Karic v. Major Automotive Companies, Inc.
799 F. Supp. 2d 219
E.D.N.Y2011Background
- Plaintiffs Karic et al. filed a FLSA/NYLL action in EDNY on Dec 30, 2009 alleging failure to pay minimum wages and related wage violations by Major World dealerships.
- Class Period spans Dec 30, 2006 to Dec 30, 2009; plaintiffs worked as sales representatives at Major World car dealerships.
- Plaintiffs allege a common policy: pay of $20 per day shift plus commissions, regardless of hours, with about six days/week and ~12 hours/day.
- Alleged underpayment occurs when no cars are sold or when commissions plus shift pay fail to meet minimum wage; plaintiffs claim lack of notice of minimum wage entitlements.
- Defendants argue discovery supports higher earnings via commissions and challenge the sufficiency of the ‘similarly situated’ showing; court ultimately grants conditional certification.
- Court orders revised Notice to list Major World entities separately and directs production of opt-in contact information by Aug 26, 2011.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiffs meet the 216(b) ‘similarly situated’ standard for conditional certification. | Karic shows a common policy across Major World dealerships. | Defendants contend the showing is insufficient, especially after discovery. | Plaintiffs sufficient for conditional certification under lenient standard. |
| Whether employees of all Major World entities can be included despite lack of named plaintiffs at three entities. | Capsolas supports including uniformly governed employees across entities. | No named plaintiffs for three entities, risking non-similarity. | Sufficient factual basis to include all Major World dealerships. |
| Whether the Notice should list each Major World entity separately. | Group listing is permissible for notice purposes. | Entities should be listed separately with corresponding class representatives. | Notice to list each entity separately; not to exclude entities lacking named plaintiffs. |
| Whether to conditionally certify and issue court-approved notice pending discovery. | Early notice is appropriate to collect opt-ins and advance discovery. | Caution against premature certification without complete discovery. | Grant conditional certification with updated notice and discovery deadlines. |
Key Cases Cited
- Hoffmann-LaRoche Inc. v. Sperling, 493 U.S. 165 (U.S. Supreme Court 1989) (authorization of notice under FLSA opt-in class actions)
- Gjurovich v. Emmanuel's Marketplace, Inc., 282 F. Supp. 2d 101 (S.D.N.Y. 2003) (two-step approach to FLSA collective actions; modest showing sufficient)
- Igles-Mendoza v. La Belle Farm, Inc., 239 F.R.D. 363 (S.D.N.Y. 2007) (lenient standard for conditional certification; notice allowed)
- Patton v. Thomson Corp., 364 F. Supp. 2d 263 (E.D.N.Y. 2005) (contrast between FLSA collective action standards and Rule 23 class actions)