Cross v. AMC Detroit, Inc.

          ORDER AND OPINION DENYING PLAINTIFFS' AMENDED MOTION FOR CONDITIONAL CERTIFICATION [18]

          NANCY G. EDMUNDS UNITED STATES DISTRICT JUDGE

         Pending before the Court is Plaintiffs' motion for conditional certification and court approved notice pursuant to 29 U.S.C. § 216(b). (ECF No. 18.) Plaintiffs move the Court to conditionally certify a collective action for unpaid wages under § 216(b) of the FLSA and approve certain notice procedures. Defendant opposes conditional certification. On May 09, 2019, the Court held a hearing in connection with the motion. For the reasons set forth below, the Court DENIES Plaintiffs' motion.

         I. Background

         This is an action for unpaid wages brought under the Fair Labor Standards Act and filed as a putative collective action. Plaintiffs are bartenders at the Buffalo Wild Wings restaurant located at 1218 Randolph Street, Detroit, Michigan 48226. Each BWW is independently owned or locally operated. Defendant AMC Detroit Inc. is the owner of this particular Buffalo Wild Wings. Plaintiffs are both employees of AMC Detroit.

         As bartenders, Plaintiffs are paid an hourly wage rate which is below the minimum wage, plus a tip credit. Plaintiffs allege that they and all bartenders at this particular BWW spend in excess of twenty percent of their time performing untipped cleaning duties in addition to performing their tipped duties as bartenders. Plaintiffs assert that the FLSA prohibits Defendant from taking a tip credit and paying Plaintiffs sub-minimum wages for this untipped cleaning work. The focus of Plaintiffs' claim is that they and the other bartenders spend a significant amount of time-in excess of twenty percent of their shifts-washing dishes and performing other tasks that they contend are not part of their tipped duties. Plaintiffs allege that Defendant in essence requires all bartenders to perform the duties of both bartenders and janitors. Plaintiffs claim that Defendant's failure to pay its bartenders a minimum wage without relying on the tip credit for performing untipped tasks violates the FLSA. As such, Plaintiffs seek a conditional certification of a collective action on behalf of all employees of Defendant AMC Detroit who worked as bartenders at Defendant's BWW location in the past three years.

         On June 21, 2018, Plaintiffs filed their original complaint initiating this putative collective action. Plaintiffs' original complaint named Diversified Restaurant Holdings as the defendant.^[1] Because Defendant AMC Detroit, and not DRH, is Plaintiffs' employer, the parties stipulated to dismissing DRH from this action and substituting AMC Detroit as the defendant. On August 15, 2018, the Court held an initial scheduling conference and ordered the parties to conduct limited discovery relating to conditional certification. The parties conducted some document discovery, including exchanging interrogatories, but no depositions have been taken. On February 27, 2019 Plaintiffs filed their renewed motion for conditional certification. On March 01, 2019, Plaintiffs filed an amended version of their motion for conditional certification, which is currently pending before the Court.

         II. Standard

         Section 216(b) of the FLSA permits individuals to sue on "their own behalf and for 'similarly situated' persons." Comer v. Wal-Mart Stores, Inc., 454 F.3d 544, 546 (6th Cir. 2006). In order to proceed as a "collective action," the plaintiffs must be actually similarly-situated and all plaintiffs must affirmatively opt into the litigation. Id. (citing 29 U.S.C. § 216(b) and Hoffman-La Roche, Inc. v. Sperling, 493 U.S. 165, 167-68 (1989)). This is in contrast to "the opt-out approach utilized in class actions under Fed.R.Civ.P. 23." Id.

         Traditionally, courts in the Sixth Circuit follow a two-stage certification process to determine whether a proposed group of plaintiffs is "similarly situated" for the purposes of the statute's requirements. See Comer, 454 F.3d at 546. The first, or "notice" stage, takes place at the beginning of discovery with a focus on determining whether there are plausible grounds for the plaintiffs' claims. Id. If so, the plaintiffs are permitted to solicit opt-in notices, under court supervision, to potential plaintiffs such as current and former employees of the defendant. Id. The second stage occurs after "all of the opt-in forms have been received and discovery has concluded." Id.

