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Boles v. Spanish Oaks Hospice, Inc.

United States District Court, S.D. Georgia, Savannah Division

May 19, 2017



         Plaintiff Malesha Boles moves the Court for leave to amend her Family and Medical Leave Act (FMLA) interference and retaliation Complaint. Doc. 19. She concedes that the current defendant, Spanish Oaks Hospice, Inc., does not appear have sufficient employees to trigger FMLA coverage.[1] Id. at 2. She thus wants to add five additional defendants, Spanish Oaks Retreat, Inc., Spanish Oaks Foundation, Inc., Spanish Oaks Properties, LLC, Spanish Oaks of Bellville, LLC, and Spanish Oaks of Bellville Properties, LLC (collectively the "Spanish Oaks entities"). Boles contends that they are her "joint" or "integrated" employers, so their employees should count towards the FMLA minimum. Id. at 2-3; doc. 19-1 at 1. She also seeks to "clarify" her claim against Spanish Oaks to allege that she detrimentally relied on its "representation that the conditions and benefits of her employment included application of the FMLA." Doc. 19 at 3. Spanish Oaks opposes on futility grounds. Doc. 22.

         The Federal Rules instruct courts, before the Scheduling Order's deadline, to "freely give leave [to amend a pleading] when justice so requires." Fed.R.Civ.P. 15(a)(2). That standard embodies a preference for resolving claims on their merits. See, e.g., Foman v. Davis, 371 U.S. 178, 182 (1962) ("If the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claim on the merits." (emphasis added)). Leave to amend may nevertheless be denied where the amendment is futile; that is "when the claim, as amended would still be subject to dismissal." Boyd v. Warden, Holman Corr. Facility, __ F.3d __, 2017 WL 1856071 at * 5 (11th Cir. May 9, 2017) (citing Burger King Corp. v. Weaver, 169 F.3d 1310, 1320 (11th Cir. 1999)).


         The FMLA defines "employer" as any person "who employs 50 or more employees" for a sufficient time period. 29 U.S.C. § 2611(4)(A)(i). Federal regulations, however, permit the aggregation of employees of separate entities, for purposes of satisfying the FMLA minimum, if the entities constitute "joint" or "integrated" employers. See 29 C.F.R. § 825.104(c); see also, e.g., Morrison v. Magic Carpet Aviation, 383 F.3d 1253, 1257-58 (11th Cir. 2004); Cruz-Lovo v. Ryder Sys., Inc., 298 F.Supp.2d 1248, 1252 (S.D. Fla. 2003) ("The regulations interpreting the FMLA provide two theories under which multiple entities can be deemed the 'employer' of an employee: the 'integrated employer' theory and the 'joint employment' theory."). Boles contends that the Spanish Oaks entities are either her joint employers or are integrated with Spanish Oaks.

         The regulations implementing the FMLA establish that several entities may be an employee's joint employers if: (1) they share the employee's services; (2) "[w]here one employer acts directly or indirectly in the interests of the other employer in relation to the employee; or, (3) [w]here the employers formatting [sic] may be deemed to share control of the employee, directly or indirectly, because one employer controls, is controlled by, or is under common control with the other employer." Morrison, 383 F.3d at 1257-8 (quoting former 29 C.F.R. § 825.106(a)[2]). Similarly, several entities are "integrated, " such that they count as a single FMLA "employer, " "where [the allegedly integrated entities] have '(i) Common management; (ii) Interrelation between operations; (iii) Centralized control of labor relations; and (iv) [A] [d]egree of common ownership/financial control.'" Id. at 1257 (quoting 29 C.F.R. § 825.104(c)(2) (alterations in original)).

         Spanish Oaks contends that Boles' proposed amendment is futile because she pleads both theories in "a single paragraph" containing only "boilerplate, conclusory statement[s] unsupported by factual allegations elsewhere in the Proposed Amended Complaint." Doc. 22 at 8. However, Spanish Oaks fails to identify all of plaintiffs supporting allegations.[3]She defines "Spanish Oaks" to include all of the Spanish Oaks entities, see Id. at 1, so several of her allegations provide factual details that Spanish Oaks has claimed was lacking. For example, Boles identifies Kandi Lanier as "Executive Director of Spanish Oaks, " id. ¶ 19, and that Mike Johnson performs "payroll and human resources functions" for the Spanish Oaks entities. Id. ¶ 28. Those assertions plausibly allege the common control and operation supporting the joint and integrated employer theories.[4] See, e.g., U.S. Capital Funding VI, Ltd. v. Patterson Bankshares, Inc., 137 F.Supp.3d 1340, 1356 (S.D. Ga. 2015) ("While a summary judgment in FLSA suit based on application of the economic realities test)), there is authority, albeit not entirely clear, supporting its application in the FMLA context. The Eleventh Circuit has noted that "the FMLA's definition of 'employer' ... is materially identical with[] the definition of 'employer' used in the Fair Labor Standards Act" Wascura v. Carver, 169 F.3d 683, 685-86 (11th Cir. 1999). The complaint need not contain detailed factual allegations, " it must contain sufficient facts to plausibly imply defendant's liability).

