FLSA Motion for Summary Judgment

 

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

             OCALA DIVISION

 

DONNA REDACTED : CASE NO.:

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Plaintiff, :

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vs. :

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HIGH SPRINGS FAMILY :

PRACTICE CLINIC AND :

DIAGNOSIS CENTER, INC. :

and JORGE PREITO-BECERA :

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Defendants/Third Party :

Plaintiffs :

:

vs.  :

:

Dr. Redacted Redacted, :

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Third Party Defendant :

______________________________:

 

DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

 

The Defendants/Third Party Plaintiffs (High Springs Family Practice Clinic and Diagnosis Center, Inc. and Jorge Preito-Becera) file the following Motion for Summary Judgment as to all Counts of the Complaint and state as follows:

BACKGROUND

 

The Plaintiff has filed a Complaint alleging violations of the Fair Labor Standards Act (29  U.S.C. § 201 et seq.) for alleged violations of the Fair Labor Standards Act (“FLSA”).   See Count I of the Complaint.  Count I of the Complaint alleges a failure to pay the Federal minimum wage and seeks back wages, liquidated  damages, prejudgment interest, attorneys’ fees, and litigation expenses.

The Defendant High Springs Family Practice Clinic and Diagnosis Center, Inc. (Highs Springs) is a small, local doctor’s office with one location in Florida.  The corporate Defendant has not grossed more than $500,000 per year.    Moreover, it does  not  have  two  or  more  employees  engaged  in  commerce  or  in  the  production of goods for commerce, and is a local business only transacting and seeking to transact business  in  Florida.   These  simple  facts,  warrant  summary  judgment  in  the  Defendants’  favor.   Bien-Aime  v.  Nanak’s  Landscaping, Inc., 572 F. Supp. 2d 1312 (S.D. Fla. 2008) (granting summary judgment for lack of  enterprise coverage in a case where defendant had over $500,000 in annual revenue, holding that “it  is  clear  from  the  record  that  Defendant’s  business  involves  the  landscaping  of  properties  solely  within the State of Florida and does not affect interstate commerce in the manner intended to trigger  application of the FLSA” . . . and “[a]pplication of the FLSA in this case would clearly undermine  the intent of Congress in enacting the FLSA, which was to ‘leave local business to the protection of  the states’”) (quoting Walling v. Jacksonville Paper Co., 317 U.S. 564, 571 (1943)); Polycarpe v. E  & S Landscaping, Inc., 572 F. Supp. 2d 1318 (S.D. Fla. 2008) (granting summary judgment for lack  of enterprise coverage in a case where defendant had over $500,000 in annual revenue, holding that  “the Defendants have submitted overwhelming evidence that the landscaping business was strictly  of a local nature and the various items used in  the business proliferated this goal of local service . . .[as  defendant]  only  performs  work  within  the  State  of  Florida,  only  solicits  clients  in  the  South  Florida  area,  only  conducts  business  in  the  State  of  Florida,  and  does  not  provide  any  services  outside of the State of Florida” and “[t]he fact that the Defendant Company provided services of an  exclusively local nature is dispositive”); Lamonica v. Safe Hurricane Shutters, Inc., – – F. Supp. 2d – –  , 2008 WL 4346323 (S.D. Fla., Sept. 23, 2008) (Cohn, J.) (holding FLSA does not apply to local  hurricane   shutter   installation   company,   although   company’s   gross   annual   revenue   exceeded  $500,000); Morales v. M & M Painting and Cleaning Corp., 2008 WL 4372891 (S.D. Fla., Sept.  24, 2008) (O’Sullivan, J.) (holding that FLSA does not apply to local painting company, although  company’s   gross   annual   revenue   exceeded   $500,000);   Sandoval   v.   Florida   Paradise   Lawn  Maintenance, Inc., 2008 WL 1777392 * 5-6 (S.D. Fla., Apr. 17, 2008).   The Bien-Aime, Polycarpe, Lamonica, Morales, and Sandoval courts relied on an Eleventh Circuit  case for their holdings that unless the plaintiff can prove that two or more employees are engaged in  interstate commerce, summary judgment is warranted.   Scott v. K.W. Max Investments, Inc., 2007  WL 2850926 (11th Cir., Oct. 2, 2007).

