Vilella v. Pup Culture LLC

Background

Ashley Vilella sued Pup Culture LLC, five related Pup Culture operating companies, and Ibrahim Alimimeh. She brought claims under the Fair Labor Standards Act (FLSA), a federal wage law, and New York Labor Law. The relevant allegations concerned unpaid overtime, calculating overtime over two-week pay periods instead of each workweek, requiring employees to clock out before finishing work, and disadvantaging employees through time rounding. Vilella also alleged state-law wage-notice and wage-statement violations and a claim involving allegedly fraudulent information returns.

Vilella moved for conditional certification of an FLSA collective action. Conditional certification is an early-stage decision allowing potentially similarly situated employees to receive notice and choose whether to join the case; it is not a final determination that the employees’ claims are valid or that the group will remain certified after discovery. Vilella proposed including non-exempt employees—including receptionists, pet groomers, kennel attendants, pet sitters, and dog walkers—who worked at any of defendants’ five locations during the six years before the complaint was filed.

Defendants disputed Vilella’s allegations and argued that she had not shown that employees in different jobs or at different locations were similarly situated. They also objected to the form and distribution of the proposed notice, including the requested six-year notice period, a 90-day opt-in period, automatic tolling of the limitations period, and production of Social Security numbers.

Conditional Certification

The court held that Vilella met the modest factual showing required at this stage. Her time and pay records showed instances in which she worked more than 40 hours in one week but was not paid overtime because she worked fewer than 40 hours in the other week of a two-week pay period. Records submitted for former employee Elisa Munguia showed a similar example. Vilella also submitted a properly signed declaration stating that employees were instructed to clock out when scheduled shifts ended even when they continued working, and that employees who failed to clock out were paid only for scheduled time.

The court did not resolve factual disputes, assess witness credibility, or decide whether defendants ultimately violated the FLSA. It also did not decide at this stage whether the alleged time-rounding practice was unlawful or common to other employees. The court concluded that the evidence was sufficient to support notice concerning a common practice of failing to pay overtime for hours worked above 40 in a week.

The court rejected limiting the collective to receptionists or to the locations where Vilella and Munguia worked. It reasoned that employees need not have identical job duties, work periods, or locations if they are similarly situated regarding the alleged unlawful pay practices. The court found sufficient allegations of common ownership, management, employee transfers among locations, centralized payroll, and common timekeeping and pay practices.

Notice and Distribution

The court ordered notice to all similarly situated non-exempt, non-managerial employees employed by defendants during the three years before the complaint was filed. It rejected the requested six-year notice period because the FLSA generally provides a two-year limitations period, extended to three years for willful violations, and because notice about state-law claims would not automatically make recipients members of a state-law class. The court used the three-year period because willfulness was alleged and had not been tested at this stage.

The court declined to automatically toll the FLSA limitations period for all potential participants while the opt-in period remained open. It stated that tolling could be considered later based on individualized facts showing diligence. The court set a 60-day period for employees to opt into the collective rather than the requested 90 days.

The court required revisions to the notice. It denied defendants’ request for repeated additional language about retaining independent counsel because the proposed notice already explained that option. It required defense counsel’s contact information to be added, approved language advising potential participants not to contact defendants’ lawyers directly if they join the case, struck language suggesting that employees had to decide immediately or risk losing all possible remedies, and found that a statement about whether a recipient was employed during the applicable period should be replaced with the shorter statement that the court might ultimately determine that the recipient did not have a claim. The notice also had to clarify that participants would be bound by rulings and settlements concerning Vilella’s FLSA claim and could share in a settlement or favorable judgment.

Defendants were ordered to provide, within 10 business days, the names, job titles, mailing addresses, email addresses, telephone numbers, and employment dates of covered employees. The court denied the request for Social Security numbers as premature and overbroad, while leaving open the possibility of reconsidering that request if many notices were returned as undeliverable. The court approved posting the notice at defendants’ businesses. It also allowed opt-in forms to be sent to Vilella’s counsel, who was ordered to file them on the electronic docket within 24 hours after receiving them.

Disposition

The court granted the motion for conditional class certification as modified by the opinion. It directed Vilella to meet and confer with defendants and submit a revised notice by December 1, 2023. The ruling was an early procedural step and did not determine the ultimate merits of the wage claims.