Yang v. An Ju Home, Inc.

Background

Yongfu Yang, Deliang Fu, Xiaojiang Zuo, Hechao Chen, Aixiang Liu, Kezheng Zuo, Shushan Hang, and Derong Zheng sued An Ju Home, Inc., Structure Enterprise, Inc., Trinity Builders, Inc., Hengjian Cui, Paul Liou, Candice Colucci, “John” Liou, and “Jane” Zhuo. They alleged violations of the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL). The plaintiffs alleged that the Trinity Defendants failed to pay promised daily compensation, overtime compensation, and spread-of-hours compensation. They also alleged that the defendants failed to provide wage statements and adequate meal periods.

Structure, Trinity, Paul Liou, and Candice Colucci—the Trinity Defendants—answered the complaint and moved for judgment on the pleadings under Federal Rule of Civil Procedure 12(c). An Ju Home, Hengjian Cui, “John” Liou, and “Jane” Zhuo had not answered or otherwise responded. The court held that the Trinity Defendants could pursue the motion even though the other defendants had not answered. The court also said that the same legal standard would apply if the motion were treated as a motion to dismiss for failure to state a claim.

FLSA claims

To state an FLSA claim for unpaid wages or overtime, a plaintiff must allege that the defendant was the plaintiff’s employer. The court applied two tests: the formal-control test and the functional-control test. The formal-control test considers whether the alleged employer had power to hire and fire workers, controlled their schedules or working conditions, determined their pay, and maintained employment records. The functional-control test considers the economic reality of the relationship, including factors such as control over the work, use of equipment or premises, the nature of the work, and whether the workers worked primarily for the alleged employer.

The court found that the complaint alleged only that the Trinity Defendants set the plaintiffs’ work schedules and required them to sign in and out. The complaint did not allege facts showing that the Trinity Defendants hired or fired the plaintiffs, determined their pay, or maintained employment records. The court also found that the complaint did not allege facts supporting any of the functional-control factors. Conclusory statements repeating the elements of the legal tests were insufficient. The court therefore dismissed all FLSA claims against the Trinity Defendants.

NYLL claims and disposition

The NYLL claims were based on the court’s supplemental jurisdiction, which allows a federal court to hear related state-law claims in some circumstances. After dismissing all federal claims, the court declined to exercise supplemental jurisdiction over the remaining NYLL claims and dismissed them as well.

The court GRANTED the Trinity Defendants’ motion for judgment on the pleadings. It directed the plaintiffs to either move for judgment against the defendants who had not responded or file a status letter by July 29, 2020. The Clerk was directed to close the motion and terminate Structure Enterprise, Inc., Trinity Builders, Inc., Paul Liou, and Candice Colucci as parties to the case.