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Schindler v. Whiting Petroleum Corp.

United States District Court, D. Colorado

December 1, 2017

CRAIG SCHINDLER, individually and on behalf of all others similarly situated, Plaintiffs,
v.
WHITING PETROLEUM CORP., Defendant.

          ORDER DENYING DEFENDANT'S MOTION TO DISMISS

          William J. Martínez, United States District Judge

         Plaintiff Craig Schindler (“Plaintiff”) brings this collective action complaint (“Complaint”) against Defendant Whiting Petroleum Corp. (“Defendant”) to recover unpaid overtime wages and other damages under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et seq. (ECF No. 1.) Defendant filed a Motion to Dismiss (“Motion”), alleging that Defendant is not an “employer” for FLSA purposes. (ECF No. 20.) Plaintiff filed a Response to Defendant's Motion to Dismiss (“Response”) (ECF No. 26) and Defendant filed a Reply in Support of Motion to Dismiss Collective Action Complaint (“Reply”) (ECF No. 29). For the reasons set forth below, Defendant's Motion is denied.

         I. LEGAL STANDARD

         As will become clear below, Defendant's principal argument is that Plaintiff has failed to sufficiently allege that Defendant was Plaintiff's “employer” for FLSA purposes. (See ECF No. 20 at 1.) The parties dispute whether FLSA “employer” status is a jurisdictional element (and therefore subject to challenge under Federal Rule of Civil Procedure 12(b)(1)) or a traditional merits element (and therefore subject to challenge under Rule 12(b)(6)). The Court need not resolve this jurisdictional/non-jurisdictional dispute, however, because the answer would have no practical effect in this case.

         There are three practical consequences of deeming an element “jurisdictional.” First, if the Court has any doubt that the element has been satisfied, the Court must raise the issue sua sponte-it cannot wait for a party to raise the question, or deem it waived because a party did not timely raise it. Williams v. Life Sav. & Loan, 802 F.2d 1200, 1202 (10th Cir. 1986) (“It is well settled that a federal court must dismiss a case for lack of subject matter jurisdiction, even should the parties fail to raise the issue. A court's lack of subject matter jurisdiction cannot be waived by the parties, nor can it be conferred upon the district court by agreement of the parties.” (citations omitted)). Here, this is not an issue because Defendant obviously has raised a jurisdictional challenge.

         Second, a defendant challenging subject matter jurisdiction under Rule 12(b)(1) can introduce evidence beyond the pleadings. Davis ex rel. Davis v. United States, 342 F.3d 1282, 1296 (10th Cir. 2003). This is in contrast to a Rule 12(b)(6) motion, where defendants are limited, for the most part, to challenging the plaintiff's allegations as stated on the face of the complaint. Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007). But this distinction has no relevance here because Defendant has not introduced any evidence beyond the pleadings. In other words, Defendant has offered only “a facial attack on the complaint's allegations as to subject matter jurisdiction. Holt v. United States, 46 F.3d 1000, 1002 (10th Cir. 1995). “In reviewing a facial attack on the complaint, a district court must accept the allegations in the complaint as true, ” id., similar to a Rule 12(b)(6) motion, see Ridge at Red Hawk, 493 F.3d at 1177.

         Third, in a Rule 12(b)(1) motion, the burden of proof ultimately falls on the Plaintiff to establish subject matter jurisdiction, Basso v. Utah Power & Light Co., 495 F.2d 906, 909 (10th Cir. 1974), rather than requiring the defendant to disprove jurisdiction. This is potentially in contrast to a Rule 12(b)(6) motion, where the defendant technically has the burden to demonstrate the plaintiff's failure to state a claim-although courts rarely think of Rule 12(b)(6) motions in terms of the respective parties' burdens. Here, however, Plaintiff's well-pleaded allegations must be accepted as true, Holt, 46 F.3d at 1002, so the shifted burden in a Rule 12(b)(1) setting has essentially no effect.

         For all of these reasons, the Court finds it immaterial whether “employer” status under the FLSA is a jurisdictional or non-jurisdictional element of Plaintiff's claim. The question would be the same under either Rule 12(b)(1) or Rule 12(b)(6), i.e., whether the Plaintiff's allegations, taken as true, plausibly suggest that Defendant was Plaintiff's employer for FLSA purposes.

         II. BACKGROUND

         Plaintiff's complaint alleges that he worked “exclusively for Whiting” as a Rig Welder from May 2015 until April 2016. (ECF No. 1 at 2.) During this time, he was paid the same hourly rate for all hours worked, including those in excess of 40 hours in a workweek. (Id. at 2.) He was not given any overtime compensation, allegedly in violation of the FLSA. (Id.)

         Defendant “Whiting is an independent exploration and production company with an oil focused asset base.” (Id. at 3.) The proposed putative class is made up of individuals who worked as Rig Welders. (Id.) While exact job titles and duties differed, these employees were all classified as independent contractors and subjected to the same payment scheme for similar work. (Id.) Their primary job duties included receiving blueprints in creation of welding components, welding pipes using various cutting processes, and maintaining the rig structure. (Id. at 3-4.) Plaintiff was typically scheduled to work 12-hour shifts, for as many as 7 days a week-Plaintiff worked in excess of 40 hours each week while employed by Whiting. (Id. at 4.)

         Plaintiff's complaint states that “Whiting and/or the company it contracted with exercised control over all aspects of [Plaintiff's] job.” (Id.) Plaintiff's daily and weekly activities were routine and “largely governed by standardized plans, procedures, and checklists created by [Defendant] and/or the operator [Defendant] contracted with.” (Id. at 5.) According to the Complaint, “[v]irtually every job function was pre-determined by [Defendant] and/or the Operator [that Defendant] contracted with, including the tools to use at the job site, the data to compile, the schedule of work, and related work duties.” (Id.) Defendant also determined Plaintiff's hours, work locations, and rates of pay. (Id. at 4.) Although Plaintiff often worked off-site without direct supervision from Defendant, Defendant “still controlled all aspects of [Plaintiff's] job activities by enforcing mandatory compliance with [Defendant's] and/ or its client's policies and procedures.” (Id.) Plaintiff did not incur operating expenses like rent, payroll, marketing, or insurance. (Id.) Defendant prohibited Plaintiff from working other jobs for other companies while he was working on jobs for Defendant, and Plaintiff was economically dependant on Defendant during his employment. (Id.) Plaintiff's earning opportunity was based on the number of days Defendant scheduled him to work. (Id.)

         Plaintiff argues that he was wrongly classified as an independent contractor and is therefore entitled to overtime compensation for all hours worked in excess of 40 hours in each workweek. (Id. at 6.) Plaintiff says he was not employed by Defendant on a project-by-project basis. (Id.) Even while classified as an independent contractor, Plaintiff was regularly on call for Defendant and/or its clients and was expected to be available to work whenever needed. (Id.)

         III. ...


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