SUMMARY OF ARGUMENT

Defendants will first demonstrate that the Plaintiff’s federal law claims (i.e. that brought pursuant to the FLSA) are without basis.  Because there is no diversity jurisdiction, Defendants will show that once the FLSA claims are dismissed so too should be the state law claims; thus, resolving this case in its entirety in this Court.  These arguments are separated below into two main sections:  Memorandum of Law as to Count I (i.e. the Federal law claims) and Memorandum of Law as to Counts II and III (i.e. the state law claims).

MEMORANDUM OF LAW – AS TO COUNT I

  1. I.               THE  LEGAL  STANDARDS  FOR  GRANTING  A  MOTION  FOR              SUMMARY JUDGMENT

 

A.     Standard for Establishing Subject Matter Jurisdiction

 

It  is  settled  that  “the  party  invoking  the  Court’s  jurisdiction,  bears  the  burden  of  demonstrating that this matter falls within the Court’s subject matter jurisdiction.”  Makro Capital  of  Am.,  Inc.  v.  UBS  AG,  436  F.  Supp.  2d  1342,  1345  (S.D.  Fla.  2006);  Lujan  v.  Defenders  of  Wildlife, 504 U.S. 555, 561 (1992); OSI, Inc. v. United States, 285 F.3d 947, 951 (11th Cir. 2002)  (holding that “the burden is on the plaintiff to prove that jurisdiction exists”).

 

B.     Legal Standard for Summary Judgment

 

Summary  judgment  under  Federal  Rule  Civil  Procedure  56(c)  is  appropriate  when  “the  pleadings,  depositions,  answers  to  interrogatories,  and  admissions  on  file,  together  with  the  affidavits, if any, show that there is no genuine issue as to any material fact and that the moving  party is entitled to a judgment as a matter of law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,  247 (1986).  The moving party bears the initial responsibility of showing the Court, by reference to the record, that there are no genuine issues of material fact to be decided at trial.  Celotex Corp. v.  Catrett, 477 U.S. 317, 323 (1986).  This burden may be met by “showing” or “pointing out” to the  Court that there are no genuine issues of material fact.  Jeffrey v. Sarasota White Sox, Inc., 64 F.3d  590, 593 (11th Cir. 1995) (per curiam) (quoting Celotex, 447 U.S. at 325).  Once the initial burden is  met, the non-moving party must go beyond the pleadings and “come forward with ‘specific facts  showing that there is a genuine issue for trial.’”  Matsushita Elec. Indus. Co. v. Zenith Radio Corp.  475 U.S. 574, 587 (1986) (quoting Fed. R. Civ. P. 56(e)); see also Celotex, 477 U.S. at 324.  In so  doing,  the  non-moving  party  “must  do  more  than  simply  show  that  there  is  some  metaphysical  doubt as to the material facts.” Id. at 586.  Instead, there must be a sufficient showing that the jury  could reasonably find for that party.  Anderson, 477 U.S. at 252; see also Walker v. Darby, 911 F.2d  1573, 1577 (11th Cir. 1990).

When deciding whether summary judgment is appropriate, the Court must view the evidence  and all reasonable factual inferences therefrom in the light most favorable to the non-moving party.  Witter v. Delta Air Lines, Inc., 138 F.3d 1366, 1369 (11th Cir. 1998) (citations omitted). The Court  must then decide whether “the evidence presents a sufficient disagreement to require submission to  a jury or whether it is so one-sided that one party must prevail as a matter of law.” Allen v. Tyson  Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997) (quoting Anderson, 477 U.S. at 251-52)).

II.     RELEVANT UNDISPUTED FACTS

 

As indicated in the Defendants’ Statement of Undisputed Material Facts, the Defendants’ business is as a local doctor’s office performing work only in Florida.  The Plaintiff did not engage in interstate commerce nor did she produce any goods or services outside the state of Florida.  Moreover, at all times, the corporate Defendant High Springs has never made more than $500,000.00.

  1. III.           THE  PLAINTIFF  CANNOT  ESTABLISH  JURISDICTION  UNDER  THE              FLSA,  BECAUSE  HIGH SPRINGS  DOES  NOT  EMPLOY  ANYONE              ENGAGED    IN    INTERSTATE    COMMERCE    OR    IN    THE              PRODUCTION OF GOODS FOR INTERSTATE COMMERCE, THE             PLAINTIFF WAS NOT SO EMPLOYED, AND HIGH SPRIGS NEVER             MADE MORE THAN $500,000.00.  

