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Paine v. Intrepid USA, Inc.

United States District Court, M.D. Tennessee, Nashville Division

June 15, 2015

SHELLEY PAINE, on behalf of herself and all other similarly situated


JULIET GRIFFIN, Senior Magistrate Judge.

By Order entered October 27, 2014 (Docket Entry No. 7), this action was referred to the Magistrate Judge, pursuant to Rules 72(a) and (b) of the Federal Rules of Civil Procedure, to address any motions or other pretrial matters.

Presently pending before the Court is the motion to dismiss or to transfer venue (Docket Entry No. 31) filed by Defendant Intrepid U.S.A., Inc., to which the Plaintiffs have filed a response in opposition (Docket Entry No. 37). Also before the Court is the Defendant's reply (Docket Entry No. 41). For the reasons set out below, the Court recommends that the motion to dismiss or to transfer venue be denied.


Shelley Paine ("Paine"), the named Plaintiff, is a resident of Lewisburg, Tennessee. On October 21, 2014, she filed this lawsuit as a collective action on behalf of herself and all similarly situated individuals, pursuant to § 16(b) of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 216(b), against Intrepid U.S.A., Inc. ("Intrepid USA") to recover unpaid wages. The Plaintiff avers that venue for this action properly lies in the Middle District of Tennessee, pursuant to 28 U.S.C. § 1391, because the Defendant resides in this judicial district and because a substantial part of the events or omissions giving rise to the claims occurred in this judicial district.

Plaintiff Paine contends that the Defendant wrongfully classified her and other similarly situated employees as exempt from overtime compensation under the FLSA, 29 U.S.C. §§ 201 et seq., and failed to pay for all time worked and for overtime wages in violation of the FLSA. She asserts that she worked as a home health care nurse for Intrepid USA's Nashville office from August 2012, to February 2014, and that her salary was based on both a flat fee for patient visits, as well as hourly wages for other types of work activities such as attending mandatory meetings, attending other meetings and conferences, and being "on call" for a certain number of hours outside of normal business hours. She also alleges that she spend several hours of uncompensated time each day, including, but not limited to, driving to and from patients' homes, completing paperwork and charting regarding patient visits, delivering samples to the lab, and receiving telephone calls from patients. Paine alleges that she typically worked between fifty (50) and sixty (60) hours each week, and that the Defendant did not compensate her at the required one and one half-times her regular rate for hours worked over forty (40) in a week. She contends that, on the basis of her observations and conversations with other employees of the Defendant, the Defendant pays other skilled home health workers using the same compensation scheme, and that Defendant's other skilled home health workers also often work more than forty (40) hours in a week without compensation at the required one and one half-times their regular rate.[1]

On December 18, 2014, Paine filed a motion (Docket Entry No. 20) for an order (1) conditionally certifying a collective action of similarly situated employees pursuant to Section 16(b) of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 216(b), and (2) authorizing notice of this action to those members of the conditionally certified collective action. She requests that this Court conditionally certify an FLSA collective action consisting of all individuals who, during any time since October 21, 2011, have been (i) employed by the Defendant, (ii) classified by the Defendant as overtime-exempt, and (iii) paid, in part, on a fee-per-visit basis. See Docket Entry No. 20. As support for the motion, Paine submits declarations from other home health care workers who worked for the Defendant in Tennessee, Minnesota, Missouri, and Georgia under the same salary structure that is alleged in the Complaint. See Docket Entry Nos. 23-26. By Order entered February 23, 2015 (Docket Entry No. 43), briefing and consideration of this motion was deferred until resolution of the Defendant's motion to dismiss or to transfer venue.

By its motion to dismiss or to transfer venue, the Defendant seeks dismissal under Rule 12(b)(2), asserting that the Court does not have personal jurisdiction over it. The Defendant states that it is a Minnesota corporation with a principal place of business in Dallas, Texas, and that it does not have offices in Tennessee, has only one remote worker in Tennessee who works out of her home, does not hold a bank account in Tennessee, does not reside in or conduct its business operations in Tennessee, is not a registered corporate entity in Tennessee, has never filed or been required to pay Tennessee taxes, and does not maintain business relationships with Tennessee residents. The Defendant contends that it does not and did not employ Paine or any of the opt-in plaintiffs ("the Plaintiffs") in this action but merely acts as a service provider that processes payments and issues payroll checks for the four local entities that actually employed the Plaintiffs. The Defendant asserts that, although these entities are subsidiaries of a company that is wholly owned by the Defendant, the Defendant does not exercise any control over the Plaintiffs. In short, the Defendant argues that there are no facts that support the assertion of personal jurisdiction over it by this Court or that support the Plaintiffs' contention that a substantial part of the events or omissions giving rise to the claims occurred in this District. The Defendant further seeks dismissal of the action under Rule 12(b)(3), contending that venue in this District is improper under 28 U.S.C. § 1391(b). Alternatively, the Defendant requests that the Court transfer this action to the Northern District of Texas under 28 U.S.C. § 1404(a). In support of its motion, the Defendant relies upon the affidavit of John Nix, the Chief Financial Officer for the Defendant. See Docket Entry No. 32-1.

