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Presson v. Recovery Connections Community

United States District Court, E.D. North Carolina, Western Division

July 10, 2019

ANDREW PRESSON and KIMBERLY MYRIS, ; on behalf of themselves and all others similarly situated, Plaintiffs,
v.
RECOVERY CONNECTIONS COMMUNITY; JOURNEY TO RECOVERY, LLC; JENNIFER A. WARREN; PHILLIP J. WARREN; 3M & N, INC. d/b/a ZAXB Y' S; WESTERN NORTH CAROLINA LIONS, INC. d/b/a MARJORIE MCCUNE MEMORIAL CENTER; INTEGRITY-HOMINY VALLEY, LLC d/b/a HOMINY VALLEY RETIREMENT CENTER; INTEGRITY-CANDLER 02 LLC d/b/a HOMINY VALLEY RETIREMENT CENTER; INTEGRITY-CANDLER LIVING CENTER, LLC d/b/a CANDLER LIVING CENTER; INTEGRITY-CANDLER 01 LLC d/b/a CANDLER LIVING CENTER; INTEGRITY SENIOR PROPERTIES INVESTMENTS, LLC; CEDARBROOK RESIDENTIAL CENTER, INC.; and THE AUTUMN GROUP, INC. d/b/a OAK HILL LIVING CENTER, Defendants.

          ORDER

          TERRENCE W. BOYLE CHIEF UNITED STATES DISTRICT JUDGE.

         This cause comes before the Court on plaintiffs' motion for Court-authorized notice pursuant to 29 U.S.C. § 216(b). Two sets of defendants have filed oppositions to the motions, plaintiffs have replied, and the matter is ripe for ruling. For the reasons that follow, plaintiffs' motion is granted.

         BACKGROUND

         Plaintiffs instituted this action by filing a complaint on September 27, 2018, alleging collective action claims under the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq., for unpaid minimum wage and overtime wages and alternatively alleging class action claims for violations of the North Carolina Wage and Hour Act. N.C. Gen. Stat. § 95-25.1, et seq. and 13 N.C. Admin. Code 12.0100, et seq. Plaintiffs further allege claims for unjust enrichment, unfair and deceptive trade practices, N.C. Gen. Stat. § 75-1.1, and conversion. See [DE 1].

         The following is derived from the allegations in the complaint. Defendant Recovery Connections Community (RCC) is a residential substance abuse recovery provider operated under the common control of defendants Jennifer and Phillip Warren. There are five RCC substance abuse rehabilitation homes which are located in Asheville, Angier, Fairview, and Black Mountain, North Carolina. Defendant Journey to Recovery is a limited liability corporation which holds itself out as a substance abuse counseling provider and whose president and chief executive officer is defendant Phillip Warren.

         RCC residents are individuals with substance abuse and addiction disorders who live in RCC homes in order to receive substance abuse education, addiction assessments by professionals, life skills, vocational training, community support groups, and animal and equine therapy. The standard enrollment period for RCC residents is two years. As a condition of residency, RCC program participants are required to perform labor and work both for RCC and at local offsite businesses. These offsite businesses with whom RCC contracts to provide resident labor include the remaining defendants, which are a restaurant and several adult care homes.

         Plaintiffs allege that RCC fails to provide therapeutic treatment and training to its residents, and instead requires them to perform arduous labor for long hours without pay.

         Plaintiffs have summarized the complained of conduct as follows:

While operating under the guise of a residential substance abuse recovery provider, Defendant [RCC] requires its program residents to work long hours-up to 16 hours per day-for area businesses, and then pockets the residents' wages for its own benefit. The businesses that contract with Recovery Connections benefit from this scheme by receiving access to a pool of sub-market rate labor performed by Recovery Connections residents. These businesses pay Recovery Connections a negotiated rate for the labor pool's work, knowing that the Recovery Connections residents receive no compensation for their labor. Recovery Connection's deceptive marketing of itself as a substance abuse recovery service provider, and Defendants' practices of profiting off the unpaid labor of individuals seeking substance abuse rehabilitation are unlawful and violate public policy.

[Del] Cmpl.¶1.

         The offsite business defendants have, through counsel, answered the complaint and filed memorandums in opposition to the instant motion. Defendants Jennifer and Phillip Warren have answered the complaint pro se but have failed to file any memorandum in response to the instant motion. Clerk's default pursuant to Fed.R.Civ.P. 55(a) was entered against defendants RCC and Journey to Recovery on June 25, 2019.

         DISCUSSION

         The FLSA expressly allows employees to maintain a collective action for, inter alia, "unpaid minimum wages, or their unpaid overtime compensation." 29 U.S.C. § 216(b). To bring a collective action under the FLSA, the putative plaintiffs must satisfy two requirements: (1) they must establish they are "similarly situated" and (2) they must affirmatively consent to the named plaintiffs class representation. Id. As to the question of whether the putative plaintiffs are "similarly situated," the Court applies a two-step approach. See Cameron-Grant v. Maxim Health Care Servs., Inc., 347 F.3d 1240, 1243 (11th Cir. 2003).[1]

         At the first, "notice" step of the process, the Court determines whether the plaintiff and potential opt-in plaintiffs are sufficiently "similarly situated" to warrant notice being given to allow potential plaintiffs to opt-in and to proceed as a collective action through discovery; at this initial stage, a lenient standard applies. Choimbol v. Fairfield Resorts, Inc., 475 F.Supp.2d 557, 562 (E.D. Va. 2006) ("Because the court has minimal evidence, this determination is made using a fairly lenient standard.") (internal quotation and citation omitted); see also Dearman v. Collegiate Horn. Servs., Inc., No. 517CV00057RJCDCK, 2018 WL 1566333, at *2 (W.D. N.C. Mar. 30, 2018). The focus is on whether the plaintiffs and potential opt-in plaintiffs will be "similarly situated with respect to the legal and, to a lesser extent, the factual issues to be determined." De Luna-Guerrero v. N. Carolina Grower's Ass'n, Inc., 338 F.Supp.2d 649, 654 (E.D. N.C. 2004) (quotation and ...


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