 

A.     General Analysis

 

Section 206(a) of the FLSA provides, in relevant part:

 

Every employer shall pay to each of his employees who in any workweek is engaged in commerce or in the production of goods for commerce, or is employed in an enterprise engaged in commerce or in the production of goods for commerce, wages at the following rates…

 

29 U.S.C. § 206(a). Simply put, the FLSA requires an employer to a certain minimum wage if that employee is either engaged in commerce of the production of goods for commerce or is employed in an enterprise engaged in commerce of the production of goods for commerce.  Moreover, Section 203(b) defines “commerce” as follows:  “Commerce” means trade, commerce, transportation, transmission, or communication among the several States or between any State and any place outside thereof.” 29 U.S.C. § 203(b).

Therefore, the FLSA  provisions apply in two circumstances:  (1) where an employee is engaged in commerce or the production of goods for commerce—individual coverage; or (2) where an employee works for an  enterprise  engaged  in  commerce  or  in  the  production  of  goods  for  commerce— enterprise  coverage.  Ares v. Manuel Diaz Farms, Inc., 318 F.3d 1054, 1056 (11th Cir. 2003).  “The burden of proof  lies  on  employees  to  establish  that  they  were  engaged  in  interstate  commerce,  or  in  the production of goods, and that such production was for interstate commerce.” Kitchings v. Florida United Methodist Children’s Home, Inc., 393 F. Supp. 2d 1282, 1292 n.25 (M.D. Fla. 2005) (citing D.A. Schulte, Inc., v. Gangi, 328 U.S. 108, 121 (1946) and Warren-Bradshaw Drilling Co. v. Hall, 317  U.S.  88,  90  (1942)).   This  is  because  the  burden  of  proof  on  a  challenge  to  subject-matter  jurisdiction  lies  with  the  party  invoking  the  court’s  jurisdiction:   here,  the  Plaintiffs.   Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992); OSI, Inc. v. United States, 285 F.3d 947, 951 (11th Cir. 2002) (holding that “the burden is on the plaintiff to prove that jurisdiction exists”).

Under the first type of FLSA coverage— “individual coverage”— an employee is entitled to  the federal minimum wage as long as he or she is “engaged in commerce or in the production of  goods for commerce.”  See 29 U.S.C. § 207; Bien-Aime v. Nanak’s Landscaping, Inc., 572 F. Supp.  2d 1312 (S.D. Fla. 2008).  To determine whether an employee performed such work, a court must  focus its inquiry on the activities of the employee and not on the business of the employer.   See  Mitchell  v.  Lublin  McGaughy  &  Assocs.,  358  U.S.  207,  211  (1959);  see  also  Thorne  v.  All  Restoration Servs., Inc., 448 F.3d 1264, 1267-68 (11th Cir. 2006). In Thorne, the Eleventh Circuit  held that it was “the intent of Congress to regulate only activities constituting interstate commerce,  not activities merely affecting commerce”, and thus an employee must be “engaged in commerce”,  which  means  he  must  be  “directly  participating  in  the  actual  movement  of  persons  or   things  in  interstate commerce”.   Thorne, 448 F.3d at 1266.   Further, in addition to the requirement that the  individual must be directly participating in the actual movement of persons or things in interstate  commerce, “[f]or an employee to be engaged in commerce, ‘a substantial part of the employee’s  work  must  be  related  to  interstate  commerce.”  Kitchings,  393  F.  Supp.2d  at  1293  n.26  (quoting Boekemeier v. Fourth Universalist Soc’y in City of New York, 86 F. Supp.2d 280, 287 (S.D. N.Y.  2000) and (citing Walling v. Jacksonville Paper Co., 317 U.S. 564, 572 (1943)).

Under the second type of FLSA coverage— “enterprise coverage”— an employee is entitled  to the federal minimum wage if he or she is employed by “an enterprise engaged in commerce,”  as defined by § 203(s) of the statute.  Section 203(s) of the FLSA provides in relevant part that an  “[e]nterprise  engaged  in  commerce  or  in  the  production  of  goods  for  commerce”  means  an  enterprise that:

(A)(i) has employees engaged in commerce or in the production of goods for  commerce, or that has employees handling, selling, or otherwise working on  goods or material that have been moved in or produced for commerce by any  person; and

 

(ii) is an enterprise whose annual gross volume of sales made or business done  is not less than $500,000 (exclusive of excise taxes at the retail level that are  separately stated).

