Shi v. TL & CG Inc.

Background

A jury trial took place on May 17, 2023. On May 19, 2023, the jury found liability by TL & CG Inc., Guoyong Chen, and Guoqing Chen. After trial, the parties largely agreed on how to calculate damages, while Yuefeng Shi separately moved for attorneys’ fees. The court’s opinion addressed damages and the fee request. A motion for default judgment against Jian Xiang Yang remained pending.

Damages for October and November 2018

The parties stipulated that Shi received a $1,500 check each month, but they disputed whether he had to return part of that money based on the number of days he worked. Shi testified that he was paid $45 per day and had to return amounts exceeding that daily rate. The jury found that he worked three days in early October 2018 and nine days in late November 2018. It also credited his testimony that he returned all of the October check and $960 from the November check, retaining $540 for 12 days of work at $45 per day.

The court rejected Shi’s argument that the monthly checks established a $1,500 monthly salary. It held that the evidence and jury findings established a $45 daily rate. The court therefore calculated his damages using the applicable minimum wage, with a $45-per-day offset, and ruled that he was not entitled to damages for October 5 through November 20, 2018, when he did not work. The court described this as a reduction from Shi’s proposed total of $4,743.09, which included liquidated damages and prejudgment interest.

The court also discussed New York Labor Law § 198-b(2), which prohibits certain demands that employees return wages. It stated that the alleged payment arrangement could possibly fit the statute’s language, but Shi had provided no authority or argument supporting that theory, and it was unclear how damages could include pay for time he did not work.

Wage Theft Prevention Act penalties

The parties stipulated that Shi did not receive the hiring wage notice or the wage statements required by New York Labor Law § 195(1)(a) and § 195(3). Those provisions allow statutory damages for qualifying violations. The court nevertheless ruled that Shi lacked Article III standing—the constitutional requirement that a plaintiff show a concrete injury caused by the challenged conduct that a court can remedy—to seek those penalties in federal court.

The court found that Shi had shown underpayment and missing notices, but had not demonstrated a causal connection between the missing notices and a separate injury. It also found that he had not identified an informational injury with consequences beyond bringing the lawsuit. The court therefore excluded the $10,000 in Wage Theft Prevention Act penalties included in Shi’s proposed damages calculation.

Attorneys’ fees and costs

Because a prevailing plaintiff may recover reasonable attorneys’ fees and costs under New York Labor Law, the court evaluated the requested $111,864.50 in fees for 264.63 hours of work. It rejected the argument that Shi’s fee award should be cut by half because the jury found Yi Nen Chen was not an employer. The court stated that employer status was only one trial issue, that the jury’s findings were consistent with Shi’s case theory, and that Yi Nen Chen’s lack of liability did not reduce the judgment recoverable from other defendants.

The court reduced several requested hourly rates. It reduced John Troy’s rate from $650 to $400, Aaron Schweitzer’s rate from $400 to $350, and Preethi Kilaru’s rate from $200 to $150. It reduced Tiffany Troy’s translation-related work to $150 per hour, while leaving the requested rates for Leanghour Lim and other Tiffany Troy work unchanged. The court also reduced hours because of problematic billing entries, including excessive or vague entries and time spent pursuing default judgment against a defendant who had not defaulted.

The court stated that the compensable work consisted of 43.34 hours for John Troy, 152.26 hours for Aaron Schweitzer, 6.09 hours for Tiffany Troy, 6.6 hours for Leanghour Lim, and 30.55 hours for Preethi Kilaru. It awarded $4,559 in costs after excluding $125 spent serving a person later identified as Jian Xiang Yang. The court granted the fee motion in part and stated that Shi was entitled to $77,773 in attorneys’ fees and $4,559 in costs, totaling $82,332.

Disposition

The court granted Shi’s motion for attorneys’ fees in part. It ruled that Shi could not recover damages for the period he did not work and lacked standing to pursue the wage-notice and wage-statement penalties. The court directed that damages be set out in a separate judgment and did not close the case because the default-judgment motion against Jian Xiang Yang remained pending.