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Sanchez v. Simply Right, Inc.

United States District Court, D. Colorado

February 27, 2017

AURELIO SANCHEZ, DOMINGO SANCHEZ, DANIEL HERNANDEZ, MIGUEL ANGEL GODOY, BENITA ARREOLA, JOSE LUIS ARREOLA, and CLARA ARRELOA, on their own behalf and on behalf of all others similarly situated, Plaintiffs,


          Michael E. Hegarty, United States Magistrate Judge

         Before the Court are Defendant Cinemark USA, Inc.'s Motion for Summary Judgment [filed November 11, 2016; ECF No. 123] and Plaintiffs' Motion for Partial Summary Judgment as to Cinemark USA, Inc.'s Status as a Joint Employer [filed November 18, 2016; ECF No. 134]. The motions are fully briefed and the Court finds oral argument (not requested by the partes) will not assist in its adjudication of the motions. For the following reasons, this Court respectfully recommends that Plaintiffs' motion be denied in part and denied without prejudice in part and that Defendant Cinemark's motion be denied.[1]


         I. Procedural History

         Plaintiffs (self-described janitorial employees of Defendant Simply Right, Inc. (“Simply Right”) and their family members and friends working in Defendant Cinemark USA, Inc. (“Cinemark”) theaters) initiated this action on May 7, 2015 and filed the operative Amended Complaint on July 10, 2015 alleging essentially that Simply Right, a cleaning service contractor, and Cinemark, the contracting party, failed to pay them minimum wages and overtime pay.[2] On August 21, 2015, the parties stipulated to stay the claims of certain Plaintiffs-Aurelio Sanchez, Domingo Sanchez, Miguel Godoy, Daniel Hernandez, Benita Arreola, and Opt-in Plaintiff Armida Raya- pending the conclusion of arbitration proceedings for each of these individuals.[3] The claims of the remaining Plaintiffs have proceeded through discovery.

         The issue raised by the present motions concerns whether Cinemark is a “joint employer” with Simply Right necessary to demonstrate liability under the Fair Labor Standards Act (“FLSA”). Cinemark argues that its relationship with Simply Right was simply one of contractor/subcontractor, and it had no supervision or control over Simply Right's employees. Plaintiffs counter that, although they were employed by Simply Right, they “worked on Cinemark's premises, with materials and equipment supplied by Cinemark, ” and “Cinemark managers used and directed [them] just like they were their own employees.” Notably, Plaintiffs bring their motion seeking judgment on behalf of themselves and the purported class. Therefore, to the extent Plaintiffs' motion is construed to seek judgment on behalf of the named Plaintiffs having claims currently before this Court-Jose Luis Arreola, Clara Arreola, Nazario Arreola, and Maribel Arreola-the Court will treat the Plaintiffs' motion and Cinemark's motion as cross motions for summary judgment.

         However, Plaintiffs' motion also seeks judgment on behalf of the stayed Plaintiffs currently in arbitration. The Court finds that a ruling on behalf of the stayed Plaintiffs would constitute a “rul[ing] on the potential merits of the underlying claims, ” which is prohibited by Supreme Court precedent. See AT&T Techs., Inc. v. Comm'cns Workers of Am., 475 U.S. 643, 649-50 (1986) (“even if it appears to the court to be frivolous, the [plaintiff's] claim that the employer has violated the [law] is to be decided, not by the court asked to order arbitration, but as the parties have agreed, by the arbitrator.”); see also Int'l Bhd. of Elec. Workers, Local 111 v. Pub. Serv. Co., 773 F.3d 1100, 1109-10 (10th Cir. 2014) (“We recognize that as a general rule, ‘in deciding whether the parties have agreed to submit a particular grievance to arbitration, a court is not to rule on the potential merits of the underlying claims.'”) (quoting AT&T Techs., Inc., 475 U.S. at 649). As such, the Court will recommend that Plaintiffs' motion on behalf of Plaintiffs Aurelio Sanchez, Domingo Sanchez, Miguel Godoy, Daniel Hernandez, Benita Arreola, and Opt-in Plaintiff Armida Raya be denied without prejudice.

