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Cox v. Gordmans Stores, Inc.

United States District Court, E.D. Missouri, Eastern Division

November 28, 2016

STEVE COX and SAMUEL R. MASON, individually and on behalf of a class of others similarly situated, Plaintiffs,
v.
GORDMANS STORES, INC., Defendant.

          MEMORANDUM AND ORDER

          RONNIE L. WHITE, UNITED STATES DISTRICT JUDGE

         This matter is before the Court on Plaintiffs' Motion for and Memorandum in Support of Conditional Collective Action Certification (ECF No. 40). This motion is fully briefed and ready for disposition.

         BACKGROUND

         Plaintiffs Steve Cox and Samuel R. Mason ("Plaintiffs") filed a Complaint on February 17, 2016, alleging claims for Violation of the Fair Labor Standards Act of 1938 ("FLSA"). (Complaint ("Compl."), ECF No. 1). Plaintiffs purport to bring this putative collective action on behalf of a class of Assistant Store Managers ("ASM") employees who worked for Defendant Gordmans Stores, Inc. ("Gordmans"). Plaintiffs allege that the ASM employees have been misclassified as "exempt" and denied payment of all of their earned wages and overtime compensation under the FLSA. (Compl., ¶3). Plaintiffs also allege that Gordmans failed to maintain accurate records regarding the hours worked by ASM employees. (Compl., ¶l 5).

         The plaintiffs include Named Plaintiffs Steve Cox and Samuel Mason (former ASM employees) and Opt-in Plaintiff Fallon Strack (a former Operations Assistant Store Manager ("OPS"). Plaintiffs claim that the principal job duty of Gordmans' ASM employee is customer service, including sales, merchandising, unloading the trucks, stocking, and inventory. (Compl., ¶9). Plaintiffs further assert that their primary duty is not the performance of work related to the management or general business operations of Gordmans or its customers. (Compl., ¶10). They contend that ASMs are not customarily or regularly engaged to perform exempt supervisory/managerial work, such as hiring, firing, disciplining, budgeting, and scheduling. (Compl., ¶11). Plaintiffs allege that ASMs' primary duties do not include the exercise of discretion an independent judgment with respect to matters of significance. (Compl., ¶12).

         DISCUSSION

          I. Motion for Conditional Class Certification

         A. Conditional Certification

         On August 15, 2016, Plaintiffs filed the instant Motion for and Memorandum in Support of Conditional Class Certification. (ECF No. 40). Plaintiffs identify the putative class as "All individuals employed by Gordmans Stores, Inc. as Assistant Store Managers, Assistant Store Manager Operations, or any Assistant Manager position, however variously titled, from February 18, 2013 through the present." (ECF No. 40-11). Gordmans operated between 93 and 103 stores in 16 states during the relevant time period. (ECF No. 44 at 7). Each store has between one and three assistant store managers, based upon sales volume. The putative class of OPS and ASM employees during the relevant time period is approximately 549 persons. (ECF No. 44 at 7).

         Gordmans opposes class certification. Gordmans claims that conditional class certification is improper because Plaintiffs have not demonstrated a common policy. Specifically, Gordmans contends that the proposed class of ASM employees and OPS employees have different job duties and training manuals and are not "similarly situated" for purposes of a proposed class. Gordmans claims that Plaintiffs conflate the two groups even though OPS employees have more managerial authority and paperwork duties. (ECF No. 44 at 3-5). Gordmans further states that ASM employees are not similarly situated to one another.

         Gordmans argues that, based upon the retail management regulations, retail management exceptions are necessarily a fact-sensitive inquiry and not appropriate for collective class actions. (ECF No. 44 at 7-8).[1] Gordmans claims that Plaintiffs' allegations rest on the proposition that "Gordmans deviated from their internal policies and stated job descriptions and forced Plaintiffs to perform duties primarily outside of said job descriptions." (ECF No. 44 at 8 (emphasis in original)). Gordmans contends that where Plaintiffs contend that their injury rises from a deviation from policy, then such claims involve individualized inquiries. (ECF No. 44 at 8-9 (citing Jost v. Commonwealth Land Title Ins. Co., No. 4:08CV734CDP, 2009 WL 211943, at *4 (E.D. Mo. Jan. 27, 2009); Garner v. Regis Corp., No. 03-5037-CV-SW-SWH, 2004 WL 5455905, at *2 (W.D. Mo. Aug. 5, 2004); Diaz v. Elecs. Boutique of Am., Inc., No. 04-CV-0840E(SR), 2005 WL 2654270, at *4 (W.D.N.Y.Oct. 17, 2005); Mike v. Safeco Ins. Co. of Am., 274 F.Supp.2d 216, 220-21 (D. Conn. 2003)). Gordmans notes that assistant managers do not receive the same training nationwide and that the duties of OPS and ASM employees vary widely, within the store and between stores. (ECF No. 44 at 9-10). Gordmans asserts that Plaintiffs have not sufficiently alleged that their job duties and experiences were similar to the job duties and experience of other ASM or OPS employees nationwide. (ECF No. 44 at 11-12). Finally, Gordmans contends that the time frame for identifying the proposed class is improper. Plaintiffs seek to certify a three year limitations period, which requires a showing of "willfulness." Gordmans states that Plaintiffs have not set forth any evidence beyond conclusory allegations in the Complaint that Gordmans acted "willfully" in violation of the FLSA. (ECF No. 44 at 13). In addition, Gordmans engaged in a corporate restructuring that became effective on July 24, 2016 that eliminated the ASM and OPS positions; therefore, Gordmans contends that the notice period for the proposed class should cease on July 24, 2016. (ECF No. 44 at 14-15).

