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Clark v. Strad Energy Services, USA Ltd

United States District Court, D. Colorado

August 1, 2018

KEVIN CLARK, on behalf of himself and all similarly situated persons, Plaintiff,
v.
STRAD ENERGY SERVICES, USA, LTD., a Colorado corporation, and STRAD OILFIELD SERVICES, INC., a Colorado corporation, Defendants.

          ORDER GRANTING DEFENDANTS' MOTION TO DISMISS

          WILLIAM J. MARTÍNEZ UNITED STATES DISTRICT JUDGE

         Plaintiff Kevin Clark (“Plaintiff”) brings this action against Defendants Strad Energy Services, USA, Ltd. and Strad Oilfield Services, Inc. (together, “Strad” or “Defendants”) for violations of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et seq., the Colorado Wage Claim Act (“CWCA”), Colo. Rev. Stat. §§ 8-4-101 et seq., the Colorado Minimum Wage Act (“CMWA”), Colo. Rev. Stat. §§ 8-6-101 et seq., and violations of the overtime and/or minimum wage laws of various other states.[1] (ECF No. 31.)

         Currently pending before the Court is Strad's Motion to Dismiss, in Part, Plaintiff's First Amended Class and Collective Action Complaint (“Motion”) under Rule 12(b)(1) and (6). (ECF No. 38.) Strad argues that Plaintiff lacks standing to assert claims under Kansas, Pennsylvania, Texas, Utah, and Virginia law. Strad also argues that the state wage-and-hour law claims should be dismissed for failure to state a claim. For the reasons explained below, this Court agrees that Plaintiff lacks standing to assert the Pennsylvania and Utah claims and has failed to state a claim for relief as to the non-Colorado claims. The Court thus grants the Motion in part. Plaintiff's FLSA and Colorado claims will remain pending before this Court.

         I. BACKGROUND

         The following factual summary is drawn from Plaintiff's Amended Complaint (ECF No. 31) and treated as true for present purposes. See Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007).

         Plaintiff is a former employee of Strad who worked as a field service technician at various locations in Colorado, Montana, North Dakota, South Dakota, and Wyoming. (ECF No. 31 ¶¶ 2, 6.) Plaintiff alleges that he was frequently required to work more than forty hours per work week and/or twelve hours per day. (Id. ¶ 6.) Plaintiff further alleges that he was not properly compensated at the mandated time-and-a-half rate for his overtime hours. (Id.)

         Plaintiff also alleges that Strad failed to properly pay him for other compensable time. Plaintiff spent “many hours waiting for work to be assigned while living away from home near remote oil sites.” (Id. ¶ 7.) Plaintiff contends that he was restricted in his activities during that time and those hours spent “on-call” are compensable. (Id.) Similarly, Plaintiff alleges that he was not properly paid for his travel time to and from remote oil sites. (Id. ¶ 8.) While Strad paid for some of the hours, it did not pay for all hours or pay at the proper rate. (Id.) Plaintiff further contends that Strad “moved hours over 16 [hours per day] to other days” to comply with a policy limiting workers to showing a maximum of 16 hours per day. (Id. ¶ 9.) Plaintiff states that “Strad's workers often worked shifts longer than 16 hours.” (Id.)

         By way of example, Plaintiff explains that his usual work schedule involved “traveling to a remote worksite and working 20 days in a row, ” followed by ten days off. (Id. ¶ 11.) During his working days, Plaintiff states that he was scheduled for 12 hours per day but would often work longer hours. After Plaintiff finished his shift, he would be “on-call” until the start of the next work day. (Id.) Plaintiff alleges that he received no compensation (much less compensation at the proper overtime rate) for 50 hours of work between December 21-27, 2015, and is owed $1, 650 for that week alone. (Id.)

         Plaintiff also alleges that Strad's failure to properly compensate him was not a limited occurrence. Rather, “none of Strad's non-exempt employees were paid properly for their time worked.” (Id. ¶ 12.) Plaintiff alleges that Strad's employee compensation polices are “blatantly illegal” and that Strad did not look into the validity of its policies. (Id. ¶ 13.)

         Plaintiff filed this lawsuit on May 22, 2017, alleging violations of the FLSA and wage laws of various states where Strad has allegedly engaged in the conduct described by Plaintiff. Plaintiff seeks to bring this action as a class action on behalf of himself and those similarly situated under the laws of those various states, including the CWCA and CMWA. Plaintiff also seek relief under an FLSA collective action, separate and apart from the state-law causes of action.[2]

         II. LEGAL STANDARD

         A. Article III Standing

         Article III of the U.S. Constitution restricts federal courts to deciding “cases” and “controversies.” See U.S. Const. art. III, § 2, cl. 1. These words have been interpreted to restrict federal courts from giving “advisory opinions, ” Flast v. Cohen, 392 U.S. 83, 96 (1968), meaning that a federal court may not resolve questions in the abstract, but instead may only resolve “disputes arising out of specific facts when the resolution of the dispute will have practical consequences to the conduct of the parties, ” Columbian Fin. Corp. v. BancInsure, Inc., 650 F.3d 1372, 1376 (10th Cir. 2011).

         To safeguard this restriction, the Supreme Court has articulated a three-element test for “Article III standing”:

First, the plaintiff must have suffered an “injury in fact”-an invasion of a legally protected interest which is (a) concrete and particularized, and (b) “actual or imminent, not ‘conjectural' or ‘hypothetical.'” Second, there must be a causal connection between the injury and the conduct complained of . . . . Third, it must be “likely, ” as opposed to merely “speculative, ” that the injury will be “redressed by a favorable decision.”

Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992) (citations omitted; certain alterations incorporated). Importantly for this case, “the plaintiff bears the burden of proof” to establish that these elements exist. Id. at 561; see also United States v. Bustillos, 31 F.3d 931, 933 (10th Cir. 1994) (“The party seeking to invoke the jurisdiction of a federal court must demonstrate that the case is within the court's jurisdiction. The facts supporting jurisdiction must be affirmatively alleged, and if challenged, the burden is on the party claiming that the court has subject matter jurisdiction.”). Preponderance of the evidence is the proper burden of persuasion in a proceeding to determine subject matter jurisdiction. Bustillos, 31 F.3d at 933.

         B. Rule 12(b)(6)

         Under Federal Rule of Civil Procedure 12(b)(6), a party may move to dismiss a claim in a complaint for “failure to state a claim upon which relief can be granted.” Rule 8 requires a complaint to contain “a short and plain statement showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). “Each allegation must be simple, concise, and direct.” Id. 8(d). Rule 8(a) also requires minimal factual allegations on the material elements that must be proven to recover on each of the Plaintiffs' claims. Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991). Rule 12(b)(6) then requires the Court to “assume the truth of the plaintiff's well-pleaded factual allegations and view them in the light most favorable to the plaintiff.” Ridge at Red Hawk, LLC, 493 F.3d at 1177. In ruling on such a motion, the dispositive inquiry is “whether the ...


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