 

29 U.S.C. § 203(s)(1)(A)(ii).   Thus, in order for an enterprise to be “engaged in commerce,” for  purposes of enterprise coverage, a business must have employees handling goods or materials that  have been moved in interstate commerce and must have annual gross volume of sales or business  done in excess of $500,000.  See 29 U.S.C. § 203(s)(1)(A)(ii).

To resolve this Motion the Court must decide two issues.  The first is whether, reviewing the  record in the light most favorable to Plaintiff, the Plaintiff participated in the actual movement of  persons or goods in interstate commerce, and whether that participation was sufficiently substantial  as  needed  to  support  a  finding  of  individual  coverage  under  the  FLSA.  The  second  is  whether, reviewing the record in the light most favorable to Plaintiff, the corporate Defendant’s annual gross  volume  of  sales  exceeded  the  minimum  requirement  under  the  FLSA  ($500,000)  and  whether  High Springs  employed  two  or  more  employee  who  regularly  and  recurrently  engaged  in  interstate  commerce.   The Court should note that given the Bien-Aime, Polycarpe, Lamonica, Morales, and  Sandoval cases, summary judgment is clearly appropriate here.

B.     Individual Coverage

 

Plaintiff  ostensibly  alleges  that  the  overtime  provisions  of  the  FLSA  apply  in  this  case  because her work for High Springs involved the use of goods that traveled in interstate commerce.  As to  Plaintiff’s use of goods that traveled in interstate commerce, it is well-settled that this is not enough  to invoke individual coverage under the FLSA.  See Thorne, 448 F.3d at 1267 (holding that “[w]hen  goods reach the customer for whom they were intended, the interstate journey ends and employees  engaged in any further intrastate movement of the goods are not covered under the Act”) (citing McLeod  v.  Threlkeld,  319  U.S.  491,  493  (1943));  Junkin  v.  Emerald  Lawn  Maintenance  &  Landscaping, Inc., 2005 WL 2862079, *1 (M.D. Fla. 2005) (holding that there was no individual  coverage  because  “[t]he  Court  is  not  persuaded  that  the  mere  act  of  transporting  goods  that  previously found themselves in the flow of interstate commerce means that an employee ‘engaged  in commerce’ and is thus subject to ‘individual coverage’ under the FLSA”); see also Russell v.  Continental  Restaurant,  Inc.,  430  F.  Supp.2d  521,  526-27  (D.  Md.  2006)  (citing  Thorne  and  rejecting  the  argument  that  handling  produce  from  out-of-state  demonstrates  that  a  restaurant  employee is engaged in interstate commerce).  The reason for these decisions is found in long ago  decided Supreme Court decisions that clearly hold that the inquiry concerning individual coverage  focuses “on the activities of the employee and not on the business of the employer.”   Mitchell v. Lublin McGaughy & Assocs., 358 U.S. 207, 211 (1959).[1] The burden of proof lies on employees to  establish that they were engaged in interstate commerce, or in the production of goods for interstate  commerce.  D.A. Schulte, Inc. v. Gangi, 328 U.S. 108, 121 (1946); Warren-Bradshaw Drilling Co.  v. Hall, 317 U.S. 88, 90 (1942).  Finally, and importantly, “a substantial part of [Plaintiff’s] work”  must be the engagement in interstate commerce for the Plaintiff to successfully invoke enterprise  coverage.   Walling v. Jacksonville Paper Co., 317 U.S. 564, 572 (1943) (holding that individual  coverage  is  only  established  “[i]f  a  substantial  part  of  an  employee’s  activities  related  to  goods  whose  movement  in  the  channels  of  interstate  commerce  was  established  by  the  test  we  have  described, he is covered by the [FLSA]”).

