Camara v. Mastro's Rests. LLC
Camara v. Mastro's Rests. LLC
Opinion of the Court
From 2015 to 2017, Plaintiff Koly Camara worked as a server at Defendant Mastro's Steakhouse here in Washington. He subsequently brought this lawsuit, alleging that the company's manner of paying its servers violated the Fair Labor Standards Act and the D.C. Minimum Wage Revision Act. His allegations focus on Defendant's use of a so-called "tip credit" - a method of compensation in which an employer pays its employees a base wage below the minimum level set by law; this is permissible so long as the employees' tips ultimately bring their wages up to the minimum. Here, however, Plaintiff claims that Mastro's violated the law by employing a tip-credit system while requiring servers to share tips with employees - e.g. , wine runners and baristas - who did not "customarily and regularly receive tips."
I. Background
The Court starts by describing the legal framework that applies to Plaintiff's lawsuit and then explains the factual and procedural background of this case.
A. Legal Background
For a good while now, federal and local law have required employers to pay their employees a minimum wage. See Fair Labor Standards Act of 1938 § 6,
These laws make special provision for "tipped employees" - viz. , employees who "customarily and regularly receive more than $30 a month in tips."
An employer may only avail itself of the tip credit if it informs its employees of the arrangement and allows them to retain all of their tips, except that an employer may require employees to pool their tips with other employees who "customarily and regularly receive tips." See
B. Factual Background
Given the stage of the proceedings, the Court recites the facts in the light most favorable to Plaintiff. See Aliron Int'l, Inc. v. Cherokee Nation Indus., Inc.,
Plaintiff worked as a server at Mastro's in D.C. from the summer of 2015 to November 2017. See ECF No. 1 (Compl.), ¶ 16. During his time there, the company compensated Camara and other servers like him using a tip credit, paying them a base hourly wage below the federal minimum with servers' tips credited against the remainder of the minimum. Id., ¶¶ 17-18. At the same time, Mastro's required servers to pool more than 40% of their tips with other employees like wine runners, food runners, and baristas. Id., ¶ 19. Certain of those employees, according to Plaintiff, did not regularly and customarily interact with customers. Id., ¶¶ 20-23. Wine runners, for instance, "spend almost all their time working in or near the restaurant's wine cellar and have little to no interaction with restaurant customers." Id., ¶ 21. And baristas "spend almost all their time working in or near the kitchen and have no interaction with restaurant customers." Id., ¶ 23. (Defendant disputes Plaintiff's allegations about wine runners and baristas, see ECF No. 18 (Def. Opp.), Exh. A (Declarations), but its disagreements are left for another day in light of the posture of the case.)
C. Procedural Background
Plaintiff filed this lawsuit against Mastro's on May 25, 2018. See Compl. He alleges that it violated the FLSA and the DCMWRA when it paid servers using a tip *51credit while requiring them to share tips with some employees who do not ordinarily receive tips. Id., ¶¶ 40-42, 48. Although not at issue in these Motions, Camara also appears to argue that Mastro's violated the DCMWRA by failing to pay him for overtime work and the D.C. Wage Payment and Wage Collection Law for similar reasons. Id., ¶¶ 28-29, 47, 50-57.
Both parties now seek the Court's intervention. Defendant has filed a Motion to Compel Arbitration and for Dismissal. See ECF No. 17. It asserts that Plaintiff previously signed a binding arbitration agreement and that the Court should therefore compel arbitration and dismiss the case. Id. Plaintiff has simultaneously filed a Motion for Notice to Similarly Situated Persons, which the Court refers to as a Motion for Conditional Certification of a Collective Action. See ECF No. 14. Based on his factual allegations and declarations from servers at other Mastro's locations around the country, he asks the Court to certify under the FLSA and DCMWRA (limited to D.C. servers) a collective action of "[a]ll employees who worked as servers and received an hourly wage less than $7.25 an hour at any Mastro's location in the United States from May 22, 2015 to the present." ECF No. 21 (Pl. Reply) at 2 (emphasis omitted).
II. Analysis
As a threshold issue, the parties debate which Motion the Court should address first. Defendant insists that it should start with the Motion to Compel Arbitration because its resolution could moot Plaintiff's Motion. See Def. Mot. at 10-12. Plaintiff rejoins that the Court should rule first on its Motion for Conditional Certification. See Pl. Reply. at 5. Since the Court denies Defendant's Motion, it does not matter in which order the issues are addressed. In any event, the Court believes it simpler to begin with arbitration before moving on to conditional certification.