         Moreover, to the extent the Plaintiffs seek summary judgment on behalf of the class, Plaintiffs concede that “once a named plaintiff establishes individual standing, the issue of whether a named plaintiff can assert claims on behalf of absent class members is determined at the class certification stage of the litigation.” Reply, ECF No. 163 at 6-7 (citing Indergit v. Rite Aid Corp., No. 08 Civ. 9361 (PGG), 2009 WL 1269250, at *4 (S.D.N.Y. May 4, 2009)). Thus, until Judge Moore issues a ruling on certification, the Court cannot determine whether the named Plaintiffs may seek judgment on behalf of the purported class. The Court recommends that Judge Moore reserve judgment as to whether the Plaintiffs may seek summary judgment concerning the joint employer issue on behalf of the purported class.

         II. Findings of Fact

         Cross-motions for summary judgment are examined under the usual Rule 56 standards, Saieg v. City of Dearborn, 641 F.3d 727, 733-34 (6th Cir. 2011), with the court viewing all facts and reasonable inferences in the light most favorable to the nonmoving party.[4] See Edwards v. Briggs & Stratton Ret. Plan, 639 F.3d 355, 359 (7th Cir. 2011).

         1. Defendant Cinemark USA, Inc. (“Cinemark”) is in the business of exhibiting movies.

         2. Defendant Simply Right, Inc. (“Simply Right”) was formed in 2000. Simply Right is a janitorial services contractor that is “in the business of providing [janitorial services] to the general public and other businesses.” 3. Cinemark and Simply Right are separate and distinct legal entities.

         4. In approximately October 2006, Simply Right began providing janitorial services at some of Cinemark's movie theater locations.

         5. One location where Cinemark contracted with Simply Right to provide janitorial services was at the theater in Greeley, Colorado (the “Greeley theater”). Simply Right started performing janitorial services at the Greeley theater on or around May 1, 2011, and has done so to the present.

         6. In addition to Cinemark, Simply Right provides janitorial services to other commercial businesses and movie theater companies. Of the approximately 800 to 1, 050 persons employed by Simply Right, only about 400 to 500 are assigned to clean movie theaters.

         7. Under the Janitorial Services Agreement (“JSA”) between Cinemark and Simply Right, Simply Right agreed to perform cleaning services “nightly between box office close and two hours prior to theater opening.” JSA Addendum A, § V.a, ECF No. 124 at 32.

         8. Simply Right hired cleaners or custodians to perform janitorial services at Cinemark theaters, including the Greeley theater.

         9. Per the JSA, Simply Right was “solely responsible for any supervision of its employees deemed necessary by” Simply Right. Id., Addendum A. The JSA reserves to Simply Right the right of direction and control over the cleaners assigned to Cinemark's work sites, including the right to hire, fire, supervise, discipline, and reassign the cleaners. Id. II. § 2.7. The JSA also provides that Simply Right “shall be solely responsible for the salary, worker's compensation, income tax withholding, unemployment, FICA, and all other aspects of employment regarding [Simply Right's] employees.” Id. II. § 2.14.

         10. Simply Right provides a written list of “Golden Work Rules” for its employees; a copy provided by Cinemark reflects a signature by Plaintiff Jose Arreola Ramos on March 13, 2013. ECF No. 123-4. These “Rules” include an arrival time, the requirement to “clock in and out each day, ” and an order to “discuss any issues such as time off, pay, job tasks[, ] etc. with your direct supervisor[, ] not the theater manager.” Id.

         11. The JSA provides that Simply Right “agree[d] it will, at all times, provide and maintain an individual at [Cinemark's] work site (the “. . . Site Manager”), who shall be responsible for the daily on-site supervision of all [Simply Right] employees.” JSA II. § 2.6.

         12. Armida Raya (“Raya”) was employed by Simply Right as a supervisor during some of the relevant time period. Raya testified that her job duties included recruiting employees for Simply Right, training cleaners, checking their work and coaching cleaners who did not do a good job, ensuring the cleaners kept track of their time, and serving as a contact with whom Cinemark could communicate when the theaters were not cleaned properly. Deposition of Armida Raya, September 27, 2016 (“Raya Dep.”), 42-48, 50-52, ECF No. 123-5.

