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Sutton v. Community Health Systems, Inc.

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

August 22, 2017

STEPHEN SUTTON, on behalf of himself and all others similarly situated Plaintiff,
COMMUNITY HEALTH SYSTEMS, INC., a Delaware Corporation, a/k/a CHS, Inc. and Dyersburg Ambulatory Corp, CHSPSC, LLC, a Delaware limited liability company, f/k/a Community Health Systems Professional Services Corporation, a/k/a Dyersburg Ambulatory Corp, KNOXVILLE HMA HOLDINGS, LLC, a Tennessee limited liability company, d/b/a Tennova Healthcare, LLC, a/k/a Dyersburg Ambulatory Corp, DYERSBURG HOSPITAL CORPORATION, a Tennessee Corporation, a/k/a Tennova Healthcare - Dyersburg Regional, Dyersburg Regional Medical Center, and Ambulance Service of Dyersburg, AMBULANCE SERVICES OF DYERSBURG, INC., a Tennessee Corporation, f/k/a Dyersburg Regional EMS, d/b/a Tennova EMS, and DYERSBURG AMBULATORY CORP, a Tennessee Corporation, Defendants.



         Before the Court is the motion of Defendants Community Health Systems, Inc., (“CHSI”), CHSPSC, LLC (“CHSPSC”), Knoxville HMA Holdings, LLC (“Knoxville HMA”), and Dyersburg Ambulatory Corp. (“Dyersburg Ambulatory”)[1] to dismiss Plaintiff Stephen Sutton's claims against them, pursuant to Federal Rule of Civil Procedure 12(b)(6). Plaintiff has filed a response in opposition (ECF No. 34), to which Defendants have replied (ECF No. 37), making the matter ripe for adjudication. For the reasons discussed below, the motion is GRANTED as to Dyersburg Ambulatory and CHSI and DENIED as to CHSPSC and Knoxville HMA.

         I. BACKGROUND

         The following facts are gleaned from Plaintiff's complaint, which the Court accepts as true for the purposes of the instant motion. (See ECF No. 1; see also Scheuer v. Rhodes, 416 U.S. 232, 236 (1974).) Plaintiff works as a paramedic at the Dyersburg Regional Hospital in Dyersburg, Tennessee in the emergency ambulance service. Paramedics and EMTs there often work twenty-four hour shifts, from 7:00 AM to 7:00 AM the following day. This lawsuit concerns a portion of these shifts called “on-call” time, typically lasting from 11:00 PM to 7:00 AM. During “on-call” time, Plaintiff and other employees are required to remain on the hospital campus and be close in proximity to their assigned “partner” and their assigned ambulance- close enough to be able to drive off in the ambulance within two minutes of receiving an emergency call. If an emergency call comes in, they must respond to it thus. They are also required to perform other duties during “on-call” time, like answering questions from law enforcement and responding to other calls.

         Plaintiff alleges that he and other similarly situated employees are only compensated $2.00 per hour during “on-call” time, which is below the minimum wage. He also alleges that Defendants do not count these hours toward the forty-hour work week, depriving employees of overtime pay that would otherwise be required by the Fair Labor Standards Act (“FLSA”). 29 U.S.C. § 201, et seq. Finally, Plaintiff claims that he has personally suffered retaliation in the form of receiving pretextual negative performance evaluations and reduced hours after making numerous complaints to his superiors regarding the “on-call” time policies. On December 16, 2016, Plaintiff filed suit under the FLSA against six Defendants, on behalf of himself and others similarly situated. (ECF No. 1.) He included notices of consent signed by him and twenty-seven others. (ECF No. 1-10.) Since then, the parties have agreed to conditionally certify this case as a collective action under 29 U.S.C. § 216(b) (ECF No. 38) and eleven other individuals have opted in (ECF Nos. 41, 42, 44, 46, 48-53).

         On February 21, 2017, Ambulance Services of Dyersburg, Inc. and Dyersburg Hospital Corporation filed answers (ECF Nos. 23 & 24), while the remaining Defendants filed the instant motion (ECF No. 25).[2] Defendants argue that they are not Plaintiff's employers within the meaning of the FLSA and should be dismissed from this action. Plaintiff responds that they are all “joint employers” and points to the FLSA's relatively expansive definition of the term.