A. Arbitration
Defendant asks the Court to compel arbitration under the Federal Arbitration Act and dismiss the case. The Court starts with the applicable legal standard and then turns to the merits.
1. Legal Standard
The Federal Arbitration Act provides that certain arbitration agreements are "valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract."
The Act comes into play, however, only when there is an enforceable arbitration agreement.
In undertaking that inquiry, "the appropriate standard of review for the district court is the same standard used in resolving summary judgment motions pursuant to Fed. R. Civ. P. 56(c)." Brown v. Dorsey & Whitney, LLP,
A brief refresher on the Rule 56 standard. A fact is "material" if it is capable of affecting the substantive outcome of the litigation. See Holcomb v. Powell,
2. Analysis
The central question for the Court is whether Plaintiff agreed to be bound by the arbitration agreement Defendant attaches to its Motion or one substantially identical to it. See Def. Mot., Exh. A (Arbitration Agreement). The parties agree that this question is governed by D.C. contract law and resolved under the summary-judgment standard discussed above. But that's about all they agree on. Mastro's insists that Plaintiff assented to the arbitration agreement, even though it cannot produce a document bearing his signature. See Def. Mot. at 6-10. Plaintiff, on the other hand, attests that he never saw the agreement, never signed it, and never otherwise agreed to arbitrate any disputes he might have with Mastro's. See ECF No. 23 (Pl. Opp.), Exh. 1 (Declaration of Koly Camara), ¶ 3.
The Court starts by considering whether Mastro's has met its initial burden of showing that Camara assented to an arbitration agreement. Finding that to be the case, the Court then considers whether Plaintiff has offered evidence creating a genuine dispute of material fact as to the issue of his agreement. Concluding that he has, the Court need not consider his back-up argument that any agreement is unenforceable as a matter of D.C. law.
a. Defendant's Evidence
Mastro's musters the following evidence that Plaintiff agreed to pursue any claims against it only in arbitration. First, it declares that since June 2015, "it has been Defendant's policy to require all employees to execute" arbitration agreements like the *53one attached to its Motion. See Def. Mot., Exh. B (First Declaration of Laura Jasso), ¶ 4. Consistent with that policy, it says that "virtually every Washington, D.C. Mastro's employee has signed an individual Arbitration Agreement." Def. Mot., Attach. 1 (Declaration of Stephen Carcamo), ¶ 3. Mastro's reasons that, because it required employees to sign such agreements and most employees did sign such agreements, Plaintiff must also have signed one. See Def. Mot. at 4, 7. Second, Mastro's internal database that tracks compliance with the company's arbitration policy shows that Plaintiff signed an arbitration agreement. See First Jasso Decl., ¶ 7. Third, Mastro's suggests that Camara impliedly agreed to arbitration by continuing to work at the restaurant after the arbitration program was rolled out. See ECF No. 25 (Def. Reply) at 3-8.
This evidence satisfies Defendant's initial burden of showing that Plaintiff assented to an arbitration agreement. Taken together, the company's general arbitration policy and its internal data could lead a reasonable jury to find that he agreed to arbitrate disputes with Mastro's. The burden thus shifts to Camara to show a genuine dispute of material fact.
b. Plaintiff's Evidence
Camara contests Defendant's position on each front, contending that he never expressly or impliedly agreed to arbitrate disputes with Mastro's. As to the question of express agreement, he declares under penalty of perjury that he "did not see [the arbitration] agreement when [he] worked at Mastro's, did not sign it, and [ ] never agreed to its terms." Camara Decl., ¶ 3. Even though it has found and produced arbitration agreements signed by other employees, see Def. Reply, Exhs. A & B, Mastro's has been unable to locate any for Camara. See Carcamo Decl., ¶ 8. Neither has it offered evidence of any specific communication between the restaurant and Plaintiff concerning the agreement.
This is a prototypical dispute of fact. On the one side is Camara's sworn statement that he never saw, signed, or otherwise assented to an arbitration agreement. On the other is Mastro's general arbitration policy and the notation by an unnamed manager in an internal database. And that dispute is material insofar as it determines whether the parties had a meeting of the minds as to an arbitration agreement.
