COLLECTIVE COMPLAINT FOR DAMAGES; DEMAND FOR JURY TRIAL

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THE UNITED STATES DISTRICT COURT 

FOR THE WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

NATALIE HEATH, aka 

HAZEL/PEPPER, an individual,

Plaintiff,

vs.

TFS DINING, LLC, D/B/A YELLOW 

ROSE; RPM DINING, LLC; JON 

PERSINGER AND KENNY DOE, 

inclusive

 Defendants.

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Case No.: 1:20-cv-00119

JURY TRIAL DEMANDED

PLAINTIFF’S ORIGINAL COMPLAINT

Plaintiff NATALIE HEATH., aka HAZEL/PEPPER (“Plaintiff”), individually and on 

behalf of all others similarly situated, alleges the following upon information and belief, based 

upon investigation of counsel, published reports, and personal knowledge: 

I. NATURE OF THE ACTION

1. Plaintiff alleges causes of action against Defendant TFS DINING, LLC, D/B/A

YELLOW ROSE, RPM DINING, LLC JON PERSINGER AND KENNY DOE

(“Defendants”) for damages resulting from Defendants evading the mandatory minimum wage 

and overtime provisions of the Fair Labor Standards Act, 29 U.S.C. §§ 201, et seq.(“FLSA”) and 

illegally absconding with Plaintiff’s tips.

2. Defendants own and operate a strip club named YELLOW ROSE. These causes 

of action arise from Defendants’ willful actions while Plaintiff was employed by Defendants

from approximately January 2019 through March 2019. Throughout her employment with 

Defendants, Plaintiff has been denied minimum wage payments and denied overtime as part of 

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Defendants scheme to classify Plaintiff and other dancers/entertainers as “independent 

contractors.” Asthe Department of Labor explained in a recent Administrative Interpretation:

Misclassification of employees as independent contractors is found in an 

increasing number of workplaces in the United States, in part reflecting 

larger restructuring of business organizations. When employers 

improperly classify employees as independent contractors, the employees 

may not receive important workplace protections such as the minimum 

wage, overtime compensation, unemployment insurance, and workers’ 

compensation. Misclassification also results in lower tax revenues for

government and an uneven playing field for employers who properly

classify their workers. Although independent contracting relationships

can be advantageous for workers and businesses, some employees may

be intentionally misclassified as a means to cut costs and avoid compliance

with labor laws.1

As alleged in more detail below, that is exactly what the Defendant is doing in this case. 

3. Plaintiff worked at Defendants’ principal place of business located at 6528 N. 

Lamar Blvd, Austin, TX. 78757.

4. Defendants failed to pay Plaintiff minimum wages and overtime wages for all 

hours worked in violation of 29 U.S.C. §§ 206 and 207 of the FLSA.

5. Defendants’ conduct violates the FLSA, which requires non-exempt employees 

to be compensated for their overtime work at a rate of one and one-half (1 1⁄2) times their regular 

rate of pay. See 29 U.S.C. § 207(a).

6. Furthermore, Defendants’ practice of failing to pay tipped employees pursuant to 

29 U.S.C. § 203(m), violates the FLSA’s minimum wage provision. See 29 U.S.C. § 206.

7. Plaintiff brings a collective action to recover the unpaid overtime compensation 

and minimum wage owed to her individually and on behalf of all other similarly situated 

employees, current and former, of Defendants. Members of the Collective Action are hereinafter 

1 See DOL Admin. Interp. No. 2015-1, available at

http://www.dol.gov/whd/workers/Misclassification/AI- 2015_1.pdf.

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referred to as “FLSA Class Members.”

8. As a result of Defendants’ violations, Plaintiff and the FLSA Class Members 

seek to recover double damages for failure to pay minimum wage, overtime liquidated damages, 

interest, and attorneys’ fees.

II. PARTIES

9. Plaintiff is an individual adult resident of the State of Texas. Furthermore, 

Plaintiff is employed by Defendants and qualifies as an “employee” of Defendants as defined by 

the FLSA, 29 U.S.C. § 203(e)(1). Her consent to this action is attached hereto as Exhibit 1.

10. The FLSA Class Members are all current and former exotic dancers who worked 

at the Yellow Rose, 6528 N. Lamar Blvd, Austin, TX 78757 at any time starting three (3) years 

before this Complaint was filed, up to the present.

11. TFS Dining, LLC d/b/a Yellow Rose is a Texas Limited Liability Company with 

its principal place of business at 14916 Copper Ridge Lane, Austin, TX 78734. At all times 

mentioned herein, TFS Dining, LLC was an “employer” or “joint employer” as defined by the

FLSA, 29 U.S.C. § 203(d) and (g). TFS Dining, LLC. may be served via its agent for service of 

process, Jonathan Michael Joseph, 14916 Copper Ridge Lane, Austin, TX. 78734.

