Velez v. MedRite

Background

Gabriel Velez and Gilbert Velez sued MedRite, LLC and Staffing Boutique, Inc., alleging violations of the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL). They alleged that the defendants sometimes failed to pay them, paid them too little or late, paid them every two weeks instead of weekly, and used common employment and compensation policies affecting other hourly workers.

The plaintiffs asserted FLSA minimum-wage and overtime claims individually and on behalf of a proposed FLSA collective action. They asserted NYLL claims for agreed-upon wages, overtime, weekly pay for manual workers, and accurate wage statements individually and on behalf of a proposed New York class action.

The defendants moved to dismiss for failure to state a claim and lack of subject-matter jurisdiction. They also moved to strike or dismiss the class and collective allegations. Magistrate Judge Sarah Netburn recommended granting the motion in part and denying it in part. The defendants objected to portions of that recommendation.

Court's Analysis

The court adopted the recommendation in large part. It concluded that Gilbert Velez adequately pleaded his FLSA minimum-wage and overtime claims. It also denied dismissal of both plaintiffs' bi-weekly pay claims to the extent they alleged failure to follow an agreed pay schedule, both plaintiffs' wage-statement claims, and the pay-frequency claims for lack of constitutional standing.

The court held that the NYLL pay-frequency claims and the federal wage and overtime claims arose from a common set of workplace facts, including the defendants' alleged compensation policies and the way the plaintiffs were paid. The court therefore had supplemental jurisdiction over the state-law claims. It also concluded that the state-law claims did not substantially predominate over the federal claims and that the plaintiffs' attempt to pursue a proposed NYLL class was not an exceptional circumstance requiring the court to decline jurisdiction.

Although Gabriel Velez's federal claims were dismissed, the court declined to dismiss his state-law claims for lack of subject-matter jurisdiction because Gilbert Velez's federal claims survived. The court stated that, at the motion-to-dismiss stage, it could not determine that the plaintiffs' claims required sufficiently distinct proof to justify separating them.

The court also denied the defendants' request to strike or dismiss the proposed NYLL class and FLSA collective allegations. It held that the defendants had not shown, from the complaint alone, that class certification would be impossible after discovery. The court deferred a decision about whether the plaintiffs could proceed on behalf of other workers until a later stage.

Disposition

The defendants' motion to dismiss was GRANTED IN PART and DENIED IN PART. The court granted the motion as to Gabriel Velez's minimum-wage and overtime claims under the FLSA and NYLL, but dismissed those claims without prejudice. The court denied the motion as to Gilbert Velez's FLSA claims and both plaintiffs' NYLL claims, except for Gabriel Velez's NYLL overtime claim as described in the order. The court also denied the motion to strike or dismiss the class and collective allegations and denied the defendants' remaining motions.

Gabriel Velez was granted leave to file an amended complaint addressing the deficiencies in the dismissed claims within 14 days after entry of the order. Judge Woods directed the Clerk of Court to terminate the pending motion at Docket Number 36.