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Kutzback v. LMS Intellibound, LLC

United States District Court, W.D. Tennessee, Western Division

February 10, 2017

MICHAEL KUTZBACK, individually and on behalf of others similarly situated, Plaintiff,



         Before the Court is Plaintiff, Michael Kutzback, and the Opt-In Plaintiffs' (Collectively “Plaintiffs”) Motion to Toll Statute of Limitations. (D.E. #176) (“Second Motion to Toll”). The instant motion was referred to the United States Magistrate Judge for determination. (D.E.#180). For the reasons set forth herein, the instant motion is GRANTED.

         I. Background

         This case arises from allegations that Defendants LMS Intellibound, LLC (“LMS”) and Capstone Logistics, LLC (“Capstone”), [1] who are third-party warehouse servicers providing logistic services for companies in the warehouse, distribution, and manufacturing industries, violated the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §201, et seq., by failing to pay proper overtime and minimum wages. (Am. Compl. ¶¶ 19, 51-69). Plaintiff filed his initial Complaint on October 2, 2013, which he later amended on January 3, 2014.

         Plaintiff alleges that Defendants operate approximately 239 locations nationwide. (Id. ¶ 20). Plaintiff alleges that he was hired to work as a non-exempt “Unloader, ” otherwise known as a “Lumper” (hereinafter “Unloader”), in or about June 2011. (Id. ¶ 21). Plaintiff alleges that he worked as a non-exempt Unloader until August 2012, during which time he was compensated on a production basis as determined by the number and weight of the trucks unloaded. (Id. ¶ 24). Plaintiff alleges that, during all times relevant to his claims, he worked in excess of forty hours within a workweek but was not properly compensated for all of his overtime hours. (Id. ¶¶ 25-27). Specifically, Plaintiff alleges that Defendants' “Team Leads” and/or Managers “systematically and consistently clocked-out its Unloaders while still working, resulting in off-the-clock hours worked.” (Id. ¶ 28). Plaintiff alleges that the “pattern and practice of clocking-out Unloaders while still working is a nationwide practice.” (Id. ¶ 29). Plaintiff alleges that these practices resulted in a failure to pay both overtime and minimum wages in violation of the FLSA from June 2011 to present. (Id. ¶¶ 31-34). Plaintiff further alleges that Defendants have failed to maintain proper time records as mandated by the FLSA. (Id. ¶ 34d).

         As to the proposed collective action, Plaintiff alleges that he and the Opt-in Plaintiffs are or were all non-exempt Unloaders employed Defendants and that they performed the same or similar job duties as one another. (Id. ¶ 37). Plaintiff alleges that all of these non-exempt Unloaders were paid in the same manner, namely on a by-the-truck or piece-rate basis. (Id. ¶ 38). Plaintiff alleges that Defendants uniformly require as their policy or practice all proposed opt-in plaintiffs to work off the clock in the aforementioned manner, thus failing to pay them their FLSA-mandated minimum wages and/or overtime wages. (Id. ¶¶ 39-42). Thus, Plaintiff's Amended Complaint proposes that the proper collective action members should be defined as follows:

All production-only “Unloaders” (a/k/a “Lumpers”) who worked for Defendants, nationwide, within the last three years, who worked in excess of 40 hours in one or more workweeks and were not compensated at one and one-half times their regular rate of pay for all hours worked in excess of 40 hours in one or more workweeks and were not compensated at a rate at least equivalent to the federal minimum wage in one or more workweeks as required by the FLSA.

         As to the causes of action, Count I alleges that Defendants violated Sections 207 and 211 of the FLSA, 29 U.S.C. §§ 207 & 211, and 29 C.F.R. §§ 516.2 & 516.4 by failing to compensate Plaintiff and the proposed opt-in plaintiffs for the overtime hours worked and by failing to maintain proper time records. Count II alleges that Defendants violated Section 206 of the FLSA, 29 U.S.C. § 206, by failing to compensate Plaintiff and the proposed opt-in plaintiffs the federally mandated minimum wage. Count III requests declaratory relief under the FLSA and the Declaratory Judgment Act, 28 U.S.C. §§ 2201-2202.