         13. Raya also recommended to Simply Right's Vice President/Director of Operations Beatrice Permann (“Permann”) how much each cleaner would be paid, once Permann provided the “budget” for that particular theater. Id. 108: 1-24.

         14. Raya was alerted to “problems in the cleaning” by Cinemark managers in Fort Collins, Boulder, and Aurora. Id. 47: 12-24. She “never had problems” with cleaners at the Greeley theater. Id. 102: 7-15.

         15. Between April 2013 and the present, Cinemark employed at least fifteen different managers at the Greeley theater.

         16. Cinemark managers never asked Raya to specifically hire or fire any janitor who performed work at the Greeley theater. Id. 167: 20-25, 168: 1-4.

         17. Cinemark did not maintain personnel files, time records, pay stubs, or government employment forms for Plaintiffs or other Simply Right cleaners who cleaned for Simply Right at the Greeley theater.

         18. Raya arranged and attended with Cinemark managers the monthly inspections of the theaters she supervised. Approximately two to three times during Raya's employment with Simply Right, Cinemark managers at the Greeley theater asked cleaners to accompany Raya and the manager on inspection “walks.” Id. 142: 19-25; 143: 7-25.

         19. Cinemark did not track the Simply Right cleaners' arrival and departure times, and it did not receive lists from Simply Right identifying who the cleaners were that Simply Right assigned to its theaters.

         20. Based on movie schedules, Cinemark managers notified Raya of “what time they would like for [the cleaners] to start” work, and Raya would notify the cleaners. Id. 110: 15-25, 111: 1-11.

         21. Cinemark purchases the chemicals and cleaning supplies used to clean the Greeley theater, so it can ensure the products used in its theaters “are environmentally friendly and … lower the risk of exposure to its customers of any contaminants.” JSA, Addendum A.

         22. Opt-in Plaintiffs Maribel Arreola (“Maribel”) and Nazario Arreola (“Nazario”) (ECF No. 7)[5] worked for Simply Right cleaning at the Greeley theater between April 21, 2014 and May 13, 2015. Maribel and Nazario claim they worked seven days a week during this roughly 13-month time period (or, approximately 388 days).

         23. In or around April 2014, Plaintiff Jose Luis Arreola (“Jose Luis”) told his brother Nazario about the work he was doing with Simply Right. Jose Luis explained that Simply Right was hiring cleaners, and he set up an appointment for Nazario and his spouse, Maribel, to meet with Permann of Simply Right at a Fort Collins hotel about employment. Nazario and Maribel interviewed only with Permann; no one from Cinemark was present for the interview meeting.

         24. At this meeting, Nazario completed and signed an Employment Application with Simply Right, and well as W-4 and I-9 employment forms. Nazario also signed a copy of Simply Right's “Golden Work Rules” and an acknowledgment that he received a copy of Simply Right's Employee Handbook.

         25. Permann discussed with Maribel and Nazario the amounts Simply Right would pay them for work at the Greeley theater 26. Cinemark never provided Nazario or Maribel with paperwork, written rules, or an employee handbook.

         27. During their employment with Simply Right, Nazario and Maribel cleaned only the Cinemark theater in Greeley. The cleaners assigned specific areas of the theater to be cleaned among themselves.

         28. During the time he worked for Simply Right, Nazario was never asked to do any work at the Greeley theater other than cleaning and no Cinemark employee told him to do something or gave him direction or instructions. Deposition of Nazario Arreola Ramos, October 25, 2016 (“Nazario Dep.”), 115: 3-9. However, a Cinemark employee criticized him for “not mopping correctly” and for a bathroom not being “clean enough.” Id. 105: 5-22.

