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Depalma v. Scotts Company, LLC

United States District Court, D. New Jersey

June 10, 2019

DOMINICK DEPALMA, etc., Plaintiffs,



         Now before this Court are motions for summary judgment by both sides in this FLSA collective action. Defendant The Scotts Company, LLC ("Scotts") seeks an order that the administrative exemption from FLSA coverage applies to the plaintiff sales managers. Plaintiffs seek an order that the executive and administrative exemptions do not apply to the plaintiff sales managers. For the reasons explained herein, I will deny both parties' motions for summary judgment on the FLSA employee-exemption issues. Scotts also seeks a ruling that the FWW methodology is appropriate for the calculation of damages. That portion of its motion, considered as a motion in limine, is granted.

         I. Background [1]

         a. Facts

         Scotts has proffered a statement of some 1500 material facts, some of them many paragraphs or even pages long. (DSOF (asserting 776 alleged material facts); DR, pp. 98-270 (asserting 766 additional, allegedly material facts)). Plaintiffs have asserted some 60 material facts. (PSOF; DE 187).[2] These submissions pose dozens of disputes of fact, some material and some clearly not. I provide a broad background and highlight just a few of the material disputes that stand in the way of summary judgment for either side.

         Scotts is a multi-national lawn and garden supply company headquartered in Marysville, Ohio. (DSOF, PR ¶ 40). Scotts sells its products to retailers throughout the United States. (DSOF, PR ¶ 44). Those retailer-customers range from large home centers, such as Lowe's, Home Depot, and Wal-Mart, to independent and local hardware stores, such as Ace Hardware. [Id.). Scotts' business development team negotiates and executes the sale of Scotts products to the various retailers. (Id.).

         Scotts' field sales organization is divided into regions, which are divided into districts, which are further divided into territories. (PSOF, DR ¶ 12; see also DSOF, PR ¶ 45-48). Before 2016, there were five regions; in 2016-17 there were four. (DSOF, PR ¶¶ 46-47). Each district has its own District Market Manager ("DMM"). (DSOF, PR ¶¶ 48-49). Scotts currently has 27 districts in the United States. (DSOF, PR ¶ 50).

         Each district is divided into from 8 to 12 territories. (DSOF, PR ¶¶ 51, 52) Each contains, e.g., Lowe's and Home Depot stores. (DSOF, PR ¶ 53).[3] The number of retail stores in each territory ranges from 7 to 26. (DSOF, PR ¶ 54).

         In each territory are Sales Managers, a category that includes the plaintiffs to this action.[4] (DSOF, PR ¶ 57, 58; see also PSOF, DR ¶ 13). The parties dispute whether the Sales Managers actually perform managerial functions within their assigned territories. [See e.g., id.). Each Sales Manager reports to a DMM. (DSOF, PR ¶ 68). Plaintiffs assert that Sales Managers spend the majority of their time doing merchandising work, which Scotts disputes. (PSOF, DR ¶ 17). The parties also dispute the amount of discretion granted to Sales Managers. [See, e.g., PSOF, DR ¶¶ 23-27 (disputing Sales Managers' control over product placement in stores); PSOF, DR ¶ 21 (disputing whether Sales Managers choose merchandise or have management authority)).

         M&Cs are the employees beneath Sales Managers. (DSOF, PR ¶ 59). M&Cs are responsible for merchandising Scotts' products in retail stores by placing them on designated shelves, building and constructing product displays, and maintaining, organizing, cleaning, and replenishing shelf space. (DSOF, PR ¶ 40). The parties dispute whether the M&Cs' responsibility for merchandising is shared with Sales Managers. [Id.).

         Plaintiffs characterizes M&Cs as seasonal and part-time employees; Scotts asserts that some M&Cs work full-time. (PSOF, DR ¶ 2). The parties dispute whether M&Cs log most of their hours during a busy spring season. (PSOF, DR ¶ 3). It remains unclear how many how many M&Cs work for the company during and after the purported peak season. (PSOF, DR ¶ 3).

