Category Archives: Trial

10th Cir.: Jury Instruction That Employer Bore Burden of Proving Exemption “Plainly and Unmistakably” Was in Error

Lederman v. Frontier Fire Protection, Inc.

Following a jury verdict in favor of the plaintiff-employee in a misclassification case, the defendant appealed. At issue was one jury instruction that the plaintiff had requested and which the trial court had given, instructing the jurors that:

An employer seeking an exemption from the overtime requirements of the FLSA bears the burden of proving that the particular employee fits plainly and unmistakably within the terms of the claimed exemption.

While the court acknowledged that the Tenth Circuit had regularly used the “plainly and unmistakably” language for decades, it ultimately held that such language is only applicable to statutory construction in the context of issues of law (i.e. decisions made by the court such as those on summary judgment motions) and not apply to issues of fact (i.e. decisions made by the jury or fact-finder). The court further clarified that the burden of proof on a defendant-employer raising an exemption defense under the FLSA is simply a preponderance of the evidence. Moreover, because the court held that the instruction had prejudiced the defendant, the court reversed the judgment in favor of the plaintiff and remanded the case back to the trial court for a new trial.

After sifting through three decades worth of Tenth Circuit jurisprudence, the court explained:

[a]ll of our other cases employing this phrase have done so in addressing legal rather than factual issues… In sum then, just as some courts have mistakenly viewed “clear and affirmative evidence” as a heightened evidentiary standard, the same is true with the phrase “plainly and unmistakably.” When our prior cases employing this phrase are read as a whole, they do not establish a heightened evidentiary requirement on employers seeking to prove an FLSA exemption. Instead, the ordinary burden of proof—preponderance of the evidence—controls the jury’s evaluation of whether the facts establish an exemption to the FLSA.

Click Lederman v. Frontier Fire Protection, Inc. to read the entire Decision.

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W.D.Tex.: Plaintiffs Retained Right to Open and Close at Trial; Defendants’ Attempt to Shift Burden With Admissions on the Eve of Trial Denied

Ransom v. M. Patel Enters, Inc.

This case was before the court on the Defendants’ Motion to Open and Close Evidence and Case.  Apparently seeking to gain the tactical advantage of addressing the jury first and last (opening and closing), normally reserved for the plaintiff in a typical case, the defendants sought leave just prior to trial to file a third amended complaint.  If granted, defendants’ motion would have permitted them to admit the plaintiffs’ prima facie case (i.e. that they worked uncompensated overtime), and rendered the issue of whether plaintiffs were exempt the sole issue at trial.  The plaintiffs refused to accept defendants stipulations regarding their prima facie case, instead preferring to retain the right to open and close the case.  Largely due to the fact defendants’ filed their motion on the eve of trial, the court denied defendants’ motion.

Denying defendants’ motion(s), the court reasoned:

“This presents the Court with an atypical controversy—and one which the Court could not find case law discussing: the Plaintiffs oppose the Defendants’ motion to admit facts proving a portion of the Plaintiffs’ case, facts that the Plaintiffs have the burden of proving at trial. Defendants argue that the Plaintiffs’ refusal to agree to the amendment demonstrates that they are trying to unnecessarily prolong the evidence solely to hold on to the right to open and close.

The deadline to amend pleadings passed months ago. Therefore, the Defendants must demonstrate good cause to obtain leave to amend. Meaux Surface Prot., Inc. v. Fogleman, 607 F.3d 161, 167 (5th Cir.2010). “Four factors are relevant to good cause: (1) the explanation for the failure to timely move for leave to amend; (2) the importance of the amendment; (3) potential prejudice in allowing the amendment; and (4) the availability of a continuance to cure such prejudice.” Id. As the Defendants admit, this is a strategic move. They want to present their evidence first. Obtaining a strategic advantage is not good cause for leave to amend. Had the Defendants wished to obtain this advantage, they should have admitted these facts early in the case, instead of contesting them until the final pretrial conference. The Plaintiffs note that they spent time and money gathering evidence on both their prima facie case and on the issue of the individual defendants’ status as “employers” under the FLSA. Therefore, the Court DENIES Defendants’ Motion for Leave to File Third Amended Original Answer (Clerk’s Doc. No. 135).

That still leaves the order of proof. The Defendants argue that, regardless of whether the Plaintiffs accept the stipulations they have offered, the Defendants bear the burden of proof on the primary issue at trial, whether the Plaintiffs were exempt employees under the FLSA.  Because the Defendants bear the burden of proof on that issue, they contend that they should present their evidence first.