         In response, Plaintiffs contend that their proposed class is proper based upon the lenient burden for conditional class certification. Plaintiffs cite to several corporate policies that uniformly apply to all Assistant Managers, regardless of title. (ECF No. 45 at 4). Plaintiffs notes that Gordmans uses same evaluation form used by Store Managers to evaluate Assistant Managers; Gordmans uses same evaluation criteria for all Assistant Managers; all Gordmans' Assistant Managers are paid on a biweekly schedule and on a salary basis; all Assistant Managers are paid pursuant to the Gordmans' compensation guidelines; Gordmans uses a standard application form and offer letter for all Assistant Managers; Gordmans provides all Store Managers the same "hiring toolkit" for hiring all Assistant Managers; and Gordmans uses the same software (Kronos) to track Assistant Mangers' Time off. (ECF No. 45 at 4). Plaintiffs contend that, based upon the overwhelming record demonstrating the similarly among all Assistant Mangers, then this Court should conditionally certify this as a class action. Plaintiffs maintain that the differences that Gordmans identifies are simply minor, inconsequential variations for purposes of conditional certification. Plaintiffs point out that Gordmans classifies all Assistant Managers as exempt based upon their singular classification as Assistant Managers, without any regard to their individual duties or other factors. (ECF No. 45 at 6). As a result, Plaintiffs claim that Gordmans cannot now claim that the positions should not be treated collectively for purposes of conditional certification. (ECF No. 45 at 6 (citing Nerland v. Caribou Coffee Co., 564 F.Supp.2d 1010, 1024 (D. Minn. 2007) ("The Court finds it disingenuous for Caribou, on one hand, to collectively and generally decide that all store managers are exempt from overtime compensation without any individualized inquiry, while on the other hand, claiming the plaintiffs cannot proceed collectively to challenge the exemption."). Plaintiffs also claim that Gordmans did not rebut the overwhelming evidence-consisting chiefly of Gordmans' own documents and admissions-that all Assistant Managers, regardless of title, are similarly situated. (ECF No. 45 at 6-7).

         Plaintiffs further maintain that Gordmans is attempting to litigate the merits of the exemption, which is improper at the conditional certification stage of litigation. (ECF No. 45 at 7-8). Similarly, Plaintiffs assert that Gordmans' claim that evaluation of the exemption defenses will require an individualized analysis and, therefore, must fail. In a footnote, Plaintiffs argue that if the subclasses are too distinct, then the Court can later create and certify two subclasses, one for each position. (ECF No. 45 at 7, n. 1 (citing Arnold v. Directv, LLC, No. 4:10-CV-352-JAR, 2016 WL 1258579, at *4 (E.D. Mo. Mar. 31, 2016)).

         Plaintiffs likewise assert that they have alleged a willful violation and the FLSA's three year statute of limitations should define the temporal scope of the collective action. Plaintiffs assert that they are not required at this step to provide any evidence of Gordmans' willfulness. (ECF No. 45 at 9). In the interests of judicial economy, Plaintiffs maintain that the class should extend the time period of the proposed class back from the filing of the Complaint. (ECF No. 45 at 9-1).

         Section 7 of the FLSA mandates that an employer may not subject non-exempt employees to a work week in excess of forty hours, unless the employee is compensated for his or her overtime with additional pay of at least one and one-half times his or her regular hourly wage. 29 U.S.C. § 207. A collective action under the FLSA to recover overtime compensation and liquidated damages may be maintained, "by any one or more employees for and in behalf of himself or themselves and other employees similarly situated." 29 U.S.C. § 216(b). Unlike a Rule 23 class action, a collective action under the FLSA is pursued on an opt-in basis, requiring employees to provide their consent in writing to join the action. 29 U.S.C. § 216(b); Ford v. Townsends of Ark., Inc., No. 4:08CV00509BSM, 2010 WL 1433455, at *3 (E.D. Ark. Apr. 9, 2010).

         District courts within the Eighth Circuit conduct a two-step analysis to determine whether employees are "similarly situated." Beasley v. GC Services LP, 270 F.R.D. 442, 444 (E.D. Mo. 2010); Littlefield v. Dealer Warranty Services, LLC,679 F.Supp.2d 1014, 1016 (E.D. Mo. 2010); Ford, 2010 WL 1433455, at *3. "Under this two-step process, the plaintiff first moves for class certification for notice purposes." Dernovish v. AT&T Operations, Inc., No. 09-0015CVWODS, 2010 WL 143692, at * 1 (W.D. Mo. Jan. 12, 2010)(internal quotations and citation omitted). "The plaintiffs motion for certification is typically filed at an early stage of the litigation thus requiring a lenient evaluation standard and typically resulting in conditional certification of a representative class." Kautsch v. Premier Communications,504 F.Supp.2d 685, 688 (W.D. Mo. 2007) (citations omitted). The Court does not reach the merits of the ...


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