United States District Court, W.D. Missouri, Western Division
EDWARD C. HUGLER, Acting Secretary of Labor, United States Department of Labor, Plaintiff,
LEGEND OF ASIA, LLC, TONG LIN, and YU MIN XIAO, Defendants.
ORDER ON PLAINTIFF'S MOTION FOR PARTIAL SUMMARY
JUDGMENT AND PLAINTIFF'S MOTION TO EXCLUDE EXPERT
KAYS, CHIEF JUDGE
Edward Hugler, Acting Secretary of Labor, United States
Department of Labor, filed suit against Legend of Asia, LLC
(“Legend of Asia”), its owner, Tong Lin
(“Lin”), and her husband, Yu Min Xiao
(“Xiao”) for violations of the minimum wage,
overtime, and recordkeeping provisions of the Fair Labor
Standards Act (“FLSA”), 29 U.S.C. § 201
et seq. The alleged minimum wage and overtime
violations primarily stem from Legend of Asia's
arrangement to pay some workers with a combination of a
“salary” and meals and lodging. The alleged
recordkeeping violations are the result of a flood that
destroyed many of Defendants' business records.
before the Court is Plaintiff's Motion for Partial
Summary Judgment (Doc 34) and Motion to Exclude Expert
Testimony of Defendants' Expert Witness (Doc.
For the reasons set forth below, the Court GRANTS IN PART and
DENIES IN PART Plaintiff's Motion for Partial Summary
Judgment (Doc. 34), and DENIES AS MOOT Plaintiff's Motion
to Exclude Expert Testimony of Defendant's Expert Witness
Material Facts 
of Asia is a buffet-style Chinese restaurant that opened in
2011. Xiao is the manager of Legend of Asia. His primary
responsibilities are hiring, firing, training, and
supervising employees, setting the rate of pay for each
employee, and processing payroll.
the sole owner of Legend of Asia and works at the restaurant
as an assistant manager. Lin is at the restaurant nearly
every day and is primarily responsible for scheduling hosts,
working as a hostess, monitoring the cleanliness of the
dining room, opening and closing the register, and
occasionally resolving customer complaints. While she has no
set work schedule, she is generally at the restaurant during
the busier lunch and dinner times as well as at opening and
closing times. Lin denies she has any responsibility for
paying employees, however her signature appears on at least
four payroll checks issued to servers. When Xiao is not at
the restaurant, Lin acts as the substitute manager by
supervising the server employees and handling customer
and Lin do not speak, read, or understand the English
language proficiently. They often rely on their son to
translate English for them. Even so, their contracts with
their employees and rental agreements, discussed later, are
all written in English.
categories of workers are subject to this motion,
“Hispanic kitchen employees, ” “Chinese
kitchen employees, ” and “server
employees.” As pertinent to this motion, the
allegations of FLSA violations for the kitchen employees
involve the arrangement to pay kitchen employees with a
combination of cash wages and meals, lodging, and
transportation. Regarding the server employees, the
allegations of FLSA violations concern proper recordkeeping.
for kitchen employees is governed by a “Restaurant
Salary Contract” which is a template-type form stating
a monthly wage amount, that the wage is paid part in cash and
part in rent and meals, and that the agreement covers a
sixty-hour workweek. See (Doc. 35-17). Each month
the kitchen employees are paid the cash portion of their
wages and are given a payment receipt, which they sign to
acknowledge the cash wages received.
to the terms of the Restaurant Salary Contract, kitchen
employees are provided housing as part of their wages.
Employee housing occurs at two locations: 3707 SE Adams Drive
(“Adams Drive”); and 1801 SW 8th Street
(“8th Street”). Both Lin and Xiao co-own the
Adams Drive property and Legend of Asia rents the building
for use as employer-provided housing. Legend of Asia also
leases the four apartments at 8th Street from Chang Zhao, the
restaurant's kitchen manager, for employer-provided
housing. Lin's signature appears on both rental
agreements on behalf of Legend of Asia.
addition to meals and lodging, Legend of Asia provides
transportation to and from the restaurant for the employees
who reside at the 8th Street location.
of Asia pays its server employees monthly through a payroll
process. Two servers hired on a probationary basis quit after
only a week on the job. These two servers refused to provide
their personal information to Xiao, and therefore they could
not be added to the payroll records.
August 2014, the United States Department of Labor
(“DOL”) began investigating Legend of Asia for
compliance with the FLSA. The investigation period covered
September 3, 2012, to July 31, 2015.
to the investigation by the DOL, Legend of Asia maintained a
record of the start and stop time for employees in a paper
notebook. These records, along with time sheets, employee
schedules, and payroll records, were stored in the basement
of Lin and Xiao's personal residence. On three separate
occasions in 2013, 2014, and 2015, Lin and Xiao's
basement flooded. These floods destroyed much of the business
records for the time periods subject to the DOL
the investigation, the DOL investigator, Yolanda Blancarte
(“Blancarte”), requested pay and time records
from Legend of Asia including the hours worked and the
additions and deductions to wages for overtime, housing, and
meals for the kitchen employees and hours worked for the
server employees. Lin and Xiao provided some records but were
unable to provide all the records requested because most of
the relevant records were destroyed in the basement floods.
in 2015, based on Blancarte's recommendation, Defendants
implemented an electronic time clock to capture employee
start and stop time for each workday rather than the paper
notebooks previously used.
response to this litigation, Legend of Asia hired accountant
Melanie Bacon, CPA (“Bacon”), to summarize Legend
of Asia's business records and calculate the reasonable cost
of the meals, lodging, and transportation provided to kitchen
employees on a workweek basis.
January 14, 2015, Xiao signed a Statute of Limitations
Tolling Agreement (“Tolling Agreement”) tolling
the statute of limitations for claims subject to this lawsuit
beginning on August 31, 2014.
moving party is entitled to summary judgment “if the
pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any,
show that there is no genuine issue as to any material fact
and that the moving party is entitled to judgment as a matter
of law.” Fed R. Civ. P. 56(a). A party who moves for
summary judgment bears the burden of showing there is no
genuine issue of material fact. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 256 (1986). A court must view
the facts in light most favorable to the nonmoving party and
allow the nonmoving party to benefit from all reasonable
inferences to be drawn from the evidence. Matsushita
Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S.
574, 588-89 (1986).
moves for partial summary judgment on the following issues
under the FLSA: (1) Legend of Asia is a covered enterprise;
(2) Xiao is an employer; (3) Lin is an employer; (4)
Defendants violated the recordkeeping requirements; (5)
Defendants should be enjoined from prospectively violating
the recordkeeping requirements; (6) Defendants are not
entitled to a wage credit to offset back wages owed to
kitchen employees; (7) employee Jersson Pineda is not an
exempt employee; and (8) Plaintiff's claims are not
barred by the statute of limitations. Defendants concede
issues (1), (2), and (7), and ...