United States District Court, D. Maryland, Southern Division
R. ALEXANDER ACOSTA, SECRETARY OF LABOR, UNITED STATES DEPARTMENT OF LABOR, Plaintiff
EMERALD CONTRACTORS, INC., et al., Defendants.
REPORT AND RECOMMENDATION
CHARLES B. DAY UNITED STATES MAGISTRATE JUDGE
Report and Recommendation addresses Plaintiff's Second
Motion for Default Judgment Against Defendants Emerald
Contractors, Inc. and Roderick Neither, Sr.
(“Plaintiff's Second Motion”), ECF No. 24.
Plaintiff R. Alexander Acosta, Secretary of Labor of the
United States Department of Labor (“Plaintiff”)
filed a complaint against Defendants Emerald Contractors,
Inc., d/b/a Emerald Plumbing Co. (“Emerald
Plumbing”) and Roderick Neither, Sr. (collectively
“Defendants”), alleging Defendants violated the
Fair Labor Standards Act (“FLSA”), 29 U.S.C.
§§ 206, 207, 211(c), 215(a)(2), and
215(a)(5). Pl.'s Compl., ECF No. 1.Plaintiff seeks
damages under 29 U.S.C. § 216(c) and an injunction under
29 U.S.C. § 217. Id. at ¶ 11. Previously,
the Court recommended that Plaintiff's Motion for Default
Judgment against Defendants Emerald Contractors, Inc. and
Roderick Neither, Sr. (“Plaintiff's First
Motion”) be Granted in Part and Denied in Part without
Prejudice. On October 3, 2019, Plaintiff's Second Motion
to 28 U.S.C. § 636 and Local Rules 301, the Honorable
Theodore D. Chuang referred this matter to the undersigned
for the making of a Report and Recommendation concerning
default judgment and/or damages. ECF No. 20. For the reasons
stated herein, I recommend Plaintiff's Second Motion be
facts of this case are set forth in detail in the Court's
September 19, 2019 memorandum. Rep. and Recomm., ECF No. 23.
The Court incorporates by reference the facts and legal
analysis from that prior memorandum. Previously, the Court
recommended Defendants be deemed liable to Plaintiff for
violating 29 U.S.C. §§ 206, 207, 211(c) of the
FLSA. Id. at 7. Further, the Court recommended that
Plaintiff's request for an injunction be granted.
Id. at 12. The Court also recommended
Plaintiff's requests for damages be denied without
prejudice. Id. at 10. The Court found that Plaintiff
failed to carry his burden by failing to provide sufficient
information to allow the Court to make an independent
determination as to the amount of damages when ruling on a
Default Motion. Id. at 10; S.E.C. v.
Lawbaugh, 359 F.Supp.2d 418, 422 (D. Md. 2005). As a
result of Plaintiff's failure to meet his burden, the
Court recommended Plaintiff's request for liquidated
damages be denied. Rep. and Recomm. 10.
Damages Plaintiff contends that because of Defendants'
failure to pay the minimum wage, Defendants owe the Employees
$386, 168.16. Pl.'s Mem. in Supp. of Pl.'s First
Mot., 5, ECF No. 19-7. Plaintiff further contends that
because of Defendants' failure to pay overtime rates,
Defendants also owe the Employees $50, 430.88. Id.
at 6. Plaintiff seeks a total of $436, 599.04 in damages.
Pl.'s Mem. in Supp. of Pl.'s Sec. Mot., 4, ECF No.
ruling on a Motion for Default Judgment, once a plaintiff
establishes liability, the Court then turns to the
determination of damages. CGI Finance, Inc. v.
Johnson, No. ELH-12-1895, 2013 WL 1192353, at *1 (D. Md.
Mar. 21, 2013). In determining damages, the Court cannot
accept Plaintiff's factual allegations as true and must
make an independent determination. Id.; see also
Lawbaugh, 359 F.Supp.2d at 422. Rule 54(c) of the
Federal Rules of Civil Procedure limits the type and amount
of damages that may be entered as a result of a party's
default, stating that a “default judgment must not
differ in kind from, or exceed in amount, what is demanded in
the pleadings.” Fed.R.Civ.P. 54(c); Diaz v. Mi
Mariachi Latin Restaurant Inc., No. GJH-18-636, 2019 WL
528185, at *2 (D. Md. Feb. 11, 2019) (quoting In re
Genesys Data Techs., Inc., 204 F.3d 124, 132 (4th Cir.
2000)) (“In entering default judgment, a court cannot,
therefore, award additional damages ‘because the
defendant could not reasonably have expected that his damages
would exceed' the amount pled in the complaint.”).
While the Court may conduct an evidentiary hearing to
determine damages, it is not required to do so “if the
record supports the damages requested.” Monge v.
Portofino Ristorante, 751 F.Supp.2d 789, 795 (D. Md.
2010) (citation omitted). The Court may rely instead on
affidavits or documentary evidence of record to determine the
appropriate sum. See, e.g., Id. (citing cases in
which damages were awarded after a default judgment and
without a hearing, based on affidavits, printouts, invoices,
or other documentary evidence).
employer has the duty to keep proper record of wages, hours,
and other conditions and practices of employment. Mt.
