Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Pontones v. San Jose Restaurant, Inc.

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

October 31, 2019

LAURA PONTONES, Plaintiff,
v.
SAN JOSE RESTAURANT INCORPORATED, et al., Defendants.

          ORDER

          JAMES C. DEVER, III UNITED STATES DISTRICT JUDGE

         On May 17, 2018, Laura Pontones ("Pontones" or "plaintiff'), on behalf of herself and similarly situated plaintiffs, filed a complaint against a group of allegedly related Mexican restaurants for violations of the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. ("FLSA"), and the North Carolina Wage and Hour Act, N.C. Gen. Stat. § 95-25.1, et seq. ("NCWHA") [D.E. 1]. On June 11, 2018, Pontones amended her complaint [D.E. 7]. On April 26, 2019, Pontones moved for conditional class certification under section 216(b) of the FLSA and Rule 23 of the Federal Rules of Civil Procedure [D.E. 66] and filed a memorandum in support [D.E. 67]. On May 17, 2019, defendants responded in opposition [D.E. 68] and filed various exhibits [D.E. 69, 70]. On June 5, 2019, Pontones replied [D.E. 75] and filed additional declarations [D.E. 73, 74]. As explained below, the court grants Pontones's motion for conditional class certification concerning both claims.

         I.

         Pontones is a former server. See Am. Compl. [D.E. 7] ¶ 1, 14. She sues San Jose Restaurant Incorporated; San Jose Management, Inc., d/b/a San Jose Mexican Restaurant and Sports Cantina; San Jose Mexican Restaurant #2 of Lumberton, Inc.; San Jose Mexican Restaurant of Elizabethtown, Inc.; San Jose Mexican Restaurant of N.C. Inc.; San Jose Mexican Restaurant of Pembroke, NC, Inc.; San Jose Mexican Restaurant of Raleigh Inc.; San Jose Mexican Restaurant of Shallotte, Inc.; San Jose of Rocky Mount #2 Inc., d/b/a San Jose Tacos and Tequila; San Jose of Zebulon, Inc.; San Jose of Roanoke Rapids, Inc.; San Jose Wakefield, Inc., d/b/a San Jose Mex and Tequila Bar; Plaza Azteca Raleigh, Inc., d/b/a San Jose Tacos and Tequila; Hector Flores; Alberto Flores; Josue Flores; Jose Perez; Vicente Perez; Pablo Meza; Edgardo Flores; and Edgar Flores (collectively, "defendants") for unpaid minimum wages and overtime compensation. See id.

         Defendants own and operate Mexican restaurants in North Carolina, Virginia, and South Carolina. See Id. ¶ 46. From about October 2, 2016, to January 22, 2017, Pontones worked as a server at the Brier Creek location in Raleigh, North Carolina. See Id. ¶ 47. From January 23, 2017, until April 2017 and again from July 2017 to August 2017, Pontones worked at the Triangle Town Center Mall location in Raleigh, North Carolina. See Id. Pontones did not supervise other employees and performed the normal duties of a server. See Id. ¶¶ 48-50. She worked Wednesday to Sunday. See Id. ¶ 51. On Wednesdays and Thursdays, Pontones worked from 10 am. to 10 p.m. See Id. On Fridays and Saturdays, Pontones worked from 10 am. to 11 p.m. See Id. On Sundays, she worked from 5 p.m. to 10 p.m. See Id. Each work day except Sunday, Pontones would take a two-hour unpaid break between shifts. See Id. Pontones alleges that defendants controlled her work schedule and rate of pay. See Id. ¶ 52.

         According to Pontones, she and others similarly situated "were advised" that they would be paid an hourly wage less than the minimum wage required under FLSA, plus tips. See Id. ¶ 53. But Pontones only received a check for her first week of training (at $8.00 per hour) and "one to two" checks for $0.00. See Id. Otherwise, Pontones alleges that she did not receive wages or check stubs that documented the hours she worked or the wages she earned. See Id. Pontones also claims that the defendants deducted a fixed percentage of all credit and cash purchases made by customers from her earnings, usually about 3%, regardless of whether a customer paid in cash or by card. See Id. ¶¶ 54-55, 57. She alleges that defendants used this deduction to pay their operating expenses. See Id. ¶ 56. She also alleges that defendants did not operate a tip pool. See id. ¶ 58.

         From 2014 until 2016, the United States Department of Labor, Wage and Hour Division, investigated defendants and found "numerous violations," including failure to pay overtime pay, failing to pay minimum wage by requiring waiters to work for tips alone, failing to maintain required time and payroll records, and falsifying payroll documents. See Id. ¶ 59. Pontones alleges that the defendants continued their practices after the federal investigation. See Id. ¶ 60. In 2006 and 2007, and again from late 2017 until early 2018, the North Carolina Department of Labor also investigated defendants. See Id. ¶ 61. The first investigation did not result in any findings because defendants did not comply. See id. The second investigation resulted in the assessment of civil penalties. See id.

