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Lovett v. SJAC Fulton Ind I, LLC

United States District Court, N.D. Georgia, Atlanta Division

June 23, 2015

AYOTUNDA LOVETT, individually and on behalf of all similarly situated persons, Plaintiff,
v.
SJAC FULTON IND I, LLC d/b/a Zaxby's, SJAC FOOD GROUPS, LLC d/b/a Zaxby's, and DOES 1 THROUGH 10, Defendants.

OPINION AND ORDER

WILLIAM S. DUFFEY, Jr., District Judge.

This matter is before the Court on Defendants SJAC Fulton Ind I, LLC ("SJAC Fulton Ind I") and SJAC Food Groups, LLC's ("SJAC Food Groups") (together, "Defendants") Objections [128] to Magistrate Judge Justin S. Anand's Non-Final Reports and Recommendations, issued on March 23, 2015 ("March 23rd R&R") [103], and April 28, 2015 ("April 28th R&R") [118].

In his March 23rd R&R, the Magistrate Judge recommends that Defendants' Motion to Dismiss for Lack of Jurisdiction ("Motion to Dismiss") [15] be denied, and that Plaintiff Ayotunda Lovett's ("Plaintiff' or "Lovett") Motion for Conditional Class Certification [14] be granted in part and denied in part.

In his April 28th R&R, the Magistrate Judge considers Defendants' "Motion for Reconsideration of Report and Recommendation on Motion for Conditional Class Certification or, in the Alternative, Motion to Decertify Class" [107]. The Magistrate Judge (i) denied Defendants' Motion to the extent it seeks reconsideration of the March 23rd R&R, and (ii) recommends that Defendants' Motion, to the extent it seeks decertification, be denied without prejudice.

Also before the Court is the Magistrate Judge's April 10, 2015, Non-Final Report and Recommendation ("April 10th R&R") [113], which recommends that Plaintiff's Motion to Dismiss Opt-in Plaintiff Ashley Greene ("Motion for Voluntary Dismissal") [19] be granted, that her claim be dismissed without prejudice, that Defendants be awarded reasonable costs incurred in defending against Greene's claim, and that Defendants' Motion for Partial Summary Judgment [16] on Greene's claim be denied as moot. Although the parties do not object to the April 10th R&R, Plaintiff has filed a Motion to Strike [123] Defendants' Bill of Costs [121].

I. BACKGROUND

This is a putative collective action brought by Plaintiff against Defendants, who own and operate various Zaxby's fast-food restaurants in the Atlanta, Georgia, area. Plaintiff claims that Defendants misclassified its Assistant Managers, including Plaintiff, and Shift Supervisors as "exempt" employees, and, as a result, failed to pay overtime compensation to Plaintiff for hours worked in excess of forty (40) hours per week, in violation of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201, et seq.[1]

A. Facts

Plaintiff seeks to conditionally certify a class consisting of "all current or former Assistant Managers' or former managers' (not General Manager') [sic], " and including Shift Supervisors, "whom Defendants classified as exempt, over the past three years." (Pl's Reply at 11). Plaintiff relies on her declaration, and the declarations of Opt-in Plaintiffs Tishuna Norman ("Norman") and Ashley Greene ("Greene"), to support that she is similarly situated to the employees who Plaintiff claims are categorically misclassified as "exempt" employees, who did not receive overtime pay as required by the FLSA. Defendants oppose conditional certification and, in support of their opposition, submit the declarations of Tracey Stalling, Chief Financial Officer for STL Management Company, Inc., which provides management services for Defendants, and declarations from thirteen (13) Assistant Managers currently employed by Defendants ("Current Assistant Managers"). Defendants argue this declaration evidence shows that Plaintiff did not meet her burden to show she is similarly situated to other Assistant Managers and Shift Supervisors and thus the Court should not conditionally certify the class Plaintiff seeks to represent.

1. Defendants and their locations

Plaintiff asserts that "Defendants owned and operated six or seven Zaxby's restaurants" in Georgia and that "Defendants' common management interchangeably assigned [her] to work at the[ir] various [ ] restaurants" located at: 5350 Cambelton-Fairburn Road, Fairburn ("Fairburn Restaurant"); 2530 Flat Shoals Road, College Park ("College Park Restaurant"); 925 Camp Fulton Parkway, Atlanta ("Camp Fulton Restaurant"); 7541 Highway 85, Riverdale ("Riverdale Restaurant"); 7149 Mount Zion Boulevard, Jonesboro ("Jonesboro Restaurant"); and 5201 South Cobb Drive, Smyrna ("Smyrna Restaurant") (collectively, the "Restaurants").[2]

It appears that each of the Restaurants is owned and operated by a separate legal entity, although it also appears that Sterling Coleman, who is not named as a defendant in this action, is the sole member of each entity. Defendant SJAC Fulton Ind I owns and operates the Camp Fulton Restaurant. (First Stalling Decl. [15.2] ¶ 2). Defendant SJAC Food Groups owns and operates the Smyrna Restaurant. (Id.).

