Rodriguez v. Caridad Sea Food Restaurant Corp.

Background

Eneria Rodriguez sued corporate and individual defendants under the Fair Labor Standards Act (FLSA), the federal wage-and-hour law, and the New York Labor Law (NYLL). She worked for 231 El Valle Seafood Corp. from February 2017 through April 2018 and for Caridad Sea Food Restaurant Corp. from April 2018 through July 2020. Victoria Marine owned El Valle during Rodriguez’s employment there. El Valle later closed and was dissolved. El Nuevo Valle Seafood Restaurant Corp. was incorporated in 2019, bought El Valle’s assets, and operates at the same location. Josean Mendez Valdez owns El Nuevo Valle, and Carlos Mendez is its vice president. Carlos Mendez was also a manager at El Valle. Jorge Rosario Quezada held some leadership position at Caridad.

Rodriguez moved for partial summary judgment. Summary judgment is a ruling entered without a trial when the evidence shows that no reasonable jury could find for the opposing party on a disputed issue of material fact.

Employers

The court applied the FLSA and NYLL standards for determining whether a person or entity was an employer, including whether the alleged employer had power to hire and fire workers, control their schedules or working conditions, set their pay, and maintain employment records. The court stated that defendants did not contest that Caridad, El Valle, Victoria Marine, Carlos Mendez, and Jorge Rosario Quezada were Rodriguez’s employers at one time or another. The court therefore granted Rodriguez’s motion as to those defendants. Quezada’s potential liability is limited to Rodriguez’s work-related claims concerning Caridad.

The court denied Rodriguez’s motion concerning El Nuevo Valle. Rodriguez did not work for El Nuevo Valle, and although defendants had made admissions about El Nuevo Valle’s alleged power to hire and fire, supervision, and control of Rodriguez, the court found that those admissions did not resolve the broader economic-reality question. The court also denied the motion concerning Valdez because Rodriguez’s evidence did not establish that he controlled her while she worked at El Valle.

The court granted Rodriguez’s motion concerning the employment dates. It found undisputed that at least some defendants employed her from February 2017 through July 6, 2020.

Successor Liability

Rodriguez argued that El Nuevo Valle was liable as El Valle’s successor. The court identified disputes about whether El Nuevo Valle had notice of Rodriguez’s claims before acquiring El Valle’s assets and whether El Valle could provide relief. The court also noted disputes concerning who controlled the restaurants. Although Rodriguez made a strong showing concerning continuity of business operations, the disputes about notice and the predecessor’s ability to provide relief required a jury to decide the issue. The court denied summary judgment on successor liability.

Whether the Restaurants Formed One Enterprise

The FLSA’s coverage can depend on whether an employer is part of an enterprise engaged in commerce with more than $500,000 in annual gross sales. Rodriguez argued that the restaurants together formed one enterprise. The court noted that her 2018 figures totaled $488,487, not more than $500,000, and that she presented no evidence of the restaurants’ 2017 sales. Caridad alone exceeded $500,000 in 2020. The issue was therefore relevant to 2019, when Caridad had less than $500,000 in sales but Caridad and El Nuevo Valle together exceeded that amount.

The court found genuine disputes about common control, common business purpose, and the relationship among the restaurants. Rodriguez relied principally on her assertion that Mendez was the true owner and controller of all the restaurants, but that assertion was disputed. Evidence that relatives owned the restaurants and that they used some overlapping materials did not resolve the issue as a matter of law. The court denied summary judgment and left the enterprise question for the jury.

Employment Records and Wage Notices

The court held that Rodriguez was entitled to a trial presumption concerning hours worked and wages paid because defendants did not contest that they had failed to keep adequate records. Under the FLSA, this presumption reduces the employee’s burden of proving damages; under the NYLL, it shifts the burden to the defendants. Defendants may still use Rodriguez’s allegedly contradictory statements in attempting to meet their burden.

The court also granted summary judgment on Rodriguez’s claims that defendants failed to provide wage notices and wage statements required by the NYLL. Defendants did not respond to those arguments.

Damages-Related Requests

Rodriguez did not seek summary judgment on the amount of damages, but she asked the court to rule that she was entitled to liquidated damages, attorney fees and costs, and prejudgment interest. The court treated those requests as premature. It declined to decide whether any violation was willful and stated that the statutory remedies could be addressed if Rodriguez ultimately prevailed. The opinion also noted that defendants raised statute-of-limitations arguments concerning some FLSA claims, but that the extent of any limitation depended in part on whether a violation was willful.

Disposition

The court granted in part and denied in part Rodriguez’s motion for partial summary judgment. It directed the parties to meet and submit their trial availability by August 13, 2024, and closed the motion on the docket.