Castillo v. Z Deli Grocery V Corp

Background

Enrique Castillo sued Z Deli Grocery V Corp, doing business as Z Grill, Ali Esmael Ziad, and Mohammed Ziad, alleging violations of the Fair Labor Standards Act and New York Labor Law. Castillo alleged that he worked more than 40 hours per week without receiving overtime pay.

The defendants’ lawyer withdrew after citing unpaid legal bills and a breakdown in communication. Magistrate Judge Jennifer Willis ordered Z Grill to obtain new counsel and ordered Ali Esmael Ziad and Mohammed Ziad to obtain counsel or appear without a lawyer. The court warned that Z Grill could not appear without counsel and that failing to obtain counsel could result in default judgment. The defendants did not obtain counsel, respond to later orders, or answer Castillo’s motion for default judgment.

Court’s Analysis

Because no party objected to Magistrate Judge Willis’s Report and Recommendation, Judge Daniels reviewed it for clear error and adopted it except as otherwise noted. The court found that the grounds for default were clearly established and that the defendants’ default appeared willful because they had received multiple opportunities to participate but did not do so.

The court accepted the well-pleaded factual allegations as true for purposes of liability. It concluded that Castillo adequately alleged coverage under both the Fair Labor Standards Act and New York Labor Law and established an overtime claim by alleging that he worked more than 40 hours per week without being paid at one-and-a-half times his regular rate. The court also found the claims timely for the periods covered by each statute.

The court did not award relief on Castillo’s claims that the defendants failed to provide wage notices and wage statements. Although he adequately alleged those violations, he did not allege an injury or consequences resulting from them. The court therefore concluded that he lacked the constitutional standing required to bring those claims.

Damages and Disposition

The court found that Castillo’s documentary evidence and declarations established his damages with reasonable certainty. It awarded $360,091.88 for unpaid overtime and an equal amount in liquidated damages. It also awarded $17,490.05 in attorney fees and costs.

The court awarded nine-percent prejudgment simple interest on $164,176.88 in damages, calculated from August 28, 2016, through the date of judgment. It also awarded post-judgment interest under federal law. The total judgment was $737,673.81, plus applicable prejudgment and post-judgment interest.

Judge Daniels granted Castillo’s Motion for Default Judgment and ordered the defendants to pay the stated amounts. Under the classification convention, this is a procedural order because the judgment followed the defendants’ nonappearance and default, even though the court also examined the pleaded wage claims.