Hu v. 226 Wild Ginger Inc.
- John Koeltl
- 1:17-cv-10161
- U.S. District Court · Southern District of New York
- 13
In Hu v. 226 Wild Ginger, Judge Koeltl ordered a new damages calculation for wage claims but denied the plaintiffs’ attorney-fee motion.
The five plaintiffs seeking unpaid wages and overtime—Jianhui Hu, Zhishong Liu, Jinquan Yin, Xing Xing, and Yan Feng Cheng—and the defendants in the default judgment. The damages issue was sent back to the magistrate judge, while the plaintiffs’ attorney-fee motion was denied.
What happened
Hu v. 226 Wild Ginger involved five plaintiffs seeking unpaid wages and overtime under federal and New York law after the defendants failed to defend the case. The court had already entered a default judgment establishing the defendants’ liability and sent the damages question to a magistrate judge.
The magistrate judge recommended awarding no damages because the plaintiffs’ evidence contained inconsistencies. Judge Koeltl rejected that recommendation as to damages, finding that the evidence showed the plaintiffs were owed at least some amount that could be calculated without speculation. He sent the damages issue back for further proceedings.
The court, in an opinion by Judge John G. Koeltl, denied the plaintiffs’ motion for attorney’s fees and costs because they had not properly supported that request before the magistrate judge. The court said counsel could seek fees and costs for work on the current proceedings before the magistrate judge in the first instance.
The detailed version
- Hu v. 226 Wild Ginger Inc. · No. 1:17-cv-10161
- John Koeltl
- July 31, 2020
Background
Jianhui Hu, Zhishong Liu, Jinquan Yin, Xing Xing, and Yan Feng Cheng brought claims against the defendants for unpaid minimum wages and overtime compensation under the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL). On December 21, 2018, the court entered a default judgment against the defendant and referred the case to Magistrate Judge Fox to determine damages.
The magistrate judge received affidavits from all five plaintiffs and held an evidentiary hearing at which four plaintiffs testified. The defendants did not respond to the plaintiffs’ submissions or appear at the hearing. The magistrate judge recommended awarding no damages or attorney’s fees and costs, citing inconsistencies about the hours worked, compensation received, and the basis for calculating damages.
Damages
The district court reviewed the challenged portions of the magistrate judge’s report independently. It explained that when an employer does not produce legally required records of employees’ hours and wages, a plaintiff may establish damages through a sufficiently supported recollection or estimate. The estimate cannot be purely speculative, but a detailed affidavit may provide a sufficient basis for calculating damages.
The court acknowledged inconsistencies between the plaintiffs’ affidavits and hearing testimony, including evidence concerning Hu’s work hours. It nevertheless concluded that the inconsistencies did not show that the plaintiffs’ claims were pure speculation. The court found that the plaintiffs had established that some damages could be calculated with reasonable certainty and that they should not receive no damages merely because their memories were inconsistent and the defendants had failed to provide employment records.
The court therefore declined to adopt the magistrate judge’s recommendation concerning damages and recommitted the case to the magistrate judge under Federal Rule of Civil Procedure 72(b)(3) for further proceedings to calculate at least a minimum amount of damages with reasonable certainty.
Attorney’s Fees and Costs
The magistrate judge had recommended awarding no attorney’s fees and costs because the plaintiffs had not presented evidence supporting the amount requested, despite being instructed to do so at the damages inquest. The plaintiffs later filed a motion in the district court under the FLSA, the NYLL, and Federal Rule of Civil Procedure 54(d), along with a supporting declaration.
The court denied the motion. It held that the plaintiffs could not use a new motion in the district court to bypass the magistrate judge’s order requiring them to present supporting evidence during the inquest. The court also declined to consider the new fee evidence because the plaintiffs had not presented it to the magistrate judge and had not justified waiting to submit it.
The court stated that its ruling did not prevent the plaintiffs’ counsel from seeking fees and costs for time spent on the current matter after recommittal. Any such application should be made to the magistrate judge first.
Disposition
The court declined to adopt the Report and Recommendation concerning damages, recommitted the case to the magistrate judge for further proceedings, and denied the plaintiffs’ motion for attorney’s fees and costs. The Clerk was directed to close Docket No. 88.
Read the full 13-page opinion on CourtListener, the free public archive maintained by the Free Law Project.