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Jones v. Henry Industries, Inc.

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

February 8, 2017

SYLVESTER JONES, Plaintiff,
v.
HENRY INDUSTRIES, INC., Defendant,

          MEMORANDUM AND ORDER

          STEPHEN N. LIMBAUGH, JR. UNITED STATES DISTRICT JUDGE.

         Plaintiff Sylvester Jones filed this action against defendant Henry Industries, Inc. (“Henry”) alleging wrongful termination under Missouri common law and that defendant retaliated against plaintiff in violation of the Fair Labor Standards Act, 29 U.S.C § 215(a)(3) (“FLSA”). Defendant counterclaimed, seeking a determination that plaintiff was an independent contractor and seeking indemnification from plaintiff for breach of contract. Plaintiff moved to dismiss those counterclaims on October 4, 2016 (#12).

         I. Background

         Henry is a third party logistics company that arranges for a variety of pickup and delivery services for customers across the country. Henry alleges that it does not itself provide the courier services to its customers, but rather Henry enters into “Cartage Contracts” with purported independent contractors to provide the courier services. Jones entered into one of those Cartage Contracts with Henry to provide such services. Section 7 of the Cartage Contract provides

         INDEMNITY. CONTRACTOR AGREES TO INDEMNIFY, HOLD HARMLESS, AND AT [HENRY'S] OPTION, DEFEND [HENRY] AND ITS AFFILIATES…FROM ALL LIABILITIES, DAMAGES, FEES, FINES, PENALTIES, AND CLAIMS OF ANY KIND, COSTS OF SUIT, SETTLEMENTS, JUDGEMENTS, AND ANY OTHER EXPENSE (INCLUDING ATTORNEYS' FEES) TO WHICH ANY OF THE INDEMNIFIED PARTIES MAY BE SUBJECTED, ARISING OUT OF OR IN CONNECTION WITH…ANY ACTION…INITIATED BY OR ON BEHALF OF ANY CONTRACTOR OR CONTRACTOR WORKER BASED ON A THEORY THAT ANY OF THE INDEMNIFIED PARTIES IS AN EMPLOYER OR JOINT EMPLOYER OF ANY SUCH CONTRACTOR.

         In 2014, Jones joined a collective action brought against Henry by his coworker James Hose. That collective action was brought under the FLSA, alleged that Henry was wrongfully classifying its employees as independent contractors, and sought compensation for unpaid overtime wages. Later that year, Henry terminated Jones's employment. Plaintiff Jones then filed the instant lawsuit against Henry, claiming that Henry had terminated Jones in retaliation for asserting his legal rights under the FLSA and related Missouri wage and hour laws.

         In response, Henry filed two counterclaims against Jones based the Cartage Contract to which Henry and Jones are parties. Henry claims that the FLSA does not apply to independent contractors and so does not provide the protection Jones seeks. Henry thus seeks, in Count I, a declaratory judgment stating Jones is an independent contractor not entitled to relief under the FLSA. In Count II, Henry seeks indemnification from Jones under the Cartage Contract for filing a lawsuit under the FLSA. Henry contends Jones is in breach of the Cartage Contract for having filed this lawsuit and other lawsuits currently pending in the United States District Court for the District of Kansas[1] and Circuit Court for St. Louis County, Missouri.

         Jones has moved to dismiss the counterclaim under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) and has moved to strike under Rule 12(f).

         II. Legal Standard

         Federal Rule of Civil Procedure 12(b)(1) provides a party may move to dismiss a claim based on a lack of subject matter jurisdiction. The purpose of a Rule 12(b)(1) motion is to allow the Court to address the threshold question of jurisdiction, as “because jurisdiction is a threshold question, judicial economy demands that the issue be decided at the outset rather than deferring it until trial.” Osborn v. United States, 918 F.2d 724, 729 (8th Cir. 1990). The burden of proving subject matter jurisdiction rests on the counterclaim plaintiff. Riley v. United States, 486 F.3d 1030, 1032 (8th Cir. 2007).

         The purpose of a Rule 12(b)(6) motion to dismiss for failure to state a claim is to test the legal sufficiency of a complaint so as to eliminate those actions “which are fatally flawed in their legal premises and deigned to fail, thereby sparing litigants the burden of unnecessary pretrial and trial activity.” Young v. City of St. Charles, 244 F.3d 623, 627 (8th Cir. 2001) (citing Neitzke v. Williams, 490 U.S. 319, 326-27 (1989)). “To survive a motion to dismiss, a claim must be facially plausible, meaning that the ‘factual content. . . allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'” Cole v. Homier Dist. Co., Inc., 599 F.3d 856, 861 (8th Cir. 2010)(quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). The Court must “accept the allegations contained in the complaint as true and draw all reasonable inferences in favor of the nonmoving party.” Id. (quoting Coons v. Mineta, 410 F.3d 1036, 1039 (8th Cir. 2005)). However, “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, ” will not pass muster. Iqbal, 556 U.S. at 678.

         Rule 12(f) allows that the Court may “strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” “Because such relief is an extreme measure, however, motions under Rule 12(f) are viewed with disfavor in the Eighth Circuit and are infrequently granted.” E.E.O.C. v. Prod. Fabricators, Inc., 873 F.Supp.2d 1093, 1097 (D. Minn. 2012) (internal quotations omitted) (citing Stanbury Law Firm, P.A. v. Internal Revenue Serv., 221 F.3d 1059, 1063 (8th Cir. 2000); Daigle v. Ford Motor Co., 713 F.Supp.2d 822, 830 (D. Minn. 2010)). A motion to strike should be granted “if the result is to make a trial less complicated or otherwise streamline the ultimate resolution of the action.” Daigle, 713 F.Supp.2d at 830.

         III. Discussion

         Jones contends that Henry's indemnification counterclaim (1) is permissive and thus fails for lack of subject matter jurisdiction, (2) fails for lack of subject matter jurisdiction because it is not ripe, (3) fails to state a claim and for lack of subject matter jurisdiction due to preemption with the FLSA, and (4) fails to state a claim because the Cartage Agreement is unenforceable. He further contends that ...


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