Court Opinion

ID: 820403
Source: CourtListenerOpinion
Date Created: 2013-02-13 18:20:52.070626+00
Date Added: 2024-06-11T15:37:28.109464
License: Public Domain

Case: 11-15227   Date Filed: 02/13/2013   Page: 1 of 21

                                                                          [PUBLISH]

                 IN THE UNITED STATES COURT OF APPEALS

                          FOR THE ELEVENTH CIRCUIT
                           ________________________

                                  No. 11-15227
                            ________________________

                        D.C. Docket No. 6:09-cv-00224-GJK

LEONARD MOORE,
JASON EVERS,
CHRISTOPHER LUNGRIN,
                                                                   Plaintiffs - Cross
                                                             Appellants - Appellees,

                                       versus

APPLIANCE DIRECT, INC.,
a Florida corporation,
                                                                    Defendant - Cross
                                                                           Appellee,

SEI PAK,
individually,
                                                                 Defendant - Cross
                                                               Appellee - Appellant.

                           ________________________

                    Appeals from the United States District Court
                         for the Middle District of Florida
                           ________________________

                                 (February 13, 2013)
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Before JORDAN and ANDERSON, Circuit Judges and ALBRITTON,* District
Judge.

ALBRITTON, District Judge:

       This is a suit for damages for retaliation under Chapter 8 of Title 29, the

Fair Labor Standards Act of 1938, 29 U.S.C. § 201–219 (“FLSA”). The case

presents cross-appeals. Defendant Sei Pak (“Pak”) appeals the district court’s

entry of judgment against him individually and its denial of his renewed motions

for judgment as a matter of law and remittitur. Plaintiffs Leonard Moore, Jason

Evers, and Christopher Lungrin (“Plaintiffs”) appealed the court’s denial of their

motion to add an award of liquidated damages so as to double the jury’s award of

economic damages. For the reasons set forth below, we affirm both the district

court’s entry of judgment against Pak and its denial of Plaintiffs’ motion for

liquidated damages.

                                   I. BACKGROUND

       Prior to the filing of this action, on March 4, 2008, Plaintiffs filed a

complaint alleging violations of the section 207 overtime provisions of the FLSA

against their employer, Appliance Direct, Inc., and Pak, the Chief Executive

     *Honorable W. Harold Albritton, United States District Judge for the Middle District of
Alabama, sitting by designation.

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Officer of Appliance Direct (“the overtime lawsuit”). Appliance Direct sells home

appliances to customers, and the Plaintiffs were employed as delivery truck

drivers. During the pendency of the overtime lawsuit, Appliance Direct began

changing the employment status of its drivers from employees to independent

contractors. Although other drivers formerly employed by Appliance Direct

received offers to become independent contractors, the Plaintiffs did not, and their

employment as truckdriver/employees was terminated as their jobs were

outsourced.

      The Plaintiffs then filed this separate suit, a one-count complaint alleging

that Appliance Direct and Pak retaliated against them for filing the overtime

lawsuit, in violation of section 215(a)(3) of the FLSA, by not giving them an

opportunity to enter into independent subcontracts for delivery services and by

interfering with the Plaintiffs’ ability to be hired by other subcontractors of

delivery services for Appliance Direct. They alleged that other

truckdriver/employees who had not joined in the overtime suit were given that

opportunity. While this suit was pending trial, the overtime lawsuit was settled,

and we held in a previous appeal that the earlier overtime lawsuit did not bar this

retaliation suit on the basis of res judicata. Moore, et al. v. Pak, No. 10-12788,

402 Fed. App’x 491 (11th Cir. 2010).

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      This retaliation case was stayed as to Appliance Direct after it filed for

bankruptcy, and it proceeded to a jury trial against Pak alone. At the conclusion of

Plaintiffs’ case-in-chief, Pak moved for judgment as a matter of law, arguing that

the Plaintiffs did not present sufficient evidence that Pak is an “employer” under

the FLSA and that they did not present sufficient evidence as to their damages.

This was denied. Pak renewed his motion after presenting his case, with the

additional ground that the Plaintiffs had not presented sufficient evidence of

causation between their protected activity and the adverse employment action.

The district court denied the renewed motion, and the jury returned a verdict for

the Plaintiffs with an economic damages award of $30,000 each.