         29. Maribel testified that Cinemark employees “check[ed] the work that [they] had done in the morning.” Deposition of Maribel Arreola, September 30, 2016 (“Maribel Dep.”) 19:21-25, 20: 1-2, ECF No. 123-10. “A supervisor would come and check the rooms that we had cleaned. And if there was something they didn't like, they would tell us to go back and finish the cleaning.” Id. 14: 19-25, 15: 1. Also, after Maribel had finished cleaning one night, “the young woman manager[ ] told us that one of the rooms really smelled because somebody had vomited in there, ” and she also said, “there was another chemical that we could apply to the seats to remove the smell.” Id. 30: 15-25, 31: 1-4. Moreover, on one occasion, a Cinemark manager to whom the cleaners referred as “Easy Money” (because he joked that their work was “easy money”), asked Maribel to interpret for him some instructions to two other cleaners: “he said that the bathrooms smelled like urine, and he wanted them to use another chemical, and he was going to show them how to use it.” Id. 28: 7-24, ECF No. 134-5. “First we got the chemicals, and then we went to the bathroom. And he explained to them where he wanted to place those chemicals in and around the bathroom and down the drain.” Id. 29: 4-10. “That same manager . . . told us [once] that there was too much gum on the floor that we had to clean. And there were some seats that we needed to clean that were not clean.” Id. 30: 2-14.

         30. Nazario received paychecks from Simply Right, and neither Nazario nor Maribel received payments from Cinemark for their work.

         31. Nazario never discussed the pay he received from Simply Right, or about whether Simply Right paid Maribel, with anyone at Cinemark. Likewise, Maribel never discussed her pay with Cinemark employees.

         32. Knowing Cinemark's requirement that, daily, the theater needed to be cleaned by 10:30 a.m. (Maribel Dep. 18: 17-25), Maribel and Nazario determined whether to arrive at work at 5:00 a.m. or 5:30 a.m. based on various factors. Id. 54: 4-20. Neither Nazario nor Maribel was aware of any Cinemark employee keeping track of their hours.

         33. Maribel and Nazario had telephone numbers for Simply Right supervisors Permann and Leo Parra (“Parra”). Parra gave Maribel and Nazario the key to the Greeley theater but also came to the theater when there was going to be an inspection because “he wanted everything to be all right.” 34. Maribel called Parra and Permann when one of the vacuums did not work properly. When Nazario and Maribel decided to quit working at Simply Right, Maribel called and told Parra. In response, Permann called Maribel and offered them more money to continue. Neither Maribel nor Nazario called, emailed, or exchanged text messages with Cinemark managers.

         35. Jose Luis and Clara Arreola (“Clara”) cleaned at the Greeley theater from approximately April 1, 2013 (Employment Application, ECF No. 123-13 at 79; Pay Stub, ECF No. 123-13 at 81; Deposition of Jose Luis Arreola, October 27, 2016 (“Jose Luis Dep.”) 164: 21-25, 165: 1-4) to May 13, 2015, when they resigned. Jose Luis and Clara allege they worked nearly every day during this period.

         36. During their employment with Simply Right, Jose Luis and Clara cleaned only the Cinemark theater in Greeley.

         37. On March 30, 2013, Jose Luis completed an Employment Application, as well as W-4 and I-9 forms, for Simply Right. Jose Luis and Clara interviewed with and were signed up to clean by Simply Right supervisor, Armida Raya.

         38. Jose Luis received paychecks from Simply Right, and neither Jose Luis nor Clara received payments from Cinemark for their work.

         39. Neither Clara nor Jose Luis ever discussed with anyone from Cinemark that Clara was not being paid by Simply Right.

         40. Jose Luis claims he or another cleaner showed a Cinemark manager a paystub around the time they were thinking about quitting due to problems with Simply Right.

         41. Neither Jose Luis nor Clara received any written work rules or employee handbook from Cinemark.

         42. During the time they cleaned at the Greeley theater, Jose Luis and Clara mostly decided with the other cleaners how they would “split up” the work necessary to clean the building. Jose Luis Dep. 55: 2-6; see also Id. 61: 2-5 (“there wasn't a lot of communication with [the supervisor]. So, it ended up being that we had to organize ourselves in order to figure out how to do the job faster.”).

         43. Jose Luis and Clara were initially trained on how to clean the theater by two other Simply Right cleaners, Daniel Hernandez and Benita Arreola.

         44. During the period that Jose Luis and Clara cleaned the Greeley theater, there were times when they and the other janitors were in the building and no Cinemark employees were there.

         45. Jose Luis was instructed by Simply Right to use a telephone number to clock in for work with Simply Right. Jose Luis had cell phone numbers for his Simply Right supervisors. He ...

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