Corrales v. AJMM Trucking Corp.

Background

Cesar Augusto Corrales sued AJMM Trucking Corp. and its owner, Wilson Morocho, alleging violations of the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL). Corrales alleged that he worked as a welder for AJMM Trucking from February 2015 through November 2018, worked substantially more than 40 hours per week, and was not paid all required wages. He also alleged that the defendants failed to provide required wage notices at hiring and wage statements with his pay.

The defendants were properly served but did not answer or otherwise respond. The Clerk entered a certificate of default, and Corrales moved for default judgment. Corrales’s counsel appeared at the April 20, 2020 telephone hearing; defense counsel did not appear.

Jurisdiction

The court exercised federal-question jurisdiction over the FLSA claims and supplemental jurisdiction over the NYLL claims. The court stated that even if Corrales had abandoned his FLSA claims, retaining the related state-law claims was appropriate because doing so promoted efficiency, convenience, and fairness and avoided requiring Corrales to start a new case in state court.

Default judgment and liability

The court applied the factors for default judgment: whether the default was willful, whether the defendants had a potentially valid defense, and whether denying judgment would prejudice Corrales. The court found that all three factors favored Corrales because the defendants failed to appear despite proper service, offered no defense, and left Corrales unable to vindicate his rights without a judgment.

A default admits well-pleaded factual allegations, but it does not automatically establish legal conclusions or damages. The court therefore considered whether Corrales’s allegations and supporting evidence established liability for each claim. It found that AJMM Trucking and Morocho were employers covered by the FLSA and NYLL. The court found liability for Corrales’s NYLL minimum-wage claim, his unpaid-overtime claims under the FLSA and NYLL, and his NYLL claims concerning missing wage notices and wage statements. The court did not find that Corrales established his federal minimum-wage claim because his hourly pay exceeded the federal minimum wage of $7.25 throughout his employment.

Damages

For the NYLL minimum-wage claim, the court found that Corrales was underpaid by $0.08 per hour from December 31, 2017, through August 31, 2018. It awarded $210.55 in actual damages and an equal amount in liquidated damages.

For unpaid overtime, the court calculated damages for hours worked above 40 per week at one-half of the applicable hourly wage, because Corrales had already received his weekly salary. The court awarded $37,093.98 in overtime damages and an equal amount in liquidated damages.

For the missing wage notice, the court awarded the statutory maximum of $5,000. For the missing wage statements, it awarded the statutory maximum of $5,000.

The court awarded $11,102.28 in prejudgment interest on actual lost wages. It also awarded $16,292.38 in attorney’s fees and costs, finding counsel’s hourly rates reasonable under the method courts use to calculate reasonable fees based on time spent and market rates.

Disposition

The court ordered entry of default judgment against Morocho and AJMM Trucking. It awarded Corrales $95,711.34 in damages, including prejudgment interest, and an additional $16,292.38 in attorney’s fees and costs.