Court Opinion

ID: 4645223
Source: CourtListenerOpinion
Date Created: 2020-12-21 19:00:16.148725+00
Date Added: 2024-06-11T08:00:50.951255
License: Public Domain

Case: 19-50638     Document: 00515680084        Page: 1     Date Filed: 12/21/2020

           United States Court of Appeals
                for the Fifth Circuit                                United States Court of Appeals
                                                                              Fifth Circuit

                                                                            FILED
                                                                    December 21, 2020
                                 No. 19-50638                          Lyle W. Cayce
                                                                            Clerk

   Ruben Molina-Aranda; Jose Eduardo Martinez-Vela;
   Juan Gerardo Lopez-Quesada,

                                                          Plaintiffs—Appellants,

                                     versus

   Black Magic Enterprises, L.L.C., doing business as JMPAL
   Trucking; Carmen Ramirez; Jessie Ramirez, III,

                                                       Defendants—Appellees.

                  Appeal from the United States District Court
                       for the Western District of Texas
                             USDC No. 7:16-cv-376

   Before Owen, Chief Judge, and Dennis and Haynes, Circuit Judges.
   Haynes, Circuit Judge:
         Plaintiﬀs allege that Carmen and Jessie Ramirez brought them to the
   United States under the H-2B visa program to work as construction workers.
   Once Plaintiﬀs arrived in the United States, however, the Ramirezes
   allegedly made them work as truck drivers, who typically receive higher
   wages and for whom H-2B visas are consequently harder to obtain. But
   Plaintiﬀs never saw those higher wages; instead, they claim they were paid
   worse than either truck drivers or construction workers, with the Ramirezes
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   unlawfully deducting from their paychecks, denying them overtime pay, and
   sometimes failing to pay them entirely.
          Plaintiﬀs sued Carmen and Jessie Ramirez and their company, Black
   Magic Enterprises, L.L.C. (“Black Magic”), claiming, as relevant here, that
   the Ramirezes violated (1) the Racketeer Inﬂuenced and Corrupt
   Organizations Act (“RICO”), and (2) the Fair Labor Standards Act
   (“FLSA”). The district court dismissed those claims for failure to state a
   claim, declined to exercise supplemental jurisdiction over Plaintiﬀs’ related
   state law claims, and denied Plaintiﬀs’ later-ﬁled motion for leave to amend
   the complaint.
          For the following reasons, we AFFIRM the district court’s dismissal
   of Plaintiﬀs’ RICO claims and the district court’s denial of Plaintiﬀs’ motion
   for leave to amend, REVERSE the dismissal of Plaintiﬀs’ FLSA claims,
   VACATE the dismissal of the state law claims, and REMAND for further
   proceedings.
                                     I.      Background
          Plaintiﬀs are former employees of the Ramirezes who were brought to
   work for Black Magic in Texas under the United States Department of
   Labor’s H-2B guest worker visa program. 1 H-2B visas allow employers to
   bring foreign workers to the United States for temporary non-agricultural
   work if (1) “qualiﬁed workers in the United States are not available” and
   (2) “the alien’s employment will not adversely aﬀect the wages and working
   conditions of similarly employed United States workers.”                       8 C.F.R.
   § 214.2(h)(6)(iv)(A); see 8 U.S.C. § 1101(a)(15)(H)(ii)(b). To obtain an H-

