Nega v. Yummy LLCNega v. Yummy LLC
Pending before the Court is Plaintiff Lemlem Nega‘s Motion for Summary Judgment (“Motion“) (ECF No. 48).1 Having considered the submissions of the parties (ECF Nos. 48, 53, and 54), I find that a hearing is unnecessary. See Loc. R. 105.6. For the following reasons, the Motion will be granted in part and denied in part.
I. INTRODUCTION
A. Factual Background
Unless otherwise noted, the following facts are not in dispute. To the extent any facts are in dispute, they will be considered in the light most favorable to Defendants, as the nonmoving parties. Perkins v. Int‘l Paper Co., 936 F.3d 196, 205 (4th Cir. 2019).
Plaintiff brought this lawsuit to recover for Defendants’ alleged violations of federal and state wage payment laws. ECF No. 1. She alleges that from November 2020 through about November 2023 she was employed as a waitress at a restaurant called Lucy‘s Kitchen (the
B. Procedural History
Plaintiff filed her Complaint in this Court in January 2024. ECF No. 1. The parties conducted discovery and, after multiple extensions, discovery closed on March 25, 2025. ECF No. 36. Thereafter, Plaintiff filed the Motion, which is now ripe for decision.
II. LEGAL STANDARD
“The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.”
The facts themselves and the inferences to be drawn from the underlying facts must be viewed in the light most favorable to the opposing party. Scott v. Harris, 550 U.S. 372, 378 (2007); Iko v. Shreve, 535 F.3d 225, 230 (4th Cir. 2008). A party may not rest upon the mere allegations or denials of its pleading but instead must cite “particular parts of materials in the record” or “show[] that the materials cited do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact.”
III. DISCUSSION
A. There is a Genuine Dispute of Material Fact as to Whether Kebede Was an Employer
The FLSA defines an “employer” broadly to include “any person acting directly or indirectly in the interest of an employer in relation to an employee.”
To determine whether an employer-employee relationship exists, “courts look to the ‘economic realities’ of the relationship between the worker and the putative employer.” Chavez-DeRemer v. Med. Staffing of Am., LLC, 147 F.4th 371, 397 (4th Cir. 2025) (citation omitted). The “overarching concern” in this analysis is whether the putative employer “possessed the power to
Plaintiff contends that Defendants were all employers under the FLSA, the MWPCL, and the MWHL. ECF No. 48-1 at 6. Defendants do not dispute that Defendant Yummy LLC (“Yummy“) and Defendant Rekik T. Tessema (“Tessema“) were Plaintiff‘s employers. ECF No. 53 at 18. But they dispute that Defendant Tsega Kebede (“Kebede“) qualifies as an employer. Id.
In a prior state court proceeding, Kebede testified that after Tessema purchased Lucy‘s Kitchen, he helped her manage the restaurant. ECF No. 48-2 at 67. In fact, the presiding judge asked Kebede to clarify, “I‘m sorry. You helped in managing the restaurant?” Id. Kebede responded, “yes.” Id. Kebede also testified that when Tessema was “not around,” he managed the restaurant for her. Id. at 70. This testimony is consistent with Kebede‘s affidavit, in which Kebede states that he would “occasionally oversee the restaurant when Defendant Tessema is out of the country,” and that he would follow Tessema‘s “instructions on what needs to be done in the restaurant.” ECF No. 53-2 at 1.
It is undisputed that Kebede has no ownership interest in Yummy LLC (the holding company for the restaurant) or the restaurant itself, and that he was not involved with the purchase
The evidence about Kebede‘s role as a manager is somewhat thin. While Plaintiff points to general acts that Kebede took that are consistent with operational control over an employee, the evidence does not establish the scope or extent of this authority. A reasonable jury could find that Kebede did not exercise sufficient operational control to qualify as an employer. A reasonable jury could also find the opposite and conclude that Kebede did qualify as an employer. Because the evidence would permit a jury to make competing reasonable inferences, the Court finds that there is a genuine dispute of material fact as to Kebede‘s status as an employer and that Plaintiff has not
B. Defendants Paid Plaintiff No Direct Wages and Cannot Benefit from the Tip Credit Provision
The FLSA requires employers to pay non-exempt employees a wage equal to or greater than the federal minimum wage for each hour worked.2
As explained above, the undisputed evidence is that Defendants did not pay Plaintiff any direct wages and did not provide Plaintiff with any tip-credit notice. Because an employer must strictly comply with these requirements to claim the tip credit, and because Defendants did not, they cannot claim the tip credit as a partial defense to Plaintiff‘s claims under the FLSA and the state wage laws.