         Plaintiffs reply brief puts additional factual meat on her proposed amendment's bones. See, generally, doc. 24 (identifying alleged common owner of the Spanish Oaks entities, providing internet address for alleged common website, and alleging several entities share common phone number). Accordingly, the Court grants Boles leave to amend her Complaint to allege that the Spanish Oaks entities were her joint employers or were integrated, for purposes of determining whether Spanish Oaks was a covered "employer."

         II. ESTOPPEL

         Boles also argues that Spanish Oaks is estopped to deny FMLA coverage. As the parties concede, the Eleventh Circuit has twice commented on, without deciding, whether equitable estoppel applies to FMLA coverage. See Dawkins v. Fulton Cty. Gov't, 733 F.3d 1084, 1089 (11th Cir. 2013) (noting that the Eleventh Circuit has "never decided that equitable estoppel can extend FMLA coverage to otherwise uncovered absences from work"); Cowman v. Northland Hearing Ctrs., Inc., 628 F.App'x 669, (11th Cir. 2015) (citing Dawkins, 733 F.3d at 1089) ("We have not determined whether the doctrine of equitable estoppel applies as a matter of federal common law in the FMLA context."); doc. 19 at 5; doc. 22 at 4. It has not, however, suggested that equitable estoppel could not apply, given appropriate factual support. See Caporicci v. Chipotle Mexican Grill, Inc., 189 F.Supp.3d 1314, 1321 (M.D. Fla. 2016) (explaining that the Eleventh Circuit "has found it unnecessary to decide [whether equitable estoppel applies] when the plaintiff fails to establish an essential element of an equitable-estoppel claim."); see also Cowman, 628 F.App'x at 672 ("Assuming that federal common law equitable estoppel applies to FMLA claims, " plaintiff failed to establish essential element for estoppel). Further, "[a] 11 of the other circuits to address the issue have concluded that the equitable estoppel doctrine applies in FMLA employment discrimination cases where its elements are met." Dawkins, 733 F.3d at 1092 (Wilson, J. dissenting) (citing Second, Fifth, Sixth, and Eighth Circuit precedent). And since Dawkins, other Circuits have concurred. See Palan v. Inovio Pharms. Inc., 653 F.App'x 97, 100 n. 5 (3d Cir. 2016) (listing Courts of Appeal recognizing application of equitable estoppel in the FMLA context, including the Sixth, Ninth, First, Fifth, Eighth, Second, and, albeit in dicta, Seventh Circuits). Balanced against that persuasive authority, is the danger that applying the doctrine "would expand FMLA liability beyond the express terms of the statute." Rodas v. Assurance Quality Grp., Inc., 2015 WL 11511578 at * 5 (N.D.Ga. Jan. 30, 2015).

         Given the competing authority, the Court is inclined to grant Boles leave to plead her claim, if only to allow the parties' arguments to develop more fully. Spanish Oaks argues that, even if equitable estoppel were available, Boles has failed to plead that it "was aware of the fact that Plaintiff was not an eligible employee under the FMLA at the time she took leave." Doc. 22 at 7. Such a failure would preclude an equitable estoppel claim, and allow the Court to follow the Eleventh Circuit's example in resolving the issue on factual, rather than legal, grounds. But the assertion is questionable, given the factual context of the dispute. Spanish Oaks is contending that Boles is not an eligible employee because it didn't have enough employees to qualify as FMLA-covered employer. Id. at 2. In effect Spanish Oaks argues that Boles' failure to plead that it was aware of the number of employees it employed is fatal to her estoppel claim. That's an odd argument, to say the least.

         Given the unusual posture of the estoppel question, the Court is persuaded by the general preference to allow claims to be disposed on their merits. It therefore grants Boles leave to amend her Complaint to allege that Spanish Oaks is equitably estopped from contending that she is not FMLA eligible. In doing so, however, the Court does not suggest that her claim could not be subject to a more fully developed motion to dismiss. The Court finds only that Spanish Oaks has not demonstrated that such a claim is futile.


         The Court GRANTS plaintiff Malesha Boles' Motion to Amend (doc. 19) and thus DENIES as moot the parties' joint motion for a stay pending resolution of her amend motion. Doc. 25. The Court GRANTS the parties' joint request for an extension of the case deadlines. Doc. 25. The Court thus extends the deadline for the parties to submit a joint status report by fourteen days (until June 5, 2017), and the deadline for Spanish Oaks to furnish an expert report for thirty days (until ...

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