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Martinez v. Capitol Drywall, Inc.

United States District Court, D. Maryland

October 24, 2014

MOISES MARTINEZ, et al.
v.
CAPITOL DRYWALL, INC., et al.

REPORT AND RECOMMENDATION

JILLYN K. SCHULZE, Magistrate Judge.

This case was referred to me pursuant to 28 U.S.C. § 636(b) and Local Rule 301.6 for review of Plaintiffs' Motion for Judgment by Default against Defendant Hector Vitela. ECF No. 39. Defendant was properly served, ECF No. 5, failed to plead or otherwise respond to the complaint, and the Clerk of the Court entered default against him. ECF No 15. For the following reasons, I recommend that Plaintiffs' motion be granted.

1. Background.

On May 30, 2013, Plaintiffs filed this complaint, amended on September 25, 2013, alleging that they were employed by Defendant in his capacity as owner, agent or principal of then co-Defendant Capitol Drywall, Inc. ECF No. 4 at ¶¶ 17, 26-28. The complaint alleges that Plaintiffs regularly worked more than forty hours per week but were not compensated at the required overtime rate in violation of the Fair Labor Standards Act (FLSA) (Count I) and the Maryland Wage and Hour Law (MWHL) (Count II), and alleges that Plaintiffs were not paid all wages due in violation of the Maryland Wage Payment and Collection Law (MWPCL) (Count III). 29 U.S.C. § 206(a)(1)(c); MD. CODE ANN., LAB. & EMPL. § 3-413(a)(1)(i), § 3-502. A fourth count states a claim in quantum meruit. I recommend that judgment be entered in the amounts explained below.

2. Analysis.

a. Liability.

In determining whether to award default judgment, the court takes as true the wellpleaded factual allegations in the complaint as to liability. Ryan v. Homecomings Fin. Network, 253 F.3d 778, 780 (4th Cir. 2001). Where the Defendant has not sought to set aside the default as provided by Federal Rule of Civil Procedure 55(c), or suggested in any way that he has a meritorious defense, the standard for default judgment has been satisfied. Fanning v. Hotel Mgmt. Advisors-Troy, LLC, 282 F.R.D. 280, 283 (D. D.C. 2012).

Plaintiff has pled facts which establish Defendant's liability as to all counts. Section 207 (a)(1) of Title 29 of the United States Code, and section 3-413 of the Maryland Code, Labor and Employment Article, mandate payment of time and a half for each hour in excess of forty per week. The complaint and affidavits accompanying the motion for default judgment establish that Defendant is Plaintiffs' employer for purposes of these statutes because he had the power to hire and fire, determine wages, set schedules, and manage the project. ECF No. 39 at Ex. 1 ¶ 5, Ex. 2 ¶ 5, Ex. 3 ¶ 5, Ex. 4 ¶5 Ex. 5 ¶ 5 Ex. 6 ¶ 5; see Brock v. Hamad, 867 F.2d. 804, 809 n.6 (4th Cir. 1989); Marroquin v. Canales, 505 F.Supp.2d 283, 299 (D. Md. 2007). Each Plaintiff's affidavit sets forth the dates and hours he worked.[1] The complaint also alleges that Defendant failed to compensate Plaintiffs at the legally required overtime rate. ECF No. 4 at ¶ 31.

The motion for default judgment contains Plaintiffs' sworn Declarations, which corroborate the allegations in the complaint regarding Defendant's employer status for purposes of the Federal and Maryland wage laws. Each Declaration sets forth the individual Plaintiffs' employment dates, the number of hours worked each week, and attests that the hours noted on their pay stubs were not accurate. Each Declaration attests that the unpaid wage calculations prepared by Plaintiffs' counsel accurately reflect the amount of unpaid wages to which he is entitled. Defendant has not responded to or rebutted these allegations. Accepting Plaintiffs' well-pled allegations as true, I find that liability has been established and that the court should enter judgment against Defendant as to Counts I, II, and III.

Quantum meruit, alleged in Count IV, permits recovery in the absence of a contract where circumstances justify a recovery as though there had been a contract. Swedish Civil Aviation Admin. v. Project Mgmt. Enters., Inc., 190 F.Supp.2d 785, 790 (D. Md. 2002). The motion for default judgment does not reference this count, and in any event, Plaintiffs are entitled to recover under Counts I-III and may not recover twice for a single injury. United States v. Rachel, 289 F.Supp.2d 688, 697 (D. Md. 2003). The court thus should not enter judgment as to this count.

3. Damages.

If the court finds that liability is established, it should then determine appropriate damages. Agora Fin. Inc. v. Samler, 725 F.Supp.2d 491, 494 (D. Md. 2010) (citing Ryan, 253 F.3d at 780-81). The court must make an independent determination of damages. Id. Where, as here, the plaintiffs submit affidavits and documentary evidence which are sufficient to establish the amount that should be awarded, no hearing is necessary. Fed. Rule Civ. P. 55(b)(2); General Ins. Co. v. O'Keefe, 275 F.Supp. 107, 109 (D. Md. 1967). Instead, the court may rely on the affidavits and other evidence to determine the appropriate sum to award. See Fanning, 282 F.R.D. at 283 (quoting Adkins v. Teseo, 180 F.Supp.2d 15, 17 (D. D.C. 2001)); see also United Artists Corp. v. Freeman, 605 F.2d 854, 857 (5th Cir. 1979). In a wage case, when the employer breaches his obligation to keep records, the court can rely on the employees' evidence to draw a just and reasonable inference as to the number of hours worked. McLaughlin v. Murphy, 436 F.Supp.2d 732, 737 (D. Md. 2005). The employees do not have to prove each hour with absolute accuracy. Pforr v. Food Lion, Inc., 851 F.2d. 106, 108 (4th Cir. 1988); see also Orellana v. Cienna Prop., LLC, No. 11-cv-02515, U.S. Dist. LEXIS 7459, at *5 (D. Md. May 23, 2012). Rather, where the employer fails to rebut the employee's evidence, that evidence may form the basis of a damages award. McLaughlin, 436 F.Supp.2d at 737; Donovan v. Kentwood Dev. Co., Inc., 549 F.Supp. 480, 485-86 (D. Md. 1982).

Plaintiffs' Declarations set forth the number of hours worked each week. Their counsel's affidavit explains how she calculated unpaid wages based on Plaintiffs' paystubs and statements regarding the number of hours they worked and their contracted hourly rates.[2] Absent additional records or other rebuttal from Defendant, each Plaintiff's evidence and counsel's calculations should be accepted as the basis for the amount of damages to which each Plaintiff is entitled. Thus, the total damage award for unpaid overtime should be $81, 860.40.

The FLSA also provides for an award of an amount equal to the unpaid wages as liquidated damages, 29 U.S.C. § 216(b). The MWPCL has recently been interpreted to permit a successful plaintiff to recover treble damages for unpaid overtime absent a bona fide dispute over their entitlement to those wages, see Peters v. Early Healthcare Giver, Inc., 439 Md. 646, 653-54 (2014); see also Marshall v. Safeway, Inc. 437 Md. 542, 560-61 (2014). Plaintiffs seek treble damages here based on Maryland law. However, the Maryland decisions, dated March 26, 2014, and August 13, 2014, post-date both the filing of the Amended Complaint and the Clerk's entry of default against Defendant. ECF Nos. 4, 12. Previously, this Court had held that the enhanced damages award under the MWPCL applied only to disputes concerning timing of wage payments and payments deriving from cessation of employment, not failure to pay overtime. See McLaughlin, ...


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