         Pontones provides evidence of the U.S. Department of Labor's investigations. See Ex. A [D.E. 67-1]. These investigations resulted in the assessment of significant back-wages against the San Jose restaurants owed to approximately 125 employees. See Id. at 167-69; Flores Dep. [D.E. 67-2] 14. Some of these employees were servers. See Flores Dep. [D.E. 67-2] 15.

         On March 10, 2016, a group of plaintiffs filed a collective action under FLSA in this court against defendants. See Galvan v. San Jose Mexican Rest, of NC. Inc., No. 7:16-CV-39-FL, 2016 WL 6205783, at *1 (E.D. N.C. Oct. 24, 2016) (unpublished). The GaWan plaintiffs alleged mirroring FLSA claims, but did not allege any state law claims. See id. On October 24, 2016, Judge Flanagan granted plaintiffs' motion for conditional class certification under section 216(b) of the FLSA. See id. at*3. On March 2, 2018, the parties settled the litigation. See Galvan v. San Jose Mexican Rest, of N.C., Inc., No. 7:16-CV-39-FL, [D.E. 46] (E.D. N.C. Mar. 2, 2018). Pontones claims that defendants continued their unlawful wage practices after the settlement See Am. Compl. [D.E. 7] ¶63.

         Pontones submits Hector Flores's deposition of December 18, 2018. Flores testified that the individual store managers essentially operate the different San Jose locations without much if any oversight from the owners. See Flores Dep. [D.E. 67-2] 12-13. He also admitted that the Department of Labor found that the San Jose restaurants had failed to pay servers anything besides tips, which resulted in minimum wage and overtime violations like those that Pontones alleges. See Id. at 15. Flores, however, did not know what policies and practices existed at the restaurants. See Id. at 27, 29, 37-38. Flores also testified that he personally had done nothing to remedy the violations at the San Jose restaurants and that the managers were responsible for bringing the restaurants into compliance after the Department of Labor's investigations. See Id. at 40.

Pontones seeks to bring a collective action under section 216(b) of FLSA for:
All current and/or former servers of Defendants whose primary duty is/was non-exempt work, who were not paid minimum wage and/or overtime, and who are/were subjected to deductions of a fixed percentage of all credit and cash purchases made by Defendants' customers., within the three (3) year period prior to joining this lawsuit under 29 U.S.C. § 216(b).

Compl. [D.E. 1] ¶ 65(a). Pontones alleges that defendants did not pay the putative members of the FLSA collective action the legally required minimum wage or overtime rate of time and that defendants took deductions from their salaries improperly. See Id. ¶ 66; Pontones Decl. [D.E. 73] ¶ 1 (naming specific individuals with whom Pontones worked). Pontones also offers evidence that these policies applied to servers at other locations. See Enriquez Decl. [D.E. 74] ¶¶ 10-13.

         Pontones also seeks to certify a class action under Rule 23 of the Federal Rules of Civil Procedure on behalf of the following proposed class:

All current and/or former employees of Defendants in North Carolina whose primary duty is/was non-exempt work, who are/were not paid for all of their hours worked, including promised regular and/or overtime wages, and who are/were subjected to unlawful deductions of a fixed percentage of all credit and cash purchases made by Defendants' customers, at any time within the two (2) year period prior to the filing of this lawsuit.

Compl. [D.E. 1] ¶ 73(a).

         II.

         The FLSA requires employers to pay non-exempt employees a minimum wage and overtime wage. See 29 U.S.C. §§ 206-07; Desmond v. PNGI Charles Town Gaming. L.L.C.,630 F.3d 351, 356-57 (4th Cir. 2011): Romero v. H.B. Auto. Grp., Inc., No. 11 Civ. 386(CM), 2012 WL 1514810, at *5-7(S.D.N.Y. May 1, 2012) (unpublished). Under the FLSA, employees can bring suit on behalf of themselves and other similarly situated employees against employers for unpaid overtime and other claims. See 29 U.S.C. § 216(b). This collective action process enables similarly situated employees to pool resources and promote judicial efficiency. See, e.g., Jackson v. Bloomberg. L.P., 298 F.RD. 152, 158 (S.D.N.Y. 2014); Faust v. Comcast Cable Commc'ns Mgmt., LLC., No. WMN-10-2336, 2011 WL 5244421, at *2 (D. Md. Nov. 1, 2011) (unpublished). The FLSA is a special form of collective action, separate from class actions under Rule 23 of the Federal Rules of Civil Procedure. See 29 U.S.C. § 216(b). For example, unlike class actions under Rule 23(b)(3), in which class members are bound by the judgment unless they opt out of the class, collective FLSA actions require plaintiffs to give "consent in writing to become such a party." Id. Thus, FLSA collective-action plaintiffs must be "similarly situated" ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.