Rosas v. Alice's Tea Cup, LLCRosas v. Alice's Tea Cup, LLC
MEMORANDUM AND ORDER
The plaintiffs, current and former employees of Alice’s Tea Cup, LLC, ATC II LLC, and ATCIII, LLC (all restaurants doing business under the name “Alice’s Tea Cup”) bring this action against the three associated entities alleging violations of the Fair Labor Standards Act (the “FLSA”), 29 U.S.C. §§ 201 et seq., and the New York Labor Law (the “NYLL”), N.Y. Lab. Law §§ 190 et seq. The parties have consented to my jurisdiction for all purposes pursuant to 28 U.S.C. § 636(c). In response to discovery requests from the defendants, the plaintiffs filed a motion for a protective order. The plaintiffs also seek leave to amend the complaint. For the following reasons, both applications are granted. :
Background
The plaintiffs allege that during the course of their employment, the defendants failed to pay them overtime compensation and a “spread of hours” premium for days when the plaintiffs worked more than ten hours. (Complaint (“Compl.”), ¶¶2, 4). The Complaint asserts claims against the three corporate defendants as well as Zhariff Melgoza and Haley Fox, who “own[ ] the stock of Alice’s Tea Cup, own[ ] Alice’s Tea Cup, and manage[ ] and make[] all business decisions,” including decisions related to employee hours and salaries. (Compl., ¶¶ 110, 111).
In discovery requests dated May 11, 2015, the defendants demand that the plaintiffs produce documents verifying their immigration status, work authorization documents, federal and state income tax returns, and documents “sufficient to identify the current employer” for each plaintiff. (Defendants’ First Request for Documents (“Def. Doc. Req.”), attached as Exh. A to Declaration of Peter H. Cooper dated May 15, 2015 (“Cooper Decl.”), Request nos. 12-15, 33). The defendants also request admissions related to the plaintiffs’ immigration status and authorization to work. (Defendants’ First Request for Admissions to Plaintiffs (“Def. RFA”), attached as Exh. B to Cooper Decl., Request nos. 1-15, 20). They ask the plaintiffs to admit that they “supplied false or fictitious [S]ocial [Sjecurity numbers” to the defen
On May 15, 2015, the plaintiffs filed the instant motion for a protective order and for leave to amend the complaint. I will address these two issues separately. Discussion
A. Motion for a Protective Order
The plaintiffs seek an order “[protecting plaintiffs from any discovery demand that involves plaintiffs’ immigration status or citizenship at the present or any point in time,” barring the discovery of the plaintiffs’ federal or state income tax returns, and protecting the plaintiffs from having to disclose their current employer. (Notice of Motion at 1; Memorandum of Law in Support of Plaintiffs’ Motion for a Protective Order and Leave to Amend the Complaint (“Pl. Memo.”) at 2; Reply Memorandum of Law in Further Support of Plaintiffs’ Motion for a Protective Order and Leave to Amend the Complaint (“Pl. Reply”) at 6-7). Specifically, the plaintiffs seek a protective order as to the Defendants’ First Request for Documents, paragraphs 12-15 and 33, and the Defendants’ First Request for Admissions, paragraphs 1-15 and 20. (Pl. Memo. at 2). The plaintiffs contend that their immigration statuses, tax returns, and current employers are irrelevant to the current proceedings. (Pl. Memo. at 3-4, 6). The defendants oppose the plaintiffs’ motion, alleging that the information sought is relevant to the plaintiffs’ ability to recover under the FLSA and the NYLL as well as their credibility, and would explain the absence of some payroll records. (Memorandum of Law of Defendants in Opposition to Plaintiffs’ Motion for a Protective Order and Leave to Amend the Complaint (“Def. Memo.”) at 12-15).
1. Legal Standard
The Federal Rules of Civil Procedure allow “discovery regarding any nonprivi-leged matter that is relevant to any party’s claim or defense.” Fed.R.Civ.P. 26(b)(1). “Evidence is relevant if: (a) it has any tendency to make a fact more or less probable than it would be without the evidence; and (b) the fact is of consequence in determining the action.” Fed.R.Evid. 401.
