Bao v. Sunwoo Trade Inc.
- Cathy Seibel
- 7:20-cv-09588
- U.S. District Court · Southern District of New York
- 12
In Bao v. Sunwoo Trade, Judge Seibel granted summary judgment to the defendants, dismissing federal claims with prejudice and state claims without prejudice.
Shuzhong Bao’s FLSA, New York Labor Law, and breach-of-contract claims against Sunwoo Trade Inc., Xuguang Wang, and Yifen Bao; the federal claims were dismissed with prejudice and the state-law claims without prejudice.
What happened
In Bao v. Sunwoo Trade Inc., Shuzhong Bao claimed that the defendants failed to pay minimum and overtime wages, failed to reimburse certain work expenses, violated New York wage laws, and breached a contract. The defendants asked the court to grant summary judgment, which is a decision without a trial when the evidence shows no genuine dispute requiring a jury.
The court ruled that Bao had not provided evidence that the defendants’ business had at least $500,000 in annual sales, a requirement for the federal wage claims under the Fair Labor Standards Act. Bao also did not claim or support another basis for federal coverage. The court therefore granted summary judgment on the federal claims.
Judge Cathy Seibel declined to decide the remaining New York wage-law and contract claims because the federal claims had been resolved before trial. The federal claims were dismissed with prejudice, the state-law claims were dismissed without prejudice, judgment was entered for the defendants, and the case was closed.
The detailed version
- Bao v. Sunwoo Trade Inc. · No. 7:20-cv-09588
- Cathy Seibel
- Sept. 20, 2022
Background
Shuzhong Bao sued Sunwoo Trade Inc., Xuguang Wang, also known as Jason Wang, and Yifen Bao. Bao alleged that the defendants violated the Fair Labor Standards Act (FLSA) by failing to pay minimum and overtime wages and failing to reimburse expenses relating to materials of the trade. He also alleged violations of the New York Labor Law (NYLL), including failure to pay overtime and spread-of-hours pay and failure to provide required wage notices and pay stubs. He additionally asserted a breach-of-contract claim.
Bao worked as a manager at the defendants’ restaurant from February 26, 2017, through September 21, 2019. He claimed that during part of that period he worked 76 hours per week and was not properly compensated. The defendants maintained that he was paid biweekly for 80 hours of work. The opinion describes disputes about Bao’s compensation, the entity that employed him during portions of the relevant period, and the scope of his managerial duties.
Summary-Judgment Standard
The court explained that summary judgment is appropriate when there is no genuine dispute about a material fact and the moving party is entitled to judgment as a matter of law. A party opposing summary judgment must provide evidence from which a reasonable jury could find in its favor. A party may obtain summary judgment by identifying a lack of evidence supporting an essential element of the opposing party’s claim.
FLSA Claims
The defendants argued that Bao could not establish that his employer was an enterprise covered by the FLSA. Enterprise coverage requires, among other things, proof that the business had annual gross sales of at least $500,000. The court held that Bao bore the burden of proving this requirement.
The court found that Bao provided no evidence showing that the defendants’ annual sales reached $500,000. The court also noted that Bao did not assert or support individual FLSA coverage, which can apply when an employee engages in interstate commerce or produces goods for interstate commerce. Because Bao could not establish enterprise coverage and did not support individual coverage, the court granted summary judgment to the defendants on the FLSA claims. The FLSA claims were dismissed with prejudice.
State-Law Claims and Disposition
After resolving all claims over which it had original federal jurisdiction, the court declined to exercise supplemental jurisdiction over Bao’s NYLL and breach-of-contract claims. Supplemental jurisdiction is the court’s authority to hear related state-law claims along with federal claims. The NYLL and breach-of-contract claims were dismissed without prejudice.
The court granted the defendants’ motion for summary judgment, entered judgment for the defendants, directed the Clerk of Court to terminate the motion, and closed the case. Judge Cathy Seibel signed the order on September 20, 2022.
Read the full 12-page opinion on CourtListener, the free public archive maintained by the Free Law Project.