Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_20-cv-08100/USCOURTS-azd-3_20-cv-08100-0/pdf.json

Nature of Suit Code: 710
Nature of Suit: Fair Labor Standards Act
Cause of Action: 29:203 Equal Pay Act

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IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

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Mark Barbee, 

Plaintiff, 

v. 

DNSPWR2 LLC, et al., 

Defendants. 

No. CV-20-08100-PCT-MTM 

ORDER GRANTING 

DEFAULT JUDGMENT 

15 Pending before the Court is Plaintiffs Motion for Default Judgment (doc. 15), filed 

16 May 28, 2020. Plaintiff seeks a default judgment against Defendants for alleged violations 17 of the Fair Labor Standards Act, 29 U.S.C. §§ 201-219 ("FLSA") generally, and for 

· 18 violations of 29 U.S.C. § 203(m)(2)(B) specifically. Plaintiff seeks an award of $5,000.00 

19 in actual damages, $5,000.00 in statutory liquidated damages, and attorneys' fees and costs 

20 in an amount to be determined in a subsequent order. (Doc. 15 at 7). Though all five 

21 Defendants were properly served, none have appeared to defend this action. For the reasons 

22 explained below, the Court awards $10,000.00 in actual and statutory damages, and grants 

23 Plaintiff leave to file a motion for attorneys' fees and costs pursuant to Local Rule 

24 54.2(b)(2) of the Local Rules of Civil Procedure. 

25 I. FACTUAL BACKGROUND 

26 The following facts are taken from Plaintiffs Complaint. Plaintiff, a citizen of 27 Arizona, was employed by Defendants beginning on August 16, 2019. (Doc. 1 at 4). 

28 Plaintiff worked at three restaurants owned in common and operated by Defendants Hulen 
6 participated in the employee tip pool, taking tips for themselves. (Id). As illustrative 

7 examples, Plaintiff states that in the pay period between March 16, 2020 and March 29, 

8 2020, Plaintiff worked approximately ninety (90) hours and received a check for $800.00. 

9 (Id). Plaintiff states that he did not receive any tip money for this pay period. (Id). Plaintiff 

10 also alleges that Defendant Hulen expressly told Plaintiff that "tips would not be paid" in 

11 the future. (Id. at 10). Plaintiffs employment at the restaurants owned by Defendants ended 

12 on May 15, 2020. (Doc. 15-1, Ex. A at 3). 

13 On April 27, 2020, Plaintiff commenced this action. Plaintiff alleges violations of 

14 the FLSA for Defendants' failure to pay all tipped wages owed. (Id. at 11 ). Plaintiff seeks 

15 declaratory relief, liquidated damages, compensatory relief, and fees and costs associated 

16 with litigating this action. (Id. at 11-12). Plaintiff completed service on all Defendants on 17 May 4, 2020. (See docs. 8-12). On May 27, 2020, after the deadline for Defendants to file 

18 a responsive pleading passed, Plaintiff filed an Application for Entry of Default (doc. 13), 19 which the Clerk of Court entered on May 28, 2020. The same day, Plaintiff filed the present 

20 Motion for Default Judgment ( doc. 15), along with a supporting Affidavit ( doc. 15-1 ). 

21 II. JURISDICTION 

22 Before the Court may consider Plaintiffs Motion for Default Judgment, the Court 

23 must consider whether it may exercise jurisdiction over Plaintiffs claims. 

24 1. Subject-Matter Jurisdiction 

25 The Court has subject-matter jurisdiction over Plaintiffs claims. Plaintiff asserts 

26 violations of the FLSA, a federal statute. Federal courts may hear claims for unpaid tips 

27 and wages under 29 U.S.C. § 216(b). Tijerino v. Stetson Desert Project, LLC, 934 F.3d 

28 968, 971-72 (9th Cir. 2019). Accordingly, the Court has subject-matter jurisdiction. 

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6 Constitution of the United States," accordingly personal jurisdiction is proper so long as it 

7 does not offend due process. Patterson v. Home Depot, USA, Inc., 684 F. Supp. 2d 1170, 

8 1175 (D. Ariz. 2010). 

