United States District Court, D. Maryland, Southern Division
MEMORANDUM OPINION AND ORDER
GEORGE J. HAZEL, District Judge.
This Memorandum Opinion and Order addresses Defendants' Motion for Protective Order and, Additionally, Motion for Summary Judgment as to Nonrecoverability of Liquidated Damages, ECF No. 82. A hearing is not necessary. See Loc. R. 105.6. For the reasons explained below, the Court will DENY Defendants' Motions.
Defendant PowerComm Construction ("PowerComm") is an electrical utility construction company. See ECF No. 21, Ex. 1. Defendant David Kwasnik, Sr. is the President and CEO of PowerComm. Id. Plaintiffs are individuals who work or have worked for PowerComm as "flaggers" or traffic controllers. See ECF No. 50, Mem. Opinion, at 22 (explaining that opt-in plaintiffs would be similarly situated to representative plaintiffs). Plaintiffs filed their Complaint on June 12, 2013 alleging violations of the Fair Labor Standards Act ("FLSA") and the Maryland Wage and Hour Law ("MWHL") for failure to pay overtime. ECF NO.1.
Among the many issues at play in this litigation is Defendants' classification of Plaintiffs as independent contractors. Defendant David Kwasnik, during his October 2013 deposition, explained that he, with the advice of counsel, decided to classify the flaggers as independent contractors. ECF No. 83, Ex. 1 at 43-44. Notably, Mr. Kwasnik could not remember when he and his counsel discussed the issue. Id. at 46. After discussions regarding the parameters of the advice-of-counsel defense and related waiver of attorney-client privilege, Mr. Kwasnik further testified: "I asked him [his attorney] what's the best approach we should do? Should we make them employees or should we make them independent contractors? We vetted it very well, and looking at the law, the determination was made, and I go on what counsel, you know, advised me that we were going to make them independent contractors." Id. at 45. However, Mr. Kwasnik next testified that he had decided to classify the tlaggers as independent contractors before speaking with counsel. Id. at 47. He further specified that PowerComm classified the flaggers as independent contractors because the company did not control the flaggers' schedules, did not want to send the flaggers to training, and did not pay for the tlaggers' personal protective gear. ECF 84, Ex. 8 at 48-52.
Discovery originally closed on December 9, 2013. ECF NO.9. However, in March 2014, the Court conditionally certified the case as a FLSA collective action. ECF No. 50. Between March and July 2014, over sixty employees or former employees opted-in to the action. See ECF No. 81. In June 2014, at the request of both parties, discovery was extended to October 1, 2014. ECF No. 79.
Also in June, Plaintiffs' counsel served interrogatories on Defendants and a deposition subpoena duces lecum on Defendants' counsel, both requesting information related to Defendants' assertion that they relied on the advice of counsel when classifying the opt-in plaintiffs as independent contractors. ECF No. 83, at 4-5. Defendants responded with a motion for protective order and summary judgment on the issue of liquidated damages. ECF No. 82.
a. Protective Order
Defendants request a protective order prohibiting any further discovery related to their advice-of-counsel defense. ECF No. 83 at 6. Under Fed.R.Civ.P. 26(c), "the court may, for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense." Fed. R. Civ. Pro. 26(c). The Rule "confers broad discretion on the trial court to decide when a protective order is appropriate and what degree of protection is required." Seattle Times Co. v. Rhinehard, 467 U.S. 20, 36 (1984). Nonetheless, protective orders "should be sparingly used and cautiously granted." Baron Financial Corp. v. Natanzon, 240 F.R.D. 200, 202 (D. Md. 2006) (citation and internal quotation marks omitted).
Defendants argue that the protective order is warranted here because, according to Defendants, the discovery deadline related to the advice-of-counsel defense has passed. Defendants assert that although discovery was reopened in June 2014, it was to be limited to information related to the new opt-in plaintiffs. ECF No. 83 at 3-4. As such, Defendants believe Plaintiffs have waived their right to discovery on the advice-of-counsel defense. Id at 7.
Plaintiffs correctly point out, however, that, regardless of what may have prompted it, the Court's extension of discovery to October 1, 2014 did not place any conditions on the scope of discovery. See ECF No. 79. Thus, Plaintiffs' requests related to the advice-of-counsel defense adhere to the Court's scheduling order. Further, even if the discovery extension did limit the scope of discovery to issues related to the opt-in plaintiffs, the discovery sought by the subpoena and interrogatories is relevant to why the over sixty additional opt-in plaintiffs were classified as independent contractors. Aside from the alleged passing of the discovery deadline, Defendants do not specifically present any additional reasons for a protective order. Because Plaintiffs' requests are within the discovery deadline, the requests cannot be said to cause the Defendants the annoyance, embarrassment, oppression, undue burden, or expense that would call for a protective order. Defendants' Motion for Protective Order is DENIED.
b. Summary Judgment
While seeking to avoid additional discovery related to the advice-of-counsel defense, Defendants have also moved for partial summary judgment, arguing that their reliance on the advice of counsel precludes liquidated damages. ECF No. 82. Summary judgment is proper only when there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law. Meson v. GATX Tech. Servs. Corp., 507 F.3d 803, 806 (4th Cir. 2007); see also Fed.R.Civ.P. 56(a). "When the movant seeks summary judgment on an affirmative defense, it must conclusively establish all elements of that defense." Ray Comm., Inc. v. Clear Channel Comm., Inc., 673 F.3d 294, 299 (4th Cir. 2012). The evidence must be that which would entitle the defendant to a directed verdict if not controverted at trial. Id. If the movant fails to fulfill its burden of providing this ...