17‐3356‐cv Gamero. v. Koodo Sushi Corp.

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURTʹS LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION ʺSUMMARY ORDERʺ). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 18th day of October, two thousand eighteen.

PRESENT: DENNY CHIN, RAYMOND J. LOHIER, JR., Circuit Judges, JOHN F. KEENAN, District Judge.* ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐x ISRAEL GAMERO, NORBERTO MASTRANZO, OSCAR SANCHEZ, Individually, on behalf of others similarly situated, Plaintiffs‐Appellants,

v. 17‐3356‐cv

KOODO SUSHI CORP., DBA Koodo Sushi, MICHELLE KOO, Defendants‐Appellees,

RAYMOND KOO, Defendant. ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐x

* Judge John F. Keenan, of the United States District Court for the Southern District of New York, sitting by designation.

FOR PLAINTIFFS‐APPELLANTS: SHAWN R. CLARK, Michael Faillace & Associates, P.C., New York, New York.

FOR DEFENDANTS‐APPELLEES: THOMAS J. GIBLIN (Roman Martinez, Richard D. Owens, Serrin A. Turner, Eric L. Taffet, M. Theodore Takougang, on the brief), Latham & Watkins LLP, New York, New York, and Washington, DC.

Appeal from the United States District Court for the Southern District of

New York (Failla, J.).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED, AND DECREED that the judgment of the district court is AFFIRMED.

Plaintiffs‐appellants Israel Gamero, Norberto Mastranzo, and Oscar

Sanchez, individually and on behalf of others similarly situated (ʺPlaintiffsʺ), appeal

from a September 29, 2017, judgment against defendants‐appellants Koodo Sushi Corp.,

DBA Koodo Sushi, and Michelle Koo (ʺDefendantsʺ) and defendant Raymond Koo for

violations of the Fair Labor Standards Act (ʺFLSAʺ) and New York Labor Law

(ʺNYLLʺ). Although Plaintiffs prevailed on their claims against Defendants, they

challenge the amount of damages they were awarded by the district court. We assume

the partiesʹ familiarity with the underlying facts, procedural history, and issues on

appeal.

Plaintiffs were each employed in various roles at Koodo Sushi, a

Manhattan restaurant serving Chinese, Japanese, and Thai food, for different but

overlapping periods between 2009 and 2015. In 2015, Plaintiffs brought this suit against

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Defendants alleging wage‐and‐hour and recordkeeping violations under the FLSA and

NYLL. After a three‐day bench trial, the district court made detailed findings of fact

and conclusions of law in a 62‐page opinion, holding that Plaintiffs were at least

partially entitled to relief on seven of their nine causes of action and awarding damages

of $24,937.12 plus prejudgment interest. Gamero v. Koodo Sushi Corp.,

(S.D.N.Y. 2017).

While ultimately awarding damages, the district court awarded Plaintiffs

only a fraction of what they had sought, finding that Defendants largely complied with

the law.

(noting that ʺin the main . . . Koo paid Plaintiffs wages that satisfied

the FLSA and the NYLLʺ). Moreover, the district court noted that Koo, who ran the

restaurant on a day‐to‐day basis, was the ʺmost credible witness at trialʺ and ʺevinc[ed]

genuine concern for her employeesʹ well‐being.ʺ

. Indeed, the district court

concluded that ʺDefendantsʹ account of Plaintiffsʹ hours and wages was more credible

than the accounts Plaintiffs offered.ʺ

On October 13, 2017, Plaintiffs filed a letter

asking the district court to clarify its damages award and release to the parties the

district courtʹs calculations. The district court denied Plaintiffsʹ request. This appeal

followed.

ʺOn appeal from a judgment after a bench trial, we review the district

courtʹs findings of fact for clear error and its conclusions of law de novo. Mixed

questions of law and fact are also reviewed de novo.ʺ Roberts v. Royal Atl. Corp., 542

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F.3d 363, 367 (2d Cir. 2008). While ʺthe applicable damages measurementʺ is a legal

question that we review de novo, ʺthe amount of recoverable damages is a question of

fact,ʺ which we review for clear error. Bessemer Tr. Co. v. Branin,

(2d Cir.

2010) (internal quotation marks omitted).

Plaintiffs raise two arguments on appeal. First, Plaintiffs contend that

ʺ[t]he district courtʹs method of calculating damages fail[ed] to apply settled FLSA and

NYLL regulations and significantly undercompensates individuals who worked

overtime at regular rates higher than the minimum wage.ʺ Appellantsʹ Br. at 4.

Specifically, Plaintiffs argue that the district court committed legal error when it failed

to calculate Plaintiffʹs ʺregular rate of pay.ʺ Id. at 6. Second, although they were

awarded liquidated damages under the NYLL, Plaintiffs argue that they should have

been awarded liquidated damages under the FLSA as well.1

As to the first argument, Plaintiffsʹ assertion that the district court did not

calculate the ʺregular rateʺ of pay fails. The court did, implicitly if not explicitly, find

the regular rate of pay ‐‐ that is, the minimum wage.

1 Plaintiffs also contend that the district court erred by failing to account for ʺextraʺ discretionary compensation Sanchez and Mastranzo received for work outside normal hours or involving unusual tasks, such as fixing the floor. This argument, however, has been waived, as Plaintiffs raise it for the first time on appeal. See Askins v. Doe No. 1,

(2d Cir. 2013) (holding that plaintiff ʺwaived the arguments he advances on appeal by failing to raise them in the trial courtʺ).