Defendant's only possible rejoinder is that the dispute is not genuine- i.e. , that no reasonable jury could side with Camara on this question. See Def. Reply at 6. In that vein, the company states that Camara fails to "support his assertions with 'affidavits, declarations, or other competent evidence.' "
Yet Defendant also maintains that Camara impliedly agreed to arbitration. In support of this position, the steakhouse looks to the Supreme Court's recent decision in Epic Systems Corp. v. Lewis, --- U.S. ----,
To start, Epic did not decide any question about the formation of arbitration agreements by implied assent. It is true that Justice Ginsburg noted in dissent her concern that the arbitration agreement in one of the underlying cases was not properly formed because it was not bilateral. See
Even if Mastro's were right that Epic made new law on what constitutes an arbitration agreement, that decision would offer little aid. In Epic, as mentioned, the plaintiff received an email telling him that if he continued working there, he would be deemed to have accepted an arbitration agreement. No such email apparently exists in this case, nor is it clear that a comparable message could have been sent, since Camara may have begun working for Mastro's contemporaneously with the rollout of the arbitration policy. The upshot: Mastro's offers no evidence that Plaintiff was aware of the arbitration agreement, and Camara avers that he was not. Implied assent would come into play only if the employee were aware (or, at a minimum, constructively aware) that his continued employment would have as a consequence an agreement to arbitrate. See Restatement (Second) of Contracts § 19(2) (1981) ("The conduct of a party is not effective as a manifestation of his assent unless he intends to engage in the conduct and knows or has reason to know that the other party may infer from his conduct that he assents."); Nicosia v. Amazon.com, Inc.,
One final note of caution to Defendant on this issue. In its Reply Brief, the company makes the following statement:
Here, Plaintiff agreed to submit his claims to arbitration because he saw the "agreement when [he] worked at Mastro's," signed it, and had "reason to believe," that he agreed to arbitrate any claims through his continued employment with Mastro's. (See Pl.'s Br. (ECF No. 23) at 3.)
*55Def. Reply at 4. The statement quotes Plaintiff's brief to suggest that he saw and signed the arbitration agreement. Yet the quoted sections of Plaintiff's brief say precisely the opposite. See Pl. Opp. at 3 (emphasizing that plaintiff "did not see that agreement" and "did not sign it") (quoting Camara Decl., ¶ 3). Parties must be careful not to misrepresent the assertions and arguments of their opponent, particularly on such a fundamental point. The Court trusts such errors will not recur.
* * *
As there is a genuine dispute of material fact over whether Plaintiff agreed to pursue all claims against Mastro's through arbitration, the Court will deny the Motion to Compel Arbitration. In doing so, it notes that Defendant has also challenged on similar grounds the presence in this case of other servers who have filed notices to become party Plaintiffs. See ECF No. 28 (Def. Surreply). Since the action will continue with Camara as named Plaintiff and given that briefing has hardly been had as to the new party Plaintiffs, the Court will not address at this point whether those other servers must go to arbitration. Defendant can raise the matter down the road.
B. Conditional Certification
Not satisfied with suing only for his own benefit, Plaintiff also seeks to litigate his Fair Labor Standards Act and D.C. Minimum Wage Revision Act claims on behalf of others who are similarly situated. He thus moves the Court to enter an order providing notice of the action to "[a]ll employees who worked as servers and received an hourly wage less than $7.25 an hour at any Mastro's location in the United States from May 22, 2015 to the present." Pl. Reply at 2. The DCMWRA claim, needless to say, is restricted to servers in the District of Columbia.
