC., et al., Defendants. ------------------------------------------x A P PEA RAN C E S: Attorney for Plaintiffs MICHAEL FAILLACE & ASSOCIATES, P.C. 60 East 42 nd Street, Suite 2020 New York, NY 10165 By: Michael A. Faillace Attorney for Defendants LAW OFFICE OF RICHARD E. SIGNORELLI 799 Broadway, Suite 539 New York, NY 10003 By: Richard E. Signorelli, Esq. Bryan Ha, Esq. LIPMAN & PLESUR, LLP 500 North Broadway, Suite 105 Jericho, NY 11753 By: Robert D. Lipman, Esq. Sweet, D.J. Defendants Spice Avenue Inc., Bangkok Palace II, Inc., Spice City, Inc., Spice West, Inc., Spice Thai Hot & Cool LLC, Kitlen Management, Inc., Spice Corner 236 Inc., Kittigorn Lirtpanaruk and Yongyut Limleartvate (collectively, "Defendants") have moved to dismiss the Amended Complaint in part pursuant to Rule 12(b) (6) of the Federal Rules of Civil Procedure. For the reasons discussed below, the Amended Complaint is dismissed to the extent it asserts claims seeking collective action or class action certification for any period of time prior to December 11, 2009. Prior Proceedings Plaintiffs filed the initial complaint in this action on January 20, 2012. An Amended Complaint was filed on July 3, 2012 alleging that the corporate defendants are "seven corporations that act in partnership with one another in the operation and management of a chain of Thai restaurants in the state of New York" (Amended Compl. 'l1 2), and that they are allegedly "current and former employees of Defendants, primarily employed as delivery workers." (Id. 'l1 56). It is further alleged 1 that, "[f]or at least six years prior to action," De s ling of this iled to pay them minimum and overtime wages as required under the Fair Labor St the New York (" FLSA") , Law, and the spread of hours wage order of the New York Commissioner of Labor. PIa Act if Id. ~~ 12-13). seek to bring this action "on behalf of themselves, individually, and all other simila y situated employees and former employees of Defendants,lf ~~ and seek certification of s action as a col ct 14-15), action pursuant to the FLSA, 29 U.S.C. ยง 216(b), and as a class action pursuant to Fed. R. Civ. P. 23 for the period from "on or after rs before the filing of the complaint in the date that is six this case, January 2006, to entry of judgment in this case (the 'New York Class Period')." (Amended CompI. ~~ 516, 13-14). The instant action is substantively similar to s District: Marlon Castro actions previously filed v. ce Place Inc. et al. 07 CV 4657 ce Place et al. ~~~~~~--~~~----~------~------- Jose Castillo et al. v. (RWS); Guillermo 08 CV 3887 et al. (RWS); and ~~~~~==~~~~~.~~~--~----------~----~--------' (RWS) (collectively, "prior act If). et al. 08 CV 6811 Many of the defendants in the prior actions are also named as defendants in the action, including Spice Avenue, Inc., Bangkok Palace II, 2 Inc., Spice City, Inc., Spice West, Inc., Kitlen Management, Inc., Kittigorn rtpanaruk, and Yongyut eartvate. The aintiffs in each of the prior actions all failed to pay them minimum and overtime the FLSA and under New York law. Amended Compl. ~~ that defendants s as required under (Castro Compl. 37, 43, 51; Castillo Compl. ~~ ~~ 4-5; Gonzalez 75, 81, 88, 108) . aintiffs in each of action and class action certification on sought collect behalf of t actions also elves and other simil y-situated empl s. The Castro plaintiffs sought certification of a collective action and a ss action for the period from "on or after the that is six rs before the filing of the complaint in this case, June 2001, to entry of judgment in this case (the 'New York Class Period').Ff (Castro Compl. the pla ~~ 54, 6-7). In Gonza s, f sought collective action and class action certification for "the period from April 30, 2002 to date of this complaint [i.e., May 1, 2008J.Ff (Gonzalez Amended Compl. ~ 6). In Castillo certif the Plaintiffs sought collective action ion for the period July 30, 2005 through July 30, 2008 and class action certification for the period 2002 through July 30, 2008. (Castillo Compl. 