      After the trial, Pak filed two renewed motions for judgment as a matter of

law and for remittitur or a new trial. In the motions he again argued that the

Plaintiffs did not sufficiently prove their damages, that Pak had not been proved to

be an employer, and that there was a lack of causation. Pak also argued that the

court should reduce the Plaintiffs’ amount of damages to zero or order a new trial

because the Plaintiffs did not prove their claim for lost profits. The district court

found that there was sufficient evidence at trial on the issues raised by Pak and

denied his motions. Pak filed this appeal claiming that: (1) he is not an employer

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under the FLSA, and (2) the Plaintiffs did not sufficiently prove their damages.1

       The Plaintiffs filed a post-trial motion seeking an additur of liquidated

damages to the jury’s damages awards. The district court denied the motion, and

the Plaintiffs cross-appealed on the issue of whether the district court was required

to add liquidated damages to the judgment because Pak did not show that he was

acting in reasonable good faith.

                              II. STANDARD OF REVIEW

       We review the denial of a motion for judgment as a matter of law de novo.

Wood v. Green, 323 F.3d 1309, 1312 (11th Cir. 2003). The court considers the

evidence and the inferences drawn from it in a light most favorable to the

nonmoving party. Goldsmith v. Bagby Elevator Co., 513 F.3d 1261, 1275 (11th

Cir. 2008).

       We review the denial of a motion for remittitur or new trial under an abuse

of discretion standard. Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 435

(1996). Questions of statutory interpretation are reviewed de novo. United States

v. Moore, 541 F.3d 1323, 1326 (11th Cir. 2008).

       1
          Pak also argues on appeal that the Plaintiffs’ claims lack causation because the alleged
retaliatory act occurred before the protected activity. This argument is unavailing. The Plaintiffs
agree that Pak decided to make drivers independent contractors before the Plaintiffs filed their
overtime lawsuit. However, evidence at trial was sufficient for the jury to find that Pak would
not allow Plaintiffs the opportunity to receive independent subcontracts because they had
previously filed their suit. There is sufficient evidence of causation.

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                                 III. DISCUSSION

A.    Definition of “Employer” under FLSA

      Pak first challenges the district court’s entry of judgment and denial of his

motions based on a finding that he is individually liable as an employer under the

FLSA. The FLSA defines an employer as including “any person acting directly or

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

203(d). A corporate officer is personally liable as an FLSA employer if he has

“operational control of a corporation’s covered enterprise,” which may be

involvement in the day-to-day operation of the company or direct supervision of

the employee at issue. Patel v. Wargo, 803 F.2d 632, 637–38 (11th Cir. 1986).

      Pak was the CEO and 75% owner of Appliance Direct, but that is only one

factor to consider in determining whether he could be held liable as an employer

under the FLSA. Considering the totality of the circumstances, the evidence at

trial was sufficient to show that Pak was an employer of the Plaintiffs. Pak’s

involvement in Appliance Direct included more than a majority ownership interest

and office of CEO. At trial there was evidence showing him to have guided

company policy and to have given instructions to managers regarding job duties;

that he was the ultimate decision maker at the company; that he negotiated leases

and vendor contracts; and significantly, that he directed that the Plaintiffs not be

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given subcontracts for delivery services, among other involvements. In short,

reasonable jurors could differ as to whether Pak was an employer under the

requirements of the FLSA, but considering the evidence in the light most

favorable to the Plaintiffs, the district court properly denied his motions for

judgment as a matter of law.

B.    Plaintiffs’ Proof of Damages

      Pak also appeals the district court’s denial of his multiple motions on the

basis that the Plaintiffs failed to prove their damages at trial. To prove their

damages, the Plaintiffs relied in part on the testimony of Jeff Caneva, whose

company had a delivery contract with Appliance Direct after Pak decided to

outsource the delivery driver positions. Caneva testified that he was not allowed

by Pak to hire anyone involved in overtime lawsuits for a position—in particular,

the Plaintiffs. The Plaintiffs argued that Pak’s decision to forbid independent

contractors from hiring the Plaintiffs denied them an economic opportunity. The

jury agreed and awarded each Plaintiff $30,000 in economic damages, using as a

guide Caneva’s pay rate to his employees multiplied by the number of weeks the

Plaintiffs were out of work.

