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Kim v. Confidental Studio, Inc.

United States District Court, D. Maryland, Southern Division

September 12, 2016

DONG KIM, Plaintiff,
v.
CONFIDENTIAL STUDIO, INC., et al., Defendants.

          MEMORANDUM OPINION

          Paul W. Grimm United States District Judge

         Plaintiff Dong Kim worked for Defendant Confidential Studio, Inc. (“Confidential Studio”), a dental business dedicated to the manufacture of false teeth and owned by Defendant Raphael Choi, from August 2011 until January 2015. Compl. ¶ 9, ECF No. 1; Defs.' Mot. 1, 8, ECF No. 30; Pl.'s Opp'n 1-2, ECF No. 31. After working for Defendants for approximately three and a half years, Kim filed suit against his employer, claiming that Confidential Studio violated state and federal law[1] by failing to pay him overtime wages. Compl. ¶ 8. Defendants seek summary judgment, arguing that it is “well settled” that Kim's salary “far exceeded” $455 per week “and his job duties directly related to the management and general business operations of the Practice, ” such that the administrative exemption applied and he was not entitled to overtime pay. Defs.' Mot. 2, 7. Yet Kim has identified evidence in the record showing that some weeks he received less than $455 and that he was not working in an administrative capacity. Moreover, he has identified documentary evidence of questionable authority and weight that Confidential Studio relied on to prove its defense that cannot, when challenged, support Confidential Studio's claims that there is no genuine dispute of material fact. Pl.'s Opp'n 31; see Jt. Ex., ECF No. 32.[2] Therefore I will deny Defendants' Motion and schedule a trial in this case.

         Standard of Review

         In reviewing a motion for summary judgment, the Court considers the facts in the light most favorable to the nonmovant, drawing all justifiable inferences in that party's favor. Ricci v. DeStefano, 557 U.S. 557, 585-86 (2009); George & Co., LLC v. Imagination Entm't Ltd., 575 F.3d 383, 391-92 (4th Cir. 2009). Summary judgment is proper when the moving party demonstrates, through “particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations . . . admissions, interrogatory answers, or other materials, ” that “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a), (c)(1)(A); see Baldwin v. City of Greensboro, 714 F.3d 828, 833 (4th Cir. 2013). If the party seeking summary judgment demonstrates that there is no evidence to support the nonmoving party's case, the burden shifts to the nonmoving party to identify evidence that shows that a genuine dispute exists as to material facts. See Celotex v. Catrett, 477 U.S. 317 (1986). The existence of only a “scintilla of evidence” is not enough to defeat a motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986). Instead, the evidentiary materials submitted must show facts from which the finder of fact reasonably could find for the party opposing summary judgment. Id.

         Discussion

         Pursuant to the FLSA, an employer cannot “employ any of his employees . . . for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.” 29 U.S.C. § 207. However, the FLSA exempts “any employee employed in a bona fide executive, administrative, or professional capacity” from overtime pay. 29 U.S.C. § 213(a)(1); see Lane v. Sys. Application & Techs., Inc., No. DKC-13-3566, 2015 WL 1013449, at *6 (D. Md. Mar. 6, 2015). “‘Administrative capacity' has the same meaning under the regulations governing the MWHL as it does under the FLSA regulations. Thus, an employee who qualifies for the administrative exemption under the FLSA also will qualify for that exemption under the MWHL.” Id. (citing Md. Code Regs. 09.12.41.01).[3]

         “[The] employer bears the burden of proving that a particular employee's job falls within such an exemption.” Darveau v. Detecon, Inc., 515 F.3d 334, 337 (4th Cir. 2008). The employer must establish “by clear and convincing evidence that an employee qualifies for exemption.” Shockley v. City of Newport News, 997 F.2d 18, 21 (4th Cir. 1993). The Court narrowly construes the exemption against the employer. See Darveau, 515 F.3d at 337.