C. Defendants Failed to Pay Minimum and Overtime Wages as Required by the FLSA and Maryland Law
There is no dispute that Defendants failed to pay Plaintiff the required minimum and overtime wages owed to her under the FLSA and Maryland law. Portillo v. H Rest. & Night Club, No. PX-21-2894, 2024 WL 1256265, at *6 (D. Md. Mar. 25, 2024) (explaining that “[t]he FLSA and MWHL require employers to pay their employees the minimum wage for all hours worked, and overtime pay of at least one and one-half times the regular wage for hours worked over 40 hours per week,” and citing
The Court will discuss the number of hours that Plaintiff worked below. But as to minimum-wage rate to which Plaintiff is entitled, the Court must address Defendants’ argument that Plaintiff is precluded from recovering under the Montgomery County, Maryland, minimum wage because she did not plead a violation of the Montgomery County Minimum Wage Law as a separate claim in her Complaint. ECF No. 53 at 20.
In her Complaint, Plaintiff brought claims under the FLSA, the MWHL, and the MWPCL. The FLSA requires employers to pay the federal minimum wage, and the MWHL requires employers to pay the Maryland state minimum wage. The MWPCL does not set wage rates but instead regulates the timing and manner of payment. Throughout her Complaint, Plaintiff alleged that Defendants failed to pay her the minimum wage in accordance with the law of Montgomery County, Maryland, but she did not bring a separate claim under Montgomery County law, as plaintiffs in wage and hour cases commonly do.
Out of an abundance of caution, and to ensure that no party is unfairly prejudiced, Plaintiff will be ordered to file an amended complaint that includes a claim under the Montgomery County Minimum Wage Law. In the Court‘s view, Plaintiff‘s Complaint contains sufficient factual allegations to support such a claim, so Plaintiff should not include additional factual allegations that might entitle the parties to more discovery. The Court makes this ruling from a recognition
It is unclear whether this amendment is necessary, but the amendment should impose no burden on Plaintiff and will prevent any prejudice to Defendants as this case proceeds. Notwithstanding
D. There is a Genuine Dispute of Material Fact as to the Hours Plaintiff Worked
Based on the evidence before it, and viewing the evidence in the light most favorable to Defendants, the Court finds that there is a genuine dispute of material fact as to the number of hours that Plaintiff worked.
The FLSA and Maryland law require employers to keep records of a worker‘s wages, hours, and other conditions and practices of employment.
Mt. Clemens provides a burden-shifting framework to be used at summary judgment, “where it serves as an evidentiary tool to determine whether a genuine dispute of material fact exists regarding the number of hours an FLSA plaintiff worked.” Johnson v. Helion Techs., Inc., No. DKC-18-3276, 2022 WL 3043413, at *6 (D. Md. Aug. 2, 2022). It also provides a framework for “what sort of evidence is sufficient for a plaintiff to prove a wage-and-hour claim.” Id. And it supplies two methods by which an employer may rebut a plaintiff‘s evidence of hours worked: by providing the employer‘s own evidence or by providing evidence that undermines the reasonableness of the inference to be drawn from the plaintiff‘s evidence. Mt. Clemens, 328 U.S. at 688. When an employer‘s evidence “calls into question the veracity” of a plaintiff‘s asserted
Plaintiff has provided sufficient evidence to support a finding that she worked 5,467 hours from 2021 through 2023, consisting of 3,719 regular hours and 1,748 overtime hours. See ECF Nos. 48-1 at 14; 48-2 at 20-21. Plaintiff created this reconstruction of her hours worked based on records of the sales transactions maintained in the restaurant‘s Clover sales system, with additional time tacked on to the beginning and end of each workday because the system did not keep track of Plaintiff‘s typical schedule or when exactly she arrived or departed on any given day. The burden thus shifts to Defendants.
Defendants provide their own reconstruction of Plaintiff‘s hours worked and also seek to rebut the reasonableness of the inference to be drawn from Plaintiff‘s evidence. See ECF No. 53 at 21-23. Defendants have provided evidence that the Clover records indicate that Plaintiff worked only 47.9 hours per week on average (with 30 minutes added to the beginning of each day worked and the end of her shift being the time the restaurant closed), significantly less than her claimed average of 72 hours per week. Id. Defendants argue that Plaintiff has provided nothing more than her own statements to support her estimate, and that her statements are not reliable. Id. Defendants state that while she was working for the restaurant, she falsely represented to a state agency that she was unemployed. Id. at 22. In support of this argument, Defendants have submitted a copy of unemployment insurance application that Plaintiff submitted on January 28, 2021. ECF No. 53-6. In this application, Plaintiff stated under penalty of perjury that her “employer temporarily shut down due to COVID-19 with the expectation that [she would] return when business resumes” and
The Court finds that Defendants’ evidence and hours-worked reconstruction call into question the veracity of Plaintiff‘s evidence of uncompensated hours worked. It is not the province of the Court to make credibility determinations or to decide which of two plausible reconstructions of the hours that Plaintiff worked is true. There is no question that Plaintiff worked regular and overtime hours for which she was not compensated as required by the FLSA and Maryland law. But the number of those hours is genuinely in dispute and must be resolved by a factfinder at trial.