12. RPM Dining, LLC is a Texas Limited Liability Company with its principal place 

of business at 6901 N. Lamar Blvd, Suite 115, Austin, TX. 78752. At all times mentioned 

herein, RPM Dining, LLC was an “employer” or “joint employer” as defined by the FLSA, 29 

U.S.C. § 203(d) and (g). TFS Dining, LLC. may be served via its agent for service of process, 

Jon Persinger, 6528 N. Lamar, Austin, TX. 78752.

13. JON PERSINGER is an owner/manager of RPM Dining, LLC and/or TFS 

Dining, LLC d/b/a Yellow Rose and may be served at 6528 N. Lamar, Austin, TX 78752.

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14. JON PERSINGER was/is the main manager who executed the policies regarding 

payment to dancers and management of dancers, including Plaintiff. 

15. JON PERSINGER was/is the main manager who executed the policies regarding 

payment to dancers and management of dancers, including Plaintiff. Plaintiff will seek to amend 

upon discovering the full name of Kenny DOE. Plaintiff will also name other individuals who 

are personally liable under the FLSA.

16. JON PERSINGER acted directly or indirectly on behalf of Yellow Rose, and, at 

all times mentioned herein was an “employer” or “joint employer” of Plaintiff within the 

meaning of the FLSA. He exerted operational and management control over Defendants, 

including day to day management. He was, and is, frequently present at, owned, directed, 

controlled and managed the operations at Defendants. He also controlled the nature, pay 

structure, and employment relationship of Plaintiff and the FLSA Class Members. Kenny had at 

all times relevant to this lawsuit, the authority to hire and fire employees at Defendants, the 

authority to direct and supervise the work of employees, the authority to sign on the business’ 

checking accounts, including payroll accounts, and the authority to make decisions regarding 

employee compensation and capital expenditures. Additionally, he was responsible for the dayto-day affairs of Defendants. In particular, he was responsible for determining whether 

Defendants complied with the FLSA.

17. JON PERSINGER acted directly or indirectly on behalf of Yellow Rose, and, at 

all times mentioned herein was an “employer” or “joint employer” of Plaintiff within the 

meaning of the FLSA. He exerted operational and management control over Defendants, 

including day to day management. He was, and is, frequently present at, owned, directed, 

controlled and managed the operations at Defendants. He also controlled the nature, pay 

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structure, and employment relationship of Plaintiff and the FLSA Class Members. Kenny had at 

all times relevant to this lawsuit, the authority to hire and fire employees at Defendants, the 

authority to direct and supervise the work of employees, the authority to sign on the business’ 

checking accounts, including payroll accounts, and the authority to make decisions regarding 

employee compensation and capital expenditures. Additionally, he was responsible for the dayto-day affairs of Defendants. In particular, he was responsible for determining whether 

Defendants complied with the FLSA.

18. Kenny DOE (“Kenny”) was/is the main manager who executed the policies 

regarding payment to dancers and management of dancers, including Plaintiff. Plaintiff will seek 

to amend upon discovering the full name of Kenny DOE. Plaintiff will also name other 

individuals who are personally liable under the FLSA.

19. Kenny acted directly or indirectly on behalf of Yellow Rose, and, at all times 

mentioned herein was an “employer” or “joint employer” of Plaintiff within the meaning of the 

FLSA. He exerted operational and management control over Defendants, including day to day 

management. He was, and is, frequently present at, owned, directed, controlled and managed the 

operations at Defendants. He also controlled the nature, pay structure, and employment 

relationship of Plaintiff and the FLSA Class Members. Kenny had at all times relevant to this 

lawsuit, the authority to hire and fire employees at Defendants, the authority to direct and 

supervise the work of employees, the authority to sign on the business’ checking accounts, 

including payroll accounts, and the authority to make decisions regarding employee 

compensation and capital expenditures. Additionally, he was responsible for the day-to-day 

affairs of Defendants. In particular, he was responsible for determining whether Defendants 

complied with the FLSA.

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20. Kenny acted directly or indirectly on behalf of Yellow Rose, and, at all times 

mentioned herein was an “employer” or “joint employer” of Plaintiff within the meaning of the 

FLSA. He exerted operational and management control over Defendants, including day to day 

management. He was, and is, frequently present at, owned, directed, controlled and managed the 

operations at Defendants. He also controlled the nature, pay structure, and employment 

relationship of Plaintiff and the FLSA Class Members. Kenny had at all times relevant to this 

lawsuit, the authority to hire and fire employees at Defendants, the authority to direct and 

supervise the work of employees, the authority to sign on the business’ checking accounts, 

including payroll accounts, and the authority to make decisions regarding employee 

compensation and capital expenditures. Additionally, he was responsible for the day-to-day 

affairs of Defendants. In particular, he was responsible for determining whether Defendants

complied with the FLSA.

