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Adan Rivera, et al v. Neftali Rivera

May 17, 2011

ADAN RIVERA, ET AL.,
PLAINTIFFS,
v.
NEFTALI RIVERA, D/B/A NR CONSTRUCTION,
DEFENDANT.



The opinion of the court was delivered by: Lucy H. Koh United States District Judge

ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT

Marco Mata, Jose Mendoza, Jose Bocanegra, Daniel Arzate, and Ariel Maya (collectively "Plaintiffs"), filed a motion for entry of default judgment on February 15, 2011 after the Clerk of 20 the Court entered default as to Defendant Neftali Rivera, doing business as NR Construction ("Defendant"). This motion was originally before the Honorable Paul S. Grewal, and was 22 subsequently transferred to the undersigned on March 31, 2011. The Court held a hearing on this 23 motion on April 21, 2011. For the reasons set forth below, Plaintiff's motion is GRANTED in part 24 and DENIED in part.

Plaintiffs Adan Rivera, Reyes Barajas, Ignacio Morales, Juan Mendez, Luis Mendez, Rafael Mendez, Manuel Chavez, Manuel Valladolid, Guillermo Avila, Victor Vivanco, Enedino Castro,

I.BACKGROUND

Plaintiffs are sixteen residents of various locations throughout the Bay Area, including

Santa Clara and Alameda Counties. See Compl. 1. All Plaintiffs worked for NR Construction, a 28 construction company doing business throughout the San Francisco Bay Area, and specifically in the cities of San Jose and Milpitas, at some point during the four years prior to the filing of this 2 action. Id. at 3. During the course of Plaintiffs' employment with Defendant, Plaintiffs were paid 3 on an hourly basis, and regularly worked in excess of 8 hours per day and more than 40 hours per 4 week. Id. at 4. Plaintiffs were variously told that they would be paid hourly, and told at other 5 times that they would be paid on a contract basis. Plaintiffs did not have management or 6 administrative functions, and performance of their job duties did not require the exercise of 7 independent discretion and judgment. Id. Plaintiffs did not maintain any professional licenses with 8 the state or practice any recognized profession. Id. All Plaintiffs allege that they were not paid 9 their earned wages for numerous hours worked between September 2009 and November 2009, 10 while other Plaintiffs allege they were not paid for additional work as well. Id. at 4-5.

Additionally, Plaintiffs allege that they were not properly compensated for overtime work. Id. at 7-9. Finally, Plaintiffs allege that Defendant did not provide lawfully required rest/meal periods and 13 wage statements. Id. at 9-10, 12.

Practices, Cal. Bus. & Prof. Code § 17200; and common law breach of contract. On April 28, 2010, Plaintiff served Defendant with a Summons and Complaint. See Dkt. No. 5. The Clerk of 18 the Court entered default against Defendant on June 30, 2010. See Dkt. No. 7. Now pending 19 before the Court is Plaintiffs' motion for entry of default judgment against Defendant under Dkt. No. 16. Plaintiffs request an award of $135,640.05 in damages. In the motion for default 22 judgment, however, Plaintiffs do not pursue the § 17200 claim.

Plaintiffs seek relief under the Federal Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 216; California Labor Code, Cal. Lab. Code §§ 200, 226, 226.7, 1194; California Unfair Business Federal Rule of Civil Procedure 55(b)(2). See Pls.' Mot. for Default Judgment ("Pls.' Mot.") at 1,

II.LEGAL STANDARDS

"The district court's decision whether to enter a default judgment is a discretionary one."

Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). After the Clerk enters a party's default 26 under Fed. R. Civ. P. 55(a), the Court may enter a default judgment against the party. See Fed. R. Civ. P. 55(b)(2). "A failure to make a timely answer to a properly served complaint will justify the 28 entry of a default judgment." Benny v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986). "The general rule of law is that upon default the factual allegations of the complaint, except those relating to the 2 amount of damages, will be taken as true." TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-3

(quotation marks omitted). "However, necessary facts not contained in the pleadings, and claims 5 which are legally insufficient, are not established by default." Cripps v. Life Ins. Co. of N. Am., 6

1978)). "When entry of judgment is sought against a party who has failed to plead or otherwise 8 defend, a district court has an affirmative duty to look into its jurisdiction over both the subject 9 matter and the parties." In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999).