9 A court may exercise personal jurisdiction if a defendant has sufficient "minimum 

10 contacts" with the forum state so that subjecting the defendant to its jurisdiction will not 

11 "offend tradition conceptions of fair play and substantial justice." Int'! Shoe Co. v. 

12 Washington, 326 U.S 310, 316 (1945)(intemal citations omitted). This standard can be met 

13 by establishing either general or specific personal jurisdiction. 

14 General personal jurisdiction exists where the defendant's contacts with the forum 

15 state are "continuous and systematic." Helicopteros Nacionales de Colombia, S.A. v. Hall, 

16 466 U.S. 408, 415 (1984). Specific personal jurisdiction exists where a defendant "has 17 purposefully directed his activities at residents of the forum and the litigation results from 

18 alleged injuries arise out of or relate to those activities." Burger King Corp. v. Rudzewicz, 

19 471 U.S. 462, 472 (1985)(intemal citations omitted). 

20 This Court may exercise both general and specific personal jurisdiction over 

21 Defendants. The Complaint identifies Defendants as either Arizona corporations or 

22 Arizona residents. Additionally, the Complaint alleges the FLSA violations occurred in 

23 Defendants' businesses in Flagstaff, Arizona. Accordingly, the Court concludes that all 

24 Defendants maintain "continuous and systematic" contacts with this forum, and that the 

25 litigation arises out of activities purposefully directed at the forum state. Personal 

26 jurisdiction in Arizona is proper. 

27 3. Standing. 

28 Plaintiff has standing to bring this suit. Plaintiff must have (1) suffered an injury in 

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6 at 11-12). Accordingly, Plaintiff has alleged an injury in fact, fairly traceable to the conduct 

7 of Defendants, that would be redressed by a favorable judicial decision. 

8 III. MOTION FOR DEFAULT JUDGMENT 

9 Rule 55(b )(2) of the Federal Rules of Civil Procedure permits a court to grant default 

10 judgment against a party after the Clerk of Court has issued an Entry of Default pursuant 

11 to Fed. R. Civ. P. 55(a). The Court must consider seven factors: (1) the possibility of 

12 prejudice to plaintiff; (2) the merits of plaintiffs substantive claim; (3) the sufficiency of 

13 the complaint; ( 4) the sum of money at stake; ( 5) the possibility of a dispute concerning 

14 material facts; (6) whether defendant's default was due to excusable neglect; and (7) the 

15 strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the 

16 merits. Const. Laborers Trust Funds/or S. Cal. Admin. Co. v. Anzalone Masonry, Inc., 316 

17 F. Supp. 3d 1192, 1198 (C.D. Cal. 2018) (citing Eitel v. McCool, 782 F.2d 1470, 1471-72 

18 (9th Cir. 1986)). The Court considers these factors in tum: 19 1. Prejudice to Plaintiff 

20 The first Eitel factor weighs in favor of default judgment. Plaintiff will be prejudiced 

21 by failure to enter default judgment, as continuation of this action despite Defendants' 

22 failure to respond precludes Plaintiffs ability to either obtain relief or litigate this case on 

23 the merits. 

24 2. Merits of the Complaint 

25 The Court considers the second and third factors together in instances where the 

26 defendant has failed to appear at all. When moving for a default judgment, "the well27 pleaded factual allegations in the complaint are accepted as true, with the exception that 

28 allegations as to the amount of damages must be proved." Anzalone, 316 F. Supp. 3d at 

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6 Shaw, 572 F.3d 1087, 1091 (9th Cir. 2009)(intemal quotations omitted). A manager and 

7 employer can be one and the same under the FLSA. Id. at 1091-92. 