The Court should be aware that, not surprisingly after Thorne, other courts in the Florida are readily granting summary judgment in favor of employers in FLSA cases, where  individual  coverage  lacks.   Numerous  district  court  opinions,  since  the  Thorne  case  was  decided,  have  actually  ruled  that  individual  coverage  does  not  exist  and  have  granted  summary  judgment for employers on that issue, see, e.g., Guzman v. Irmadan, Inc., 551 F. Supp.  2d 1368  (S.D. Fla. 2008) (granting summary judgment on issue when plaintiff was remodeling residences for  the  employer,  even  though  plaintiff  picked  up  and  purchased  at  retail  stores  various  items  needed for work); Navarro v. Broney Automotive Repairs, Inc., 533 F. Supp. 2d 1223 (S.D. Fla.  2008)  (granting  summary  judgment  in  favor  of  defendants,  even  though  plaintiff  picked  up  automobile  parts  that  had  traveled  in  interstate  commerce),  aff’d,  Navarro  v.  Broney  Automotive  Repairs, Inc., 2008 WL 2315869 (11th Cir., June 6, 2008) (holding that to prove coverage under the  FLSA  the  plaintiff  must  “participate  in  the  actual  movement  of  persons  or  things  in  interstate  commerce” and reiterating that goods intended for resale are at rest and are no longer moving in  commerce, and thus it is irrelevant to the coverage issue if the plaintiff, buys, uses, or handles retail  or wholesale goods that are purchased locally that previously traveled in interstate commerce), cert.  denied, – – S. Ct. – -, 2008 WL 4144447 (2008); Casseus v. First Eagle, L.L.C., 2008 WL 1782363  (S.D.  Fla.,  Apr.  18,  2008)  (granting  summary  judgment  in  favor  of  defendant  and  against  the  restaurant worker plaintiff); Casanova v. Morales, 2007 WL 4874773, *1 (S.D. Fla., Aug. 3, 2007),  aff’d, – – F.3d – -, 2008 WL 94756 (11th Cir. 2008); Severin v. Pasha’s Restaurants, Inc., 2007 WL  967021 (S.D. Fla., Mar. 22, 2007) (granting summary judgment on the issue— not enough direct  involvement in the production of goods for commerce—to an employer when the employee ordered  food  and  supplies,  and  made  bank  deposits  regularly);  Thompson  v.  Robinson,  Inc.,  2007  WL  2714091 (M.D. Fla., Sept. 17, 2007) (granting summary judgment on the issue when the plaintiff  did not use instrumentalities of commerce, such as fax machines, telephones, or e-mails, and his  only involvement with goods was after they ceased to move in interstate commerce); Scott v. K.W.  Max Investments, Inc., 2007 WL 423080 (M.D. Fla., Feb. 6, 2007) (holding that the handling of  building  materials  that  had   traveled  in  interstate  commerce  not  enough  to  establish  individual  coverage, and noting that there was no production of goods, much less goods for commerce, since  the  employer  was  a  service  provider),  and  there  has  been  one  Eleventh  Circuit  case  that  has followed Thorne.  Scott v. K.W. Max Investments, Inc., 2007 WL 2850926 (11th Cir., Oct. 2, 2007)  (holding that the plaintiff purchasing goods from a Home Depot that had originally moved through  commerce not entitled to invoke individual coverage).

It is clear from the facts of this case that the Plaintiff simply was not involved in any manner  in the actual movement of persons or goods in interstate commerce, much less that the participation  was sufficiently substantial as needed to support a finding of individual coverage under the FLSA.  The Plaintiff simply worked as a doctor’s assistant, and the materials with which she worked  were  clearly  at  rest,  and  no  longer  in  interstate  commerce.   Navarro  v.  Broney  Automotive Repairs, Inc., 533 F. Supp. 2d 1223 (S.D. Fla. 2008) (holding that the instate purchase  of  automotive  parts  from  wholesalers  and  retailers  that  were  manufactured  or  traveled  outside  Florida does not constitute the engagement in commerce, because the parts were at rest and out of  the stream of commerce).

