New York State Court of Claims

New York State Court of Claims

DOLAN v. THE STATE OF NEW YORK, #2002-015-271, Claim No. 104921, Motion Nos. M-64839, CM-65024


Synopsis


Defendant's motion to dismiss FLSA claim on grounds that neither liquidated damages or attorneys fees could be recovered in Court of Claims denied. Cross-motion to recover liquidated damages and attorneys fees granted as to liability trial need to determine amount to be awarded.

Case Information

UID:
2002-015-271
Claimant(s):
JAMES J. DOLAN, JR.
Claimant short name:
DOLAN
Footnote (claimant name) :

Defendant(s):
THE STATE OF NEW YORK
Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
104921
Motion number(s):
M-64839
Cross-motion number(s):
CM-65024
Judge:
FRANCIS T. COLLINS
Claimant's attorney:
Gleason, Dunn, Walsh & O'SheaBy: Mark T. Walsh, Esquire
Defendant's attorney:
Honorable Eliot Spitzer, Attorney General
By: Kevan J. Acton, EsquireAssistant Attorney General
Third-party defendant's attorney:

Signature date:
July 1, 2002
City:
Saratoga Springs
Comments:

Official citation:

Appellate results:

See also (multicaptioned case)



Decision

The defendant's motion to dismiss the claim pursuant to CPLR 3211 (a)[1] on the ground that the State has not waived its sovereign immunity with regard to the recovery of liquidated damages and attorneys fees otherwise available under the Fair Labor Standards Act (FLSA), 29 USC 201, et seq., and the Court therefore lacks jurisdiction to adjudicate the claim is denied. Claimant's cross-motion for summary judgment awarding liquidated damages and attorney fees based on the defendant's willful violation of the FLSA is granted as to liability only. The Court reserves judgment with respect to damages and attorneys fees. The claim seeks to recover liquidated damages and attorneys fees pursuant to the FLSA based upon an alleged willful violation of the federal statute's minimum wage provision by the New York State Department of Taxation and Finance (the Department). Specifically, claimant alleges that he was owed wages for work performed from August 31, 2000 to September 13, 2000 which were payable on September 27, 2000 but were not tendered to the claimant until October 11, 2000 and were not received until October 16, 2000. He further alleges that he was owed wages for work performed during the period September 14, 2000 to the date of termination of his employment by the Department on September 21, 2000 which were payable on October 11, 2000 but were not tendered until October 18, 2000 and were not received by claimant until October 20, 2000. Claimant asserts that the defendant's failure to promptly pay such wages constitutes a willful violation of the FLSA and that, accordingly, he is entitled to recover an additional amount equal to his gross wages payable during such periods as liquidated damages in the amount of $1,742.42 plus costs, disbursements and reasonable attorneys fees as provided in 29 USC § 201 et seq.

The defendant moves to dismiss the claim on the ground that the State has not waived its sovereign immunity with respect to the unique FLSA remedy of liquidated damages and on the further ground that Court of Claims Act § 27 specifically precludes recovery of attorneys fees, costs and disbursements against the State.

Defense counsel further argues on the motion that the delays involved in the tender of claimant's wages (i.e., two weeks and one week respectively) were de minimis and that claimant's remedy is limited to the recovery of statutory interest pursuant to CPLR § 5004 for 14 days with regard to the first check and 7 days with regard to the second.

Claimant opposed the defendant's motion and cross-moved for summary judgment on the ground that there are no triable issues of fact and judgment in claimant's favor for liquidated damages, attorneys fees and costs may be determined as a matter of law.

As pointed out by claimant's counsel in his memorandum of law, this Court has previously addressed the issues raised by the defendant's motion and decided them in claimant's favor. In Speers v State of New York, 183 Misc 2d 907, affd in part rev'd in part 285 AD2d 872, reconsideration granted and amended 288 AD2d 651 this Court at 913-914 held:
As to the availability of liquidated damages, except as otherwise limited by its express terms (see, infra) section 8 of the Court of Claims Act subjects the State to liability in the same manner as a private person or corporation. Liquidated damages under the FLSA may be recovered against a private employer and constitute compensation, not a penalty or punitive damages (Brothers v Branch Motor Express Co., 60 Misc 2d 835, 840). Consequently, the request for liquidated damages is proper and will not be dismissed.