(9th Cir. 1987)) (quoting Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977)) 980 F.2d 1261, 1267 (9th Cir. 1992) (citing Danning v. Lavine, 572 F.2d 1386, 1388 (9th Cir. 7

III. DISCUSSION

A.Jurisdiction

This Court has subject matter jurisdiction (federal question) over Plaintiffs' FLSA claim.

See 29 U.S.C. § 216(b) ("An action to recover the liability prescribed in either of the preceding 14 sentences may be maintained against any employer (including a public agency) in any Federal or 15

State court of competent jurisdiction by any one or more employees for and in behalf of himself or 16 themselves and other employees similarly situated."). This Court has supplemental jurisdiction over the related state law claims. See 28 U.S.C. 1367(a). sole proprietorship that is incorporated in California, has its primary offices in Dixon, California, 20 and operates throughout the San Francisco Bay Area, including Santa Clara and Alameda counties.

In fact, the claims in this case arise from Plaintiffs employment with NR Construction on projects 22 in Santa Clara and Milpitas, California.

claims for damages.

burden under the FLSA if he shows he performed work for which he was improperly compensated 28 and produces some evidence to show the amount and extent of that work "as a matter of just and

Moreover, there is no question that the Court has personal jurisdiction over Defendant, a

With the jurisdictional prerequisites satisfied, the Court will proceed to analyze Plaintiffs'

B.Claims for Damages

Where an employer fails to maintain accurate payroll records, an employee carries his reasonable inference." Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687 (1946), 2 superseded by statute on other ground,Portal-to-Portal Act, 61 Stat. 86-87; see also Brock v. Seto, 790 F.2d 1446, 1448 (9th Cir. 1986); McLaughlin v. Seto, 850 F.2d 586, 589 (9th Cir. 1988). "The 4 burden then shifts to the employer to come forward with evidence of the precise amount of work 5 performed, or with evidence to negate the reasonableness of the inference to be drawn from the 6 employee's evidence." Mt. Clemens Pottery, 328 U.S. at 687-88. If the employer fails to produce 7 such evidence, the court may then award damages to the employee. Id. at 688. Moreover, the 8 award of back wages is not barred for being "too speculative" if the employer failed to keep 9 records as required by FLSA. Seto, 790 F.2d at 1448.

California courts have shifted the burden of proof to employers reasoning that "applying the normal burden of proof in such circumstances would unfairly penalize an employee for the employer's failure to keep proper records and would allow the employer to keep the benefits of the 13 employee's labors without paying full compensation." Amaral v. Cintas Corp. No. 2, 163 Cal. 14 App. 4th 1157, 1189 (Cal. App. 1st. 2008). Therefore, "[u]nless the employer can provide accurate 15 estimates [of hours worked], it is the duty of the trier of facts to draw whatever reasonable 16 inferences can be drawn from the employees' evidence." Mt. Clemens Pottery, 328 U.S. at 688.

be deemed as true, and all issues pertaining to the amount of damages will be ascertained from 19 those facts and from the reasonable inferences drawn from Plaintiffs' evidence. 20

existence of a contract; (2) performance by the plaintiff; (3) a breach by the defendant; and (4) 23 damages. See Careau & Co. v. Sec. Pac. Bus. Credit, Inc., 222 Cal. App. 3d 1371, 1399 (1990). 24

Plaintiffs state that in September 2009, each Plaintiff was employed by NR Construction.

Here, the Clerk has entered default against the Defendant. All facts pled by Plaintiffs will

1.Breach of Contract -- Failure to Pay Agreed Upon Wages

Under California law, to prevail on a breach of contract claim, a plaintiff must show: (1) the

Here, Plaintiffs have alleged facts sufficient to establish breach of contract.