The  Plaintiff  may  attempt  to  rely  on  Alonso  v.  Garcia,  2005  WL  1901682,  *1  (11th  Cir.  2005),  but  that  decision  is  not  supportive  of  individual  coverage  in  these  circumstances,  and  its  application  has  been  rejected  by  the  courts  identified  above  granting  summary  judgment  on  this  issue for the employer.  Alonso contains no discussion of the facts, much less any analysis of them,  whatsoever,  but  merely  holds  that  a  “laborer  transporting  fumigation  materials  and  chemicals,  which had traveled in interstate commerce to defendants’ customers within the state”, presented in  issue of fact preventing summary judgment on the question of whether the plaintiff was engaged in  interstate commerce.[2] The Middle District of Florida’s decision in Junkin explains the problems with  Alonso. The  plaintiff  in  Junkin  worked  for  a  lawn  maintenance  company  and  his  work  required him to transport herbicides and fertilizers manufactured or shipped out of state.   Junkin,  2005  WL  2862079  at  *1.    The  court  found  that  there  was  no  enterprise  coverage  because  the  employer’s  annual  volume  of  business  did  not  exceed  $500,000,  id.  at  *3,  and  there  was  no  individual coverage because the mere act of transporting goods that previously found themselves in  the flow of interstate commerce does not mean that an employee engaged in commerce or produced  goods or services for commerce.   The court noted that “[b]rought to its logical end, such a theory  would  mean  that  an  employee  who,  in  the  course  of  his  duties,  simply  moves  an  item  (which  originated in another state) from one place to another within the same property . . . has ‘engaged in  commerce’ by ‘transporting’ that item.  Such a theory cannot stand, as it would, in essence, nullify  the ‘interstate’ requirement and ultimately render the  Commerce Clause meaningless.”   Id. at *4.  As  for  the  persuasiveness  or  lack  thereof  of  the  Alonso  decision,  it  was  deemed  not  persuasive  because of its failure to provide a factual background and because, “[a]s an unpublished opinion,  under  Eleventh  Circuit  Rule  36-2,  Alonso  is  not  binding  precedent  and  is,  at  best,  persuasive  authority. However, given the fact that the court there relied on undisclosed facts in the record, the Court does not find them to be persuasive here.”  Id. at *4 n.6.

Moreover,  the  Eleventh  Circuit’s  subsequent  decision  in  Thorne  explaining  that  activities  are  not  rendered  interstate  commerce  simply  because  the  employer  purchased  goods  which  had  previously  moved  in  interstate  commerce,  Thorne,  448  F.3d  at  1268,  completely  eclipses  the  applicability of the reasoning used by the court in Alonso.   Thorne’s determination that, “[w]hen  goods reach the customer for whom they were intended, the interstate journey ends and employees  engaged in any further intrastate movement of the goods are not covered under the [FLSA]”, id. at  1267  (emphasis  in  original),  cannot  be  reconciled  with  the  reported  Alonso  decision;  the  Thorne  court  clearly  distinguished  and  rejected  Alonso,  to  the  extent  it  purports  to  hold  if  an  employee  merely  handles  goods  that  at  one  time  traveled  interstate  that  employee  is  entitled  to  invoke  individual coverage.  See also Russell, 430 F. Supp. 2d at 526 (granting motion to dismiss for lack  of  subject  matter  jurisdiction  and  citing  Thorne  for  the  proposition  that  there  is  no  individual  coverage  for  employees  “who  handle  goods  after  an  employer  acquires  the  goods  for  local  disposition”).    Even before Thorne, other courts had reached the same conclusion.    Rivera v. Heights Landscaping, Inc., 2004 WL 434214 *4 (N.D. Ill. 2004) (holding that “‘mere use, physical  touching,  or  consumption  of  goods’  that  have  traveled  in  interstate  commerce  is  not  enough  [to  establish  individual  coverage]”  and  “Plaintiffs  cannot  establish  individual  coverage  merely  by  showing that in the course of their work they used rakes, fertilizers, or other goods that originated  out of state”) (citing Joles v. Johnson County Youth Servs. Bureau, Inc., 885 F. Supp. 1169 (S.D.  Ind.1995)).   For the reasons addressed herein, the Defendants request that the Court hold that the Plaintiff has not met his burden to establish individual coverage.

C.     Enterprise Coverage

 

Under the FLSA, unless the enterprise has $500,000 or more in gross annual revenue, and  has  two  or  more  employees  who  are  engaged  in  commerce  or  in  the  production  of  goods  for  commerce,  the  employer  is  not  subject  to  the  Act.   29 U.S.C.  § 203(s) (1) (A) (i & ii).   Section  203(s)(1)(A)(i)  of  the  FLSA,  which  pertains  to  enterprise  coverage,  requires  that  the  defendant-  employer have employees engaged in commerce or in the production of goods for commerce, as  follows:

 

(s)(1)  ‘Enterprise  engaged  in  commerce  or  in  the  production  of  goods  for  commerce’ means an enterprise that–

 

(A)(i)  has  employees  engaged  in  commerce  or  in  the  production  of  goods  for  commerce,  or  that  has  employees  handling,  selling,  or  otherwise  working  on  goods or materials that have been moved in or produced for commerce by any  person; and

 

(ii) is an enterprise whose annual gross volume of sales made or business done is  not  less  than  $500,000  (exclusive  of  excise  taxes  at  the  retail  level  that  are  separately stated) . . . .