          1
              Black Magic filed for bankruptcy and has since been dismissed from the case.

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   2B visa for an employee, the employer must ﬁrst apply for and obtain a labor
   certiﬁcation with the Department of Labor. 8 C.F.R. § 214.2(h)(6)(iii)(C).
          Plaintiﬀs alleged that the Ramirezes “systematically defrauded the
   federal government to obtain” the visas that brought them to the United
   States by misrepresenting to the Department of Labor the type of work
   Plaintiﬀs would perform.      According to Plaintiﬀs, the applications the
   Ramirezes submitted claimed falsely that Black Magic sought guest workers
   for “physical labor at construction sites . . . operat[ing] hand and power tools
   of all types.”    Plaintiﬀs alleged that the Ramirezes obtained a labor
   certiﬁcation by stating that the “oﬀered wage” for such work “equal[ed] or
   exceed[ed] the highest of the most recent prevailing wage for the
   occupation”—$13.72 per hour. Plaintiﬀs alleged that, after obtaining that
   certiﬁcation, the Ramirezes additionally submitted H-2B visa applications
   stating that they would “pay at least the oﬀered wage . . . during the entire
   period of th[e] application,” minus “authorized and reasonable deductions.”
          Plaintiﬀs claimed, however, that the Ramirezes knowingly lied in
   those materials: the Ramirezes did not want physical laborers—they actually
   wanted heavy truckers. That lie, Plaintiﬀs claimed, was central to the
   Ramirezes getting the visas in the ﬁrst place. Heavy truckers are paid more
   than physical laborers at $20 per hour, and, because there might be American
   citizens willing to work at that rate, the Ramirezes might not have been able
   to get the H2-B visas had they told the truth in their applications. According
   to Plaintiﬀs, the Ramirezes’ gambit paid oﬀ; although Plaintiﬀs were
   ostensibly brought in as construction workers, the Ramirezes made them
   work as heavy truck drivers once they arrived. But Plaintiﬀs did not make
   $20 per hour—or even the $13.72 per hour they were initially promised.
   Instead, because the Ramirezes allegedly unlawfully deducted from their pay,
   failed to pay overtime despite work weeks between ﬁfty and eighty hours, and

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   sometimes failed to pay Plaintiﬀs entirely, Plaintiﬀs claimed they eﬀectively
   made much less.
          On the basis of these allegations, Plaintiﬀs sued the Ramirezes in
   federal district court. In their complaint, Plaintiﬀs sought relief under
   RICO’s civil penalty section, 18 U.S.C. § 1964(c); the FLSA, 29
   U.S.C.§ 216(b); and Texas state law. The district court dismissed the federal
   causes of action with prejudice for failure to state a claim under Federal Rules
   of Civil Procedure 12(b)(6) and 9(b). With no federal claims left, the district
   court declined to exercise supplemental jurisdiction over the remaining state-
   law claims. After their complaint was dismissed, Plaintiﬀs ﬁled a motion for
   leave to amend, which the district court denied. Plaintiﬀs timely appealed.
                    II.       Jurisdiction & Standard of Review
          The district court had federal-question jurisdiction over Plaintiﬀs’
   RICO and FLSA claims, see 28 U.S.C. § 1331, and we have jurisdiction to
   review the district court’s ﬁnal judgment, see id. § 1291.
          We review a district court’s dismissal under Rule 12(b)(6) de novo,
   accepting all well-pleaded facts as true and viewing those facts in the light
   most favorable to the plaintiﬀs. See Gonzalez v. Kay, 577 F.3d 600, 603 (5th
   Cir. 2009). To meet the pleading standard of Rule 12(b)(6), plaintiﬀs must
   allege “enough facts to state a claim that is plausible on its face.” Bell Atl.
   Corp. v. Twombly, 550 U.S. 544, 570 (2007). Additionally, allegations of
   fraud—like the predicate acts Plaintiﬀs allege in connection with their RICO
   claims—must meet Rule 9(b)’s heightened pleading standard, under which
   plaintiﬀs “must state with particularity the circumstances” of the allegedly
   fraudulent conduct. See Williams v. WMX Techs., Inc., 112 F.3d 175, 177 (5th
   Cir. 1997). Accordingly, plaintiﬀs alleging fraud must additionally describe,
   in short, “the who, what, when, and where” supporting their fraud
   allegations. Id. at 178.

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           Plaintiﬀs also challenge the district court’s denial of leave to amend
   their complaint, which we review for abuse of discretion. N. Cypress Med.
   Ctr. Operating Co., Ltd. v. Aetna Life Ins. Co., 898 F.3d 461, 477 (5th Cir.
   2018). A district court does not abuse its discretion when denying leave to
   amend if, for example, amendment would be futile, the moving party has
   repeatedly failed to cure the deﬁciencies in its pleadings, or the opposing
   party would suﬀer undue prejudice. See id.
                                      III.      Discussion
           On appeal, Plaintiﬀs argue that the district court erred in dismissing
   their RICO, FLSA, and state law claims and abused its discretion in denying
   their motion for leave to amend. We address each argument in turn.

           A.      RICO Claims
           RICO makes it “unlawful for any person employed by or associated
   with any enterprise engaged in, or the activities of which aﬀect, interstate or
   foreign commerce, to conduct or participate, directly or indirectly, in the
   conduct of such enterprise’s aﬀairs through a pattern of racketeering
   activity.” 18 U.S.C. § 1962(c). It allows “[a]ny person injured in his
   business or property by reason of a violation of section 1962” to bring a civil
   suit for treble damages. Id. § 1964(c). To state a claim under § 1962(c), a
   plaintiﬀ must adequately plead that the defendant engaged in “(1) conduct
   (2) of an enterprise (3) through a pattern (4) of racketeering activity.”
   Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 (1985) (footnote omitted). 2
           A RICO plaintiﬀ must also plausibly allege that the RICO violation
   proximately caused the plaintiﬀ’s injuries.              See Holmes v. Secs. Inv. Prot.