1. Legal Standard
Employees who assert violations of the FLSA's and DCMWRA's minimum-wage provisions may bring actions on their own behalf and that of "other employees similarly situated" in a collective action. See
Although the D.C. Circuit has not yet spoken on the issue, "[c]ourts in this Circuit and others have settled on a two-stage inquiry for determining when a collective action is appropriate" under the FLSA. Dinkel v. MedStar Health, Inc.,
At the first stage, "the court mak[es] an initial determination to send notice to potential opt-in plaintiffs who may be 'similarly situated' to the named plaintiffs with respect to whether a FLSA violation has occurred." Myers v. Hertz Corp.,
*56Chase v. AIMCO Props., L.P.,
The bar for a plaintiff at the first stage of the process is not high. See, e.g., Morgan v. Family Dollar Stores, Inc.,
2. Analysis
The question of conditional certification in this case turns on whether Plaintiff is similarly situated to other Mastro's servers who were paid a base hourly wage below the federal minimum. The Court first addresses Camara's allegation on this point before turning to Defendant's arguments about the various differences between Plaintiff and other Mastro's servers. After explaining why it finds conditional certification appropriate, the Court last addresses a separate issue related to the scope of notice to putative Plaintiffs.
a. Plaintiff's Showing
Camara says that other servers are subject to the same unlawful employment practices he challenges in this case, and that they are thus similarly situated to him. In particular, he says that Mastro's *57maintained (1) "a common policy and practice of paying the hourly tipped minimum wage to servers"; (2) "a common policy and practice of requiring servers to put approximately 42-45% of the tips they received into a 'tip pool' to be shared with other employees including wine runners, food runners, bartenders, bussers, and baristas"; and (3) "a common policy and practice of certain participants in the tip pool not having customary and regular interaction with restaurant customers as part of their job duties." Pl. Mot. at 10. He backs those allegations up with sworn declarations from servers at a number of different Mastro's locations around the country. See, e.g., Pl. Mot., Attachs. 2-5 (Server Declarations). The Court finds, as a result, that Plaintiff has easily made the "modest factual showing sufficient to demonstrate that [named] and potential plaintiffs together were victims of a common policy or plan that violated the law." Chase,
b. Defendant's Objections
Defendant's principal objection to certification appears to be its position that it does not in fact maintain an unlawful tip pool. See Def. Opp. at 2-12 (taking issue with Plaintiff's factual allegations). It attaches to its Opposition numerous declarations of other Mastro's servers to that effect.
This argument and these declarations offer little meat. At the conditional-certification stage, district courts are advised to "refrain from resolving factual disputes and deciding matters going to the merits." Freeman v. MedStar Health Inc.,
Mastro's remaining briefing is somewhat scattershot, but it appears to identify three purported differences between Camara and other servers that preclude conditional certification, none of which the Court finds persuasive.
(i). It first suggests that Camara is not similarly situated with servers at Mastro's other restaurant locations. See Def. Opp. at 11, 16, 19. The only differences it points out, however, are (1) the percentage of servers' tips placed in the tip pool (from 40 to 50% depending on location), and (2) the level of interaction wine runners and baristas have with customers. Id. at 16-18. The first difference is immaterial to conditional certification and the second is illusory.
In asserting that the differences in the percentage of tips placed in the tip pool preclude certification, Mastro's forgets that Plaintiff needs "show only that [his] position[ ] [is] similar, not identical, to the positions held by the putative class members."
*58Grayson,
As to the interaction between wine runners and customers, Mastro's fixates on what it says are "gross" inconsistencies among three of Plaintiff's declarations that it says show that servers are not similarly situated. See Def. Opp. at 16-18. Here's what the declarations said: Pena, the New York server, averred that servers would retrieve wine from wine runners "at a meeting point outside of the view of customers." Id. at 17 (quoting Pena Decl., ¶ 4). Mary Still, a Chicago server, declared that servers obtain wine from wine runners at "a meeting point outside of the view of customers, such as near the point of sales system or the main bar." Id. (quoting Mary Still Decl., ¶ 4). Cory Warfield, also in Chicago, stated that servers get wine from wine runners at a "meeting point 'like the bar or the point of sales terminal.' " Id. at 18 (quoting Cory Warfield Decl., ¶ 5). Mastro's asserts that the declarations are inconsistent - e.g. , the bar is within the view of customers - and thus show that servers across locations are not similarly situated. See Def. Opp. at 17-18.