It appears that there are three primary issues for trial: (1) whether the Plaintiffs can demonstrate a prima facie case under the FLSA (on which there appears to be little or no controversy); (2) whether the Plaintiffs were exempt employees under the FLSA; and (3) whether the Defendants failed to pay overtime “willfully.” The Plaintiffs bear the burden of proof on the first and last of these three items, and the Defendants on the second. As the Defendants note, the bulk of the evidence at trial will no doubt relate to the issue on which they bear the burden of proof. This does not mean that the Defendants should automatically be permitted to open and close, however. The Plaintiffs were the parties who were forced to take the initiative to file this lawsuit, the Defendants have vigorously defended it, and only in the last few days have they sought the right to open and close the evidence. Rule 16 makes it clear that these issues should be raised early in the case, not late. See FED. R. CIV. P. 16(c)(2)(A), (D), (N) and (P) (directing courts at the pretrial conference to address, among other things, “formulating and simplifying the issues,” “avoiding unnecessary proof and cumulative evidence,” “ordering the presentation of evidence early in the trial on a manageable issue that might, on the evidence, be the basis for a judgment,” and “facilitating in other ways the just, speedy, and inexpensive disposition of the action”).

The Court has wide discretion on these matters. Moreau v. Oppenheim, 663 F.2d 1300, 1311 (5th Cir.1981) (“The matter of a court’s allocation of the right to open and close … does not go to the merits of a controversy and has long not been the subject of writ of error, even when coupled with the denial of requested party realignment.”) (citing Day v. Woodworth, 54 U.S. 363, 370, 13 How. 363, 14 L.Ed. 181 (1851)). On balance, considering all of the above, the Court believes that it is appropriate to leave the order of proof as is, so that the Plaintiffs shall open and close. Accordingly, the Court DENIES the Defendants’ Motion to Open and Close Evidence and Case (Clerk’s Doc. No. 128).”

Click Ransom v. M. Patel Enters, Inc. to read the entire Order.

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11th Cir.: Trial Court Erred In Allowing Defendants To Amend Their Affirmative Defenses At Trial To Add Previously Unpled Exemption

Diaz v. Jaguar Restaurant Group, LLC

Plaintiff filed a lawsuit against Defendants, her former employer, for unpaid overtime wages under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201–216. During trial, the district court allowed Jaguar to amend its Answer pursuant to Federal Rule of Civil Procedure 15(b) to include the administrative exemption as an affirmative defense as it found that Diaz had injected the issue through her testimony at trial. The jury returned a verdict finding that Diaz had worked more than 40 hours per week for which she was not compensated, but also finding that she was exempt from the requirements of the FLSA as she was an administrative employee.  On appeal to the Eleventh Circuit, Plaintiff challenged the district court’s decision to allow Defendant to amend its Answer during trial. The Eleventh Circuit reversed, and remand the case to the district court for a trial on damages.

In reversing, the Eleventh Circuit reasoned:

“Jaguar failed to plead the administrative exemption as an affirmative defense in its Answer. In the fourteen months between the filing of its Answer and the commencement of trial, Jaguar never moved to amend its Answer to include the administrative exemption. Jaguar also did not raise the issue of the administrative exemption during discovery. The only time Jaguar raised the issue prior to trial was by inserting it in one line of the Joint Pretrial Stipulation and in the proposed Joint Jury Instructions, to which Diaz objected. Jaguar did not raise the issue during the pretrial conference and the district court did not include the issue in its Omnibus Order Following Pretrial Conference. If ever there were a classic case of waiver, this is it! See Latimer v. Roaring Toyz, Inc., 601 F.3d 1224, 1239 (11th Cir. 2010) (“Failure to plead an affirmative defense generally results in a waiver of that defense.”). Jaguar repeatedly waived the administrative exemption defense by failing to plead the defense in its Answer and by failing to move to amend its Answer before trial.

Ideally, cases should be tried on their merits. Accordingly, even if Jaguar failed to plead the administrative exemption defense, the district court could allow Jaguar to amend its Answer during trial if the issue was tried by the parties’ express or implied consent, or included in a pretrial order. See Fed. R. Civ. P. 15(b); see Steger v. Gen. Elec. Co., 318 F.3d 1066, 1077 (11th Cir. 2003) (“[I]ssues not raised in the pleadings may be treated as if they were properly raised when they are ‘tried by express or implied consent of the parties,’ Federal Rule of Civil Procedure 15(b), or are included in a pretrial order.”). In this case, the issue was not included in the district court’s Omnibus Order Following Pretrial Conference. Further, it is clear that the administrative exemption issue was not tried by the parties’ express consent as Diaz opposed the insertion of the issue in the Joint Pretrial Stipulation, proposed Joint Jury Instructions, and at trial. See R. Vol. 5: 160–65. The district court, however, found that the issue was tried by implied consent as it believed Diaz introduced the issue of the administrative exemption through her testimony at trial. Thus, the district court allowed the amendment.