         The first stage is "fairly lenient," generally requiring only that plaintiffs show a colorable basis for their claim that a class of similarly situated plaintiffs exists. White v. MPW Indus. Serv., Inc., 236 F.R.D. 363, 366-67 (E.D. Tenn. 2006); Olivo v. GMAC Mortg. Corp., 374 F.Supp.2d 545, 548 (E.D. Mich. 2004). Some district courts in the Sixth Circuit have held that this burden can be met solely upon allegations in the complaint, Belcher v. Shoney's, Inc., 927 F.Supp. 249, 251 (M.D. Tenn. 1996) (citation omitted), while others have required a "modest factual showing." Pritchard v. Dent Wizard Int'l Corp., 210 F.R.D. 591, 595-96 (S.D. Ohio 2002) (quotation and citation omitted).

         On the other hand, the second-stage review is understandably more stringent as it occurs after the receipt of completed opt-in notices and completed discovery. Comer, 454 F.3d at 547. In determining whether the class members are similarly situated at the second stage, courts generally consider: (1) the factual and employment settings of the individual plaintiffs; (2) the likely defenses that appear to be individual to each plaintiff; and (3) the degree of fairness and the procedural impact of resolving the claims collectively. See Knispel v. Chrysler Grp. LLC, No. 11-11886, 2012 WL 553722, at *3 (E.D. Mich. Feb. 21, 2012). At this later stage, the district court has much more information upon which to make that decision and it employs a stricter standard. Id. The analysis at the second stage is more akin to class certification under Fed.R.Civ.P. 23, but the Sixth Circuit has stated that it involves a less stringent criteria than Rule 23. See O'Brien v. Ed Donnelly Enterprises, Inc., 575 F.3d 567, 584 (6th Cir. 2009), abrogated on other grounds by Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663, 193 L.Ed.2d 571 (2016).

         However, when the parties are afforded the opportunity to conduct discovery before seeking conditional certification, such as in the case before this Court, courts have employed different approaches in deciding motions for conditional certification. See Creely v. HCR ManorCare, Inc., 789 F.Supp.2d 819, 823 (N.D. Ohio 2011) (discussing the "difficult time" courts have had attempting to craft an intermediate, or hybrid, standard that falls between the lenient first-stage and the strict second stage review). The majority of district courts in the Sixth Circuit have applied a "heightened" or "more restrictive" - but not stringent - standard, which is sometimes referred to as the "modest-plus" standard. See, e.g., Swinney v. Amcomm Telecommunications, Inc., No. 12-12925, 2013 WL 4507919, at *3 (E.D. Mich. Aug. 23, 2013); Wheeler v. City of Detroit, 2012 WL 1119300, at *3 (E.D. Mich. Apr. 3, 2012); Neff v. U.S. Xpress, Inc., 2013 WL 4479078, at *3 (S.D. Ohio Aug. 20, 2013); Lankford v. CWL Investments, LLC, 2014 WL 3956184 at *4 (E.D. Mich. Aug. 13, 2014); Byers v. Care Transp., Inc., No. 13-CV-15174, 2016 WL 4771328, at *3 (E.D. Mich. Sept. 14, 2016).

         In Creely v. HCR ManorCare, Inc., 789 F.Supp. 2d8l9(N.D. Ohio 2011), the court described the requisite showing under the heightened "modest-plus" standard. Id. at 826-27. Under this "modest-plus" standard, the court compares the allegations set forth in the plaintiffs' complaint with the factual record assembled through discovery to determine whether the plaintiffs have made a sufficient showing beyond their original allegations that would tend to make it more likely that a class of similarly situated employees exists. Id. at 827. In other words, the court reviews whether the plaintiffs have "advanced the ball down the field" - showing that it is more likely that a group of similarly situated individuals may be uncovered by soliciting opt-in plaintiffs. Id. "Plaintiffs need not have moved the ball far down the field, but they need to have shown some progress as a result of the discovery as measured against the original allegations and defenses." Id. "How much progress Plaintiffs have made will be considered in conjunction with Defendant's evidence and in the context of Plaintiffs' unshifting burden to prove their claims." Id. However, the Court will not weigh the relative merits of the parties' claims at this conditional certification stage. Id. "A full and complete merits review is best preserved for the detailed and strict review conducted at stage two." Id.

         Defendant urges the Court to apply the modest-plus standard here because the parties engaged in discovery. While neither party provides significant detail about the status of discovery in this case, it is clear that the parties conducted some discovery. In addition, the parties were afforded almost six months to conduct discovery related to the issue of conditional certification. Based on the record before the Court and the statements of counsel at the hearing, the Court finds the parties had an ample opportunity to obtain substantial information about Defendant's policies and procedures and Plaintiffs' claims. Accordingly, the Court will employ the modest-plus standard and determine whether Plaintiffs "advanced the ball down the field." ...