           2
              Consistent with Rule 9(b), a RICO plaintiff alleging predicate acts of fraud (like
   Plaintiffs do here) must plead the circumstances of that fraud with particularity. Tel-Phonic
   Servs., Inc. v. TBS Int’l, Inc., 975 F.2d 1134, 1138 (5th Cir. 1992).

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   Corp., 503 U.S. 258, 268 (1992). The proximate causation standard in this
   context is not one of foreseeability; instead, the plaintiﬀ must demonstrate
   that the alleged violation “led directly” to the injuries. Anza v. Ideal Steel
   Supply Corp., 547 U.S. 451, 461 (2006); see also Hemi Grp., LLC v. City of New
   York, 559 U.S. 1, 10, 12 (2010) (plurality opinion). If some other conduct
   directly caused the harm, the plaintiﬀ cannot sustain a RICO claim. See Hemi
   Grp., LLC, 559 U.S. at 11 (rejecting a RICO claim on proximate causation
   grounds because “the conduct directly causing the harm was distinct from
   the conduct giving rise to the fraud”).
           Here, Plaintiﬀs’ allegations, taken as true, do not support a conclusion
   that their underpayment injuries were directly caused by the Ramirezes’
   alleged fraud in obtaining the H-2B visas. Rather, their complaint shows that
   the injury was caused by the alleged underpayments which were not required
   by the alleged fraud. See Walters v. McMahen, 684 F.3d 435 (4th Cir. 2012).
   The Fourth Circuit in Walters addressed a similar situation where a set of
   domestic U.S. workers alleged that a company’s managers ﬁled false
   immigration forms that led to depressed wages for local workers—allegations
   the Fourth Circuit found insuﬃcient precisely because other managerial
   decisions more directly impacted the workers’ compensation:
           Although false attestations made by the hiring clerks are one
           step in a chain of events that ultimately may have resulted in
           the employment of unauthorized aliens . . . , the plaintiffs have
           not demonstrated that the false attestations themselves have
           had a direct negative impact on the plaintiffs’ wages, or on any
           other aspect of their compensation.
Id. at 444. 3

           3
            It does not appear that prior panels of this court have had occasion to squarely
   address RICO proximate causation for this type of fact pattern: workers claiming that they

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           Similar reasoning applies here. Understating the type of work to be
   done may have supported obtaining the visas, but it was not the cause of
   underpayment; indeed, if one accepts the Plaintiﬀs’ allegations, truthfulness
   would likely have resulted in a lack of visas, keeping Plaintiﬀs from being able
   to come to the United States in the ﬁrst place. 4 But, critically, Plaintiﬀs’
   reduced wages were several steps in the causal chain away from the
   transmission of fraudulent forms; nothing about the forms required
   underpayment. To even have the opportunity to underpay Plaintiﬀs, the
   Ramirezes had to submit fraudulent forms, obtain authorization, and bring
   the Plaintiﬀs to the United States for work. Only then could the Ramirezes
   actually underpay Plaintiﬀs. Importantly, the claim in this case is not just
   that the $13.72 per hour that the Ramirezes represented they would pay
   Plaintiﬀs was inadequate to cover the work done but that the Ramirezes did
   not even pay that amount properly. It is therefore clear that the Ramirezes’
   underpayment was not a necessary result of their alleged fraud—
   underpayment “in no sense required [them] to defraud” the Department of
   Labor. Anza, 547 U.S. at 459.             Whatever hourly rate is stated to the
   Department of Labor is irrelevant if the employer is going to fail to pay what
   is owed, refuse to pay for overtime, or deduct inappropriate charges.

   were underpaid after their employer succeeded in defrauding the government. We find the
   Fourth Circuit’s analysis in Walters persuasive.
           4
             The parties agree that, if the Ramirezes had truthfully represented that they
   sought truck drivers, the Department of Labor likely would not have provided the necessary
   certiﬁcations because the prevailing wage rate for truck drivers is high enough that
   domestic workers would be available to perform the job.