3 ~~ 66, 87.) July 30, At the time that the prior actions were pending, the Office of the Attorney General of the State of New York ("OAG") was conducting an investigation of the Defendants' alleged wage law violations. (Order Facilitating Settlement, p. 1). In December 2009, "the OAG [] negotiated a settlement of its investigation with defendants which serves the interests of plaintiffs [] in the form of a document entitled 'Assurance of Discontinuance'." (Id.). The Assurance of Discontinuance was fully executed on December 14, 2009. In connection with the settlement of the OAG's investigation, the parties also settled the Castro action and the Gonzales action, and these actions were dismissed with prejudice pursuant to stipulations of dismissal so-ordered by the Court (collectively, "Dismissal Orders"). Each of the Dismissal Orders contains a prohibition against the filing of any collective or class action against any of the defendants for alleged wage law violations, as follows: Upon the full execution of the Assurance of Discontinuance executed by Andrew M. Cuomo, Attorney General of the State of New York, and the corporate defendants herein, no class or collective action may be brought against defendants for alleged wage-hour violations for any time up to the date of this Order. 4 The order dismissing the Castro action is dated November 17, 2009. The order dismissing the Gonzales action is dated December 11, 2009. The instant motion, based in part on the Dismissal Order, was heard and marked fully submitted on January 23, 2013. The Amended Complaint As A Collective Action Is Dismissed The Dismissal Orders entered in the Castro and Gonzales actions resolved those cases and banned collective and class actions covering the same period of time covered by the Defendants' settlement with the OAG of the wage-hour claims of its employees. Concurrently with the Dismissal Orders, the Defendants entered into a negotiated settlement with the OAG pursuant to an Assurance of Discontinuance and paid the sum of $650,000 as restitution for unpaid wages, overtime pay and other compensation, to be distributed by the OAG to persons employed by the Defendants during the period from "September 1, 1999 through the date of execution of this Assurance of Discontinuance[.]" Each of the Dismissal Orders provided that, "[u]pon the full execution of the Assurance of Discontinuance ... no class or collective action may be brought against 5 defendants for alleged wage-hour violations for any time up to the date of this Order." The later of the two Dismissal Orders is dated December 11, 2009. The Assurance of Discontinuance together with the Dismissal Orders established a framework for distributing funds to employees with wage-hour claims against the Defendants through December 11, 2009, in lieu of a class or collective action. Essentially, the OAG would distribute the funds from the defendants to all eligible employees to satisfy and secure the release of their wage-hour claims, thereby obviating the need for any class or collective action. Eligible employees who did not receive a distribution from the OAG are not prohibited from bringing individual wage-hour claims against the defendants. They are free to bring such claims to recover any unpaid wages, overtime pay and other compensation that may be owed them. Only class and collective actions are prohibited. The Plaintiffs acknowledge that this prohibition of class and collective actions is "presumptively reasonable" because the OAG's investigation (which culminated in the Assurance of Discontinuance) was not limited to any particular employees but rather "covered workers generally at the Defendants' restaurants, and included a mechanism for 6 individuals deemed eligible by OAG to submit a claim and re and receive payment from the settlement monies paid by t s] to OAG." (Opp. Mem. Law, p. 3). However, the Plaintiffs contend that they may assert ss and col ive action claims in this case because they y ndid not receive adequate notice of the OAG investi they aims procedure." (Id.). Without such notice, and of the prohibition against class and aim, col act would violate their due process rights. (Id. at 3-4). If t iffs did not receive adequate notice as they claim, and did not rece any distribution from the OAG, they may seek recovery of any unpaid wages, overtime pay and other compensation that t wage-hour claims aga t y may be owed by bringing individual t 3). Nothing in the Dismissal Discontinuance prohibits s. De rs or the Assurance of from asserting individual wage- hour claims in their compla substantive rights have (Def. Reply Memo, p. ly, none of their or compromised. wa Plaintiffs rely on Alabama, 517 U.S. 793 (1996), ral propos 7 ion that "one is not bound by a judgment in personam in a 1 or to which which he is not signated as a been made a by service of process." Richards, the igation in has not (Opp. Mem., p. 4). In abama Supreme Court applied