      Pak contends that Plaintiffs did not sufficiently prove compensatory

damages because Caneva testified that he only had three positions available for

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delivery drivers and did not testify as to when the Plaintiffs would have been hired

and how much he would have paid them. Due to this lack of certainty, Pak argues

that it was error for the jury to speculate as to what the Plaintiffs’ damages were,

because the Plaintiffs may not “throw [themselves] on the generosity of the jury.”

Taliferro v. Augle, 757 F.2d 157, 162 (7th Cir. 1985).

      The Plaintiffs’ situation is unusual: their damages are similar to those that

employees would receive in a case where there was a reduction-in-force and the

employees were discriminated against during the rehiring process. However, here,

the rehiring was done by Caneva, a third-party independent contractor, who

according to Pak had filled his three available positions before the Plaintiffs

sought employment with him.

      Ultimately, though, Pak’s arguments surrounding the particular

circumstances of Caneva’s company are without force. Regardless of whether the

Plaintiffs would have secured employment with Caneva, evidence of Caneva’s

delivery operation serves as proof of what the Plaintiffs would have been paid as

independent contractors. We hold that this evidence was sufficient for a jury to

award the Plaintiffs compensatory damages in the amount of $30,000 each, and

the district court did not abuse its discretion in denying Pak’s motions on this

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ground.2

C.     Liquidated Damages

       The final issue before us is whether the district court was required to award

the Plaintiffs liquidated damages in addition to the economic damages awarded by

the jury. The Plaintiffs in their cross-appeal argue that the court did not have

discretionary authority to deny their motion to alter the judgment by adding

liquidated damages, and that the award of such damages was required by statute.

       This presents our court with a question of first impression: Does the FLSA

mandate the imposition of liquidated damages after a finding of liability for

retaliation, unless excused by proof of reasonable good faith of the employer, the

same as it does after a finding of liability for unpaid minimum wages and

overtime, or are liquidated damages discretionary in a retaliation case?

       The award of liquidated damages in FLSA cases is governed by 29 U.S.C. §

216(b), which states in pertinent part:

              Any employer who violates the provisions of section 206
              or section 207 of this title [minimum wage or overtime
              provisions] shall be liable to the employee or employees

       2
         Pak also appeals the court’s denial of his renewed motion for remittitur, arguing that
because Caneva stopped making deliveries for Appliance Direct before the entry of judgment,
calculating the Plaintiffs’ damages to the date of judgment gave the Plaintiffs a windfall.
However, similar to the discussion above, evidence regarding Caneva should be viewed as
evidence of what the Plaintiffs would have been paid as independent contractors, not necessarily
employed with Caneva.

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            affected in the amount of their unpaid minimum wages,
            or their unpaid overtime compensation, as the case may
            be, and in an additional equal amount as liquidated
            damages. Any employer who violates the provisions of
            section 215(a)(3) of this title [retaliation provision] shall
            be liable for such legal or equitable relief as may be
            appropriate to effectuate the purposes of section
            215(a)(3) of this title, including without limitation
            employment, reinstatement, promotion, and the payment
            of wages lost and an additional equal amount as
            liquidated damages.

29 U.S.C. § 216(b).

      A separate statute, 29 U.S.C. § 260, included in Chapter 9 of Title 29,

adopted in 1947, provides that

            In any action . . . to recover unpaid minimum wages,
            unpaid overtime compensation, or liquidated damages,
            under the Fair Labor Standards Act of 1938, as amended
            . . . if the employer shows to the satisfaction of the court
            that the act or omission giving rise to such action was in
            good faith and that he had reasonable grounds for
            believing that his act or omission was not a violation of
            the [FLSA], the court may, in its sound discretion, award
            no liquidated damages or award any amount thereof not
            to exceed the amount specified in section 216 of this
            title.

      The Plaintiffs contend that 29 U.S.C. § 216(b) makes an award of

liquidated damages mandatory in retaliation cases, just as in minimum wage and

overtime cases, and it can be overcome only by proof of the reasonable good faith

exception found in section 260. Since it is without dispute that Pak did not offer

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proof to show good faith as allowed by section 260, they argue that the court had

no discretion to deny the addition of a liquidated damages award in an equal

amount as the economic loss award returned by the jury.

