Defendant United Mortgage and Loan Investment, LLC (United Mortgage), headquartered in Charlotte, North Carolina, is in the business of buying and servicing distressed mortgages, business loans, and consumer loans. Defendants Arthur Kechijian and Larry Austin are both corporate officers of United Mortgage. At various times, United Mortgage employed Ma’lissa Simmons, Monterrus Marshall, Yolanda Carraway, and Delana Pruitt (the Named Plaintiffs) as Junior Asset Managers.
As a general rule, the FLSA prohibits an employer from requiring "any of his employees" to work more than forty hours per workweek unless the employee receives overtime compensation "at a rate not less than one and one-half times the regular rate at which he is employed." 29 U.S.C. § 207(a)(1). However, "any employee employed in a bona fide executive, administrative, or professional capacity . . . (as such terms are defined and delimited from time to time by regulations of the Secretary [of Labor] . . .)," is exempt from this general rule. Id. at § 213(a)(1). "An employer bears the burden of proving that a particular employee’s job falls within [this] exemption." Darveau v. Detecon, Inc., 515 F.3d 334, 337 (4th Cir. 2008). An employer who violates the FLSA’s overtime provision is "liable to the employee or employees affected in the amount of their . . . unpaid overtime compensation . . . and in an additional equal amount as liquidated damages . . . ." 29 U.S.C. § 216(b).
On October 17, 2007, the Named Plaintiffs filed their initial complaint (the Complaint) in North Carolina state court against United Mortgage, Arthur Kechijian, and Larry Austin (the Original Defendants). The Complaint alleged the Original Defendants: (1) paid their Junior Asset Managers as "salaried ‘exempt’ employees,"; (2) routinely required Junior Asset Managers to work in excess of forty hours per week; (3) "refused to pay them for hours worked in excess of 40 hours per week,"; (4) in August 2004, began requiring Junior Asset Managers to fill out time cards documenting the hours they had worked; and (5) following an investigation by the United States Department of Labor in 2006, instructed Junior Asset Managers to stop filling out the time cards. (J.A. 24). Under the heading "FIRST CLAIM FOR RELIEF," the Complaint alleged "[t]he position of Junior Asset Manager does not meet the standards for exemption under the FLSA, 29 U.S.C. § 213(a)(1)" and alleged the Original Defendants violated the FLSA by willfully: (1) failing to pay the Named Plaintiffs and other similarly situated employees overtime wages for hours worked in excess of forty hours per week; (2) regularly and routinely requiring the Named Plaintiffs and other similarly situated employees to work off the clock; (3) failing to make, keep, and preserve accurate time records sufficient to determine the wages and hours of the Named Plaintiffs and other similarly situated employees; and (4) other practices. Additionally, the Complaint alleged that the Original Defendants were "employer[s]," within the meaning and definition of the FLSA, 29 U.S.C. § 203(d), and that the Named Plaintiffs were "employee[s]" of the Original Defendants, within the meaning and definition of the FLSA, id. at § 203(e).
The Named Plaintiffs brought this portion of the case as an opt-in collective action, pursuant to 29 U.S.C. § 216(b), on behalf of themselves and "on behalf of all persons . . . who were, are, or will be employed by United Mortgage in the position of Junior Asset Manager on or after the date that is three years before the filing of this complaint." (J.A. 20). Specifically, overtime compensation "may be maintained against any employer . . . in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated." Id. However, unlike in a class action filed pursuant to Federal Rule of Civil Procedure 23 or a comparable state court rule, in a collective action under the FLSA, a named plaintiff represents only himself until a similarly-situated employee opts in as a "party plaintiff" by giving "his consent in writing to become such a party and such consent is filed in the court in which such action is brought." Id. See Sandoz v. Cingular Wireless, LLC, 553 F.3d 913, 919 (5th Cir. 2008) ("[U]nlike in a Rule 23 class action, in a FLSA collective action the plaintiff represents only him- or herself until similarly-situated employees opt in."). Also notable is the fact that, in an action to recover unpaid overtime and liquidated damages under the FLSA, "[t]he court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a reasonable attorney’s fee to be paid by the defendant, and costs of the action." 29 U.S.C. § 216(b). 29 U.S.C. § 216(b) provides that an FLSA action for
Judge(s): Clyde Hamilton
Jurisdiction: U.S. Court of Appeals, Fourth Circuit
|Circuit Court Judge(s)|
|Trial Court Judge(s)|
|Appellant Lawyer(s)||Appellant Law Firm(s)|
|Narendra Ghosh||Patterson Harkavy, LLP|
|Ann Groninger||Patterson Harkavy, LLP|
|Appellee Lawyer(s)||Appellee Law Firm(s)|
|Aaron Christensen||Smith & Christensen, LLP|
|Kevin Parsons||Smith, Parsons & Vicstrom, PLLC|