8 Plaintiff has pleaded facts sufficient to state a claim for violations of the FLSA. The 

9 Complaint alleges that Defendant Hulen "supervised and controlled Plaintiff's work 

10 schedules or the conditions of Plaintiff's employment," and that Defendant Hulen 

11 "determined the rate and method of Plaintiff's payment of wages." (Doc. 1 at 4). Further, 

12 Plaintiff alleges that all three restaurants where Plaintiff was employed were "under 

13 common control of Defendant Sarah Padmos." (Id. at 6). Finally, Plaintiff states that, under 

14 the Ninth Circuit's decision in Torres-Lopez v. May, 111 F.3d 633,640 (9th Cir. 1997), all 

15 Defendants in this action are joint employers of Plaintiff, because Defendants Hulen and 

16 Padmos are also principals, common managers, and supervisors of the LLC Defendants. 17 (Doc. 1 at 7). Plaintiff has pied facts sufficient to show that all Defendants in this action 

18 were "employers" for purposes of the FLSA. 

19 Plaintiff has also introduced facts that show Defendants Hulen and Padmos failed 

20 to pay Plaintiff tipped wages Plaintiff was entitled to receive. Plaintiff states that Defendant 

21 Hulen expressly informed him that "tips would not be paid" and wrote Plaintiff a check for 

22 $799.71 instead, well below what Plaintiff alleges he made in the two-week period between 

23 March 23, 2020 and April 5, 2020. (Doc. I at 10). Further, Plaintiff alleges that each 

24 Defendant "gave consent to, ratified, and authorized the acts of all other Defendants." (Id. 

25 at 6). Plaintiff has sufficiently alleged that Defendants failed to pay Plaintiff tipped wages. 

26 3. Amount in Controversy 

27 The fourth Eitel factor weighs in favor of entering default judgment. Default 

28 judgment is disfavored where the sum of money requested is too large or unreasonable 

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6 Defendants' alleged FLSA violation is not unreasonable. 

7 Additionally, the FLSA provides for liquidated damages equal to the amount of 

8 compensatory damages when the violation of the FLSA is "willful," and the FLSA requires 

9 the Court to award attorney's fees when a plaintiff prevails. 29 U.S.C. § 216(b). Were 

10 Plaintiff to prevail at a trial on the merits, Plaintiff would receive a liquidated damage 

11 amount equal to Plaintiffs compensatory damages award. Therefore, the damages 

12 requested by Plaintiff are not unreasonable considering the factual allegations and the 

13 statutory provisions. 

14 4. Dispute Over Material Facts 

15 The fifth Eitel factor weighs in favor of entering default judgment. The possibility 

16 of a dispute regarding material facts is relevant only so far as there are two parties present 17 to dispute those facts. When one party fails to appear to defend an action, there is no dispute 

18 of material facts. 19 5. Excusable Neglect 

20 The sixth factor weighs in favor of granting default judgment. The risk of excusable 

21 neglect is substantially lessened when a defendant fails to respond after being properly 

22 served. Wecosign, Inc. v. lFG Holdings, Inc., 845 F. Supp. 2d 1072, 1082 (C.D. Cal. 2012). 

23 Defendants were properly served on May 4, 2020 (see docs. 8-12) and have failed to 

24 respond by filing an answer, a motion to dismiss, or some other responsive pleading 

25 indicative of intent to contest this action. 26 Additionally, Plaintiff attests that Defendants previously engaged counsel to defend 

27 this action but dismissed counsel on May 14, 2020. (Doc. 15 at 5). Plaintiff also attests that 

28 Defendant's former counsel stated that "[Defendant Hulen] plans to contact you directly." 

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6 of Civil Procedure contain a policy strong favoring deciding cases on the merits, a 

7 judgment on the merits is impractical, if not impossible, where defendants fail to respond 

8 to a plaintiffs complaint. Anzalone, 316 F. Supp. 3d at 1202. Accordingly, the preference 

9 for decisions on the merits does not preclude default judgment. 

10 7. Conclusion 

11 After analyzing the Etiel factors, the Court concludes that all seven factors favor a 

12 default judgment. Accordingly, the Court grants Plaintiffs motion and enters a default 

13 judgment on behalf of Plaintiff. 

