Carusillo v. Fansided, Inc.

Background

Brandon Carusillo and David Gate sued FanSided, Inc., doing business as FanSided, and Sportority, Inc., doing business as Minute Media and FanSided. They alleged violations of the Fair Labor Standards Act (FLSA), which sets federal wage and overtime requirements. Carusillo also alleged violations of the Massachusetts Fair Minimum Wage Act.

The plaintiffs alleged that they worked as FanSided “Site Experts” under Expert Services Agreements but were classified as independent contractors. Carusillo alleged that he worked about 30 to 35 hours per week during baseball season and was paid approximately $2.14 to $4.40 per hour. Gate alleged that he worked about 30 hours per week and was paid approximately $5.00 to $6.66 per hour. Their work included producing sports articles, managing or editing writers, monitoring search-engine data, and overseeing website or social-media functions.

Motion to Dismiss

Defendants argued that the FLSA claims were untimely, that the plaintiffs had not adequately alleged an employment relationship, and that they had not adequately alleged minimum-wage violations. The court applied the standard for a Rule 12(b)(6) motion, under which a complaint must allege enough facts to make a claim plausible, while the court accepts well-pleaded factual allegations as true at this stage.

The court rejected the statute-of-limitations argument. Although the FLSA generally provides a two-year limitations period, it allows three years for a willful violation. The court held that the plaintiffs alleged enough facts to plausibly infer willfulness, including allegations that Defendants knew of similar litigation involving sports-website workers and did not remedy the alleged violations. The court therefore applied the three-year period.

The court also held that the plaintiffs alleged enough facts to support an employment relationship under the FLSA and Massachusetts law. It relied on allegations that Defendants hired the plaintiffs, supervised them through Editorial Directors, directed their work, retained the right to edit their work, owned the resulting work product, and depended on the content as part of their business. The court did not decide whether the plaintiffs were employees on the ultimate merits; it held only that their allegations were sufficient to proceed past the dismissal stage.

Finally, the court held that the plaintiffs adequately alleged minimum-wage violations. Their allegations about the hours they worked and the amounts they were paid allowed a simple calculation showing pay below the federal and Massachusetts minimum wages.

Conditional Collective Certification

The plaintiffs sought conditional certification under Section 216(b) of the FLSA. Conditional certification is an early-stage decision allowing similarly situated workers to receive notice and choose whether to join the case; it is not a final determination that all potential members will ultimately qualify.

The proposed collective covered people who worked or had worked in the United States for FanSided as Site Experts during the previous three years and were classified as independent contractors. Based on declarations from Carusillo, Gate, and Vincent Page, the court found a modest factual showing that Site Experts were subject to common wage practices. The declarations described similar hiring, agreements, sports-content work, supervision of writers, social-media responsibilities, work hours, and pay below the federal minimum wage.

The court granted the motion for collective action certification. It approved a collective covering the three-year period from June 22, 2017, through June 22, 2020, but directed the plaintiffs to revise the proposed notice. The notice could not expand the approved group to include undefined “similar employees.”

Notice and Arbitration Communications

The court found that a section of the proposed notice discussing updated agreements and arbitration provisions was unnecessary and directed the plaintiffs to remove or revise it. The court also directed the plaintiffs to explain how the arbitration opt-out provision worked and what failing to opt out could mean for the litigation.

Defendants separately asked for permission to send potential opt-in plaintiffs an updated Expert Services Agreement containing an arbitration provision and class and collective-action waivers. The court granted that request. It concluded that the proposed agreement clearly described arbitration, the right to opt out within 30 days, the method for opting out, the absence of retaliation for opting out, and the pending litigation. The court therefore found no misleading, coercive, or confusing communication on the materials presented.

Equitable Tolling

The plaintiffs requested equitable tolling, which pauses a limitations period in appropriate circumstances, for potential opt-in plaintiffs. The court granted the request beginning September 4, 2020, the date the plaintiffs moved for collective certification. It relied on the timing of the motion and the lengthy period during which the certification motion had been under consideration, concluding that otherwise some potential members could become time-barred through no fault of the plaintiffs or their counsel.

Disposition

Judge Oetken ordered that Defendants’ motion to dismiss the First Amended Complaint was denied as moot; Defendants’ motion to dismiss the Second Amended Complaint was denied; Defendants’ motion to communicate with putative collective-action members was granted; the plaintiffs’ motion for collective-action certification was granted; and the plaintiffs’ motion for equitable tolling was granted. The case was not resolved on the ultimate merits of the wage claims.