This argument is not ready to come of the grill. Even if the particular meeting point were different in New York from Chicago and D.C. and even if customers might see wine runners near the bar, that would be consistent with declarants' (and Plaintiff's) averment that wine runners in all locations did not regularly interact with customers. The declarations thus fully support Plaintiff's allegation that servers at Mastro's restaurants nationwide, like Camara in D.C., participate in a tip pool that includes employees who do not regularly interact with customers. More generally, Defendant's attacks on the servers' credibility are misdirected, for "the Court does not resolve factual disputes, decide substantive issues going to the ultimate merits or make credibility determinations" at this stage of the proceedings. Summa v. Hofstra Univ.,
Before moving on, it is worth noting what arguments Mastro's does not make about its different restaurant locations. The company does not maintain, for example, that its restaurants are independently run or that they maintain varying employment and personnel practices. Just the opposite. It describes all Mastro's restaurants as adhering to the same "approach to service," which focuses on using a team of employees to address customers' needs. See Def. Opp. at 4;
(ii). Defendant next asserts that Camara is not similarly situated to other servers who have signed arbitration agreements. The Court concludes that any difference among putative collective members *59as to arbitration agreements does not defeat the Motion.
The majority of district courts to have addressed the issue have determined that the fact that some employees "have signed arbitration agreements does not preclude conditional certification" as to all employees. See Maddy v. General Elec. Co.,
The Court is persuaded by the decisions of the majority of courts. At least in the circumstances of this case, in which the named Plaintiff has not signed an arbitration agreement and questions of fact remain about the existence and validity of other arbitration agreements, the Court will not prematurely limit the dissemination of notice. See Dinkel,
(iii). Finally, Mastro's suggests that individual factual determinations as to liability preclude conditional certification. See Def. Mot. at 12. The only individual factual determinations it mentions, though - apart from those already discussed - center around the duties of wine runners and baristas. Its concern in that respect is overdone. Because Plaintiff is a server and seeks only to represent other servers, variations among other Mastro's employees only matter to the extent they affect the restaurant's liability as to servers. And, variations among wine runners and baristas within one restaurant will not affect Mastro's liability as to servers under the FLSA and DCMWRA: If a single wine runner or barista does not regularly interact with customers but joins a location's tip pool, Mastro's will presumably have contravened the Acts. Neither do such intra-restaurant variations appear to matter for purposes of calculating damages, which do not depend on individual facts about non-tipped *60employees. See Montano v. Montrose Restaurant Assocs., Inc.,
While one might imagine that wine runners' and baristas' duties could vary among different restaurants, thus requiring factual determinations about Mastro's liability to servers by location, the Court has already explained why any such variations are illusory. See supra at 57-59. Indeed, the steakhouse has affirmed that it takes the same approach to service in all of its restaurants. See Second Jasso Decl., ¶ 6. Because Defendant fails to identify any other differences among servers that would require individual adjudication, the Court rejects its conclusory assertion that the need for individual factual determinations precludes conditional certification.
c. Notice
The only remaining issues concern the scope of notice to putative collective members.
First, Mastro's briefly asserts that notice should not issue to servers in all of its restaurants in the United States because it "does not own or operate all Mastro's restaurant locations in the United States." Def. Opp. at 9. It is not entirely clear what Defendant is arguing on this score. Insofar as Mastro's suggests that servers at certain restaurants are not "employed" by Defendant, such that it would not be liable for any FLSA or DCMWRA violations, such questions are properly addressed at the second stage of certification. See, e.g. Rivera v. Power Design, Inc.,
Second, Mastro's argues that it should not be required to disclose putative Plaintiffs' social-security numbers or phone numbers. See Def. Opp. at 26-27. When deciding whether to require disclosure of potential plaintiffs' information, courts balance "plaintiffs' need" for the information "against the privacy interests of the current and former employees." Gieseke v. First Horizon Home Loan,
The Court will therefore order notice of this action be provided consistent with this Opinion to "[a]ll employees who worked as servers and received an hourly wage less than $7.25 an hour at any Mastro's location in the United States from May 22, 2015 to the present." Pl. Reply at 2. In connection with this Notice, Defendant shall provide Plaintiff with the full names, telephone numbers, mailing addresses, email addresses, and employee IDs for all putative Plaintiffs. As both parties agree, the notice period shall be sixty days.
III. Conclusion
For the reasons given in this Opinion, the Court will deny Defendant's Motion to Compel Arbitration and grant Plaintiff's Motion for Conditional Certification of a Collective Action under the FLSA and DCMWRA. A separate Order so stating will issue this day.
Reference
- Full Case Name
- Koly CAMARA v. MASTRO'S RESTAURANTS LLC
- Cited By
- 8 cases
- Status
- Published