         A. 12(b)(6) Standard

         A defendant may move to dismiss a claim “for failure to state a claim upon which relief can be granted” under Federal Rule of Civil Procedure 12(b)(6). When considering a Rule 12(b)(6) motion, the Court must treat all of the well-pleaded allegations of the pleadings as true and construe all of the allegations in the light most favorable to the non-moving party. Scheuer v. Rhodes, 416 U.S. 232, 236 (1974); Saylor v. Parker Seal Co., 975 F.2d 252, 254 (6th Cir. 1992). Legal conclusions and unwarranted factual inferences, however, need not be accepted as true. Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987). “To avoid dismissal under Rule 12(b)(6), a complaint must contain either direct or inferential allegations with respect to all the material elements of the claim.” Wittstock v. Mark a Van Sile, Inc., 330 F.3d 899, 902 (6th Cir. 2003). Under Federal Rule of Civil Procedure 8, a complaint need only contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Although this standard does not require “detailed factual allegations, ” it does require more than “labels and conclusions” or “a formulaic recitation of the elements of a cause of action.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); see Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007); see also Reilly v. Vadlamudi, 680 F.3d 617, 622 (6th Cir. 2012) (quoting Twombly, 550 U.S. at 555). In order to survive a motion to dismiss, the plaintiff must allege facts that, if accepted as true, are sufficient “to raise a right to relief above the speculative level” and to “state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 555, 570. “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678.

         B. The Effect of Presenting Matters Outside the Pleadings

         “Assessment of the facial sufficiency of the complaint must ordinarily be undertaken without resort to matters outside the pleadings.” Rondigo, L.L.C. v. Twp. of Richmond, 641 F.3d 673, 680 (6th Cir. 2011) “If, on a motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56.” Fed.R.Civ.P. 12(d). However, “a court may consider exhibits attached [to the complaint], public records, items appearing in the record of the case and exhibits attached to defendant's motion to dismiss so long as they are referred to in the complaint and are central to the claims contained therein, without converting the motion to one for summary judgment.” Rondigo, 641 F.3d at 680-81 (internal quotation marks omitted).

         Plaintiff points out that Defendants filed two sworn declarations along with their motion to dismiss and urges the Court to treat it as a motion for summary judgment. (See ECF Nos. 26-1 & 26-2.) If outside material is filed, a Court may choose not to consider it and continue to evaluate the motion under the 12(b)(6) standard. See Travelers Prop. Cas. Co. of Am. v. Breeding Heavy Haulers, Inc., No. CIV.A. 7:09-124-KKC, 2012 WL 1029459, at *2 (E.D. Ky. Mar. 26, 2012); see also Tackett v. M & G Polymers, USA, LLC, 561 F.3d 478, 488 (6th Cir. 2009). The Court finds it prudent to do so here.

         III. ANALYSIS

         The purpose of the FLSA is to “correct labor conditions detrimental to the maintenance of the minimum standard of living necessary for health, efficiency, and general well-being of workers . . . .” Donovan v. Brandel, 736 F.2d 1114, 1116 (6th Cir. 1984). The Act requires “employers to pay employees engaged in commerce a wage consistent with the minimum wage . . . and instructs employers to pay employees overtime compensation, which must be no less than one-and-one-half times the regular rate of pay, if the employee works more than forty hours in a week.” Ellington v. City of E. Cleveland, 689 F.3d 549, 552 (6th Cir. 2012). “The Supreme Court has indicated that the FLSA is to be construed liberally, ” id. (citing Tony & Susan Alamo Found. v. Sec'y of Labor, 471 U.S. 290, 296 (1985)), and “Courts interpreting the FLSA must consider Congress's remedial purpose, ” Keller v. Miri Microsystems LLC, 781 F.3d 799, 806 (6th Cir. 2015). The FLSA's definition of “‘[e]mployer' includes any person acting directly or indirectly in the interest of an employer in relation to an employee . . . .” 29 U.S.C. § 203(d).[3] In light of its remedial purpose, the FLSA defines “‘employer' more broadly than the term would be interpreted in traditional common law applications.” Dole v. Elliott Travel & Tours, Inc., 942 F.2d 962, 965 (6th Cir. 1991) (quoting McLaughlin v. Seafood, Inc., 867 F.2d 875, 877 (5th Cir. 1989) (per curiam)).

         A. Joint Employment Standards Under the FLSA

         A single individual may be employed by multiple employers at the same time. Department of Labor (“DOL”) regulation 29 C.F.R. § 791.2 distinguishes between “separate and distinct employment, ” in which “two or more employers are acting entirely independently of each other and are completely disassociated with respect to the employment of a particular employee, ” and “joint employment, ” in which “employment by one employer is not completely disassociated from employment by the other employer(s).” 29 C.F.R. § 791.2(a). If a worker is found to be “jointly employed by two entities, each of [them] is responsible for complying with the FLSA.” Skills Dev. Servs., Inc. v. Donovan, 728 F.2d 294, 300 (6th Cir. 1984). Whether joint employment exists “depends upon all the facts in the particular case.” 29 C.F.R. § 791.2(a). Section 791.2 provides three situations “where a joint employment relationship generally will be considered to exist”:

(1) Where there is an arrangement between the employers to share the employee's services, as, for example, to interchange employees; or
(2) Where one employer is acting directly or indirectly in the interest of the other employer (or employers) in relation to the employee; or
(3) Where the employers are not completely disassociated with respect to the employment of a particular employee and may be deemed to share control of the employee, directly or indirectly, by reason of the fact that one employer controls, is ...

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