Morales v. Performance Master, Inc.

Background

Ten construction workers sued under the Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL). They alleged that the defendants were their employers and failed to pay minimum wages and overtime and failed to provide wage notices and wage statements required by New York law.

Two groups of defendants moved for summary judgment: the Horsemen Defendants—Five Horsemen Construction Inc., Ronald Chien, and Five Horsemen LLC—and the J.D.M. Defendants—J.D.M. Marmol & Granite Corp. and Marcos Zhiminaicela. Summary judgment is a decision without a trial when the evidence shows that no reasonable jury could find for the opposing party on a necessary issue.

Evidence and employer-status analysis

The defendants argued that they were not the workers’ employers and therefore could not be liable under the FLSA or NYLL. They also argued that the claims were untimely because the workers did not file written consents within the limitations period. The court decided the employer issue was sufficient and did not reach the timeliness argument.

The court applied the two joint-employer tests used in the Second Circuit. The formal-control test examines whether the alleged employer had power to hire and fire workers, controlled work schedules or employment conditions, set pay rates or payment methods, and maintained employment records. The functional-control test examines the broader economic reality, including use of premises and equipment, movement of labor between employers, the nature of the workers’ jobs, transfer of subcontracting responsibilities, supervision, and whether the workers worked primarily for the alleged employer.

The court held that the workers had not produced enough evidence on any of the factors as to the Horsemen Defendants. Evidence that Five Horsemen monitored the project’s quality, progress, and compliance with safety laws showed worksite oversight, but not control over the workers’ employment terms. The workers also had not shown that Five Horsemen hired or fired them, controlled their schedules, set their pay, maintained their employment records, supplied the premises or equipment, or required them to work primarily for Five Horsemen.

As to the J.D.M. Defendants, the court recognized a factual dispute about whether J.D.M. worked on the project, based partly on a check from Performance Master made out to J.D.M. for an “East 22 subcontract.” But even assuming J.D.M. worked on the project, the workers had not shown that J.D.M. was their employer. The court found that the evidence did not connect Marcos Zhiminaicela to Angel Zhiminaicela, who the workers identified as a supervisor, and that the sign-in sheets did not identify Marcos or Angel as working for J.D.M. The court also found that an earlier declaration by Joah Samuel was too ambiguous and unsupported to create a genuine dispute.

Videos and other evidence

The court granted the Horsemen Defendants’ motion to exclude three covertly recorded videos. The workers did not produce the videos during discovery, did not explain that failure or the videos’ importance, and did not respond to the motion. The court also noted that the videos lacked context, had unclear identities and dates, and in one instance were untranslated. The court stated that even if it had considered the videos, they would not have been enough to defeat summary judgment.

The court also stated that the workers could not rely on the unverified complaint as summary-judgment evidence. It found the two submitted worker affidavits to be barebones and noted that they did not connect the people identified as Angel and Donovan to the Horsemen or J.D.M. Defendants.

Rulings and remaining defendants

The court granted Defendants’ motions for summary judgment. It directed the clerk to terminate Five Horsemen Construction Inc., Five Horsemen LLC, Ronald Chien, J.D.M. Marmol & Granite Corp., and Marcos Zhiminaicela from the docket and to close the related motion docket entries. The court also granted the motion to preclude and directed the clerk to close that motion.

Six defendants remained. The only remaining defendant who had appeared was Joah Samuel; the others included Performance Master and four individuals, including Angel Zhiminaicela. The court did not enter a final ruling on those defendants in this opinion. It gave the workers until June 14, 2024, to address whether the claims against the remaining defendants should be dismissed for failure to prosecute and failure to follow court orders, and specifically asked them to address whether summary judgment should be granted for Samuel even though he had not moved for it.

The court also ordered counsel for the Horsemen and J.D.M. Defendants to submit letters by June 14, 2024, explaining why they should not be sanctioned under Federal Rule of Civil Procedure 11(b). The court questioned apparent inconsistencies between some defense statements and evidence concerning the project, while acknowledging that the defendants might have innocent explanations.