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When calculating damages in wage‐and‐hours cases, the starting point is

the employeeʹs ʺregular rateʺ of pay, see

, which is the hourly rate

when ʺthe employee is employed on the basis of a single hourly rate.ʺ

(a); see also 12 N.Y.C.R.R. § 142‐2.16 (ʺThe term regular rate shall mean the

amount that the employee is regularly paid for each hour of work.ʺ (emphasis in

original)). The ʺregular rateʺ is important for calculating damages, including overtime

pay, which is one and a half times the ʺregular rate.ʺ See

(a)(1); 12

N.Y.C.R.R. § 142‐2.2; 12 N.Y.C.R.R. § 146‐1.4.

It is true that the opinion and order of the district court speaks mostly in

terms of how much Plaintiffs were owed per week. See, e.g., Gamero,

(ʺSanchez was owed . . . $340.49 per week during his first month at Koodo Sushi.ʺ).

In adopting Defendantsʹ proposed findings of fact and conclusions of the law, however,

the district court based its calculations on a per hour ʺregular rateʺ of pay.

For both Sanchez and Mastranzo, the district court began its calculation

with the findings of facts and conclusions of law proposed by Defendants.

at 506‐07.

Defendantsʹ calculations began from a regular hourly rate of the minimum wage, which

was then adjusted, including for weekly overtime hours. Accordingly, the district court

found that the ʺregular rate of payʺ as to Sanchez and Mastranzo was the minimum

wage.

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The district court then calculated the average weekly pay based on the

evidence presented of time worked and compared that to what Sanchez and Mastranzo

were actually paid.

Except where Defendantsʹ records established that a Plaintiff

worked less than 50 hours a week, the district court credited Plaintiff with a standard

50‐hour work week.

The district court explained its methodology but did not set

forth its exact calculations. This sort of approximation is acceptable where there is

insufficient evidence to make more specific findings. See Kuebel v. Black & Decker Inc.,

(2d Cir. 2011).

As to Gamero, the district court was explicit in its finding of a ʺregular

rateʺ of pay of $5.00 an hour. Gamero,

(ʺAll of these Seamless

delivery reports confirmed that Koo paid Gamero $5.00 per hour . . . .ʺ); see

(noting that the $5.00 rate was ʺthe minimum wage minus tip and meal credits, plus a

ʹcushionʹʺ). The district court found that Gamero was paid $65 a week on average.

.2 Using this weekly average, the district court aggregated what Gamero was paid

throughout his employment and calculated the difference between that figure and what

the NYLL required Gamero to be paid from late November 2012 through the end of

April 2015, less one year of damages because Gamero did not work at Koodo Sushi for a

whole year.

2 Gamero was a delivery person who worked part time. Gamero,

. Accordingly, he received damages for improper tip and meal credit deductions, but not for any overtime pay.

.

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Alternatively, Plaintiffs contend that even if the district court did calculate

the ʺregular rate,ʺ it erred by calculating Sanchezʹs ʺregular rateʺ using the minimum

wage despite the district courtʹs finding that Sanchez received periodic raises, topping

out at $9.00 an hour. Where a plaintiff alleges minimum wage and overtime pay

violations, and the employer does not have complete records, as was the case here, the

plaintiff bears the burden of proving that he performed work for which he was

insufficiently compensated, and of producing sufficient, credible evidence showing the

amount and extent of the uncompensated work as a matter of just and reasonable

inference. See Anderson v. Mt. Clemens Pottery Co.,

(1946). When an

employee has offered evidence to permit an inference of improper compensation and

the employer cannot come forward with evidence of the precise amount of work

performed, the court may award damages, even if they are approximate. Reich v. S.

New Eng. Telecomms. Corp.,

, 69 (2d Cir. 1997).

Here the district court found that Plaintiffs made a minimally sufficient

showing of violations, but that their testimony regarding their wages was inconsistent

and not credible. The district court did find that Sanchez received periodic raises,

which at some point rose to $9.00 an hour, but Plaintiffs failed to introduce sufficient

evidence of when or for how long Sanchez was paid more than the minimum wage.

Plaintiffs failed to prove that Sanchezʹs raises did not simply approximate New Yorkʹs

minimum wage, which was raised from $7.25 to $8.00 an hour in December 2013 and

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raised again to $8.75 an hour in December 2014. NYLL § 652. Given the lack of records

demarcating when Sanchez received raises, and that it was Plaintiffsʹ burden to produce

sufficient evidence, the district courtʹs approximation of Sanchezʹs regular rate of pay as

the minimum wage was not error. See Anderson,

; Kuebel,

.

Second, Plaintiffs argue that the district court erred in declining to award

liquidated damages under both the FLSA and NYLL. Recent decisions of this Court,

issued after Plaintiffs had filed their brief in this appeal, foreclose this argument. See

Rana v. Islam,

(2d Cir. 2018) (per curiam) (ʺWe therefore interpret the

NYLL and FLSA as not allowing duplicative liquidated damages for the same course of

conduct.ʺ). Rana adopted the conclusion of an earlier summary order discussed by

Plaintiffs. See Appellantsʹ Br. At 11 (citing Chowdhury v. Hamza Express Food Corp., 666 F.

Appʹx 59, 61 (2d Cir. 2016) (summary order)); Catzin v. Thank You & Good Luck Corp.,

(2d Cir. 2018) (noting that the conclusion presented by Chowdhury ʺwas later

adopted as the law of the Circuit in an opinionʺ).

We have considered all of Plaintiffsʹ remaining arguments and find them

to be without merit. Accordingly, we AFFIRM the judgment of the district court.

FOR THE COURT: Catherine OʹHagan Wolfe, Clerk

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