Evidence that is irrelevant or may result in undue prejudice is outside the scope of discovery. A court may issue a protective order for good cause in order to “protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense.” Fed.R.Civ.P. 26(c); see Herbert v. Lando,
If the evidence sought is relevant, “the burden is upon the party seeking non-disclosure or a protective order to show good cause.” Penthouse International, Ltd. v. Playboy Enterprises,
2. Immigration Status
a. Recoverability of Backwages by Undocumented Workers Under the FLSA and the NYLL
The defendants contend that if the plaintiffs submitted invalid employment authorization documents, their “claims for wages under New York Labor Law are barred as a matter of law,” and that evidence regarding their immigration status and work authorization is therefore relevant. (Def. Memo. at 12). In support of their position, the defendants cite Hoffman Plastic Compounds v. National Labor Relations Board,
However, federal courts have made “clear that the protections of the FLSA are available to citizens and undocumented workers alike.” Flores v. Albertsons, Inc., CV 01-00515,
Thus, courts distinguish between “undocumented workers seeking backpay for wages actually earned,” as in FLSA wage and hour violations, and “those seeking backpay for work not performed,” as in a termination in 'violation of the NLRA. Flores,
For this reason, the defendants’ contentions regarding the plaintiffs’ NYLL
Because the plaintiffs here seek payment under the FLSA and the NYLL only for work already performed (Pl. Reply at 5), the IRCA has no bearing on their ability to recover backpay.
b. Relevance of Immigration Status to Absence of Payroll Records
The defendants also assert that information regarding the plaintiffs’ immigration status is relevant and discoverable because it will “explain[ ] why [the plaintiffs] were satisfied with the manner in which [the defendants initially documented their wages, through the use of cash sheets, and only took action after [the defendants sought to move them to payroll.” (Def. Memo, at 13). In making this argument, the defendants rely solely on Campos v. Lemay, No. 05 Civ.2089,
c. Relevance of Immigration Status to Credibility
Finally, the defendants claim that evidence regarding immigration status is relevant to the plaintiffs’ credibility. However, “[w]hile it is true that credibility is always at issue, that ‘does not by itself warrant unlimited inquiry into the subject of immigration status when such examination would impose an undue burden on private enforcement of employment discrimination laws.’ ” Rengifo v. Erevos Enterprises, Inc., No. 06 Civ. 4266, 2007 WL
3. Tax Returns
The defendants also seek discovery of the plaintiffs’ federal and state income tax returns. (Def. Doc. Req., Request nos. 14, 15; Def. RFA, Request nos. 14, 15). Income tax returns are not inherently privileged. However, “courts are typically reluctant to compel their disclosure because of both the private nature of the sensitive information contained therein and the public interest in encouraging the filing by taxpayers of complete and accurate returns.” Uto v. Job Site Services Inc.,
Here, the defendants have failed to demonstrate either relevance or a compelling need. While the defendants contend that “the returns will further corroborate [the] [defendants’ position that [the plaintiffs] were paid the amount of compensation required by state and [f]ederal law” (Def. Memo. at 16), “the corporate defendants possess relevant data on hours and compensation, and there is no reason to assume that [the] defendants’ records are less reliable than any records maintained by [the plaintiffs].” Rengifo,
4. Identity of Current Employers
Finally, the defendants request that the plaintiffs identify their current employers and admit that they are being paid in cash. (Def. Doc. Req., Request no. 33; Def. RFA, Request no. 20). Generally, information from or about plaintiffs’ current employers is irrelevant in determining whether the defendant-employers violated wage and hour laws. See Campos v. Zopounidis, No. 3:09 CV 1138,
Here, the defendants argue that the identity of the plaintiffs’ current employers is relevant because the plaintiffs were “content being paid in cash because of their undocumented status.” (Def. Memo. at 16). The defendants seek to prove that the plaintiffs “are continuing to be paid on a cash basis ... precisely because they want to ... avoid scrutiny.” (Def. Memo. at 16). But whatever the plaintiffs’ arrangement with their current employers might be, it says nothing about the hours that the plaintiffs worked for the defendants or what they were paid. Thus, the defendants have “failed to offer any valid argument in support of [their] position that the requested documents are necessary for the defense of this case.” Wagner,
B. Motion for Leave to Amend Complaint
The plaintiffs also seek leave to amend the complaint to add an additional defendant, add an opt-in plaintiff, and remove the collective and class action allegations. (Notice of Motion at 1; Pl. Memo. at 6; Proposed First Amended Complaint (“Amend. Compl.”), attached as Exh. C to Cooper Decl., ¶¶ 17, 114-120, 123).