         The parties dispute how much time Sales Managers spent supervising M&Cs. (DSOF, PR ¶ 59). Plaintiffs rely on spreadsheets allegedly containing the names and hours of every M&C who worked with each Plaintiff. (PSOF ¶ 6). Using the spreadsheets and payroll data provided by Scotts [see Lesser Decl. DE 181 ¶¶ 18-20), Plaintiffs have created a summary chart of the time Plaintiffs spent supervising two or more M&Cs. [Id.; Summary Chart, Ex. 16, DE 181-16; see also PSOF, DR ¶¶ 7-9). Plaintiffs' counsel, Seth R. Lesser, has provided a declaration in support of the summary chart, explaining it as follows:

[The chart] [s]ummarize[es] Plaintiffs' review of the M&C hour and payroll data produced by the defendant . . . Plaintiffs studied the data across a full six-year period from 2011-2016. Plaintiff identified the total number of two-week pay periods worked by any of the Discovery Opt-ins (as well as the pre-notice plaintiffs), plus all the hours by any co-working M&C recorded during those same pay periods. Plaintiffs found that, on average across the full six years, the 25 SMs included in the review directed the work of two-or-more employees only 44% of the time (i.e., in only 44% of the over 2500 two-week pay periods that the SMs worked did the M&Cs under their direction collectively log 160 or more hours). As well, across the six years, no individual SM directed the work of two-or-more employees more than 65% of the time, and the majority of SMs directed the work of two-or-more other employees less than 50% of the time.

(DE 181 ¶ 20) (referring to Chart, Ex. 16, DE 181-16)).

         Scotts takes issue with the Plaintiffs' use of the summary charts and Lesser Declaration. (See e.g., PSOF, DR ¶¶ 7-9). In Section Il.b.i.l.a, infra, 1 conclude that Plaintiffs may rely on summary charts. Nevertheless, the amount of time Plaintiff Sale Managers spent directing the work of two or more employees remains a disputed issue of fact. (PSOF, DR ¶¶8-9).

         b. Procedural history

         I write for the parties and therefore assume familiarity with the procedural history, including my (DE 66, 120, 217) and Judge Dickson's (DE 107) previous opinions.

         On December 20, 2013, Plaintiffs Depalma and Leszczynski, through their counsel, filed a "Class Action Complaint and Demand for a Jury Trial." (DE 1). On February 4, 2014, Depalma and Leszczynski filed their "First Amended Collective Action Complaint and Demand for Jury Trial." (DE 5).

         In April 2014, after the retirement of Judge Cavanaugh, this case was reassigned to me. (DE 25). Although Magistrate Judge Hammer originally had the case, it was soon reassigned to Magistrate Judge Dickson. (DE 31).

         On March 31, 2016, I granted Plaintiffs' motion for conditional certification. (DE 66, 67). About two weeks later, I approved the form of the parties' proposed FLSA notice. (DE 70). By July 22, 2016, approximately 100 opt-ins had filed their consent forms. (See DE 72-106).[5]

         On August 4, 2016, Judge Dickson granted Plaintiffs' equitable tolling motion and ordered that the statute of limitations for the collective action opt-ins to be tolled from March 20, 2015 to April 11, 2016. (DE 109). Scotts appealed (DE 110), and I affirmed Judge Dickson's order. (DE 120, 121).

         On November 12, 2018, Plaintiffs filed the motions that are now before me. Scotts filed a motion for summary judgment as to all plaintiffs (DE 174); Plaintiffs filed their own motion for summary judgment. (DE 177).

         II. Discussion

         a. Legal standard

         Federal Rule of Civil Procedure 56(a) provides that summary judgment should be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Kreschollek v. S. Stevedoring Co., 223 F.3d 202, 204 (3d Cir. 2000). In deciding a motion for summary judgment, a court must construe all facts and inferences in the light most favorable to the nonmoving party. See Boyle v. County of Allegheny Pennsylvania, 139 F.3d 386, 393 (3d Cir. 1998). The moving party bears the burden of establishing that no genuine issue of material fact remains. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "[W]ith respect to an issue on which the nonmoving party bears the burden of proof ... the burden on the moving party may be discharged by 'showing'-that is, pointing out to the district court-that there is an absence of evidence to support the nonmoving party's case." Celotex, 477 U.S. at 325.

         Once the moving party has met that threshold burden, the non-moving party "must do more than simply show that there is some metaphysical doubt as to material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The opposing party must present actual evidence that creates a genuine issue as to a material fact for trial. Anderson, 477 U.S. at 248; see also Fed. R. Civ. P. 56(c) (setting forth types of evidence on which nonmoving party must rely to support its assertion that genuine issues of material fact exist). "[Unsupported allegations ... and pleadings are insufficient to repel summary judgment." Schoch v. First Fid. Bancorporation, 912 F.2d 654, 657 (3d Cir. 1990); see also Gleason v. Norwest Mortg., Inc., 243 F.3d 130, 138 (3d Cir. 2001) ("A nonmoving party has created a genuine issue of material fact if it has provided sufficient evidence to allow a jury to find in its favor at trial."). If the nonmoving party has failed "to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial, ... there can be 'no genuine issue of material fact,' since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial." Katz v. Aetna Cas. & Sur. Co., 972 F.2d 53, 55 (3d Cir. 1992) (quoting Celotex, 411 U.S. at 322-23).