E. There is a Genuine Dispute of Material Fact as to Willfulness
Plaintiff argues that Defendants’ violations of the FLSA were willful, such that the FLSA‘s three-year statute of limitations applies. ECF No. 48-1 at 17-18; see generally Calderon v. GEICO Gen. Ins. Co., 809 F.3d 111, 130 (4th Cir. 2015) (explaining that “the length of the FLSA‘s statute of limitations depends upon whether the violation at issue was willful,” and that “[i]f it is not willful, the limitations period is two years, but the period is three years for willful violations“). In their argument, Defendants assume that the three-year statute of limitations applies, see ECF No.
To demonstrate that an employer‘s violation of the FLSA was willful under § 255(a), a plaintiff must prove that the employer “either knew or showed reckless disregard for the matter of whether its conduct was prohibited by the [FLSA].” Desmond v. PNGI Charles Town Gaming, L.L.C., 630 F.3d 351, 358 (4th Cir. 2011) (quoting McLaughlin v. Richland Shoe Co., 486 U.S. 128, 135 (1988)). “Negligent conduct is insufficient to show willfulness.” Id. Willfulness under the FLSA is a question of fact and is not “treated any differently from other factual determinations relating to application of a statute of limitations that are routinely submitted to the jury.” Fowler v. Land Mgmt. Groupe, Inc., 978 F.2d 158, 163 (4th Cir. 1992); see also Sama v. Turning Point, Inc., No. JMC-22-02344, 2024 WL 112030, at *8 (D. Md. Jan. 10, 2024) (“This Court is consistently hesitant to rule on the ‘willfulness’ issue at the summary judgment stage when presented with competing plausible justifications for an employer‘s conduct.“).
Under the FLSA, an employer who has violated the statute is liable to the employee “in an additional equal amount as liquidated damages.”
Plaintiff argues that the Court should award summary judgment in her favor on the issue of willfulness for numerous reasons. She points to evidence that Defendants were advised about recordkeeping requirements when they purchased the restaurant, but Defendants dispute this evidence. See ECF Nos. 48-1 at 17 & 53 at 23. She notes that Defendants were previously sued for violating the FLSA, a point that Defendants concede, but she says little else about the nature of the prior litigation. Id.; ECF No. 48-2 at 24 (“Upon information and belief, Defendants have been sued before for FLSA violations involving failure to pay proper wages. This prior litigation demonstrates their awareness of legal requirements and makes their violations in [this] case willful.“). She points to Defendants’ changed practices after this lawsuit was filed, but Defendants insist that they “implemented this change to prevent future compliance issues.” ECF No. 53 at 24. She invokes the extent of Defendants’ recordkeeping and wage payment violations but, as stated above, the extent of Plaintiff‘s uncompensated work is in dispute. She argues that the nature of Defendants’ violations—paying employees only with tips and zero direct wages—establishes a “clear violation of fundamental wage requirements.” ECF No. 48-1 at 18. But Defendants contend that it was Plaintiff who requested that she be paid in this manner and that Defendants’ review of their Clover records indicated that Plaintiff made at least the minimum wage each week in tips. ECF No. 53 at 23.
Plaintiff has not established willfulness as a matter of law. There are genuine disputes of material fact regarding how Defendants violated the FLSA. On this record, a reasonable jury could conclude that Defendants acted negligently in violating the FLSA, which would not support a finding of willfulness. Accordingly, summary judgment on the issue of willfulness is denied. And
IV. Conclusion
For the reasons set forth above, Plaintiff‘s Motion for Summary Judgment (ECF No. 48) is GRANTED IN PART and DENIED IN PART. The Motion is granted to the extent that it seeks an order finding that Tessema and Yummy were Plaintiff‘s employers, that Defendants cannot rely on the tip-credit defense, and that Defendants generally violated the FLSA, the MWHL, and the MWPCL in failing to pay Plaintiff the minimum and overtime wages due to her. The Motion is otherwise denied, with all remaining issues to be decided by a factfinder at trial and the Court after the conclusion of trial. A separate Order will accompany this opinion.
Date: September 1, 2026
/s/
Timothy J. Sullivan
Chief United States Magistrate Judge