21. The true names, capacities or involvement, whether individual, corporate, 

governmental or associate, of all managers and owners of Defendants are unknown to Plaintiff. 

Plaintiff prays for leave to amend this Complaint to show their true names and capacities when 

the same have been finally determined. Plaintiff is informed and believes, and upon such 

information and belief alleges thereon, that each of the unknown Defendants is negligently, 

intentionally, strictly liable or otherwise legally responsible in some manner for the events and 

happenings herein referred to, and negligently, strictly liable intentionally or otherwise caused

injury and damages proximately thereby to Plaintiff, as is hereinafter alleged. 

22. At all material times, Defendants have been an enterprise in commerce or in the 

production of goods for commerce within the meaning of 29 U.S.C. § 203(r)(1) of the FLSA 

because they have had employees at their club engaged in commerce, which has travelled in 

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interstate commerce. Moreover, because of Defendants’ interrelated activities, they function in 

interstate commerce. 29 U.S.C. § 203(s)(1).

23. Furthermore, Defendants have had, and continue to have, an annual gross 

business volume in excess of the statutory standard.

24. At all material times during the three (3) years prior to the filing of this action, 

Defendants categorized all dancers/entertainers employed by Defendants as “independent 

contractors” and have failed and refused to pay wages or compensation to such 

dancers/entertainers. Plaintiff was an individual employee who engaged in commerce or in the 

production of goods for commerce as required by 29 U.S.C. §§ 206-207.

25. Plaintiff is informed and believes that, at all relevant times herein, Defendants

engaged in the acts alleged herein and/or condoned, permitted, authorized, and/or ratified the 

conduct of its employees and agents, and other Defendants and are vicariously or strictly liable 

for the wrongful conduct of its employees and agents as alleged herein.

26. Plaintiff is informed and believes, and on that basis alleges that, each of the 

Defendants acted, in all respects pertinent to this action, as the agent or employee of each other, 

and carried out a joint scheme, business plan, or policy in all respect thereto and, therefore, the 

acts of each of these Defendants are legally attributable to the other Defendants, and that these 

Defendants, in all respects, acted as employers and/or joint employers of Plaintiff in that each of 

them exercised control over her wage payments and control over her duties.

27. Plaintiff is informed and believes, and on that basis alleges that, at all relevant 

times, each and every Defendant has been the agent, employee, representative, servant, master, 

employer, owner, agent, joint venture, and alter ego of each of the other and each was acting 

within the course and scope of his or her ownership, agency, service, joint venture and 

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employment.

28. At all times mentioned herein, each and every Defendant was the successor of the 

other and each assumes the responsibility for the acts and omissions of all other Defendant.

III. VENUE AND JURSIDICTION

29. This Court has jurisdiction over the subject matter of this action under 28 U.S.C. 

§ 1331 because this action arises under the FLSA, 29 U.S.C. §§ 201, et seq.

30. Venue is proper in this District because all or a substantial portion of the events 

forming the basis of this action occurred in this District. Defendants’ club is located in this 

District and Plaintiff worked in this District. 

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IV. ALLEGATIONS COMMON TO ALL CAUSES OF ACTION

(AGAINST ALL DEFENDANTS)

A. FACTUAL ALLEGATIONS

31. Defendant operates an adult-oriented entertainment facility located at 

6528 N. Lamar Blvd, Austin, TX. 78757. The picture below depicts the outside of the 

Club.

32. At all times mentioned herein, Defendants were “employer(s)” or “joint 

employer(s)” of Plaintiff. 

33. At all times during the three (3) years prior to the filing of the instant action, 

Defendants categorized all dancers/entertainers employed by Defendants as “independent 

contractors” and have failed and refused to pay wages to such dancers. 

34. At all times relevant to this action, Defendants exercised a great deal of 

operational and management control over the subject club, particularly in the areas of terms and 

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conditions of employment applicable to dancers and entertainers. 

35. Plaintiff began working as a dancer for Defendants in January, 2019 through 

March 2019.

36. The primary duty of an entertainer is to dance and entertain customers, and give 

them a good experience. Specifically, an entertainer performs stage and table dances, and 

entertains customers on an hourly basis. 

37. Stated differently, entertainers dance on stage, perform table dances, and 

entertain customers in VIP rooms, all while nude or semi-nude. 

38. Plaintiff worked and performed at the adult-oriented entertainment facility

multiple shifts per week. Plaintiff was an integral part of Defendants’ business which operated 

solely as an adult-oriented entertainment facility featuring nude or semi-nude female 

entertainers. 

39. Defendants did not pay entertainers on an hourly basis. 

40. Defendants exercised significant control over Plaintiff during her shifts, and 

Defendants required Plaintiff to work an entire shift.