The district court erred in finding that the administrative exemption issue was tried by implied consent and in thereby allowing Jaguar to amend its Answer.  That issue was not tried by implied consent as Diaz’s testimony was relevant to another defense in this case: Jaguar’s independent contractor defense. “The introduction of evidence arguably relevant to pleaded issues cannot serve to give a party fair notice that new issues are entering the case.” Wesco Mfg., Inc. v. Tropical Attractions of Palm Beach, Inc., 833 F.2d 1484, 1487 (11th Cir. 1987); see Jimenez v. Tuna Vessel Granada, 652 F.2d 415, 421 (5th Cir. 1981) (stating that implied consent cannot be found when “evidence is introduced that is relevant to an issue already in the case and there is no indication that the party who introduced the evidence was seeking to raise a new issue”). Diaz’s testimony was relevant to counter Jaguar’s independent contractor defense, and she clearly was not seeking to raise the administrative exemption as a new issue. Further, we cannot conclude that her testimony was “much more strongly relevant” to the administrative exemption than to the independent contractor defense, which could be construed as notice of a new issue. See United States f/u/b/o Seminole Sheet Metal Co. v. SCI, Inc., 828 F.2d 671, 677 (11th Cir. 1987). Thus, her testimony cannot be considered implied consent to try the administrative exemption.”

Click Diaz v. Jaguar Restaurant Group, LLC, to read the entire opinion.

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Filed under Affirmative Defenses, Exemptions, Trial

D.Md.: FLSA Plaintiffs Residing In Honduras May Testify At Trial Via Videoconference; Good Cause Demonstrated By Visa Issues And Cost Of Travel

Lopez v. NTI, LLC

This case was before the Court on several motions.  As discussed here, several of the plaintiffs who resided out of state and out of the country, requested that they be permitted to testify at trial via videoconference in lieu of appearing in person in court.  Granting plaintiffs motion in part and denying in part, the court held that the international plaintiffs had demonstrated the requisite good cause, because of visa issues and high cost of international travel.  However, the court denied the out of state plaintiffs’ motion for failure to demonstrate the requisite good cause.

Discussing the plaintiffs’ motion, the Court reasoned:

“Plaintiffs have moved for an order permitting certain Plaintiffs residing in Honduras, Tennessee, and Virginia to testify via “contemporaneous transmission” (Paper 70), namely videoconferencing. In support, Plaintiffs note the difficulty of securing a visa from Honduras and the substantial expense of travel. Defendants oppose, arguing that (1) the non-resident Plaintiffs need to be in the courtroom to establish their identity, (2) the use of videoconferencing would impede central credibility determinations, and (3) financial considerations weigh in favor of Defendants, not Plaintiffs.

Federal Rule of Civil Procedure 43 governs the taking of testimony at trial. That rule expressly provides for the possibility of videoconference testimony, stating that “[t]he court may, for good cause shown in compelling circumstances and upon appropriate safeguards, permit presentation of testimony in open court by contemporaneous transmission from a different location.” Fed.R.Civ.P. 43(a). Although Rule 43 provides some flexibility in accepting remote testimony, it seems obvious that remote transmission is to be the exception and not the rule. See Fed.R.Civ. P. 43 advisory committee’s note on 1996 amendments (“The importance of presenting live testimony in court cannot be forgotten. The very ceremony of trial and the presence of the factfinder may exert a powerful force for truth telling. The opportunity to judge the demeanor of a witness face-to-face is accorded great value in our tradition.”). Courts have also recognized that, even with the benefits that technology provides, substitutes for live testimony are necessarily imperfect:

Videoconference proceedings have their shortcomings. Virtual reality is rarely a substitute for actual presence and … even in an age of advancing technology, watching an event on the screen remains less than the complete equivalent of actually attending it. The immediacy of a living person is lost with video technology…. Video conferencing … is not the same as actual presence, and it is to be expected that the ability to observe demeanor, central to the fact-finding process, may be lessened in a particular case by video conferencing. This may be particularly detrimental where it is a party to the case who is participating by video conferencing, since personal impression may be a crucial factor in persuasion.  Thornton v. Snyder, 428 F.3d 690, 697 (7th Cir.2005) (quotations and citations omitted).