See Declarations of Sixteen Plaintiffs ("Pls.' Decl.") at ¶¶ 5-6, attached to Pls.' Mot. Each Plaintiff 27 entered into an oral agreement with the Defendant, agreeing to furnish labor under an agreed upon 28 hourly wage creating a valid contract. Compl. 4, ¶ 15. Moreover, from September 2009 to November 2009, Plaintiffs, on behalf of the Defendant, worked on two separate apartment projects, 2 one in Milpitas, California and the other in San Jose, California. Pls.' Mot. at 4 (citing 3 declarations). Plaintiffs worked on the sites and performed various jobs involving the installation 4 of drywall. Id. Despite performing their work, Plaintiffs allege that they were not paid their agreed 5 upon wages for the time periods articulated in each declaration. Pls.' Decl. ¶¶ 6-8. Plaintiffs' 6 allegations are sufficient to establish a contract, performance, and breach. 7

8 their declarations. Plaintiffs' documents were only necessary because the Defendant did not 9 maintain any records pertaining to hours or wages, and did not provide any form of wage 10 statements. Id. at ¶ 7. Because the Defendant did not maintain any records, the Court will draw 11 reasonable inferences from records submitted by Plaintiffs.

Decl. of Adan Rivera, ¶¶ 10-11; Juan Mendez, ¶¶ 10-12; and Jose Mendoza, ¶ 9. These records 15 documented that each Plaintiff had worked a certain number of hours, and that Plaintiffs were not 16 paid for that work. See Decl. of Adan Rivera, Exh. 1; Juan Mendez, Exh. 1; and Jose Mendoza,

Exh. 1. Each record showed a handwritten sheet of hours worked on each day for each employee.

Id. Additionally, Adan Rivera, the foreman during the time in question, attached a document 19 showing the date of the last payment each Plaintiff received from the Defendant. See Decl. of 20

In light of Defendant employer's failure to maintain records of the Plaintiffs' contracts and failure to provide any wage time sheets, the Court is limited to relying upon the evidence provided 23 by Plaintiffs. Plaintiffs' records, supported by sworn declarations, establish the last date of 24 payment, the amount of hours worked by each employee, the pay rate, and the amount of unpaid 25 wages due. See Ulin v. Alaea-72, Inc., 2011 U.S. Dist. LEXIS 17468, *38 (N.D. Cal. Feb. 23, 26

2011) (although "very few records were kept," awarding "necessarily approximated" damages for 27 failure to pay wages). The Court will rely on certain charts provided by Plaintiffs in summarizing 28 the wages due. See Decl. of Adam Pedersen , Exh. 1; Pls.' Mot. 10, 27.

Lastly, Plaintiffs supported their request for damages with several documents attached to Most of the hours recorded were submitted by Plaintiffs Adan Rivera, Juan Mendez, and Jose Mendoza, each of whom acted as a foreman or "team leader" on the dry wall projects. See

Adan Rivera, Exh. 3. 21

Therefore, from the attached sworn declarations, each Plaintiff's unpaid hours worked were combined and multiplied by that Plaintiff's specific pay rate. Furthermore, additional amounts 3 were awarded to specified Plaintiffs for wages that were earned prior to the period of September 2009 to November 2009, and were not subsequently paid. See Decl. of Adan Rivera, ¶ 9; Ariel 5

Maya, ¶¶ 10-12. This leads to the following award: 6

Name Pay Rate Total Unpaid Total Wages Due

Hours Worked

Adan Rivera $20.00 205 $4,100.00 8

$1,608.00 (Unpaid amounts

from July/Aug. 2009)

Ignacio Morales $14.00 113.5 $1,589.00 10

Juan Mendez $15.00 314 $4,710.00 11

Luis Mendez $14.00

218 $3,052.00 Rafael Mendez $14.00 248 $3,472.00 12

Manuel Chavez $14.00 278 $3,892.00 13

Manuel Valladolid $14.00 62 $868.00 14

Enedino Castro $20.00 481.5 $9,630.00 Jose Bocanegra $14.00 ...


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