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   Accordingly, Plaintiﬀs failed to adequately plead proximate causation, and
   the district court properly dismissed their RICO claims. 5
           B.      FLSA Claims
           The FLSA claims are diﬀerent. The FLSA was “enacted in 1938 to
   protect all covered workers from substandard wages and oppressive working
   hours.” Encino Motorcars, LLC v. Navarro, 136 S. Ct. 2117, 2121 (2016)
   (quotation omitted). An employee can be covered by the FLSA if either the
   employee or the employing enterprise is “engaged in commerce or in the
   production of goods for commerce.” See id.; Martin v. Bedell, 955 F.2d 1029,
   1032 (5th Cir. 1992). Among other requirements, the statute requires
   employers to pay any covered employee at least a minimum wage of $7.25
   per hour, 29 U.S.C. § 206(a)(1)(C), and to pay any covered employee at least
   one-and-one-half times the employee’s regular wages when the employee
   works more than forty hours in a week, id. § 207(a)(1). To state an FLSA
   claim, then, an employee must plead that the employee is covered by the
   FLSA and that the employer failed to pay the FLSA-required wages.
                   1.       Enterprise Coverage
           The ﬁrst FLSA issue on appeal is the enterprise coverage provision,
   which extends the FLSA’s requirements to any enterprise that, as relevant
   here, either “has employees engaged in commerce or in the production of
   goods for commerce” (the “engaged-in clause”) or “has employees
   handling, selling, or otherwise working on goods or materials that have been
   moved in or produced for commerce by any person” (the “handling
   clause”). 29 U.S.C § 203(s)(1)(A)(i).

           5
             Because we conclude that Plaintiffs failed to adequately allege proximate
   causation, we do not address whether Plaintiffs adequately alleged a pattern of racketeering
   activity.

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          Plaintiﬀs contend that the Ramirezes and Black Magic trigger the
   handling clause “by employing more than 11 drivers and hauling water, sand,
   gravel[,] and construction and oilﬁeld equipment both interstate and
   intrastate,” as well as by “handling, selling, or otherwise working on goods
   or materials (such as heavy trucks, fuel and equipment) that have been moved
   in or produced for commerce by any person.” The district court concluded
   that this assertion was conclusory. We disagree and conclude that Plaintiﬀs’
   allegation is suﬃciently plausible to survive dismissal on this issue.
          We have not had many occasions to discuss the handling clause, but
   the limited case law on point makes clear that it does not impose a strenuous
   pleading burden on plaintiﬀs. For example, addressing a prior version of the
   handling clause, we reasoned in Brennan v. Greene’s Propane Gas Service that,
   unlike the engaged-in clause, the handling clause’s requirements are in the
   past tense—that is, the “employees’ handling, selling, or otherwise
   working” must be “on goods that have been moved in or produced for
   commerce by any person.” 479 F.2d 1027, 1030 (5th Cir. 1973). That
   phrasing, we concluded, means that “[t]here is no requirement of continuity
   in the present.” Id. Instead, “the legislation was designed to regulate
   enterprises dealing in articles acquired intrastate after travel in interstate
   commerce.” Id. (quotation omitted).
          Brennan’s reasoning has generated similar holdings in our sister
   circuits. For instance, the Eleventh Circuit relied on Brennan in applying the
   handling clause to items that travelled interstate prior to sale in Polycarpe v.
   E&S Landscaping Service, 616 F.3d 1217, 1221 (11th Cir. 2010). In particular,
   the Eleventh Circuit rejected the alternative “ʻcoming to rest’ doctrine,”
   under which “interstate goods or materials can lose their interstate quality if
   the items have already come to rest within a state before intrastate purchase
   by a business.” Id. In turn, the Sixth Circuit has cited Polycarpe in applying
   the handling clause to a logging company whose employees used logging