In response, the Plaintiffs contend that there is evidence supporting their assertion that the Defendant was involved in their employment on a sufficient level to warrant the finding of personal jurisdiction over the Defendant in Tennessee. They contend that they were paid by the Defendant, that they received tax forms identifying the Defendant as their employer, that the Defendant was the entity that employed them, that an employee manual was issued to Tennessee employees indicating that the Defendant was their employer and directing employment related issues to the Defendant at its corporate office, that the Defendant took active roles in determining pay, benefit, and leave issues and that employees were told that the Defendant controlled such matters, and that a disability policy issued listed the Defendant as their employer. The Plaintiffs also assert that the Defendant maintains an interactive website describing its presence in Tennessee, advertising job openings in Tennessee, and enabling individuals in Tennessee to apply for employment via the website and that there is evidence that the Defendant and its corporate subsidiaries shared a physical address, corporate officers, and interactive computer system, and that corporate officers of the Defendant traveled to Tennessee. The Plaintiffs further argue that venue is appropriate in this District and that the action should not be transferred to the Northern District of Texas. In support of their response, the Plaintiffs rely on the declarations of Vicky Tataryn (Docket Entry No. 38) and Shelley Paine (Docket Entry No. 39), the affidavit of Jerry Martin (Docket Entry No. 40), and the affidavit of John Nix submitted by the Defendant.


A. Personal Jurisdiction

Due Process requires that the Defendant be subject to the personal jurisdiction of the Court. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). As the party bringing the lawsuit, the Plaintiff must establish that this Court has personal jurisdiction over the Defendant. See Neogen Corp. v. Neo Gen Screening, Inc., 282 F.3d 883, 887 (6th Cir. 2002); Nationwide Mut'l Ins. Co. v. Tryg Int'l Ins. Co., Ltd., 91 F.3d 790, 793 (6th Cir. 1996).

In a case in which a federal court's subject matter jurisdiction over a case is based on a federal question, personal jurisdiction over a defendant exists "if the defendant is amenable to service of process under the [forum] state's long-arm statute and if the exercise of personal jurisdiction would not deny the defendant[ ] due process." Bird v. Parsons, 289 F.3d 865, 871 (6th Cir. 2002) (citation omitted). When the state's long-arm statute extends to the limits of the due process clause, the two inquiries are merged and the court need only determine whether exercising personal jurisdiction violates constitutional due process. See Nationwide Mut. Ins. Co., 91 F.3d at 793. Because the Tennessee long-arm statute has been interpreted as "coterminous with the limits on personal jurisdiction imposed by the due process clause, " Payne v. Motorists' Mut. Ins. Cos., 4 F.3d 452, 454 (6th Cir. 1993), the only inquiry is whether exercising personal jurisdiction over the Defendant is consistent with federal due process requirements. Bridgeport Music, Inc. v. Still N The Water Pub., 327 F.3d 472, 477 (6th Cir. 2003).

The bedrock principle of personal jurisdiction due process analysis is that, when the Defendant is not physically present in the forum, it must have "certain minimum contacts with [the forum] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.'" International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 85 L.Ed. 278 (1940)). "Minimum contacts" exist when "the Defendant's conduct and connection with the forum State are such that he should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980); Youn v. Track, Inc., 324 F.3d 409, 417 (6th Cir. 2003). The minimum contacts necessary to establish personal jurisdiction can either be general or specific. Air Prods. & Controls, Inc. v. Safetech Int'l, Inc., 503 F.3d 544, 550 (6th Cir. 2007); Reynolds v. International Amateur Athletic Fed'n, 23 F.3d 1110, 1116 (6th Cir.1994). General personal jurisdiction requires the Defendant to have "continuous and systematic" contacts in the forum state such that the forum court may exercise jurisdiction over the Defendant regardless of whether the claim at issue is related to the Defendant's activities in the state. Neogen Corp., 282 F.3d at 889. Specific personal jurisdiction, on the other hand, is based on the ...

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