14 IV. DAMAGES 

15 Having determined that Plaintiff has pled facts sufficient to claim both actual and 

16 statutory damages, the Court now considers the appropriate damages award. Even when a 17 party defaults an action for failing to respond to a well-pleaded complaint, the prevailing 

18 party is required to produce evidence to support a specific damages award. Anzalone, 316 

19 F. Supp. 3d at 1202. A plaintiff need not submit voluminous evidence to support a claim 

20 for damages; a declaration or affidavit from the plaintiff describing the factual allegations 

21 that support a damages award will suffice. See Vogel v. Rite Aid Corp., 992 F. Supp. 2d 

22 998, 1014 (C.D. Cal. 2014). 

23 1. Actual Damages 

24 The Court awards $5,000.00 in actual damages. Plaintiff submitted an affidavit 

25 asserting that, from August 16, 2019 to May 15, 2020, Plaintiff was deprived of 26 approximately $5,000.00 in tips. (Doc. 15-1, Ex. A at 3). This is consistent with the 

27 allegations in the Complaint, where Plaintiff alleges that in a single pay period, Plaintiff 

28 was not paid $575.85 in tips. (Doc. 1 at 10). 

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6 Plaintiff was an employee of Defendants, Plaintiffs declaration that he is owed $5,000.00 

7 in unpaid tips is not patently unreasonable. The Court concludes that Plaintiff has submitted 

8 sufficient evidence of damages to support an award of$5,000.00 in actual damages. 

9 2. Statutory Damages 

10 The Court awards $5,000.00 in statutory damages. Section 216 of the FLSA 

11 provides for "an additional equal amount as liquidated damages" for any violation of the 

12 FLSA. 29 U.S.C. 216(b). For most FLSA violations, liquidated damages are mandatory. 

13 Ader v. SimonMedimaging Inc., ---F. Supp. 3d---, ---, 2020 WL 3078350 at *13 (D. Ariz. 

14 2020). However, Section 260 of the FLSA reads in relevant part that, in any civil action 

15 regarding unpaid compensation, "if the employer shows to the satisfaction of the court that 

16 the act or omission giving rise to such action was in good faith and that he had reasonable 17 grounds for believing that his act or omission was not a violation of the [FLSA], the court 

18 may, in its sound discretion, award no liquidated damages or award any amount thereof." 

19 29 U.S.C. § 260. 

20 Liquidated damages are warranted. The good faith exception to the presumption of 

21 liquidated damages must be proved by the employer, not disproved by the employee. 

22 Flores v. City of San Gabriel, 824 F.3d 890, 905 (9th Cir. 2016). In a default judgment 

23 where the employer failed to respond, the employer has failed to demonstrate "an honest 

24 intention to ascertain and follow the dictates of the Act and that it had reasonable grounds 

25 for believing that its conduct complied with the Act." Id. Accordingly, Plaintiff is entitled 

26 to $5,000.00 in statutory liquidated damages under the FLSA. 

27 3. Fees and Costs 

28 While Plaintiff seeks attorneys' fees and costs associated with litigating this action, 

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6 of fees and costs pending a proper motion from Plaintiff. Plaintiff may file, no later than 

7 fourteen (14) days from the issuance of this Order, a motion seeking attorneys' fees and 

8 costs that satisfies the requirements ofLRCiv 54.2. 

9 V. CONCLUSION 

10 Plaintiff is entitled to a default judgment for Defendants violation of the FLSA. 

11 Because the violation was willful and Defendants did not provide any evidence of good 

12 faith, Plaintiff is entitled to full compensatory and statutory damages totaling $10,000.00. 

13 Upon entry of this Order, Plaintiff may file a separate motion, with supporting exhibits, 

14 seeking attorney's fees and costs. 

15 IT IS ORDERED: 

16 (1) Plaintiff's Motion for Default Judgment (doc. 15) is GRANTED. 17 (2) Defendants shall pay, jointly and severally, $5,000.00 in compensatory 18 damages to Plaintiff. 19 (3) Defendants shall pay, jointly and severally, $5,000.00 in statutory damages 

20 pursuant to 29 U.S.C. § 216(b) to Plaintiff. 

21 ( 4) Within fourteen (14) days of the issuance of this Order, Plaintiff may file a 

22 motion seeking attorney's fees and costs that satisfies the requirements of Rule 54.2 of the 

23 Local Rules of Civil Procedure. 

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