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   equipment that had been moved in commerce.                     See Sec’y of Labor v.
   Timberline S., LLC, 925 F.3d 838, 845, 848 (6th Cir. 2019). As these cases
   make clear, an employer can trigger enterprise coverage if its employees
   handle items that had travelled in interstate commerce at some point in the
   past, even if the act of handling those items does not amount to engaging in
   commerce in the present.
           The Ramirezes argue that Plaintiﬀs must nonetheless show that their
   work directly aﬀected commerce. But the Ramirezes rely primarily on two
   summary judgment opinions implicating the engaged-in clause—not the
   handling clause—for that proposition. See Williams v. Henagan, 595 F.3d 610
   (5th Cir. 2010) (per curiam); Sobrinio v. Med. Ctr. Visitor’s Lodge, Inc., 474
F.3d 828 (5th Cir. 2007) (per curiam). 6 Those cases do not compel dismissal
   of Plaintiﬀs’ claims. As we have discussed, the handling clause does not
   require the same sort of present-tense continuity that the Ramirezes suggest.
   See Brennan, 479 F.2d at 1030. That means that, unlike the Williams and
   Sobrinio plaintiﬀs, Plaintiﬀs here do not need to allege that their actual work
   activities directly aﬀected interstate commerce, merely that the goods or
   materials they handled had previously come into the state from elsewhere.
   The Ramirezes’ argument also conﬂates Plaintiﬀs’ ultimate burden of proof
   with what must be plausibly alleged. Indeed, Williams and Sobrinio were

           6
             In Williams, we concluded that a police chief was entitled to summary judgment
   on an inmate’s FLSA claims because the inmate, who waxed church ﬂoors, worked at a city
   railroad festival, cooked for local fundraisers, counted burnt-out streetlamps, worked for
   the chief’s bounce-castle rental and grass-cutting businesses, and traveled with a mayor
   from Louisiana to Texas to transport the mayor’s furniture, performed only “occasional
   odd jobs” and was not actively “engaged in commerce.” 595 F.3d at 613–14, 621. In
   Sobrinio, we concluded that a motel was entitled to summary judgment on an employee’s
   FLSA claims because the employee, who “acted as a janitor, security guard and a driver for
   the motel’s guests, who were often from out of town,” but “did not drive them to or from
   any airport or other interstate transportation center,” was not “engaged in interstate
   commerce.” 474 F.3d at 829–30.

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   resolved at summary judgment, where the plaintiﬀs were required to
   demonstrate, with evidence showing at least a genuine dispute of material
   fact, a relationship between their work and interstate commerce.                         See
   Williams, 595 at 615. Here, Plaintiﬀs need only plausibly allege that they
   handled goods or materials that had at some point travelled interstate. See
   Twombly, 550 U.S. at 570.
           We conclude that Plaintiﬀs have done so. They identiﬁed water, sand,
   gravel, construction equipment, oilﬁeld equipment, trucks, and fuel as goods
   or materials that had potentially been moved in commerce before being
   handled by Black Magic and its employees. At least some of these items are
   plausibly goods or materials: they are all items one could plausibly conclude
   are used in or produced during construction and trucking work. 7 It is also
   plausible that some or all of these items had travelled interstate at some point
   in their life cycle. Texas is a large state with considerable industrial capacity,
   but it does not stretch the deﬁnition of plausible for Plaintiﬀs to allege that at
   least some of the raw materials and machinery that they handled came from
   beyond Texas’s borders. Importantly, Plaintiﬀs will have to provide proof of
   these allegations at the summary judgment or trial stage (after they have had
   a chance to conduct discovery), but they are not required to provide further
   details than they have at this stage.

           7
              We note that the distinction between “goods” and “materials” in the handling
   clause has been the subject of considerable judicial discussion. See Timberline, 925 F.3d at
   845–48 (collecting and summarizing cases); Polycarpe, 616 F.3d at 1223–25 (examining
   dictionary sources, legislative history, an agency opinion letter, and a law review article on
   the distinction). Because the parties do not suggest such a distinction makes any difference
   here, we need not wade into those waters. We merely conclude that many of the items
   Plaintiffs identify plausibly constitute either goods or materials.