         In deciding a motion for summary judgment, the court's role is not to evaluate the evidence and decide the truth of the matter, but to determine whether there is a genuine issue for trial. Anderson, 477 U.S. at 249, 106 S.Ct. 2505. Credibility determinations are the province of the fact finder. Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d Cir. 1992).

         The summary judgment standard, however, does not operate in a vacuum. "[I]n ruling on a motion for summary judgment, the judge must view the evidence presented through the prism of the substantive evidentiary burden." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254, 106 S.Ct. 2505, 2513, 91 L.Ed.2d 202 (1986). That "evidentiary burden" is discussed in the following section.

         When the parties file cross-motions for summary judgment, the governing standard "does not change." Clevenger v. First Option Health Plan of N.J., 208 F.Supp.2d 463, 468-69 (D.N.J. 2002) (citing Weissman v. U.S.P.S., 19 F.Supp.2d 254 (D.N.J. 1998)). The court must consider the motions independently, in accordance with the principles outlined above. Coldwell of N.J., Inc. v. KPSS, Inc., 622 F.Supp.2d 168, 184 (D.N.J. 2009); Williams v. Philadelphia Housing Auth., 834 F.Supp. 794, 797 (E.D. Pa. 1993), affd, 27 F.3d 560 (3d Cir. 1994). That one of the cross-motions is denied does not imply that the other must be granted. For each motion, "the court construes facts and draws inferences in favor of the party against whom the motion under consideration is made" but does not "weigh the evidence or make credibility determinations" because "these tasks are left for the fact-finder." Pichler v. UNITE, 542 F.3d 380, 386 (3d Cir. 2008) (internal quotation and citations omitted).

         b. Analysis

         I am presented with both sides' motions for summary judgment on the issue of whether the plaintiffs to this action ("Sales Managers" or "SMs") were exempt employees under the FLSA. Plaintiffs move for summary judgment, arguing that neither the executive nor administrative exemption applies. (DE 177-1). Defendant moves for summary judgment, arguing that the administrative exemption applies. (DE 174-1 pp. 14-27). Defendant argues in the alternative that, even if no exemption applies, Plaintiffs' damages should be calculated under a fluctuating-work-week method. (Id. pp. 27-30).

         i. FLSA Exemptions

          "The FLSA establishes federal minimum-wage, maximum-hour, and overtime guarantees that cannot be modified by contract." Davis v. Abington Mem'lHosp., 765 F.3d 236, 241 (3d Cir. 2014) (quoting Genesis Healthcare Corp. v. Symczyk, 569 U.S. 66, 69 (2013)). Generally, an employer must pay its employees at least a minimum hourly wage for work performed and must pay one and one-half times the employee's regular wage for hours worked in excess of forty hours per week. 29 U.S.C. §§ 206, 207. Exempt from the coverage of FLSA, however, are white-collar salaried employees, meaning "any person employed in a bona fide executive, administrative, or professional capacity." 29 U.S.C. § 213(a)(1). See also 29 C.F.R. § 541.3.[6]

         FLSA exemptions are to be given a fair (as opposed to narrow) interpretation. Encino Motorcars, LLC v. Navarro, 138 S.Ct. 1134, 1142 (2018) (quoting A. Scalia 8s B. Garner, Reading Law 363 (2012)). Employers bear the burden to prove that an employee qualifies for an FLSA exemption. Mazzarella v. Fast Rig Support, LLC, 823 F.3d 786, 790-91 (3d Cir. 2016); Martin v. Cooper Elec. Supply Co., 940 F.2d 896, 900 (3d Cir. 1991).[7]

         1. Executive exemption

          Plaintiffs move for summary judgment on the executive exemption, arguing that Sales Managers did not "customarily and regularly" supervise two or more employees, as required by 29 C.F.R. § 541.100(a)(3). In opposition, Defendant counters that there is at least an issue of fact as to whether the Sales Managers are subject to the ...

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