591 F.Supp.3d 191
W.D. Ky.2022Background
- Lindsay Entertainment operated The Godfather, an adult nightclub in Louisville; entertainers performed dances and were paid via commissions on credited drink sales and patron tips, while the club charged house fees and fines.
- Plaintiffs (lead: Gloria Tassy) worked as entertainers from May 2014–Jan 2016, signed independent-contractor agreements, and were subject to club rules (dress code, stage assignments, house fees, noncompete prohibiting other Louisville clubs).
- The club controlled marketing, provided facilities and staff (bartenders, DJs, security), set minimum prices for dances, and retained portions of proceeds.
- Tassy sued under the FLSA alleging misclassification and unpaid minimum wages; the court conditionally certified a collective action and six opt-ins joined.
- Defendant moved to decertify the §216(b) collective; Plaintiffs moved for partial summary judgment on employee status, willfulness (three-year SOL), and liquidated damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether conditional collective should remain (decertification) | Plaintiffs are similarly situated: same position, duties, pay scheme, and classification | Decertify for failure to meet Rule 23 numerosity and merits | Denied; Rule 23 inapplicable; opt-ins showed they are similarly situated under §216(b) |
| Whether entertainers are employees or independent contractors under FLSA | Entertainers are employees based on economic-reality factors (permanency, low skill, small investment, limited profit/loss, club control, integral to business) | Facts disputed; entertainers are independent contractors who earn by hustling for customers | Granted for Plaintiffs; court found all six economic-reality factors weigh for employee status |
| Whether defendant willfully violated FLSA (statute of limitations: 3 vs 2 years) | Defendant acted willfully/recklessly and failed to inquire about compliance; three-year SOL applies | (No substantive rebuttal; failed to respond) | Granted for Plaintiffs; court found willfulness (and defendant conceded by not responding), three-year SOL applies |
| Whether liquidated damages are recoverable (good-faith defense) | Liquidated damages mandatory; defendant failed to show good faith or affirmative steps to ensure compliance | (No substantive rebuttal; failed to respond) | Granted for Plaintiffs; defendant did not demonstrate good-faith defense, so liquidated damages awarded as a matter of law |
Key Cases Cited
- O’Brien v. Ed Donnelly Enters., Inc., 575 F.3d 567 (6th Cir. 2009) (collective-action "similarly situated" standard under §216(b))
- Keller v. Miri Microsystems LLC, 781 F.3d 799 (6th Cir. 2015) (economic-reality test and six-factor framework for employee status)
- Donovan v. Brandel, 736 F.2d 1114 (6th Cir. 1984) (origin and discussion of economic-reality factors)
- Gilbo v. Agment, LLC, [citation="831 F. App'x 772"] (6th Cir. 2020) (application of economic-reality test to exotic dancers)
- Reich v. Circle C. Investments, Inc., 998 F.2d 324 (5th Cir. 1993) (dancer investment small relative to club's investment)
- McLaughlin v. Richland Shoe Co., 486 U.S. 128 (1988) (willfulness standard for FLSA statute of limitations)
- Elwell v. Univ. Hosp. Home Care Serv., 276 F.3d 832 (6th Cir. 2002) (good-faith defense to liquidated damages under FLSA)
- Martin v. Ind. Mich. Power Co., 381 F.3d 574 (6th Cir. 2004) (liquidated damages mandatory absent employer good faith)