Clemens Pottery Co., 328 U.S. at 687. Where an
employer's records are inaccurate or inadequate, the
employee should not be penalized by denying him any recovery
on the ground that he is unable to prove the precise extent
of uncompensated work. Id. at 687. In such a
situation, the employee has carried his burden if he proves
that he has in fact performed work for which he was
improperly compensated, and he produces sufficient evidence
to show the amount and extent of that work as a matter of
just and reasonable inference. Id.
(emphasis added); Melendez v. Spilled Milk Catering,
LLC, No. PWG-18-2135, 2019 WL 2921782, at *2 (D. Md.
July 8, 2019). “The burden then shifts to the employer
to come forward with evidence of the precise amount of work
performed or with evidence to negative the reasonableness of
the inference to be drawn from the employee's
evidence.” Mt. Clemens Pottery Co., 328 U.S.
at 687-88. A court may grant back wages under the FLSA to
non-testifying employees based upon the representative
testimony of a small percentage of employees. Donovan v.
Bel-Loc Diner, Inc., 780 F.2d 1113, 1116 (4th Cir.
1985), disapproved on other grounds by McLaughlin v.
Richland Shoe Co., 108 S.Ct. 1677, 1680, n.1 (1988).
However, the testimony must be fairly representational.
Plaintiff in calculating the amount of back pay owed to the
Employees, relied on: (1) unsworn Employee statements; (2)
payroll records; (3) time records; (4) business hours posted
on the employer's website; and (5) estimated hire and
termination dates. However, aside from the representative
sample Employee statements, which were not made under oath,
none of the documents Plaintiff relied on to calculate the
back pay were provided to the Court. With the scarce
information provided, there was no way to validate the
estimated amount of: (1) hours worked; (2) the length of
employment; or (3) how much each Employee was specifically
paid for regular or overtime hours. Therefore, the Court
could not make a “just and reasonable inference”
to the amount of back pay owed for Defendants' overtime
and minimum wage violations.
Plaintiff's Second Motion, Plaintiff has provided: (1)
Representative Sample Employee Statements, ECF No. 24-2; (2)
Decl. of Claudia Villarreal Cuevas (“Villareal Cuevas
Decl.”), ECF No. 24-3; (3) Wage Transcription and
Computation Worksheets for the Employees (“Back Wage
Computations”), ECF No. 24-4; (4) Defendants'
Payroll Summary, ECF No. 24- 5; (5) Defendants' Time
Records, ECF No. 24-6; (6) Dates of the Employees'
Employment (“Dates of Employment”), ECF No. 24-7;
(7) Defendants' Business Hours, ECF No. 24-8; (8) Decl.
of Three of the Employees, (“Three Employees'
Decl.”), ECF No. 24-9; and (9) Second Decl. of Claudia
Villarreal Cuevas (“Villareal Cuevas Second
Decl.”), ECF No. 25.
Defendants' failure to make, keep, and preserve records
as required by Section 211(c) of the FLSA, Plaintiff was
required to compute back wages and overtime by
“reconstruct[ing] the hours and used average of hours
worked based on the records available.” Pl.'s Mem.
in Supp. of Pl.'s Second Mot. 10; 29 U.S.C. §
211(c). To determine the number of hours each Employee
worked, Plaintiff “reconstructed hours [by using] an
average of the hours worked based on the available
records.” Pl.'s Mem. in Supp. of Pl.'s Second
Mot. 11. Plaintiff used the start and termination dates
provided by Defendants. Villareal Cuevas Second Decl. ¶
18. Where the dates provided by Defendants were inconsistent
with information in the payroll and time records, Plaintiff
either: (1) calculated the hours based on the start and
termination date provided by each Employee, if interviewed;
or (2) calculated the hours worked for the entire
investigatory period from December 6, 2015 through June 25,
2017. Id. at ¶ 17. Plaintiff also relied on
Defendants' website to determine the hours of operations,
which was provided to the Court. Id. at ¶ 16.
When Plaintiff did not have time records for certain
Employees, Plaintiff “calculated an average number of
hours worked from the partial payroll and time records
[Plaintiff] had for other employees.” Id. at
¶ 18. The Court, having reviewed the Back Wage
Computations, Defendants' Business Hours, and the Three
Employees' Decl., finds that the computation of hours
allows for a just and reasonable inference to the hours
calculating the hours worked, Plaintiff calculated the back
wages owed for Defendants' minimum wage violations by
“multiplying the reconstructed number of hours worked,
by the federal minimum wage . . . .” Pl.'s Mem. in
Supp. of Pl.'s Second Mot. 11. To determine the overtime
wages owed to the Employees, Plaintiff:
[D]ivid[ed] each employee's total gross pay for the week
by their hours worked to determine their regular rate. Then,
[Plaintiff] multiplied each employee's regular rate by
one-and-one-half to determine his/her overtime premium rate.
Thereafter, [Plaintiff] multiplied the resulting overtime
premium rate times the number of hours the employees worked
over 40 in a workweek. [Plaintiff] then subtracted the amount
of overtime ...