       Four Circuits are cited by the parties for having considered whether

liquidated damages in an FLSA retaliation case are discretionary or mandatory,

with differing results. The Plaintiffs cite Lowe v. Southmark Corp., 998 F.2d 335,

337–38 (5th Cir. 1993), as well as Avitia v. Metro. Club of Chicago, Inc., 49 F.3d

1219, 1223 (7th Cir. 1995), as having held in favor of mandatory liquidated

damages.3 Pak argues that the “as may be appropriate language” in section 216(b)

renders the grant of liquidated damages in a retaliation case discretionary with the

district court, an opinion supported by Braswell v. City of El Dorado, Ark., 187

F.3d 954, 958 (8th Cir. 1999) and Blanton v. City of Murfreesboro, 856 F.2d 731

(6th Cir. 1988).

       Lowe involved claims by two plaintiffs for violating their entitlement to

equal pay under section 206(d), and protection from retaliation under section

215(a)(3), of the FLSA. The jury returned lump sum awards to the plaintiffs after

       3
          The Lowe court cited the pre-September 30, 1981 case of Reeves v. Int’l Tel. and Tel.
Corp., 616 F.2d 1342, 1352 (5th Cir. 1980). See Lowe, 998 F.2d at 337. While the Plaintiffs do
not cite or argue that Reeves is binding, we find it appropriate to note that Reeves is not on point,
as discussed below, and thus is not determinative. See Bonner v. City of Prichard, Ala., 661 F.2d
1206, 1207 (11th Cir. 1981) (en banc) (adopting all Fifth Circuit cases prior to October 1, 1981).

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finding the defendant liable on both of the claims. The Fifth Circuit did not

analyze the language of section 216(b), but simply quoted it, stated that “[t]he

granting of liquidated damages is mandatory under section 216(b) except where

the employer shows to the satisfaction of the court that its act or omission was in

‘good faith’ and was based upon reasonable grounds for believing that it was not

violating the Act,” and required the doubling of lump sum awards of back pay and

retaliation damages, rather than unexplained lesser amounts of liquidated damages

included in the judgment. Lowe, 998 F.2d at 337. It cited section 260 and two

earlier Fifth Circuit cases: Reeves v. Int’l Tel. and Tel. Corp., 616 F.2d 1342, 1352

(5th Cir. 1980) and Mireles v. Frio Foods, Inc., 899 F.2d 1407, 1415 (5th Cir.

1990).

      These cases, however, are not on point. While Reeves involved findings of

liability for failure to pay wages due under the FLSA and for retaliatory discharge,

and liquidated damages were computed and awarded by doubling the amounts

found to be due for minimum wages and overtime, and for back pay from the time

of the plaintiffs’ retaliatory termination, no issue was raised on appeal as to

whether doubling the back pay awarded was mandatory. The defendant merely

contended on appeal that it should not have been charged with liquidated damages

because it proved that it acted under a good faith belief that the plaintiff was an

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exempt employee under the FLSA. The court held, in response to the issue before

it, that the proof at trial was insufficient to establish the reasonableness of such a

belief, so that the good faith exception did not apply, and upheld the awarding of

liquidated damages. Reeves, 616 F.2d at 1352, 1353. Mireles did not involve

retaliation, but held that section 216(b) required a full doubling of the amount

found to be due to multiple plaintiffs for time spent waiting for productive work,

unless the section 260 exception was proved, and the district court had no

discretion to award liquidated damages in a lesser amount. In so holding, the

court emphasized the word shall in the first sentence of section 216(b). Mireles,

899 F.2d at 1414–15. Neither case cited in Lowe discusses liquidated damages in

the context of the retaliation provision in section 216(b) or whether it would be

within the district court’s discretion to deny them. We do not find Lowe to be

persuasive.

      In Avitia, one of the two plaintiffs had both overtime and retaliation claims.

The Seventh Circuit opinion assumed, without analysis, that liquidated damages

were part of relief for retaliation claims unless excused by the good faith

exception. This was not an issue in the appeal. See Avitia, 49 F.3d at 1223.

      On the other hand, both Braswell and Blanton, the cases cited by Pak, dealt

directly with whether liquidated damages are mandatory or discretionary in

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retaliation cases, analyzed the statute, and emphasized the different language in

the retaliation provision of section 216(b) as compared to the minimum wages and

overtime provision.