 

(11th Cir., Oct. 2, 2007); Francois v. Fried Green Tomatoes, Inc., 2006 WL 5097646, *2 n.1 (S.D.  Fla.) (noting that these are the two elements to enterprise coverage and the parties had stipulated to the first element).  Simply put, the FLSA requires an employer to pay the federal minimum wage as long  as  it  employs two or more individuals who are engaged in commerce or in the production of goods for  commerce.  Id.

As stated above, it is Defendants’ position that the Plaintiff was not engaged in commerce,  because  all  she  did  was  perform  administrative  functions  tied  to  the  general  management  and  operations of the doctor’s office, and the supplies that she used in her employment were outside of  the stream of commerce by the time she used them, because they were purchased locally.  (Facts ¶¶  2-4); Polycarpe v. E & S Landscaping, Inc., 572 F. Supp. 2d 1318 (S.D. Fla. 2008) (holding that the  materials, supplies, and equipment used by the plaintiffs that were purchased by  the defendant from  local  retailers  and  wholesalers  “had  come  to  rest,  i.e.,  any  journey  of  an  interstate  nature  had  ended— and  were  then  utilized  to  transact  the  landscaping  business,  which  was  entirely  local  in  nature”);  Navarro  v.  Broney Automotive Repairs, Inc., 533 F.  Supp.  2d 1223 (S.D.  Fla.  2008)  (holding  that  the  instate  purchase  of  automotive  parts  from  wholesalers  and  retailers  that  were  manufactured or traveled outside Florida does not constitute the engagement in commerce, because  the  parts  were  at  rest  and  out  of  the  stream  of  commerce),  aff’dNavarro  v.  Broney Automotive Repairs, Inc., – – F.3d – -, 2008 WL 2315869 (11th Cir., June 6, 2008), cert. denied, – – S. Ct. – -, 2008  WL 4144447 (2008).  In Navarro, the court was clear to note that “the [automotive] parts were sent  from the out-of-state wholesaler to the various local dealers, not to Broney Automotive.  They were  stored by the local dealers until they were purchased by Broney Automotive or other customers.  The parts stopped flowing in commerce when they were delivered and stored by the local dealers.”  Id.  The Court concluded by stating:

Here, the FLSA coverage line is at the point where the parts were delivered and  stored by the l            ocal dealers.  Any intra-state activity after this point is not interstate  commerce for purposes of             the FLSA.  Id.

 

Moreover, in this case, High Springs did not have a gross annual revenue that exceeded $500,000.  Therefore, the Plaintiff  cannot  establish  enterprise  coverage  under the FLSA.  Accordingly, on the authority of Bien-AimePolycarpe,  Lamonica,  Morales,  Sandoval,  and  Scott,  High Springs  respectfully  requests  that  this  Honorable Court grant summary judgment in its favor as to Count I of the Compliant.

MEMORANDUM OF LAW – AS TO COUNTS II AND III

            The Defendant previously requested via Summary Judgment that Count III of the complaint (i.e. breach of contract) be dismissed for lack of subject matter jurisdiction.  The Court denied said motion, noting in part that “In the instant case, this Court has supplemental jurisdiction over the Plaintiff’s state law breach of contract claim because that claim arises from the same case or controversy as her FLSA claim.” Doc. 75, page 12.  However, as demonstrated via the above, the Plaintiff’s FLSA claim should be dismissed as the FLSA does not apply in this circumstance.  Therefore, Counts II and III (which have no independent federal jurisdiction) should be remanded to state court.

