United States District Court, D. Maryland, Southern Division
J. HAZEL, UNITED STATES DISTRICT JUDGE
action, Juan Pablo Carrillo, Julio Cesar Sanchez, Luis David
Castro, Enrique Patricio Correa, Roger A. Ramos, Carlos
Humberto Calderon and Melvin Omar Lemus (collectively,
”Plaintiffs”) allege violations of the Fair Labor
Standards Act ("FLSA") 29 U.S.C. §§ 201
et seq., the Maryland Wage and Hour Laws,
("MWHL"), Md. Code Ann., Lab & Empl.
§§ 3-401 el seq., and the Maryland Wage
Payment and Collection Law ("MWPCL"), Md. Code
Ann., Lab & Empl. §§ 3-501 et seq.,
against their former employer, Borges Construction, LLC; its
successor corporations, Lu-Ma Construction, LLC, Deco Inc.,
and LMS Contractors Inc.; and the officers of said
corporations, Silvestre Borges, Maria Nicoladle, and Salomon
Nicolalde in their individual capacities (collectively,
"Defendants"). ECF No. 45. This Memorandum Opinion
and accompanying Order address Plaintiffs' Motion for
Default Judgment. ECF No. 56. A hearing is unnecessary.
See Loc. R. 105.6 (D. Md.). For the reasons stated
herein. Plaintiffs Motion will be granted in part, and
denied, in part.
Borges Construction is a waterproofing and construction
contractor and subcontractor, performing services in
Maryland, Virginia and the District of Columbia. ECF No. 45
¶ 12. It is a Maryland limited liability company with
its principal place of business located in Gaithersburg,
Maryland. Id. ¶ 3, During the relevant time
period, Defendants Silvestre Borges, Maria Nicoladle, and
Salomon Nicolalde were officers and active owners of Borges
Construction. Id. ¶ 8. Plaintiffs worked for
Defendants as constructions workers and laborers from 2010
through 2013. See ECF Nos. 56-3 through 56-8,
60-1 ¶ 2. Plaintiffs' hours varied, working an
average of 52 hours each week. ECF No. 56-1 at
9-18; see also e.g. ECF Mo. 56-3
¶ 4. During their employment, Plaintiffs allege that
Defendants "willfully and systematically directed and
forced Plaintiffs" to underreport the hours they worked
each week on preliminary and postliminary work duties. ECF
No. 45 ¶¶ 55 - 60. According to the Third Amended
Complaint, each morning, Defendants required Plaintiffs to
arrive at Defendants' place of businesses and load
Defendants' work trucks before proceeding to the job
location. Id. ¶ 56. Similarly, at the
conclusion of Plaintiffs' work duties at the job site.
Defendants required Plaintiffs to drive Defendants'
equipment back to Defendants' place of business and
return the equipment to a secure location. Id.
¶ 57. Plaintiffs allege that these work duties,
including driving time, were performed by the Plaintiffs
primarily for the benefit of Defendants and with
Defendants' knowledge. Id. ¶¶ 58-59.
Plaintiffs attest that these duties accounted for
approximately seven additional unreported hours each week.
ECF No. 56-1 at 10-18. Plaintiffs maintain that they were
never paid overtime wages for these duties, calculated at one
and one half time their regular wages. ECF No. 45 ¶ 62.
further allege that Defendants sought to shield themselves
from liability by creating a series of successor
corporations. Id. ¶¶ 64- 67. Plaintiffs
state that around the time of the commencement of this
lawsuit Defendants ceased or substantially limited their
operations as Borges Construction and began operating through
the entity of Defendant Lu-Ma Construction, a Maryland
limited liability company with its principal place of
business in Gaithersburg, Maryland. Id. ¶¶
4, 64. Furthermore, on or about May 20. 2013, Plaintiffs'
allege that Defendants ceased or substantially limited their
operations as Lu-Ma Construction, LLC and began operating
through the entity of Defendant Deco Inc., also a Maryland
corporation with its principal place of business in
Rockville, Maryland. Id. ¶¶ 5, 65.
Finally, in or about February 2014. in an alleged further
attempt to limit their liability. Defendants ceased or
substantially limited their operations as Lu-Ma Construction.
LLC. Deco Inc.. and Borges Construction and began operating
through the entity of Defendant LMS Contractors Inc.. also a
Maryland corporation with its principal place of business in
Rockville. Maryland. Id. ¶¶ 6, 66.
Plaintiffs allege that all of the above referenced corporate
defendants share a common identity of officer. director and
stockholders; hold themselves out to the public as identical
or near identical businesses and the entities perform the
same or similar services for the same clientele. Id.