the doct judicata and rul of res that the petitioners' claims were barred by a prior adjudication on the merits in an earlier litigation. See Richards, 517 U.S. at 795-96. The Supreme Court revers holding that "[b]ecause petitioners received neither notice of, nor sufficient entation in [the or litigation], t adjudication, as a matter of federal due process, may not bind them and thus cannot them from" asserting their claims. Id. at 805. Richards is inapposite here contending that Plaint if are barred judicata from asserting ir wage-hour c Unli in Richards, se Defendants are not the doctrine of res ims in this action. the petitioners were barred from asserting their claims based on a prior adjudication, the PIa iffs here are free to assert all their claims (and have in done so). The PI if in this case are represented by the same counsel who represented the Plaintif actions. Unlike in Richa there is no cl in the prior here that Plaintiffs were not "adequately represented" by the parties who were present in the prior actions. See id. at 800-801. Nor is 8 re any claim that Plaintiffs' interests con s of the parties who were present in t ict with the p or actions. e, 311 U.S. See id. at 800-801 (noting that in Hansber --------~--------- 32. 42-43 (1940), the Supreme Court concluded "that because the rests of those class members who had been a party to the litigation were in conflict with absent members who were the defendants in the subsequent action,H the Defendants could not be bound by the prior adjudicat ). Since no monetary claims were waived under the Dismissal Orders and Assurance of scontinuance, no notice to potential plaintiffs was requi Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541, 2558-59 (2011) under Fed. R. Civ. P. 23 (b) (2); (notice is not required Supreme Court has never held that the lack of notice violates due process where the monetary claims do not predominate). The framework es ished by the Assurance of Discontinuance and Dismissal Orders in lieu of a class or collective action was approved and so-ordered by the Court and agreed upon by all parties including the Plaintiffs' counsel, who also represented iffs in the prior actions. Defendants ente the Assurance of Discontinuance and agreed to settle the or actions in reliance on the promise of 9 "finality and repose" with respect to class and collective actions covering the same period covered by these agreements. Such "finality and repose" was critical to the reements. See 187 F. R. D. 453, 458 (N.D.N.Y. 1999) ("'Most importantly, a settlement produces finality and repose upon whi affairs.'") (quoting 267, 616 N.Y.S.2d 424 Huls~v. people can order their A.B. Dick Co., 162 Misc.2d 263, (N.Y. Sup. Ct. 1994)); a Foundations, Inc. v. Ilgwu Nat. Retirement Fund, 902 F.2d 185, 190 (2nd Cir. 1990) (noting the importance of "[t]he need finality" in a settlement agreement). As the Court of Appeals for the Second Circuit has noted, "[c]ourts are wary of disturbing settlements, because they represent compromise and conservation of judi resources, two concepts al ghly regarded in American jurisprudence." Anita Foundations, 902 F.2d at 190; see also Hasbrouck poli 187 F.R.D. at 458 (noting" important public of encouraging settlements") . Pursuant to the Assurance of sed complete scontinuance, t OAG total control over the claims rmine distribution process; it had "absolute discretion to eligibility of individuals and distributed to individuals [], the t identity of the recipients and 10 ific amounts to be frames for stribution, manner of distribution, provided, however, that money will be distributed only those individuals who submit claims to OAG within the time period which may be required by OAG, and who complete and sign a Release[.]U (Assurance of Discontinuance, p. 5 , 2(a)). Defendants were not involved in the claims distribution process. If Plaintiffs here believe that they are entitled to distributions from t OAG but did not submit claims because they did not receive adequate notice, and they do not want to continue to participate in this lawsuit, to pursue may be appropriate matter with the OAG. CONCLUSION For the reasons set forth above, the Amended Complaint is dismissed to the extent that asserts claims seeking lective action or class action certification any period prior to December 11, 2009. Leave to replead within of t twenty days is granted. New York, NY June ,2013 /1 . SWEET U.S.D.J. 11
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