41. Defendants set prices for all VIP performances. 

42. Defendants charge the dancers a late fee if they do not arrive for a shift on time. 

43. Defendants controlled the means and manner in which Plaintiff could perform.

44. Defendants had the authority to suspend, fine, fire, or otherwise discipline 

entertainers for non-compliance with their rules regarding dancing. 

45. Defendants actually suspended, fined, fired, or otherwise disciplined entertainers 

for non-compliance with their rules regarding dancing. 

46. Plaintiff was compensated exclusively through tips from Defendants’ customers. 

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That is, Defendants did not pay Plaintiff whatsoever for any hours worked at their 

establishment.

47. Defendants also required Plaintiff to share her tips with Defendants, other nonservice employees who do not customarily receive tips, including the managers, disc jockeys, 

and the house mother.

48. Defendants are in violation of the FLSA’s tipped-employee compensation 

provision, 29 U.S.C. § 203(m), which requires employers to pay a tipped employee a minimum 

of $2.13 per hour. Defendants also violated 29 U.S.C. § 203(m) when they failed to notify the 

Plaintiff about the tip credit allowance (including the amount to be credited) before the credit 

was utilized. That is, Defendants’ exotic dancers were never made aware of how the tip credit 

allowance worked or what the amounts to be credited were. Furthermore, Defendants violated 

29 U.S.C. § 203(m) because they did not allow Plaintiff to retain all of her tips and instead 

required that she divide her tips amongst other employees who do not customarily and regularly 

receive tips. Because Defendants violated the tip-pool law, Defendants loses the right to take a 

credit toward minimum wage.

49. Defendants provided and paid for all advertising and marketing efforts 

undertaken on behalf of Defendants.

50. Defendants paid for the building used by Defendants’ maintenance of the facility, 

the sound system, stages, lights, beverages and inventory used at the facility. 

51. Defendants made all hiring decisions regarding wait staff, security, entertainers, 

managerial and all other employees on the premises. 

52. Defendants’ opportunity for profit and loss far exceeded Plaintiff’s opportunity 

for profit and loss from work at Yellow Rose. 

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53. Nude dancing is an integral part of Defendants’ operations. Defendants’ 

advertising prominently displays nude dancing for its customers. Yellow Rose is well known as 

a “strip club.”

54. Defendants needs entertainers to successfully and profitably operate their 

business model. 

55. The position of entertainer requires no managerial skill of others.

56. The position of entertainer requires little other skill or education, formal or 

otherwise. 

57. The only requirements to become an entertainer at are “physical attributes” and 

the ability to dance seductively. The amount of skill required is more akin to an employment 

position than that of a typical independent contractor. 

58. Defendants failed to maintain records of wages, fines, fees, tips and gratuities 

and/or service charges paid or received by entertainers.

59. Plaintiff was not paid an hourly minimum wage or any hourly wage or salary 

despite being present at Defendants’ facility and required to work and entertain its customers at 

any time during a seven-plus (7+) hour work shift.

60. Plaintiff was not paid overtime wages at one-and-a-half (11⁄2) times the regular 

minimum wage rate for any hours worked despite being present at Defendants’ facility and 

required to work and entertain its customers for longer than eight (8) hours per shift. 

61. The FLSA Class Members had the same pay structure and were under the same 

controls as Plaintiff. 

62. Plaintiff and FLSA Class Members would work over forty (40) hours in some 

weeks each worked for Defendants.

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63. Defendants have never paid Plaintiff and the FLSA Class Members any amount 

as wages whatsoever, and have instead unlawfully required Plaintiff and FLSA Class Members 

to pay them for the privilege of working.

64. The only source of monies received by Plaintiff (and the class she seeks to 

represent) relative to her employment with Defendants came in the form of gratuities received 

directly from customers, a portion of which Plaintiff and the FLSA Class Members were 

required to pay to Defendants. 

65. Although Plaintiff and the FLSA Class Members are required to and do in fact 

frequently work more than forty (40) hours per workweek, they are not compensated at the 

FLSA mandated time-and-a-half rate for hours in excess of forty (40) per workweek. In fact, 

they receive no compensation whatsoever from Defendants and thus, Defendants violates the 

minimum wage requirement of FLSA. See 29 U.S.C. § 206.

66. Defendants’ method of paying Plaintiff in violation of the FLSA was willful and 

was not based on a good faith and reasonable belief that its conduct complied with the FLSA. 

Defendants misclassified Plaintiff with the sole intent to avoid paying her in accordance to the 

FLSA; the fees and fines described herein constitute unlawful “kickbacks” to the employer 

within the meaning of the FLSA, and Plaintiffs are entitled to restitution of such fines and fees. 