Plaintiff also names as defendants "Does 1 through 10, " which, she asserts, "either separately or jointly, own and operate approximately six other Zaxby's franchise restaurants where members of the putative class work or have worked within the past three years, " and "were organized by and have the same owners as Defendants SJAC Fulton Ind I, LLC and SJAC Food Groups, LLC." (Compl. [1] at ¶¶ 10-11). Plaintiff has not filed a motion to join, or to amend her complaint, to identify the Doe Defendants. She does not distinguish between the named Defendants and the Doe Defendants, instead referring to "Defendants" generally.[3]

2. Plaintiff's testimony

From May 3, 2010 to May 2012, Plaintiff was employed as an Assistant Manager and worked at the Fairburn, College Park, Camp Fulton, Riverdale, Jonesboro, and Smyrna Restaurants. She asserts that "Defendants' common management interchangeably assigned [her] to work at the various Zaxby's restaurants owned by Defendants, as needed, for varied periods of time." (First Lovett Decl. ¶¶ 5, 8-9). From January 2011 through May 2012, Plaintiff worked only at the Fairburn Restaurant. (Id. ¶ 10).

Plaintiff asserts that, as an Assistant Manager, her "primary job duties were: (a) to prepare and cook the food, (b) to serve customers, and (c) to keep the restaurant clean." (Id. ¶ 16). Plaintiff "observed that all the primary duties of all Assistant Managers and Shift Supervisors required them to [perform these same duties]." (Id. ¶ 17). Plaintiff "relied exclusively on Zaxby's Operations Manuals, which outlined all of the procedures and details needed to perform these standardized manual tasks." (Id. ¶ 18). For example, Plaintiff seasoned and cooked chicken, cut vegetables to a specific size, made salads, and labeled food, all according to the recipes and procedures outlined in the manuals. (Id. ¶ 19). The manuals also explained how to interact with customers and how to clean the restaurant. (Id. ¶ 21).

Plaintiff states that she "spent the majority of [her] time performing these primary duties, " that she "performed these same duties at the other Zaxby's restaurants in Defendants' restaurant group, and [her] primary duties did not change in any material way over the course of [her] employment, regardless of the Zaxby's location in which Defendants assigned [her] to work." (Id. ¶ 23). Plaintiff "did not manage any of the restaurants in Defendants' restaurant group, " she "was not authorized to, nor did [she] ever hire or fire employees on behalf of Defendants, " and her "duties did not include the exercise of discretion and independent judgment." (Id. ¶¶ 26-28). "Virtually all of the duties [Plaintiff] performed were strictly governed by the policies and procedures contained in Defendants' various manuals, and [Plaintiff] lacked the discretion to vary from these procedures and policies in performing [her] duties." (Id. ¶ 29).

Plaintiff asserts that, although she "worked overtime hours many weeks of [her] employment, Defendants did not pay [her] an overtime premium" "because Defendants uniformly classified their Assistant Manager position as exempt' from federal overtime requirements." (Id. ¶¶ 31-32). Plaintiff claims: "During my employment, I personally observed that there were numerous similarly situated Assistant Managers (and/or Shift Supervisors) who: (a) performed the same or similar job duties that I performed; (b) were paid a salary; (c) worked over 40 hours in many workweeks; and (d) were not paid an overtime premium due to Defendants' uniform misclassification." (Id. ¶ 33).

3. Norman's Testimony

Norman "began working for Defendants in May 2010 and resigned in January 2013." (Norman Decl. [14.3] ¶ 5). She states that "[d]uring most of [her] employment, [she] was an Assistant Manager, " that "Defendants' common management interchangeably assigned [her], as needed, to work at the various Zaxby's restaurants in Defendants' restaurant group, " and that she worked at the College Park, Camp Fulton and Smyrna Restaurants. (Id. ¶¶ 6, 8-9) (emphasis added). Norman does not identify when, or in what position, she worked at each Restaurant. The evidence submitted by Defendants shows that, from April 9, 2011, through July 2, 2012, Norman worked as an Assistant Manager at only the Camp Fulton Restaurant. (First Stalling Decl. ¶¶ 5-6 & Ex. 2 [15.2 at 35-87]). After July 2, 2012, Norman worked as an hourly, non-exempt "Cashier/Cook, " at the College Park Restaurant. (Id.).