      The Eighth Circuit in Braswell acknowledged that liquidated damages were

mandatory as to an overtime claim, but held that the language in the second

sentence of section 216(b)—“as may be appropriate to effectuate the purposes of

section 215(a)(3)”—gives discretion to the district court to choose the remedy that

the court deems appropriate in the case, and that includes discretion to award

liquidated damages. Braswell, 187 F.3d at 958. Although both provisions in

section 216(b) employ the words “shall” and “and” in listing appropriate remedies

(including liquidated damages), the additional language in the retaliation provision

modifies the mandatory language and creates a separate standard for retaliation

claims. The court stated that it was unpersuaded by the Fifth Circuit’s discussion

of section 216(b) in Lowe, where it noted that an award of liquidated damages was

discretionary for both wage and retaliation claims only if the employer proved the

exception allowed by section 260, saying that “[t]he court, however, made no

mention of the ‘as may be appropriate’ phrase, words which we conclude are not

superfluous and were intended to establish a separate, and discretionary, standard

for awards of liquidated damages in retaliation claims.” See Braswell, 187 F.3d at

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958–59. Therefore, the court affirmed the district court’s refusal to add liquidated

damages on the retaliation claim, holding that whether to do so was discretionary

and that the refusal was not an abuse of discretion.

      The Sixth Circuit in Blanton similarly focused on the “as may be

appropriate to effectuate the purposes of section 215(a)(3)” language and

determined that a district court erred in awarding liquidated damages in a

retaliation case when such an award would not “effectuate the purposes of [the

retaliation provision].” Blanton, 856 F.2d at 737.

      The district court in this case, in its well-reasoned opinion, analyzed the

findings of other courts on this issue, applied rules of statutory construction,

followed Braswell and Blanton in applying a discretionary interpretation to section

216(b)’s retaliation provision, and found that the $30,000 awarded to each

Plaintiff as economic damages was sufficient to effectuate the purposes of section

215(a)(3) and that no award of liquidated damages was necessary.

      We begin with the plain language of the statute—29 U.S.C. § 216(b),

Damages, and specifically its first two sentences. See Silva-Hernandez v. U.S.

Bureau of Citizenship & Immigration Servs., 701 F.3d 356, 361 (11th Cir. 2012)

(“As with any question of statutory interpretation, we begin by examining the text

of the statute . . . .”) (internal citation omitted). The first sentence applies only to

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damages for violations of sections 206 (minimum wage) and 207 (overtime), while

the second sentence applies only to violations of section 215(a)(3) (retaliation).

      The first sentence mandates that for violation of the provisions of either the

minimum wage or overtime provisions of the FLSA the employer “shall be liable .

. . in the amount of . . . unpaid minimum wages, or . . . unpaid overtime

compensation . . . and in an additional equal amount as liquidated damages”

(emphasis added). There is no discretion or mention of retaliation.

      The second sentence, on the other hand, provides that for retaliation against

an employee for, inter alia, filing a suit for failure to pay minimum wage or

overtime (section 215(a)(3)) an employer “shall be liable for such legal or

equitable relief as may be appropriate to effectuate the purposes of section

215(a)(3) of this title, including without limitation employment, reinstatement,

promotion, and the payment of wages lost and an additional equal amount as

liquidated damages” (emphasis added). This second sentence was added to

section 216(b) in 1977. Pub. L. No. 95-151, 91 Stat. 1245, 1252 (Nov. 1977).

      This second sentence was added by amendment in 1977 to provide damages

in private causes of action to enforce the anti-retaliation provisions of the FLSA,

and clearly was for the purpose of allowing separate and more extensive relief to

an employee in case of retaliation. And, it is just as clear that the extent of that

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separate relief is discretionary, requiring a finding that any such relief, even relief

not mentioned in the non-exclusive examples, is appropriate to effectuate the

purposes of the retaliation section of the law. There is no more basis in the

language of the second sentence for holding that liquidated damages are required

to be awarded in a retaliation case, than there would be for requiring

reinstatement, or promotion, or front pay. Whatever is awarded must be

appropriate to effectuate the purposes of the retaliation provision, and determining

that requires the exercise of wide discretion. Cf. DIRECTV, Inc. v. Brown, 371

F.3d 814, 816–18 (11th Cir. 2004) (use of the word “may” and the phrase “as may

be appropriate” in the Wiretap Act, 18 U.S.C. § 2511(1)(a), made award of

liquidated damages discretionary).

