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Diaz v. Lost Dog Pizza, LLC

United States District Court, D. Colorado

June 19, 2018

VICTOR DIAZ, on his own behalf and on behalf of all others similarly situated, Plaintiff,
v.
LOST DOG PIZZA, LLC, DANIEL WARREN LYNCH, and JEFF SMOKEVITCH, Defendant.

         ORDER GRANTING IN PART JOINT MOTION TO ADOPT PARTIES' STIPULATION OF PRELIMINARY CERTIFICATION OF A FAIR LABOR STANDARDS ACT § 216(B) CLASS AND CERTIFICATION OF A FED. R. CIV. P. 23 CLASS AND FOR COURT-AUTHORIZED NOTICE TO CLASS MEMBERS

          William J. Martínez, United States District Judge

         Now before the Court in this action brought under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et seq., and the Colorado Minimum Wage Act (the “Wage Act”), C.R.S. §§ 8-6-101 et seq., is the parties' Joint Motion to Adopt Parties' Stipulation of Preliminary Certification of a Fair Labor Standards Act § 216(b) Class and Certification of a Federal Rule of Civil Procedure 23 Class and for Court-Authorized Notice to Class Members. (ECF No. 28.)

         I. BACKGROUND

         As alleged in the Complaint, Plaintiff and the other members of the proposed class were hourly employees at Defendants' Brown Dog Pizza restaurant in Telluride, Colorado. (ECF No. 1 ¶ 1.) Plaintiff worked for Defendants from approximately 2009 through April 2017. He alleges Defendants refused to pay him and other members of the proposed class overtime for hours worked beyond forty each workweek and beyond twelve each workday, in violation of the FLSA and the Wage Act. (Id. ¶¶ 2-3.) For example, Plaintiff alleges from he worked 107.67 hours from July 16-31, 2015 and 99.61 hours from September 5-18, 2016, and that Defendants failed to pay him overtime as required during those periods. (Id. ¶ 17.)

         Plaintiff alleges that Defendants subjected not only himself, but all their hourly employees to a “common policy of refusing to pay overtime wages for hours worked beyond forty each workweek and beyond twelve each workday.” (Id. ¶ 29; see also Id. ¶ 18.)

         Further, Plaintiff alleges that upon separation, Defendants did not pay him all of his earned, vested and determinable wages, and failed to pay other employees all of their earned and vested wages upon termination, as is required under the Wage Act. (Id. ¶¶ 6, 19.)

         As set out in the present Joint Motion, and in the parties' related filings, since this case was filed in September 2017, the parties have been working to negotiate a settlement agreement. Thus they have jointly stipulated to the preliminary FLSA and Rule 23 class certification and notice procedure, as proposed in the Joint Motion, and represent that at the end of the proposed notice and opt-in/opt-out period, the parties will have “the benefit of full information as to potential damage” and “intend to negotiate the monetary terms of settlement” upon receipt of that information. (ECF No. 28 at 2.) The parties represent that “[u]pon agreement to terms of settlement, ” they will submit their settlement agreement to the Court for approval, to be followed by a final fairness hearing. (Id.)

         II. LEGAL STANDARDS

         A. Rule 23 Class Certification Standards

         A party seeking class certification must demonstrate that the four prerequisites of Federal Rule of Civil Procedure 23(a) are clearly met. Shook v. El Paso Cnty, 386 F.3d 963, 971 (10th Cir. 2004); see also Tabor v. Hilti, Inc., 703 F.3d 1206 (10th Cir. 2013). These threshold elements are: (1) the class is so numerous that joinder of all members is impracticable; (2) there are questions of law or fact common to the class; (3) the claims or defenses of the representative party are typical of the claims or defenses of the class; and (4) the representative parties will fairly and adequately protect the interests of the class. Fed.R.Civ.P. 23(a). A plaintiff who meets these threshold requirements must then demonstrate that the action falls within one of the three categories of lawsuits set forth in Rule 23(b). Shook, 386 F.3d at 971. Here, Plaintiff seeks certification pursuant to Rule 23(b)(3). (ECF No. 28 at 7, 11-12.)

         In determining the propriety of a class action, the question is not whether a plaintiff has stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met. Anderson v. City of Albuquerque, 690 F.2d 796, 799 (10th Cir. 1982). When deciding whether the proposed class meets the requirements of Rule 23, the Court accepts the plaintiff's substantive allegations as true, though it need not blindly rely on conclusory allegations and may consider the legal and factual issues which the complaint presents. Shook, 386 F.3d at 968; see also Vallario v. Vandehey, 554 F.3d 1259, 1265 (10th Cir. 2009). The Court should not pass judgment on the merits of the case, but must conduct a “rigorous analysis” to ensure that the requirements of Rule 23 are met. D.G. ex rel. Stricklin v. Devaughn, 594 F.3d 1188, 1194 (10th Cir. 2010). The decision whether to grant or deny class certification “involves intensely practical considerations and therefore belongs within the discretion of the trial court.” Tabor, 703 F.3d. at 1227.

         B. FLSA Collective Action Conditional Certification Standards

         The FLSA permits collective actions where the allegedly aggrieved employees are “similarly situated.” 29 U.S.C. § 216(b). Whether employees are similarly situated is judged in two stages: a preliminary or “notice stage” (at issue here) and then a more searching, substantive stage, usually after the close of discovery. Thiessen v. Gen. Elec. Capital Corp., 267 F.3d 1095, 1102-03, 1105 (10th Cir. 2001). At the notice stage, a plaintiff must offer “nothing more than substantial allegations that the putative [collective action] members were together the victims of a single decision, policy, or plan.” Id. at 1102 (internal quotation marks omitted); see also Boldozier v. Am. Family Mut. Ins. Co., 375 F.Supp.2d 1089, 1092 (D. Colo. 2005) (applying Thiessen standard).

         If the plaintiff meets this standard, then the Court may order that the defendant provide contact information for all employees and former employees that may be eligible to participate in the collective action, and the Court may approve a form of notice to be sent to all of those individuals. See Hoffmann-La Roche Inc. v. Sperling, 493 U.S. 165, 169-74 (1989). Such notice is often necessary because, unlike class actions under Federal Rule of Civil Procedure 23, FLSA collective actions require a party to opt in to the litigation rather than opt out of the class. See 29 U.S.C. § 216(b) ("No employee shall be a party plaintiff to any [collective] action unless he gives his consent in writing to become such a party and such consent is filed in the court in which such action is brought."). Obviously, current or former employees cannot opt in if they do not know about the pending action.

         III. PROPOSED CLASS

         The parties have stipulated to the following class definitions:

(1) As to Plaintiff's Wage Act class action claims, a class defined as:
All hourly employees who worked at Brown Dog Pizza on or after September 14, 2015 and who were not paid overtime wages for overtime hours worked.
(2) As to Plaintiff's FLSA collective action claims, a group defined as:
All hourly employees who worked at Brown Dog Pizza on or after September 14, 2014 and who were not paid overtime wages for overtime hours worked.

(ECF No. 28 at 3, 7.)

         III. ANALYSIS

         A. ...


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