Although it is not always clear whether she is describing the duties she performed as an Assistant Manager or a "Cashier/Cook, " Norman states that she "did not manage any of the restaurants in Defendants' restaurant group, " she was not authorized to hire or fire employees, and her "primary job duties were: (a) to prepare and cook the food, (b) to serve the customers, and (c) to keep the restaurant clean." (Id. ¶¶ 10-11, 19). Norman asserts that "[v]irtually all of the duties that [she] performed as an Assistant Manager were governed by the policies and procedures set forth in Defendants' various manuals" and she "lacked discretion to vary from these policies and procedures in performing [her] job duties." (Id. ¶ 13). Norman claims that "[t]hroughout [her] employment, [she] regularly worked over 40 hours per week, " but "Defendants did not pay [her] an overtime premium for [her] overtime hours" "because Defendants uniformly classified their assistant manager position as exempt' from federal overtime requirements." (Id. ¶¶ 30-32).

4. Greene's Testimony

In the summer of 2010, Greene began working for Defendants as a Crew Member. (Greene Decl. [14.4] ¶¶ 5-6). From December 26, 2011, to July 2, 2012, Greene worked as a Shift Supervisor. (Id.; First Stalling Decl. ¶ 7 & Ex. 3). Greene worked at the Fairburn, College Park, Camp Fulton, Riverdale, and Jonesboro Restaurants, although from January 2011 through January 2012, she worked at only the Fairburn Restaurant. (Greene Decl. ¶¶ 15-16).

Greene states that the Shift Supervisor and Assistant Manager positions were "essentially the same. Employees in those positions had similar training and similar job duties, " and [t]here was no material difference between the two positions." (Id. ¶ 7). "As a Shift Supervisor, [her] primary duties were: (a) to prepare and cook the food; (b) to serve the customers; and (c) to keep the restaurant clean, " and, "like the Assistant Managers, [Greene] relied exclusively on Zaxby's Operations Manuals to perform these duties." (Id. ¶¶ 17, 19). Greene states that she "did not ever manage any of the restaurants in Defendants' restaurant group" and she was not authorized to hire or fire employees. (Id. ¶¶ 26-27).

Greene asserts that, although she regularly worked over forty hours per week, "Defendants did not pay [her] an overtime premium for all of [her] overtime hours, particularly when [she] was a Shift Supervisor." (Id. ¶¶ 29-30). Greene does not claim that she, or other Shift Supervisors, were paid a salary or misclassified as exempt. The evidence submitted by Defendants shows that throughout her employment, including as a Shift Supervisor, Greene was paid as an hourly wage employee and she was classified as non-exempt. (First Stalling Decl. ¶¶ 7 & Ex. 2).

5. Stalling's Testimony

Stalling is the Chief Financial Officer for STL Management Company, Inc., which provides management services for certain companies that own Zaxby's franchises, including Defendant SJAC Fulton Ind I and Defendant SJAC Food Groups. (Second Stalling Decl. [20.3] ¶ 2). Stalling testified, based on her personal knowledge, about the job descriptions, duties, classifications and compensation for Assistant Managers and Shift Supervisors. (Id. ¶ 3).[4]

Stalling states that each restaurant typically employs one General Manager, who has ultimate authority over the restaurant when he or she is working his or her shift. (Id. ¶ 4). Assistant Managers report directly to the restaurant's General Manager. (Id.). Assistant Managers "are expected to be able to manage the restaurant" and "frequently, even when the General Manager is present, manages the shifts at the restaurant, " which includes "managing operations, including controlling costs and inventory and providing quality control, as well as managing personnel, including directing the work of Shift Managers and Crew Members and providing training." (Id. ¶ 5). Assistant Managers have the authority to make hiring and firing decisions "subject to the hiring and termination policies in place at each restaurant." (Id. ¶ 6). The scope of this authority, whether and how it is exercised, varies among restaurants and individual Assistant Managers. (Id.).

According to Stalling, "[m]ost Assistant Managers will spend a small portion of their work day, subject to their own discretion, performing duties alongside Crew Members, " including "running a cash-register, operating a drive-thru window and preparing food." (Id. ¶ 7). The amount of time an Assistant Manager spends performing these "Crew Member duties' depends on the Assistant Manager's management style." (Id.). Some Assistant Managers spend only 5-10% of their work day performing these "Crew Member duties, " while others may spend more time if they prefer a "hands-on training/management style." (Id.).

Each restaurant classifies its Assistant Managers as exempt from the overtime provisions of the FLSA. Assistant Managers are paid a salary, are not required to record their hours worked, and earn the same gross pay each pay period, excluding ...


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