Lundy v. Catholic Health System of Long Island Inc.
711 F.3d 106
2d Cir.2013Background
- Plaintiffs: a respiratory therapist and two nurses suing CHS for unpaid time; claims under FLSA, RICO, NYLL for meal breaks, pre/post-shift work, and trainings.
- CHS is a network of hospitals and related entities; district court proceedings involved multiple amendments and several dismissals without prejudice or with prejudice.
- District court dismissed FLSA overtime and RICO claims for failure to state a claim; NYLL overtime claims also dismissed; NYLL gap-time claims were addressed separately.
- Court granted limited leave to replead only the claims dismissed without prejudice; subsequent orders clarified scope of dismissal.
- Appeal challenges: (i) FLSA overtime and gap-time, (ii) NYLL overtime and gap-time, and (iii) RICO; the Fifth Circuit affirms some dismissals and vacates/remands others.
- Resolution ultimately: FLSA overtime, NYLL overtime, and RICO claims affirmed; NYLL gap-time claims remanded for further consideration.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiffs plead plausible FLSA overtime claims | Plaintiffs allege compensable time and overtime hours | Defendants contend no plausible claim; no week with 40+ hours plus uncompensated time | Plaintiffs fail to plead 40+ hours with uncompensated time; overtime claims dismissed |
| Whether FLSA gap-time claims are viable | Gap-time claims permitted under FLSA interpretations | Guidance interpretations not binding; gap-time not recoverable | FLSA gap-time claims affirmatively dismissed; gap-time under NYLL not decided here |
| Whether NYLL overtime claims are viable | NYLL overtime mirrors FLSA overtime | Same deficiencies as FLSA overtime | NYLL overtime claims dismissed with prejudice |
| Whether NYLL gap-time claims should be salvaged on remand | NYLL recognizes gap-time; potential recovery | Dismissal based on FLSA outcome; no prejudice to NYLL gap-time | NYLL gap-time claims vacated and remanded for narrow reconsideration |
| Whether RICO claims survive pleading standards | Payroll mailings constitute mail fraud under RICO | Pleading requirements not met; no pattern of racketeering shown | RICO claims dismissed for lack of particularity and lack of in-furtherance showing |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (pleading standard; plausibility required)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (plausibility pleading standard)
- Klinghoffer Bros. Realty Corp. v. Del. River Port Auth., 285 F.2d 487 (2d Cir. 1960) (gap-time interpretation; limited recoveries under FLSA)
- Monahan v. County of Chesterfield, 95 F.3d 1263 (4th Cir. 1996) (discussion of gap-time interpretations under FLSA)
- Holmes v. Grubman, 568 F.3d 329 (2d Cir. 2009) (pleading and factual allegations standards post-Iqbal)
- McLaughlin v. Anderson, 962 F.2d 187 (2d Cir. 1992) (necessity of particularity in mail fraud claims under Rule 9(b))
- Anatian v. Coutts Bank (Switz.) Ltd., 193 F.3d 85 (2d Cir. 1999) (RICO predicate-act pleading principles)
- United States v. Maze, 414 U.S. 395 (U.S. 1974) (mail fraud framework; not all mailings advance fraud)