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Creazzo v. Lenderlive Network, Inc.

United States District Court, D. Colorado

October 22, 2014

DOROTHY MURPHY and HEATHER CREAZZO, on behalf of themselves and all others similarly situated, Plaintiffs,
v.
LENDERLIVE NETWORK, INC., Defendant.

ORDER

R. BROOKE JACKSON, District Judge.

This matter is before the Court on Plaintiffs' Motion for Certification of WARN Class and Related Relief [ECF No. 27], Defendant's Motion to Stay Decision on Plaintiffs' Motion for Certification of Warn Class and Related Relief [ECF No. 34], and Defendant's Motion for Partial Summary Judgment [ECF No. 39]. The Court has jurisdiction pursuant to 28 U.S.C. § 1331.

BACKGROUND

The plaintiffs assert violations of the Worker Adjustment and Retraining Notification Act ("WARN Act"), 29 U.S.C. § 2101, et seq. and the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201, et seq. The Court recently granted the plaintiffs' motion for conditional certification of a collective action under Section 216(b) of the FLSA. [ECF No. 60]. The current motions concern only the WARN Act claims.

The two named plaintiffs, Ms. Murphy and Ms. Creazzo, performed work as underwriters for the defendant employer, LenderLive Network, Inc. ("LenderLive"). LenderLive is a Tennessee corporation with its principal place of business in Colorado. It provides mortgage services for financial institutions in the United States. The plaintiffs allege that they, along with approximately 120 similarly-situated former employees, were terminated without cause as part of, or as the result of, a mass layoff ordered by the defendant on or about October 15, 2013. They further allege that they did not receive either 60 days' advance written notice of their terminations or 60 days' pay and benefits in lieu of notice. Complaint [ECF No. 1] at ¶¶ 1, 46. According to the plaintiffs, the failure to so notify or pay the affected employees constitutes a violation of the WARN Act. The defendant denies this allegation and asserts a number of affirmative defenses. First Amended Answer [ECF No. 12] ¶¶ 1, 46; p. 8.

The plaintiffs move for certification of a WARN class pursuant to Fed.R.Civ.P. 23. [ECF No. 27]. The defendant moves for partial summary judgment on the grounds that it did not lay off enough employees to violate the WARN Act. [ECF No. 39]. The defendant also moved to stay a decision on the plaintiffs' motion for class certification pending the outcome of its then-forthcoming motion for partial summary judgment. [ECF No. 34]. The Court addresses each of these pending motions herein.

A. Defendant's Motion for Partial Summary Judgment [ECF No. 39] & Motion to Stay [ECF No. 34].

The defendant moves for partial summary judgment, arguing that it did not lay off enough employees to trigger the WARN Act. The plaintiffs respond that discovery is still ongoing, and that they need more evidence before they can determine the validity of this contention. The Court agrees with the plaintiffs and therefore denies this motion.

The Court grants summary judgment only if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). However, "summary judgment [should] be refused where the nonmoving party has not had the opportunity to discover information that is essential to his opposition, " Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 n.5 (1986); see also Dreiling v. Peugeot Motors of Am., Inc., 850 F.2d 1373, 1376 (10th Cir. 1988). Under Fed.R.Civ.P. 56(d) (formerly Rule 56(f))[1], "[i]f a nonmovant shows by affidavit or declaration that, for specified reasons, it cannot present facts essential to justify its opposition, the court may: (1) defer considering the motion or deny it; (2) allow time to obtain affidavits or declarations or to take discovery; or (3) issue any other appropriate order."

The WARN Act requires employers to provide 60 days' advance notice to employees who will be subjected to a mass layoff or a plant closing ("affected employees"). 29 U.S.C. § 2102(a). The term "affected employees" is defined as "employees who may reasonably be expected to experience an employment loss as a consequence of a proposed plant closing or mass layoff by their employer." 29 U.S.C. § 2101(a)(5). The plaintiffs claim that they are affected employees because they were part of a mass layoff, which the WARN Act defines as a reduction in force ("RIF") that:

(A) is not the result of a plant closing; and
(B) results in an employment loss at the single site of employment during any 30-day period for-
(i) (I) at least 33 percent of the employees (excluding any part-time employees); and
(II) at least 50 employees (excluding any part-time employees); or
(ii) at least 500 employees (excluding any part-time employees)

Id. § 2101(a)(3). The WARN Act also specifies that employment losses for two or more groups of employees at a single site of employment which in the aggregate exceed the minimum number of layoffs and which occur within any 90-day period will be considered a mass layoff, "unless the employer demonstrates that the employment losses are the result of separate and distinct actions and causes and are not an attempt by the employer to evade the requirements of [the WARN Act]." Id. § 2102(d).

The defendant contends that "[n]o mass layoff occurred here." [ECF No. 39 at 7]. It maintains that it has compiled data spanning all layoffs that occurred between August 5, 2013 and December 31, 2013 (beyond a 90-day window), and that "[o]ver that entire period, LenderLive did not lay off fifty employees at any single site of employment." Id. Instead, it laid off 46 employees in Glendale, CO; 44 employees in Madison Heights, MI; and one in Kansas City, MO. Id. LenderLive contends that it likewise did not meet the 33% threshold to trigger the WARN Act's notification requirements. It maintains that it laid off 11.9% of its workforce in Glendale; 27.8% in Madison Heights; and 4% in Kansas City. Id. at 8. LenderLive supports its motion with a lengthy spreadsheet from which this information was distilled. [ECF No. 39-2]. The spreadsheet includes the name of each individual employed during this time period, ...


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