67. Plaintiff and FLSA Class Members who worked at Yellow Rose performed 

precisely the same job duties - dancing and entertaining at Yellow Rose.

68. Plaintiff and FLSA Class Members who worked at Yellow Rose during the 

applicable limitations period(s) were subject to the same work rules established by the 

Defendants as identified above.

69. Plaintiff and FLSA Class Members at Yellow Rose were subject to the terms and 

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conditions of employment and the same degree of control, direction, supervision, promotion and 

investment imposed or performed by Defendants.

70. Plaintiff and FLSA Class Members at Yellow Rose during the applicable 

limitations period(s) were subject to the same across-the-board, uniformly applied corporate 

policy mandated by Defendants.

71. Plaintiff and the FLSA Class Members at Yellow Rose, during the applicable 

limitations period, were subject to the same fees and fines imposed by Defendants.

72. As a result of Defendants’ across-the-board, standard operating procedure of 

mischaracterizing dancers/entertainers as “independent contractors” and their consequent failure 

to pay any wages or compensation whatsoever, it is a certainly that numerous other current and 

former dancers and entertainers who worked at Yellow Rose during the applicable limitations 

period would elect to participate in this action if provided notice of same.

73. Upon information and belief, more than one hundred (100) dancers and 

entertainers have worked at Yellow Rose during the three (3) to five (5) years prior to the filing 

of this action.

74. Plaintiff is “similarly situated” to the 29 U.S.C. § 216(b) class of persons she 

seeks to represent and will adequately represent the interests of the class.

75. Plaintiff has hired Counsel experienced in class actions and in collective actions 

under 29 U.S.C. § 216(b) who will adequately represent the class.

76. Defendants failed to keep records of tips, gratuities and/or service charges paid to 

Plaintiff or any other entertainer and failed to maintain and furnish wage statements to Plaintiff.

77. Federal law mandates that an employer is required to keep for three (3) years all 

payroll records and other records containing, among other things, the following information:

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a. The time of day and day of week on which the employees’ work week begins;

b. The regular hourly rate of pay for any workweek in which overtime compensation 

is due under section 7(a) of the FLSA;

c. An explanation of the basis of pay by indicating the monetary amount paid on a 

per hour, per day, per week, or other basis;

d. The amount and nature of each payment which, pursuant to section 7(e) of the 

FLSA, is excluded from the “regular rate”;

e. The hours worked each workday and total hours worked each workweek;

f. The total daily or weekly straight time earnings or wages due for hours worked 

during the workday or workweek, exclusive of premium overtime compensation;

g. The total premium for overtime hours. This amount excludes the straight-time 

earnings for overtime hours recorded under this section;

h. The total additions to or deductions from wages paid each pay period including 

employee purchase orders or wage assignments;

i. The dates, amounts, and nature of the items which make up the total additions and 

deductions;

j. The total wages paid each pay period; and

k. The date of payment and the pay period covered by payment.

29 C.F.R. 516.2, 516.5.

78. Defendants have not complied with federal law and have failed to maintain such 

records with respect to Plaintiff and the FLSA Class Members. Because Defendants’ records are 

inaccurate and/or inadequate, Plaintiff and the FLSA Class Members can meet their burden 

under the FLSA by proving that they, in fact, performed work for which they were improperly 

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compensated, and produce sufficient evidence to show the amount and extent of their work “as a 

matter of a just and reasonable inference.” See, e.g., Anderson v. Mt. Clemens Pottery Co., 328 

U.S. 680, 687 (1946). Plaintiff seeks to put Defendants on notice that she intends to rely on 

Anderson to provide the extent of her unpaid work.

B. INDIVIDUAL LIABILITY UNDER THE FLSA

79. In Lamonica v. Safe Hurricane Shutters, Inc., the U.S. Court of Appeals for the 

Eleventh Circuit held that individuals can be liable for FLSA violations under an expansive 

interpretation of “employer” for directors and officers. Lamonica v. Safe Hurricane Shutters, 

Inc., 711 F.3d 1299 (11th Cir. 2013). The FLSA defines “employer” as “any person acting 

directly or indirectly in the interest of an employer in relation to an employee.” 29 U.S.C. § 

203(d). The Fifth Circuit stated “[t]he dominant theme in the case law is that those who have

operating control over employees within companies may be individually liable for FLSA 

violations committed by the companies.” Gray v. Powers, 673 F.3d 352, 357 (5th Cir. 2012).

80. Where an individual exercise “control over the nature and structure of the 

employment relationship,” or “economic control” over the relationship, that individual is an 

employer within the meaning of the FLSA and is subject to liability. Lambert v. Ackerley 180 

F.3d 997 (9th Cir. 1999) Factors related to “economic control,” which included ownership 

interest, operational control of significant aspects of the day-to-day functions, the power to hire 

and fire employees, determine salaries, and the responsibility to maintain employment records. 