      Plaintiffs’ argument that section 260 (the reasonable good faith exception)

makes the clear discretionary language of the second sentence of section 216(b)

mandatory is unavailing. Section 260 was already in existence at the time

Congress added the second sentence. Before that addition, section 216(b)

contained no reference to retaliation, and section 260 provided the reasonable

good faith exception only to then-available actions “to recover unpaid minimum

wages, unpaid overtime compensation, or liquidated damages.” Thus, as the

district court noted, at the time Congress drafted the second sentence with its “as

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may be appropriate” language, it was aware of its existing mandatory liquidated

damages requirement for minimum wage and overtime claims and the application

of a reasonable good faith exception to that, and did not choose to do the same in

regard to retaliation claims. The preexisting section 260 has no applicability to the

later-added second sentence of section 216(b).

      Plaintiffs also argue that holding the second sentence language to be

discretionary would be irreconcilable with and would require the overturning of

two of this court’s earlier panel decisions in Equal Employment Opportunity

Comm’n v. White and Son Enters., 881 F.2d 1006 (11th Cir. 1989) and Snapp v.

Unlimited Concepts, Inc., 208 F.3d 928 (11th Cir. 2000). We reject this

contention.

      While White and Son Enters. affirmed the district court’s award of

additional liquidated damages for both back pay based on discrimination under

section 206(d) and retaliation under section 215(a)(3) of the FLSA, no issue was

discussed as to whether liquidated damages were mandatory or discretionary. See

White & Son Enters., 881 F.2d at 1012–13. They had been awarded as to both

claims and the issue on appeal merely involved the correct method for computing

them. This was quite different from the case sub judice, where the issue is

presented to us directly, and we must decide it.

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      Likewise, the issue now before us was not presented in Snapp. There, a jury

found for the plaintiff on both an overtime claim and a retaliation claim and

awarded $200 in overtime wages, $1,000 in wages lost because of a retaliatory

discharge, and $35,000 in punitive damages on the retaliation claim. The district

court found that the defendant had not proved a section 260 good faith defense on

either claim, and doubled as liquidated damages both the $200 overtime award and

the $1,000 retaliation award, held that punitive damages were not available as

damages for section 216(b) retaliation, and struck the $35,000 punitive damages

award. Judgment was entered for $2,400 and the plaintiff appealed the finding

that punitive damages were not available. The opinion in Snapp did not deal with

whether liquidated damages were mandatory in retaliation cases and could be

excused only through exercising discretion under section 260, but dealt solely with

the availability of punitive damages. In doing so, and in holding that punitive

damages were not available because they were outside the compensatory nature of

available damages under the second sentence of section 216(b), the court did note

that “the kinds of relief that a district court may need to award to compensate the

plaintiff fully will vary with the facts of each case,” and that “district courts may

have to exercise some creativity in awarding relief in retaliation cases.” Snapp,

208 F.3d at 937.

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      Far from being irreconcilable, these earlier cases point to the need for the

court in this case to establish a clear answer to the question of whether in an FLSA

retaliation case a district court in this circuit must award liquidated damages in the

absence of proof of a reasonable good faith exception, or may do so in its

discretion if that would “be appropriate to effectuate the purposes of” the

retaliation section.

      In reviewing the cases cited by Plaintiffs and Pak, the briefs and oral

argument of counsel, and the clear language of the statute, we join the Sixth and

Eighth Circuits in holding that the second sentence in section 216(b), which

allows such damages “as may be appropriate to effectuate the purposes of [the

retaliation provision],” creates a separate, discretionary, standard of damages for

retaliation claims. We therefore hold that the retaliation provision of 29 U.S.C. §

216(b) gives the district court discretion to award, or not to award, liquidated

damages, after determining whether doing so would be appropriate under the facts

of the case. The district court made the determination in this case that it would not

be appropriate, and in declining to award liquidated damages it did not abuse its

discretion.

                                IV. CONCLUSION

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For the foregoing reasons, the judgment of the district court is

AFFIRMED.

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