Despite videoconferencing’s deficiencies, courts in this circuit and elsewhere have approved or affirmed its use in the civil context. See generally Rusu v. INS, 296 F.3d 316 (4th Cir.2002) (asylum proceeding); United States v. Baker, 45 F.3d 837 (4th Cir.1995) (civil commitment hearing); Edwards v. Logan, 38 F.Supp.2d 463 (W.D.Va.1999) (civil rights action); see also In re Merck Prods. Liab. Litig., 439 F.Supp.2d 640, 642 (E.D.La.2006) (listing cases). These cases reflect a “consistent sensitivity to the utility of evolving technologies that may facilitate more efficient, convenient, and comfortable litigation practices.” 9A Wright & Miller, Federal Practice & Procedure § 2414 (3d ed.2008). And while videoconferencing has its shortcomings, it at least appears to be favorable to alternative methods, such as the submission of written deposition testimony. Sallenger v. City of Springfield, No. 03-3093, 2008 WL 2705442, at *1 (C.D.Ill. July 9, 2008).

In this case, Plaintiffs have demonstrated good cause as to those Plaintiffs residing in Honduras. The cost of international travel can provide good cause for contemporaneous transmission of testimony. See, e.g., Dagen v. CFC Grp. Holdings, No. 00 Civ. 5682, 2003 WL 22533425, at *2 (S.D.N.Y. Nov. 7, 2003). In some cases, travel cost and inconvenience have justified contemporaneous transmission even when the parties where located within the United States, in contrast to the internationally resident Honduran Plaintiffs in this case. See, e.g., Beltran-Terado v. INS, 213 F.3d 1179, 1186 (9th Cir.2000) (affirming use of telephonic testimony for hearing in California where witness was in Missouri); Scott Timber, Inc. v. United States, No. 05-708C, 2010 WL 2947090, at *1 (Fed.Cl. July 28, 2010) (approving use of videoconferencing for trial in Washington, D.C., where witness was in Oregon); Fed. Trade Comm’n v. Swedish Match N. Am., Inc., 197 F.R.D. 1, 2 (D.D.C.2000) (finding good cause for videoconferencing where witness was in Oklahoma and hearing was in Washington, D.C.). Forcing the Honduran Plaintiffs in this case to travel to the United States would impose substantial inconvenience and cost on persons with strikingly few financial resources. (Paper 76-1). When viable alternatives like videoconferencing are available, compelling individuals who make no more than $7,000 a year to travel hundreds of miles seems fundamentally unjust. And although the court sympathizes with Defendants’ claim that this litigation has already imposed substantial costs on them as well (Paper 75, at 4-5), those costs do not justify imposing needless expense on Plaintiffs.

The use of videoconferencing for the Honduran Plaintiffs will not prejudice Defendants. Each of the witnesses will testify in open court, under oath, and will face cross-examination. Even if Defendants are correct that this case presents complicated issues (Paper 75, at 3), the protections of the oath and cross-examination will provide them with the tools necessary to resolve those issues. With videoconferencing, a jury will also be able to observe the witness’ demeanor and evaluate his credibility in the same manner as traditional live testimony. Indeed, one judge who presided over two hearings using videoconferencing has concluded that “there is no practical difference between live testimony and contemporaneous video transmission.” Swedish Match, 197 F.R.D. at 2; see also Scott Timber, 2010 WL 2947090, at *1 (observing that videoconferencing does not have a “significantly adverse effect” on factfinder’s ability to make credibility determinations).

Plaintiffs’ motion is not limited to the Honduran Plaintiffs; it requests an order permitting contemporaneous transmission of testimony for all Plaintiffs “outside a 100 mile radius of this Court.” (Paper 70-2). Although Plaintiffs have shown good cause as to the Honduran Plaintiffs, good cause has not been shown as to the remaining Plaintiffs. Plaintiffs do not address the Plaintiff residing in Richmond, Virginia anywhere in the motion papers, and the court cannot discern any reason why the Richmond Plaintiff would be unable to attend. The court is also unconvinced that the financial expense of travelling from Tennessee merits videoconferencing for that witness. Therefore, Plaintiffs’ motion will be denied as to those two witnesses.

In sum, Plaintiffs have shown good cause for contemporaneous transmission of the testimony of those Plaintiffs currently residing in Honduras. Those Plaintiffs are Marvin A. Mejia, Jesus Orellana, Victor Perez, Juan Pineda Gonzalez, Josue Roberto Pineda, Nery Armando Pineda, and Oscar Pineda. The Plaintiffs have not shown good cause as to any other Plaintiff.”

Not discussed here, the Court also denied Defendants’ motion for summary judgment based upon the plaintiffs prior settlement of a portion of their claims with some of the co-defendants.

To read the entire opinion, click here.

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