Gray, 673 F.3d at 355 (citing Williams v. Henagan, 595 F.3d 610, 615 (5th Cir. 2010).

81. Kenny is individually liable for failing to pay Plaintiff her wages. The actual 

identities of other managers and owners are unknown at this time. As stated before, Plaintiff will 

be amending to include individuals liable pursuant to Gray v. Powers, 673 F.3d 352, 357 (5th 

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Cir. 2012).

V. COLLECTIVE ACTION ALLEGATIONS

82. Plaintiff hereby incorporates by reference and re-alleges each and every 

allegation set forth in each and every preceding paragraph as though fully set forth herein.

83. Plaintiff brings this action as an FLSA collective action pursuant to 29 U.S.C. 

§ 216(b) on behalf of all persons who were or are employed by Defendants as exotic 

dancers/entertainers at any time during the three (3) years prior to the commencement of this 

action to present.

84. Plaintiff has actual knowledge that FLSA Class Members have also been denied 

overtime pay for hours worked over forty (40) hours per workweek and have been denied pay at 

the federally mandated minimum wage rate. That is, Plaintiff worked with other 

dancers/entertainers at Yellow Rose. As such, she has firsthand personal knowledge of the same 

pay violations throughout Defendants’ club. Furthermore, other exotic dancers/entertainers at 

Defendants’ club have shared with her similar pay violation experiences as those described in 

this Complaint.

85. Other employees similarly situated to Plaintiff work or have worked at Yellow 

Rose but were not paid overtime at the rate of one and one-half (1 1⁄2) their regular rate when 

those hours exceeded forty (40) hours per workweek. Furthermore, these same employees were 

denied pay at the federally mandated minimum wage rate.

86. Although Defendants permitted and/or required the FLSA Class Members to 

work in excess of forty (40) hours per workweek, Defendants have denied them full 

compensation for their hours worked over forty (40). Defendants have also denied them full 

compensation at the federally mandated minimum wage rate.

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87. FLSA Class Members perform or have performed the same or similar work as 

the Plaintiff.

88. FLSA Class Members regularly work or have worked in excess of forty (40) 

hours during a workweek.

89. FLSA Class Members regularly work or have worked and did not receive 

minimum wage.

90. FLSA Class Members are not exempt from receiving overtime and/or pay at the 

federally mandated minimum wage rate under the FLSA.

91. As such, FLSA Class Members are similar to Plaintiff in terms of job duties, pay 

structure, misclassification as independent contractors and/or the denial of overtime and 

minimum wage.

92. Defendants’ failure to pay overtime compensation and hours worked at the 

minimum wage rate required by the FLSA results from generally applicable policies or practices

and does not depend on the personal circumstances of the FLSA Class Members.

93. The experiences of the Plaintiff, with respect to her pay, are typical of the 

experiences of the FLSA Class Members.

94. The specific job titles or precise job responsibilities of each FLSA Class Member 

does not prevent collective treatment.

95. All FLSA Class Members, irrespective of their particular job requirements, are 

entitled to overtime compensation for hours worked in excess of forty (40) during a workweek.

96. All FLSA Class Members, irrespective of their particular job requirements, are 

entitled to compensation for hours worked at the federally mandated minimum wage rate.

97. Although the exact number of damages may vary among FLSA Class Members, 

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the damages for the FLSA Class Members can be easily calculated by a simple formula. The 

claims of all FLSA Class Members arise from a common nucleus of facts. Liability is based on 

a systematic course of wrongful conduct by the Defendants that caused harm to all FLSA Class 

Members.

98. As such, Plaintiff brings her FLSA claims as a collective action on behalf of the 

following class:

All of Defendants’ current and former exotic dancers/entertainers who 

worked at the Yellow Rose located in Austin, Texas at any time 

starting three years before this Complaint was filed.

VI. CAUSES OF ACTION

FIRST CAUSE OF ACTION

FAILURE TO PAY MINIMUM WAGE PURSUANT TO FLSA, 29 U.S.C. § 206

(By Plaintiff Individually and on Behalf of the Collective

Against All Defendants)

99. Plaintiff hereby incorporates by reference and re-alleges each and every 

allegation set forth in each and every preceding paragraph as though fully set forth herein.

100. Defendants are engaged in “commerce” and/or in the production of “goods” for 

“commerce” as those terms are defined in the FLSA.

101. Defendants operate an enterprise engaged in commerce within the meaning of the 

FLSA, 29 U.S.C. § 203(s)(1), because it has employees engaged in commerce, and because its 

annual gross volume of sales made is more than five hundred thousand U.S. Dollars ($500,000).

102. Defendants failed to pay Plaintiff minimum wage in violation of 29 U.S.C. § 206.

103. Based upon the conduct alleged herein, Defendants knowingly, intentionally and 

willfully violated the FLSA by not paying Plaintiff the minimum wage under the FLSA.