         To establish that Kim is an exempt employee under the administrative exemption, Confidential Studio must demonstrate that (1) Kim was “[c]ompensated on a salary or fee basis at a rate of not less than $455 per week”; (2) his “primary duty [was] the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer's customers”; and (3) his “primary duty include[d] the exercise of discretion and independent judgment with respect to matters of significance.” 29 C.F.R. § 541.200(a); see Rossi v. Circle Treatment Ctr., P.C., No. 14-3803-GJH, 2015 WL 1815501, at *2 (D. Md. Apr. 17, 2015); Darveau, 515 F.3d at 338; Lane, 2015 WL 1013449, at *6.

         Salary

         “An employee [is] considered to be paid on a ‘salary basis' . . . if the employee regularly receives each pay period . . . a predetermined amount constituting all or part of the employee's compensation, which amount is not subject to reduction because of variations in the quality or quantity of the work performed.” 29 C.F.R. § 541.602(a) (emphasis added). Some deductions are permissible, such as for certain absences for at least one full day, as “penalties imposed in good faith for infractions of safety rules of major significance, ” and “for unpaid disciplinary suspensions of one or more full days imposed in good faith for infractions of workplace conduct rules . . . imposed pursuant to a written policy applicable to all employees.” Id. § 541.602(b). “If employees are actually paid on an hourly rather than a guaranteed salary basis, regardless of the kind of duties performed, they are covered by the wage and hour laws.” Donovan v. Kentwood Dev. Co., 549 F.Supp. 480, 484 (D. Md. 1982).

         Choi testified that Confidential Studio did “not keep track of any employee hours.” Choi Dep. 68:6-12, Jt. Ex. 23. Yet, Kim's biweekly paychecks from January 1, 2013 through June 16, 2014 show that he did not receive a consistent salary, which calls into question whether he was receiving a predetermined amount. See Pl.'s Paychecks, Jt. Ex. 129-291. Without addressing whether Kim was paid on a “salary basis, ” Confidential Studio asserts that Kim earned in excess of the statutory amount, see Defs.' Mot. 7, and it is undisputed that this is true of many of the weeks Kim worked for Defendants, see Pl.'s Opp'n 5. But, significantly, he received less than $910 (the equivalent of $455 per week for two weeks) for seven paychecks during that period. Pl.'s Paychecks, Jt. Ex. 129-291 (Feb. 16, 2013 paycheck for $200.00, Jt. Ex. 137; Nov. 1, 2013 paycheck for $457.00, Jt. Ex. 170; Nov. 16, 2013 paycheck for $700.00, Jt. Ex. 172; Dec. 24, 2013 paycheck for $100.00, Jt. Ex. 178; Jan. 7, 2014 paycheck for $150.00, Jt. Ex. 181; Apr. 16, 2014 paycheck for $100.00, Jt. Ex. 196; July 16, 2014 paycheck for $300.00, Jt. Ex. 212). He testified that he “received 1400 something” every two weeks “after July of 2014, after tax, but before then [he did] not know well” how much he received. Kim Dep. 44:18 - 50:6, Jt. Ex. 63- 64.

         Thus, it is far from clear (and much less than “clear and convincing”) that Kim received “a predetermined amount.” See 29 C.F.R. § 541.602(a). Moreover, Kim has shown that a genuine dispute exists regarding whether he received a salary “of not less than $455 per week” while working for Defendants. Because this fact is material to whether Kim was an exempt employee and therefore not entitled to overtime pay, see 29 C.F.R. § 541.200(a), it alone is sufficient to defeat Defendants' summary judgment motion. See Celotex v. Catrett, 477 U.S. 317 (1986). But, genuine disputes exist as to the other elements of the exemption as well.

         Primary Duty

         An employee's “‘primary duty'” is “‘the principal, main, major or most important duty that the employee performs, '” which the Court determines “‘based on all the facts in a particular case, with the major emphasis on the character of the employee's job as a whole.'” Lane, 2015 WL 1013449, at *7 (quoting 29 C.F.R. § 541.700(a)). The Court considers how much time the employee “‘spent performing exempt work'” and how important his exempt duties were in comparison to his other duties, as well as how much “direct ...


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