¶¶ 64 -67.
times during the period of Plaintiffs" employment,
Plaintiffs claim that Defendants were their
"employers" for the purposes of the FLSA. MWHL and
MWPCL. Id. ¶ 22. Furthermore.. Plaintiffs'
allege that Defendants were engaged in commerce or in the
production of goods within the meanings of Section 3(s)(1) of
the FLSA, 29 U.S.C. § 203(s)(1). Id. ¶ 23.
Finally. Plaintiffs state that they were employees who
engaged in commerce or the production of good for commerce,
under the FLSA, 29 U.S.C. § 207. Id. ¶ 24.
February 28. 2013. Plaintiffs filed a Complaint for unpaid
wages, liquidated damages and reasonable attorney's fees
under the FLSA. MWHL. and MWPCL, ECF No. 1. which they have
subsequently amended three times. ECF Nos. 3, 19 and 45. On
August 17. 2016. Plaintiffs filed a Motion for Clerk's
Entry of Default. ECF No. 54. and the presently pending
Motion for Default Judgment was filed the next day. ECF No.
56. An Order of Default was entered by the Clerk of the Court
against Defendants on September 8, 2016. ECF Nos. 57-59.
STANDARD OF REVIEW
defendant's default does not automatically entitle the
plaintiff to entry of a default judgment: rather, that
decision is left to the discretion of the court."
Choice Hotels Intern.. Inc. v. Savannah Shakli
Carp., No. DKC-I1-0438, 2011 WL 5118328 at * 2 (D. Md.
Oct. 25, 2011) (citing Dow v. Jones, 232 F.Supp.2d
491, 494 (D. Md. 2002)). Although "ft]he Fourth Circuit
has a 'strong policy' that 'cases be decided on
their merits, '" id. (citing United
States v. Shaffer Equip. Co., 11 F.3d 450. 453 (4th
Cir.1993)).. "default judgment may be appropriate when
the adversary process has been halted because of an
essentially unresponsive party[.]" Id. (citing
S.E.C. v. Lawbaugh, 359 F.Supp.2d 418, 421 (D. Md.
default, the well-pled allegations in a complaint as to
liability are taken as true, although the allegations as to
damages are not." SEC. v. Lawbaugh, 359
F.Supp.2d 418, 422 (D. Md. 2005). Rule 54(c) of the Federal
Rules of Civil Procedure limits the type of judgment that may
be entered based on a party's default: "A default
judgment must not differ in kind from, or exceed in amount,
what is demanded in the pleadings." In entering default
judgment, a court cannot, therefore, award additional damages
"because the defendant could not reasonably have
expected that his damages would exceed th[ej amount [plead in
the complaint]." In re Genesys Data Techs..
Inc., 204 F.3d 124, 132 (4th Cir. 2000). Where a
complaint does not specify an amount, "the court is
required to make an independent determination of the sum to
be awarded." Adkins v. Texeo, 180 F.Supp.2d 15.
17 (D.D.C. 2001) (citing S.E.C. v. Management Dynamics.
Inc., 515 F.2d 801, 814 (2nd Cir. 1975); An Bon Pain
Corp. v. Artect. Inc., 653 F.2d 6L 65 (2nd Cir. 1981)).
While the Court may hold a hearing to prove damages, it is
not required to do so; it may rely instead on "detailed
affidavits or documentary evidence to determine the
appropriate sum." Adkins. 180 F.Supp.2d at 17
(citing United Artists Corp. v. Freeman, 605 F.2d
854, 857 (5th Cir. 1979)); see also laborers'
District Council Pension, et al. v. E.G.S.. Inc., No.
WDQ-09-3174, 2010 WL 1568595, at *3 (D. Md. Apr. 16, 2010)
C'[O]n default judgment, the Court may only award damages
without a hearing if the record supports the damages
considering a Motion for Default Judgment, the Court accepts
as true the well-pleaded factual allegations in the Complaint
as to liability, but nevertheless "must determine
whether [those] allegations .. . support the relief sought in
th[e] action." Int'l Painters &
Allied Trades Indus. Pension Fund v. Capital Restoration
& Painting Co., 919 F.Supp.2d 680, 685 (D. Md. 2013)
(citation and internal quotation marks omitted).
Preliminary and Postliminary Activities as Compensable Work
under the FLSA
Plaintiffs allege that Defendants failed to pay them overtime
pay for compensable preliminary and postliminary work duties
they completed, as required under the FLSA and MWHL. The FLSA
requires that an employee must receive compensation "at
a rate not less than one and one-half times the regular rate
at which he is employed" for any hours worked in excess
of forty hours per week. 29 U.S.C. § 207(a)(1).
"The MWHL similarly requires that employers pay ...an
overtime wage of at least 1.5 times the usual hourly wage for
each hour worked in excess of forty hours per week."