         On February 18, 2014, Plaintiff filed a Motion to Conditionally Certify Collective Action and Facilitate Notice to Potential Class Members (“Motion to Certify”). (D.E. #43). On October 10, 2014, Plaintiff filed a Motion to Toll asserting that the statute of limitations should be tolled for potential opt-in plaintiffs as of February 18, 2014, the date of the filing of the Motion to Certify (“Motion to Toll”). (D.E. #64). On October 24, 2014, Defendants filed a Response to Plaintiff's Motion to Toll arguing that the “extraordinary” relief requested by Plaintiff is not consistent with the statutory scheme set forth under the FLSA. (D.E. #65). Defendants further asserted that tolling was inappropriate because nothing has prevented or is preventing any potentially aggrieved individuals from pursuing their claims by filing their own suits or opting-in to this action. On December 16, 2014, the Magistrate Judge issued a Report and Recommendation on the Motion to Certify and Motion to Toll. As to the Motion to Certify, the Magistrate Judge recommended that the collective action should be conditionally certified. As to the Motion to Toll, the Magistrate Judge recommended that it should be denied without prejudice. The Report and Recommendation reasoned that there has been uncertainty about applying the doctrine to unidentified potential opt-in plaintiffs and that, “[i]f and when potential plaintiffs whose claims would otherwise be timebarred choose to opt into this class, they may apprise the Court of their circumstances and individually move for equitable tolling.” (D.E. #68 at 25) (quoting Tiffany Montgomery v. Decatur County General Hosp., No. 1:11-cv-01096-JDB-egb, slip op. at 15 (W.D. Tenn. Mar. 19, 2012)). On March 25, 2015, the District Court adopted the Magistrate Judge's Report and Recommendation.[2]

         On July 15, 2016, Plaintiff filed the Second Motion to Toll arguing that, while the universe of Opt-in Plaintiffs claims would be barred in whole or in part was unknown at the time Plaintiff filed his initial Motion to Toll, there is now a “known and definite certainty that many of the current Opt-ins' claims would be barred in the absence of any order tolling their statute of limitations.” Plaintiff asserts that, in the absence of tolling, at least 144 current Opt-in Plaintiffs' claims would be completely time-barred and extinguished. (See Second Mot. to Toll, Exh A). Plaintiff further argues that he is currently unable to identify every single Opt-in Plaintiff by name who would be adversely impacted if his or her statute of limitations were not tolled, in part because Defendants have not provided complete start and end dates for each Opt-in Plaintiff for him to ascertain precisely who would be adversely impacted if the statute of limitations were not tolled. Plaintiff requests that the statute of limitations be tolled from the date he filed his Motion to Conditionally Certify until the Court ruled on the motion-a period of 400 days.

         On August 1, 2016, Defendants filed their Response in opposition to the Second Motion to Toll. Defendants assert that Plaintiff's request is extraordinary, that it is not supported by statute or case law, and that it fails to put forth any new or material facts or changes in the law since the Court previously denied his Motion to Toll. Defendants argue that, contrary to the Magistrate Judge's prior Report and Recommendation, Plaintiff has not “individually move[d]” for tolling by apprising the Court of individual opt-in Plaintiff's circumstances. Instead, Defendants argue that Plaintiff merely reiterates the arguments that the Court previously rejected.

         II. Analysis

         Under the FLSA, “[n]o employee shall be a party plaintiff to any [action] unless he gives consent in writing to become such a party and such is filed in the court in which the suit is brought.” 29 U.S.C. § 216; EEOC v. Chrystler Corp., 546 F.Supp. 54 (E.D.Mich. 1982), affirmed, 733 F.2d 1183 (6th Cir. 1984) (concluding that the filing of consent does not relate back to the date the original complaint was filed). To opt in to an FLSA collective action, written consent must be filed within the statute of limitations set forth in 29 U.S.C. § 255. Thus, the filing of the complaint does not stop the statute of limitations from running for individuals other than the complainant(s); instead, the statute of limitations will continue to run as to other potential opt-in plaintiffs unless or until he or she files written consent to opt into the collective action. Kathy Brown v. Consolidated Restaurant Operations, Inc., No. 3:12-00788, 2013 WL 4804780, at *8 (M.D. Tenn. Sept. 6, 2013). Section 255, however, only serves as “a procedural limitation period under the Act, ” Ott v. Midland- Ross Corp., 523 F.2d 1367 (6th Cir. 1975), and is thus subject to equitable measures such as tolling, Owens v. Bethlehem Mines Corp., 630 F.Supp. 309, 311 (S.D.W.V. 1986) (citing Zipes v. Trans World Airlines, Inc., 455 U.S. 385 (1982)).

         “Equitable tolling is an extraordinary remedy that is sparingly applied and concerns cases involving extraordinary circumstances.” Bennett v. Runyon, No. 96-5532, 1997 WL 133337, at *1 (Mar. 21, 1997) (citing Irwin v. Dep't of Veterans Affairs, 498 U.S. 89, 96 (1990)). “Generally, a litigant seeking equitable tolling bears the burden of establishing two elements: (1) that he has been pursuing his rights diligently; and, (2) that some extraordinary circumstance stood in his way.” Menominee Indian Tribe of Wisconsin v. United States, 136 S.Ct. 750, ...

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