895 F.3d 1278
11th Cir.2018Background
- Abalux, a small Florida sign-printing company, employed Jesus Collar from Aug. 2013 to Jan. 2016; Collar worked overtime in 2015 for which he was unpaid.
- Collar sued under the Fair Labor Standards Act (overtime) claiming enterprise coverage because Abalux’s annual gross sales in 2015 exceeded $500,000.
- Abalux produced tax returns and bookkeeping: tax returns showed gross sales under $500,000 in 2015; bookkeeping (cash-basis) showed gross receipts of $505,973.33 in 2015, which included sales tax and reimbursements.
- Abalux’s office administrator declared the company used the cash method and calendar year accounting and reported $10,467.96 in state sales tax for 2015 (with $6,255.88 attributable to retail sales).
- The magistrate limited additional discovery to 2015 and certain records; the district court denied Collar’s motion to expand discovery, granted summary judgment for Abalux, entered final judgment, and later struck Collar’s post-judgment acceptance of a prior Rule 68 offer.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Abalux met the FLSA enterprise-coverage $500,000 gross sales threshold for 2015 | Collar: include cash received in 2016 for sales made in 2015 and exclude only excise taxes; accounting should reflect accrual or include reimbursements to exceed $500,000 | Abalux: uses cash-basis, calendar-year accounting; must exclude separately stated retail excise taxes; 2016 receipts are income for 2016, not 2015 | Court: Affirmed for Abalux — using cash-basis/calendar year and excluding retail sales tax, 2015 gross sales did not reach $500,000, so no enterprise coverage |
| Whether the district court abused discretion by denying expanded discovery | Collar: additional discovery (2014–2016, customer depo, payment classification) was needed to show sales characterization and payments | Abalux: produced tax returns, bookkeeping, bank deposits, invoices, and witness declarations; discovery was sufficient | Court: No abuse — appellant failed to show substantial harm from limited discovery |
| Whether Collar could accept a Rule 68 offer after the district court entered final judgment for defendant | Collar: the Rule 68 offer remains open for the full acceptance period even if the court enters summary judgment before acceptance (relies on Perkins) | Abalux: once final judgment is entered, defendant is no longer "defending against a claim," so Rule 68 no longer applies | Court: Striking acceptance was proper — Rule 68 is a pretrial mechanism and does not permit entry of a new judgment after a final judgment is entered |
Key Cases Cited
- Josendis v. Wall to Wall Residence Repairs, Inc., 662 F.3d 1292 (11th Cir. 2011) (standard for FLSA coverage and appellate review of discovery rulings)
- Healy v. Comm’r, 345 U.S. 278 (U.S. 1953) (cash-basis taxpayer recognizes income when received)
- Marek v. Chesny, 473 U.S. 1 (U.S. 1985) (clerk’s ministerial role in entering judgment on accepted Rule 68 offer)
- Perkins v. U S West Communications, 138 F.3d 336 (8th Cir. 1998) (contrasting view that Rule 68 acceptance remains effective despite intervening summary judgment)
- Green Tree Financial Corp.-Ala. v. Randolph, 531 U.S. 79 (U.S. 2000) (description of final judgment effect: ends litigation on the merits)