The Court may decline to exercise supplemental jurisdiction over a claim arising under state law in the following circumstances: (1) the claim raises a novel or complex issue of State law,  (2) the claim substantially predominates over the claim or claims over which the district court has original jurisdiction, (3) the district court has dismissed all claims over which it has original jurisdiction,  or (4) in exceptional circumstances, there are other compelling reasons for declining jurisdiction. 28 U.S.C. § 1367(c).  Therefore, jurisdiction may be declined in the event that the court has dismissed all claims of original jurisdiction.  Id.  Moreover, pursuant to rule 12(h), Federal Rules of Civil Procedure, a motion for lack of subject matter jurisdiction may be raised at any point by suggestion of the parties.[3]

            In this case, as noted supra, Count I of the Complaint (relating to the FLSA) should be dismissed.  Therefore, per 28 U.S.C. § 1367(c), all claims over which this Court has original jurisdiction will be dismissed and subject matter jurisdiction may be declined.  Moreover, as noted in the Defendant’s previous Summary Judgment Motion regarding pre-suit notice under the state law minimum wage act (consideration of which was stayed due to the early stages of the litigation), the Defendant also anticipates that Count II of the Complaint will be dismissed.  See Doc. 75, page 20. Therefore, assuming the Plaintiff’s FLSA claims are dismissed, the Defendant would also urge that any remaining state law claims be dismissed in favor of state court proceedings.  The end result would be that, once the FLSA claim is properly disposed of, this entire case be litigated in state court.[4]

/s/ Michael Massey________

Michael Massey

Fla. Bar No. 153680

 

           

 



[1] Under individual coverage jurisprudence, “commerce” and “interstate commerce” are narrower terms of art than in other areas of Commerce Clause jurisprudence. As the Supreme Court has clarified, in enacting the FLSA, Congress did not intend to exercise the full extent of its constitutional regulatory powers, and clearly intended to exempt local businesses:

[W]e cannot be unmindful that Congress in enacting this statute plainly indicated its purpose to leave local business to the protection of the states. [citations omitted]. Moreover as we stated in Kirschbaum Co. v. Walling [citations omitted], Congress did not exercise in this Act the full scope of the commerce power.

Walling v. Jacksonville Paper Co., 317 U.S. 564, 571 (1943). Further, because the FLSA manifests the “concern of Congress to avoid undue displacement of state regulation of activities of a dominantly local character . . . [t]he focus of coverage became ‘commerce’, not in the broadest constitutional sense, but in the limited sense of Section 3(b) of [the FLSA, 29 U.S.C. § 203(b)]: ‘trade, commerce, transportation, transmission, or communication among the several States . . . .’” Marshall v. Whitehead, 463 F. Supp. 1329, 1345 (M.D. Fla. 1978) (citing Mitchell v. H. B. Zachry Co., 362 U.S. 310, 315 (1960)). High Springs is a purely local, one-location, doctor’s office that does not have employees engaged in commerce or in the production of goods for commerce. This is exactly the sort of local business Congress, in enacting the FLSA, intended to leave to the regulation of the several states. Jacksonville Paper Co., 317 U.S. at 571.

 

[2] The Alonso opinion, in pertinent part, states as follows, in holding the plaintiff was:

‘engaged in commerce’ through his duties as a laborer transporting fumigation materials and chemicals, which had traveled in interstate commerce to defendants’ customers within the state. Although these duties required no transportation outside the state of Florida, the materials and chemicals, which had traveled in interstate commerce, continued to flow in interstate commerce until they reached Dolphin Exterminating Company’s customers. See [Brennan v. Wilson Bldg., Inc., 478 F.2d 1090 (5th Cir.1973)] at 1095 (holding elevator operators [to be] ‘engaged in commerce’ because the goods they transported continue to flow in interstate commerce until delivered to the tenants of the building). Alonso v. Dolphin Exterminating Co., 2005 WL 1901682 (11th Cir. 2005).

 

[3] To the extent this requires a motion to dismiss per Rule 12(h), Defendants request that the instant motion be considered as such to the extent necessary.

 

[4] Defendants Prieto and High Springs have a state law indemnification claim against Dr. Redacted.  Assuming the remainder of this case is sent to state court, that claim (also grounded in state law) could as well as courts may raise an objection to subject matter jurisdiction on their own initiative. See e.g. Goodman v. Sipos, 259 F.3d 1327, 1331 n. 6 (11th Cir.2001) (“A federal court must always dismiss a case upon determining that it lacks subject matter jurisdiction, regardless of the stage of the proceedings, and facts outside of the pleadings may be considered as part of that determination.”); See also See Bender v. Williamsport Area Sch. Dist. 475 U.S. 534, 541, 106 S.Ct. 1326, 1331 (1986).