Ke v. J R Sushi 2 Inc

Background

Yi Mei Ke filed a wage-and-hour action against JR Sushi 2 Inc. and other defendants, alleging violations of the federal Fair Labor Standards Act and the New York Labor Law involving minimum wage, overtime, spread-of-hours pay, notices, and wage statements. The case was referred to Magistrate Judge Barbara C. Moses for general pretrial management.

In March 2022, the court granted summary judgment to Zi Wang and Xin Wang and held that Troy Law, PLLC, Ke’s counsel, was subject to monetary sanctions for unreasonably and vexatiously multiplying the proceedings. Judge Moses later set those sanctions at $26,152.50. In the meantime, no docket activity occurred for about two years, and Ke did not file the joint pretrial order required by the scheduling order.

In May 2024, Judge Moses directed Ke to explain why the case should not be dismissed for failure to prosecute under Federal Rule of Civil Procedure 41(b). Ke responded that she believed the deadline to file the pretrial order did not arise until Judge Moses resolved the sanctions issue. The remaining defendants argued that the summary-judgment motion had been fully resolved in March 2022 and that Ke’s failure to act required dismissal.

Report and Recommendation

Judge Moses recommended dismissing the case without prejudice based on Ke’s failure to prosecute. The recommendation found that several factors supported dismissal, including Ke’s more than two years of noncompliance, presumed prejudice from the delay, and the ineffectiveness of lesser sanctions. It treated other factors as neutral. The recommendation also noted that the statute of limitations had run on Ke’s core federal wage claims, meaning that a dismissal without prejudice could effectively operate as a dismissal with prejudice for those claims.

Court’s Analysis

After the recommendation issued, the Second Circuit decided Romano v. Laskowski. The Court explained that when a dismissal without prejudice would effectively end the claims because of the statute of limitations, the district court must find willfulness, bad faith, or reasonably serious fault by the plaintiff before dismissing under Rule 41(b).

Judge Engelmayer held that this standard applied because the limitations period had run on Ke’s federal wage claims. Although the recommendation described serious misconduct by Troy Law, the court concluded that the firm’s conduct in other cases could not simply be attributed to Ke. The court also found that the recommendation did not provide a sufficient basis to determine that Ke herself had acted with the level of fault required for an effectively prejudicial dismissal.

Disposition

The court did not adopt the recommendation to dismiss the action. Instead, it referred the matter to Judge Moses for a supplemental Report and Recommendation addressing whether Ke personally acted willfully, in bad faith, or with reasonably serious fault in connection with the delays and missed deadlines, and whether sanctions should be imposed directly on Troy Law in addition to the sanctions already imposed. The opinion therefore leaves the dismissal question unresolved.