McFeeley v. Jackson St. Entm't. LLC, 47
F.Supp.3d 260, 275-76 (D. Md. 2014) (internal quotation marks
and citations omitted). "The MWHL is the State parallel
to the FLSA, and the requirements of that provision mirror
those of the federal law. Thus, Plaintiffs' claim[s]
under the MWHL stand or fall on the success of their
claims under the FLSA.'" Brawn v. White's
Ferry, Inc., 280 F.R.D. 238, 242 (D. Md. 2012) (internal
citation and quotations omitted). "To prove a prima
facie violation of this provision, a plaintiff must show the
following: (I) that the plaintiff worked overtime hours for
the employer and did not receive the prescribed compensation;
(2) the number of overtime hours worked; and (3) that the
employer had actual or constructive knowledge that the
plaintiff worked those hours." See Orellana v.
Cienna Properties, LLC, No. CIV.A. JKB-11-2515, 2012 WL
203421, at *2 (D. Md. Jan. 23, 2012)
Plaintiffs claims rest upon the allegation that Defendants
"willfully and systematically directed and forced
Plaintiffs" to underreport the hours they worked each
week on "preliminary and postliminary work duties,
" ECF No. 45 ¶¶ 55 - 60, the Court must first
determine whether such activities properly constitute
Portal-to-Portal Act, 29 U.S.C. § 254, was passed by
Congress to clarify the meaning of "work, " left
undefined under the FLSA. See Integrity Staffing Sols..
Inc. v. Busk, 135 S.Ct. 513, 516-17 (2014). Among other
things, the Portal-to Portal Act "exempted employers
from liability for future claims based on... activities which
are preliminary to or postliminary to said principal activity
or activities...which occur either prior to the time on any
particular workday at which such employee commences, or
subsequent to the time on any particular workday at which he
ceases, such principal activity or activities."
Id. at 517(internal quotations omitted).
under the FLSA thus turns on whether or not an activity can
be defined as a "principal activity" under the
Portal-to-Portal Act. See Jones v. Hoffberger Moving
Servs. LLC, 92 F.Supp.3d 405, 410 (D. Md. 2015).
"The Supreme Court has interpreted the term
'principal activity' to 'embrace[ ] all
activities which are an integral and indispensable
part of the principal activities/" Id.
(internal citation omitted). Recently in Integrity
Staffing, the Supreme Court held that an activity is
integral and indispensable "if it is an intrinsic
element of those activities and one with which the employee
cannot dispense if he is to perform his principal
activities." Integrity Staffing Sols.. Inc.,
135 S.Ct. at 519 (2014).
contend that Defendants violated the FLSA by requiring
Plaintiffs to arrive at Defendants' place of businesses
and load Defendants' work trucks before proceeding to the
job location and to drive Defendants' equipment back to
Defendants' place of business at the end of the day. ECF
No. 45 ¶¶ 56-57. Plaintiffs were employed by
Defendants as day laborers and construction workers, work
that could not been completed without access to the
appropriate tools. Thus, the employers could not have
disposed of the disputed activity, here the loading and
unloading of equipment and tools; "without
impairing their employee's ability to perform the work
they were employed to perform." Cf. Jones, 92
V. Supp. 3d at 410 (discussing example where
employer could dispose of the disputed activity). Indeed,
several district courts, post-Integral Staffing,
have held that similar preliminary equipment loading is
considered "integral and indispensable" to an
employees' work activities. See. e.g.. Gaytan v.
G&G Landscaping Constr.. Inc., 145 F.Supp.3d 320,
325 (D.N.J. 2015)(holding that "loading trucks with
necessary tools and materials" for landscaping jobs is
compensable time under the FLSA); Jones, 92
F.Supp.3d at 412 (D. Md. 2015)(holding that time spent
loading trucks with moving equipment at company's
warehouse was integral and indispensable to Plaintiffs'
principal activities of loading and unloading Defendants'
trucks at job sites). Thus, the Court finds that
Plaintiffs' work loading and unloading equipment from
Defendants' work trucks is integral and indispensable to
their principal activity as laborers and construction workers
and Plaintiffs should have been compensated
established that Plaintiffs are owed compensation for their
preliminary and postliminary work activities, the Court next
turns to whether or not those hours consisted of overtime
work. Here, Plaintiffs allege that they worked an average of
52 hours per week, ECF Nos. 56-3 through 56-8 ¶¶
2-4 and ECF No. 60-1 ¶¶ 2-4, including
approximately seven hours of preliminary and postliminary
work duties for which they were never compensated. ECF Nos.
56-3 through 56-8 ¶ 8; ECF No. 60-1 ¶ 8. Plaintiffs
also allege that at all times during their employment,
Defendants Silvestre Borges, Maria Nicoladle and Salomon
Nicoladle were the owners of Borges Construction, LLC and had
the power to set their work schedules. Id. at
¶¶ 10, 12. They also allege that Defendants
"willfully and systematically directed and forced
Plaintiffs" to underreport the hours they worked each
week on "preliminary and postliminary work duties."
ECF No. 45 ¶¶ 55 ...