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104. Throughout the relevant period of this lawsuit, there is no evidence that 

Defendants’ conduct that gave rise to this action was in good faith and based on reasonable 

grounds. In fact, Defendants continued to violate the FLSA long after it learned that its 

misclassification scheme and compensation policies were illegal.

105. Due to Defendants’ FLSA violations, Plaintiff is entitled to recover from 

Defendants, minimum wage compensation and an equal amount in the form of liquidated 

damages, as well as reasonable attorneys’ fees and costs of the action, including interest, 

pursuant to 29 U.S.C. § 216(b).

SECOND CAUSE OF ACTION

FAILURE TO PAY OVERTIME WAGES PURSUANT TO FLSA, 29 U.S.C. § 207

(By Plaintiff Individually and on Behalf of the Collective

Against All Defendants)

106. Plaintiff hereby incorporates by reference and re-alleges each and every allegation 

set forth in each and every preceding paragraph as though fully set forth herein.

107. Each Defendant is an “employer” or “joint employer” of Plaintiff within the 

meaning of the FLSA, 29 U.S.C. § 203(d). 

108. Defendants are engaged in “commerce” and/or in the production of “goods” for 

“commerce” as those terms are defined in the FLSA.

109. Defendants operate an enterprise engaged in commerce within the meaning of the 

FLSA, 29 U.S.C. § 203(s)(1), because it has employees engaged in commerce, and because its 

annual gross volume of sales made is more than five hundred thousand U.S. Dollars 

($500,000.00).

110. Defendants failed to pay Plaintiff the applicable overtime wage for each hour in 

excess of forty (40) during each workweek in which she worked in violation of 29 U.S.C. § 207.

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111. Based upon the conduct alleged herein, Defendants knowingly, intentionally and 

willfully violated the FLSA by not paying Plaintiff the overtime wage required under the FLSA.

112. Throughout the relevant period of this lawsuit, there is no evidence that 

Defendants’ conduct that gave rise to this action was in good faith and based on reasonable 

grounds. In fact, Defendants continued to violate the FLSA long after it learned that its 

misclassification scheme and compensation policies were unlawful.

113. Due to Defendants’ FLSA violations, Plaintiff is entitled to recover from 

Defendants, overtime wage compensation and an equal amount in the form of liquidated 

damages, as well as reasonable attorneys’ fees and costs of the action, including interest, 

pursuant to 29 U.S.C. § 216(b).

THIRD CAUSE OF ACTION

UNLAWFUL TAKING OF TIPS IN VIOLATION OF THE FLSA, 29 U.S.C. § 203

(By Plaintiff Individually and on Behalf of the Collective

Against Defendants)

114. Plaintiff hereby incorporates by reference and re-alleges each and every allegation 

set forth in each and every preceding paragraph as though fully set forth herein.

115. Plaintiff customarily and regularly received more than thirty U.S. Dollars 

($30.00) a month in tips and therefore is a tipped employee as defined in the FLSA, 29 U.S.C. § 

203(t), see also 29 C.F.R. § 531.50. 

116. At all relevant times, Defendants were “employer(s)” or “joint employer(s)” of 

Plaintiff within the meaning of the FLSA, 29 U.S.C. § 203(d).

117. Defendants are engaged in “commerce” and/or in the production of “goods” for 

“commerce” as those terms are defined in the FLSA.

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118. Defendants operate an enterprise engaged in commerce within the meaning for 

the FLSA, 29 U.S.C. § 203(s)(1), because it has employees engaged in commerce, and because 

its annual gross volume of sales made is more than five hundred thousand U.S. Dollars 

($500,000).

119. Under TIPA:

[a]n employer may not keep tips received by its employees for any 

purpose including allowing managers or supervisors to keep any 

portion of employees’ tips, regardless of whether or not it takes a tip 

credit.

29 U.S.C. § 203.

120. Defendants kept a portion of tips paid to Plaintiff by Defendants’ customers in the 

form of fees, fines, mandatory charges and other payments to management, house moms, disc 

jockeys, and floor men in violation of TIPA.

121. Defendants required Plaintiff to participate in an illegal tip pool, which included 

employees who do not customarily and regularly receive tips, and do not have more than a de 

minimis, if any, interaction with customer leaving the tips (such as the Club DJ, security, and 

management). See U.S. Dep’t of Labor, Wage and Hour Division, “Fact Sheet # 15: Tipped 

employees under the Fair Labor Standards Act (FLSA).” 

122. The contribution Defendants required Plaintiff to make after each shift was 

arbitrary and capricious and distribution was not agreed to by Plaintiff or other dancers; rather, it 

was imposed upon Plaintiff and other dancers. 