1. Legal Standard
While parties are free to amend their pleadings once as a matter of course within twenty-one days of serving a complaint or receiving a responsive pleading or motion, Fed.R.Civ.P. 15(a)(1), “[i]n all other cases, a party may amend its pleading only with the opposing party’s written consent or the court’s leave. The court should freely give leave when justice so requires.” Fed.R.Civ.P. 15(a)(2). The Supreme Court has interpreted this rule liberally, stating:
In the absence of any apparent or declared reason — such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc. — the leave sought should, as the rules require, be freely given.
Foman v. Davis,
2. Adding an Employer
The plaintiffs seek to add Lauren Fox as a defendant, arguing that she served as an employer of the plaintiffs. (Amend. Compl., ¶¶ 17, 123). Motions to amend are generally governed by Rule 15(a) of the Federal Rules of Civil Procedure. However, Rule 21 of the Federal Rules of Civil Procedure controls if the proposed amendment adds new parties. Bridgeport Music, Inc. v. UMG Recordings, Inc., No. 05 Civ. 6430,
The FLSA defines “employer” as “any person acting directly or indirectly in the interest of an employer in relation to an employee.” 29 U.S.C. § 203(d). “[Continuous monitoring of employees, looking over their shoulders at all times, or any sort of absolute control” is not required, and “[c]ontrol may be restricted, or exercised only occasionally, without removing the employment relationship from the protections of the FLSA.” Herman v. RSR Security Services Ltd.,
Whether someone is an employer is analyzed using an “economic reality test,” which requires consideration of four factors: “whether the alleged 'employer (1) had the power to hire and fire the employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records.” Id. (citing Carter v. Dutchess Community College,
The plaintiffs here have made factual allegations that may meet the elements of the economic reality test, because they allege that Ms. Fox “supervised and controlled plaintiffs’ work, [] controlled their compensation” (Pl. Memo. at 6), and was “present on a daily basis” (Pl. Rep. Memo. at 8). The plaintiffs may uncover evidence during discovery to support these allegations. While the defendants argue that Ms. Fox “was not involved in any of the Company’s daily operations, particularly employment decisions” (Def. Memo. at 19), this is an issue for the factfinder to resolve. In the instant case, the plaintiffs have made sufficient factual allegations for Lauren Fox to be added as an additional employer in the amended complaint.
3. “Opt-in” Plaintiff
The plaintiffs also seek to add Teofilio Toribio as an opt-in plaintiff. (Pl. Memo.
4. Collective and Class Action Allegations
The plaintiffs finally seek to remove the collective and class action allegations. (Pl. Memo. at 6). This issue is not contested by the defendants. The plaintiffs are granted leave to remove the collective and class action allegations.
Conclusion
The plaintiffs’ motion (Docket no. 21), is granted. The plaintiffs’ application for a protective order is granted to the extent that the defendants may not seek discovery of the plaintiffs’ immigration status, tax returns, or current employers. The plaintiffs are also granted leave to amend the complaint to add Lauren Fox as a defendant, add Teofilio Toribio as a plaintiff, and remove the collective and class action allegations.
SO ORDERED.