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Chado v. National Auto Inspections, LLC

United States District Court, D. Maryland

July 13, 2018

IAN CHADO, et al., Plaintiffs,
v.
NATIONAL AUTO INSPECTIONS. LLC, Defendant.

          MEMORANDUM OPINION

          A. David Copperthite, United States Magistrate Judge

         Plaintiffs, Ian Chado, Nancy Nguyen, and William Rush ("Plaintiffs"), move this Court to add multiple plaintiffs and defendants by granting their Motion for Leave to File an Amended Complaint Without Consent ("Motion to Amend") (ECF No. 64). Plaintiffs also move this Court for class certification of the claims alleged in this matter (the "Motion for Class Certification") (ECF No. 72). After considering each of the motions and the responses thereto (ECF Nos. 68. 73-75), the Court finds that no hearing is necessary. See Loc.R. 105.6 (D.Md. 2016). For the reasons stated herein, the Court GRANTS Plaintiffs' Motion to Amend and GRANTS Plaintiffs* Motion for Class Certification.

         Factual Background

         Plaintiffs are all former employees of Defendant, National Auto Inspections, LLC, t/a CARCHEX ("Defendant"), and Plaintiffs seek to add thirty-six additional plaintiffs (collectively with Plaintiffs. "Amended Plaintiffs") and two additional defendants, CARCHEX. LLC ("CARCHEX") and Jason Goldsmith (collectively with Defendant and CARCHEX, "Defendants"). See ECF 64-14 at 6-7. Defendants are in the business of selling vehicle insurance products, including Extended Vehicle Protection Plans ("EVPP"). Id. at 18. All Amended Plaintiffs were employed as Vehicle Protection Specialists ("'Specialists"). Id. at 7. 13-17. As Specialists. Plaintiffs made and received calls to and from Defendants' prospective customers, following a script to sell vehicle insurance. Id. at 19. Defendants paid Amended Plaintiffs through a "complex piece-rate structure" primarily based on the number of EVPPs that each Specialist sold as well as sales-based bonuses. Id. at 20. When the piece-rate and bonus payments did not rise to a certain threshold. Plaintiffs would receive a guaranteed minimum commission. Id. at 22.

         Plaintiffs contend that they "consistently" worked a minimum of forty-five to fifty-four hours per week as a result of their regular schedules, which included some weekend shifts, and the competitive atmosphere Defendants fostered among the Specialists. Id. at 23-24. Plaintiffs allege, however, that their pay did not provide any additional compensation or overtime wages during weeks when they worked more than forty hours in violation of the Fair Labor Standards Act ("FLSA"), the Maryland Wage and Hour Law ("MWHL"), and the Maryland Wage Payment and Collection Law C'MWPCL"). Id. at 23, 32.

         Additional facts are included in the Discussion.

         Procedural Background

         On October 5, 2017, Plaintiffs filed this lawsuit against Defendant, their employer, seeking allegedly unpaid overtime wages. ECF No. 1. In its December 4, 2017 answer. Defendant denied Plaintiffs' claims. ECF No. 7. On December 27, 2017, Plaintiffs filed a Motion for Conditional Certification of a Collective Class and to Facilitate Identification and Notice to Similarly Situated Employees. ECF No. 15.[1] Upon reviewing the motion and the responses thereto. ECF Nos. 23-24, on February 6, 2018. the Court granted Plaintiffs' Motion for Conditional Certification. ECF No. 25.

         On April 20, 2018, Plaintiffs filed their Motion to Amend. ECF No. 64. Defendant filed a response on May 4, 2018, ECF No. 68, and Plaintiffs replied on May 18, 2018, ECF No. 73. Plaintiffs filed their Motion for Class Certification on May 9, 2018, ECF No. 72, and Defendant opposed the motion on May 23, 2018, ECF No. 74. On June 6. 2018, Plaintiffs filed a reply. ECF No. 75. Accordingly, the Motion to Amend and the Motion for Class Certification are fully briefed.

         Standard of Review

         A. Motion To Amend

         When a plaintiff files a motion to amend a complaint after the defendant files a responsive pleading, "a party may amend its pleading only with the opposing party's written consent or the court's leave." Fed.R.Civ.P. 15(a)(1)-(2); see also Foman v. Davis, 371 U.S. 178, 182 (1962); CSX Techs., Inc. v. GCC Techs., LLC, No. JKB-10-2112, 2012 WL 3038639, at *3 (D.Md. July 24, 2012) (stating that the "good cause" standard of Rule 16(b)(4) becomes the starting point in this Court's analysis after the deadline for amending pleadings has passed), ajfd, 533 Fed.Appx. 182 (4th Or. 2013). Pursuant to Rule 15(a)(2), "[t]he court should freely give leave [to amend] when justice so requires." The decision to grant a motion for leave to amend falls within this Court's discretion. Foman, 371 U.S. at 182. Reasons to deny leave to amend include "undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, [and] futility of amendment.'" Id.; see also Laber v. Harvey, 438 F.3d 404, 426 (4th Cir. 2006) ("We have interpreted Rule 15(a) to provide that "leave to amend a pleading should be denied only when the amendment would be prejudicial to the opposing party, there has been bad faith on the part of the moving party, or the amendment would have been futile.""). Otherwise, "fi]f the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief." and the plaintiff moves to amend, the Court should grant the motion so that the plaintiff has the "opportunity to test his claim on the merits." Foman, 371 U.S. at 182.

         Determining whether amendment would be futile does not involve "an evaluation of the underlying merits of the case." Next Generation Grp. v. Sylvan Learning Ctrs., LLC, No. CCB-11-986, 2012 WL 37397, at *3 (D.Md. Jan. 5, 2012). Rather, "the merits of the litigation" are only relevant to the Court's ruling on a motion for leave to amend if "a proposed amendment may clearly be seen to be futile," Davis v. Piper Aircraft Corp., 615 F.2d 606, 613 (4th Cir. 1980), such as "if the proposed amended complaint fails to state a claim under the applicable rules and accompanying standards," Katyle v. Penn Nat'l Gaming, Inc., 637 F.3d 462, 471 (4th Cir. 2011).

         B. Motion for Class Certification

         To maintain a class action, a party moving for class certification bears the burden of demonstrating that the proposed class meets the two-step inquiry outlined in Federal Rule of Civil Procedure 23. See Gunnells v. Healthplan Serws., Inc.,348 F.3d 417, 423 (4th Cir. 2003). First, the movant ...


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