123. By requiring Plaintiff to pool her tips with club management, including the 

individual Defendants named herein, Defendants “retained” a portion of the tips received by 

Plaintiff in violation of the FLSA. 

124. Defendants did not make any effort, let alone a “good faith” effort, to comply 

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with the FLSA as it relates to compensation owed to Plaintiff. 

125. At the time of their illegal conduct, Defendants knew or showed reckless 

disregard that the tip-pool which they required Plaintiff to contribute included non-tipped 

employees and, therefore, was statutorily illegal. In spite of this, Defendants willfully failed and 

refused to pay Plaintiff the proper amount of the tips to which she was entitled. 

126. Defendants’ willful failure and refusal to pay Plaintiff the tips she earned violates 

the FLSA. 

127. Defendants kept a portion of tips paid to Plaintiff by Defendants’ customers in 

the form of fees, fines, mandatory charges and other payments to management, house moms, disc 

jockeys, and door men in violation of TIPA.

128. As a result of the acts and omissions of the Defendants as alleged herein, and 

pursuant to 29 U.S.C. §§ 216(b) and 260, Plaintiff is entitled to damages in the form of all 

misappropriated tips, plus interest; as liquated damages, an amount equal to all misappropriated 

tips, mandatory attorneys’ fees, costs, and expenses. 

FOURTH CAUSE OF ACTION

ILLEGAL KICKBACKS, 29 C.F.R. § 531.35

(By Plaintiff Individually and on Behalf of the Collective Against All Defendants)

129. Plaintiff hereby incorporates by reference and re-alleges each and every allegation 

set forth in each and every preceding paragraph as though fully set forth herein.

130. Defendants required Plaintiff to pay monetary fees to Defendants and other 

Yellow Rose employees who did not work in positions that are customarily and regularly tipped, 

in violation of 29 U.S.C. § 203(m).

131. Defendants’ requirement that Plaintiff pay fees to Defendants and other Yellow 

Rose employees violated the “free and clear” requirement of 29 C.F.R. § 531.35.

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132. Because Defendants violated the “free and clear” requirement of 29 C.F.R. § 

531.35 as alleged above, they were not entitled to utilize the FLSA’s tip-credit provision with 

respect to Plaintiff’s wages.

133. Because Defendants violated the “free and clear” requirement of 29 C.F.R. § 

531.35, all monetary fees imposed on Plaintiff are classified as illegal kickbacks. 

134. Plaintiff is entitled to recover from Defendants all fees that Defendants required 

Plaintiff to pay in order to work at Yellow Rose, involving but not limited to house fees and tip 

sharing.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff requests of this Court the following relief:

1. For compensatory damages according to proof at trial of at least $100,000;

2. For special damages according to proof at trial;

3. For restitution of unpaid monies;

4. For attorneys’ fees;

5. For costs of suit incurred herein;

6. For statutory penalties;

7. For civil penalties;

8. For pre-judgment interest;

9. For post-judgement interest; 

10. For general damages in an amount to be proven at trial;

11. For declaratory relief;

12. For injunctive relief; and

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13. For such other and further relief as the tribunal may deem just and proper.

Dated: February 3, 2020 /s/ Jarrett L. Ellzey 

Jarrett L. Ellzey

Texas Bar No. 24040864

W. Craft Hughes

Texas Bar No. 24046123

Leigh Montgomery

Texas Bar No. 24052214

HUGHES ELLZEY, LLP

1105 Milford Street

Houston, Texas 77066

Telephone: (713) 554-2377

Fax: (888) 995-3335

jarrett@hughesellzey.com

John P. Kristensen 

California Bar No. 224132

KRISTENSEN LLP

12540 Beatrice Street,

Suite 200

Los Angeles, California 90066

Telephone: (310) 507-7924

Fax: (310) 507-7906

john@kristensenlaw.com

(Pro Hac Vice forthcoming)

Attorneys for Plaintiff

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DEMAND FOR JURY TRIAL

Plaintiff hereby demands a trial by jury for all such triable claims.

Dated: February 3, 2020 /s/ Jarrett L. Ellzey 

Jarrett L. Ellzey

Texas Bar No. 24040864

W. Craft Hughes

Texas Bar No. 24046123

Leigh Montgomery

Texas Bar No. 24052214

HUGHES ELLZEY, LLP

1105 Milford Street

Houston, Texas 77066

Telephone: (713) 554-2377

Fax: (888) 995-3335

jarrett@hughesellzey.com

John P. Kristensen 

California Bar No. 224132

KRISTENSEN LLP

12540 Beatrice Street,

Suite 200

Los Angeles, California 90066

Telephone: (310) 507-7924

Fax: (310) 507-7906

john@kristensenlaw.com

(Pro Hac Vice forthcoming)

Attorneys for Plaintiff

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