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                 2.     Failure to Pay
          Plaintiﬀs also adequately pleaded that they lost wages as a result of the
   alleged FLSA violations. Plaintiﬀs claimed that they were paid less than $18
   per hour for overtime, less than one-and-one-half times their contractually
   agreed upon hourly wage. Plaintiﬀs further alleged that the Ramirezes
   eﬀectively paid Plaintiﬀs less than the federal minimum wage by making
   impermissible deductions from their paychecks. They also identiﬁed that,
   for “several pay periods during late August and September of 2015,” they
   “worked 50 to 80 or more hours a week” but “were not paid fully or paid at
   all.” The district court concluded that these allegations were insuﬃcient to
   establish the amount of compensation and overtime Plaintiﬀs were due.
          We conclude that Plaintiﬀs’ allegations are suﬃcient at the pleadings
   stage. The allegations put the Ramirezes on notice of minimum and overtime
   wage claims for speciﬁc time periods and set forth a plausible claim for relief.
   See Twombly, 550 U.S. at 555. Rule 12(b)(6) “do[es] not require heightened
   fact pleading of speciﬁcs, but only enough facts to state a claim to relief that
   is plausible on its face.” Id. at 570. The district court required Plaintiﬀs to
   do more than that—essentially making them prove (rather than plausibly
   allege) that the Ramirezes “violated the FLSA’s overtime wage
   requirements” and “the amount of overtime compensation due.” See
   Johnson v. Heckmann Water Res. (CVR), Inc., 758 F.3d 627, 630 (5th Cir.
   2014). Such proof is unnecessary at this point; in fact, even past the pleading
   stage, when an employer fails to keep proper records, “the remedial nature
   of the FLSA and the great public policy which it embodies militate against
   making the burden of proving uncompensated work an impossible hurdle for
   the employee.” Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036, 1047 (2016)
   (cleaned up). Plaintiﬀs’ allegations regarding the hours worked and
   approximate wages paid during certain time periods were suﬃcient to meet
   the pleading requirements.

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           As Plaintiﬀs have adequately pleaded both enterprise coverage and
   underpayment of wages, we reverse the district court’s dismissal of their
   FLSA claims. Additionally, because Plaintiﬀs adequately pleaded at least one
   federal claim, we conclude that the district court’s dismissal of their state law
   claims should be vacated so that the district court can assess the exercise of
   supplemental jurisdiction under the current pleading situation. 8
           C.       Leave to Amend
           Finally, we turn to Plaintiﬀs’ challenge to the district court’s denial of
   their motion for leave to amend their complaint. Plaintiﬀs sought such leave
   more than ﬁve weeks after the district court’s order dismissing their
   complaint for failure to state a claim. The district court reasoned that their
   motion was untimely and noted the numerous opportunities Plaintiﬀs had to
   ﬁx their pleading deﬁciencies. The district court explained that, among other
   opportunities, Plaintiﬀs could have raised any new matters prior to dismissal.
   The district court also concluded that further amendment would be futile.
           We conclude that the district court did not abuse its discretion in
   denying Plaintiﬀs’ motion for leave to amend. Although Plaintiﬀs amended
   their complaint only once, they did not explain what would be accomplished
   by further amendment in their second request for leave to amend. That
   deﬁciency is exacerbated by the fact that Plaintiﬀs waited more than ﬁve
   weeks after the district court’s dismissal order to ask for leave the second
   time. Plaintiﬀs’ failure to seriously pursue amendment until well after

           8
              The vacatur of the district court’s ruling on this point is solely because the district
   court’s dismissal decision was premised on the now-changed ground that it had dismissed
   all of Plaintiffs’ federal claims. See 28 U.S.C. § 1367(c)(3). We do not address any other
   possible bases for declining supplemental jurisdiction; those topics may be raised, as
   appropriate, on remand for evaluation by the district court in the first instance.

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   dismissal—a combination of failure to cure and delay—more than justiﬁed
   the district court’s denial of their motion.
          Additionally, amendment was futile as to the RICO claims. As we
   explained above, Plaintiﬀs’ injury was, on its face, not proximately caused by
   the alleged fraud. Amendment was also unnecessary on Plaintiﬀs’ FLSA
   claims, albeit for a diﬀerent reason: Plaintiﬀs’ FLSA claims were adequately
   pleaded in the ﬁrst place. The district court thus did not abuse its discretion
   by denying Plaintiﬀs leave to amend their complaint.
                                 IV.      Conclusion
          Plaintiﬀs’ RICO claims fail because they did not adequately plead that
   their injuries were proximately caused by the Ramirezes’ alleged fraud. But
   their FLSA claims were improperly dismissed; Plaintiﬀs plausibly alleged
   that the goods and materials they handled had travelled in interstate
   commerce and that they lost wages as a result of the Ramirezes’ conduct.
   Because their FLSA claim were plausibly pleaded, we remand Plaintiﬀs’ state
   law claims for new consideration of supplemental jurisdiction. Finally, the
   district court did not abuse its discretion in denying Plaintiﬀs’ motion to
   amend their complaint.
          Accordingly, we AFFIRM the district court’s dismissal of Plaintiﬀs’
   RICO claims and the district court’s denial of Plaintiﬀs’ motion for leave to
   amend, REVERSE the district court’s dismissal of Plaintiﬀs’ FLSA claims,
   VACATE the district court’s dismissal of the state law claims, and
   REMAND to the district court for further proceedings.

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