Nor will the court act to dismiss that part of the claim which seeks to recover attorneys' fees. Court of Claims Act § 8 expressly conditions the State's waiver of immunity upon a claimant's compliance with "the limitations of this article"; namely article II of the Act pertaining to jurisdiction. Section 27 of the Court of Claims Act provides in pertinent part that counsel or attorneys' fees may not be allowed to any party. However, section 27 is part of the practice provisions found in article III of the Act and falls outside the article 2 limitations referenced in section 8 as conditioning the State's waiver of immunity. As such, the proscription against the award of attorneys' fees contained in section 27 does not represent a reservation of immunity and the State, having waived its immunity with regard to FLSA actions except as otherwise conditioned in article II, is subject to the provisions of the Federal Act authorizing the recovery of counsel fees.
The defendant has offered nothing on this motion to persuade the Court to reconsider its holding in Speers, supra with regard to the availability of liquidated damages and attorneys fees in an FLSA action brought in the Court of Claims and the Court can find no reason to alter that conclusion.

Moreover, the Court of Appeals in Alston v State of New York, 97 NY2d 159 recognized the State's waiver of its sovereign immunity with regard to FLSA claims while at the same time noting that pursuant to Court of Claims Act § 8 any such waiver was conditioned upon a claimant's compliance with the limitations contained in Article II of the Act.

The Court stated the following at pages 162-163:
We conclude that, here, the State has indeed retained its sovereign immunity. Section 8 of the Court of Claims Act enacted in 1939 (L 1939, ch 860), provides:

'The state hereby waives its immunity from liability and action and hereby assumes liability and consents to have the same determined in accordance with the same rules of law as applied to actions in supreme court against individuals or corporations, provided the claimant complies with the limitations of this article' (emphasis supplied).

Thus, the State's waiver of sovereign immunity was not absolute, but was conditioned upon a claimant's compliance with the limitations on the waiver, including the relevant filing deadlines. Article II, section 10 of the Court of Claims Act could not be any clearer in conditioning the waiver of sovereign immunity on compliance with the time limitations for filing claims it sets forth. It states that '[n]o judgment shall be granted in favor of any claimant unless such claimant shall have complied' with the time limitations established in that section (emphasis supplied). This is fully consistent with the legislative history of the statute (see, Statement in Support, Bill Jacket, L 1939, ch 860, at 27 ['[t]he waiver (of immunity) is conditioned * * * upon the claimant's complying with the limitations contained in Article II, which confers jurisdiction upon the Court']; see also, Davison, Claims Against the State of New York ch 19, at 152 ['Waiver of the State's Immunity is Conditional.']).
The defendant's motion to dismiss the claim on the basis that the relief requested is unavailable in the Court of Claims must be denied. The defendant does not assert that the FLSA claim herein is barred through application of any of the jurisdictional provisions contained in Article II of the Court of Claims Act. Since the claim is timely and otherwise cognizable in this Court the provisions of Court of Claims Act § 27, which are contained within Article III of the Act, must give way to the forms of relief expressly authorized by the federal statute.

The rules applicable to the determination of a motion for summary judgment were clearly stated by the Court of Appeals in Alvarez v Prospect Hosp., 68 NY2d 320, 324:
As we have stated frequently, the proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact (Winegrad v New York Univ. Med. Center, 64 NY2d 851, 853; Zuckerman v City of New York, 49 NY2d 557, 562; Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395, 404). Failure to make such prima facie showing requires a denial of the motion, regardless of the sufficiency of the opposing papers (Winegrad v New York Univ. Med. Center, supra, at p 853). Once this showing has been made, however, the burden shifts to the party opposing the motion for summary judgment to produce evidentiary proof in admissible form sufficient to establish the existence of material issues of fact which require a trial of the action (Zuckerman v City of New York, supra, at p 562).
The proponent of a summary judgment motion may only meet its initial burden through the submission of evidentiary proof in admissible form (Rifenburgh v Wilczek, 2002 WL 826797 [N.Y.A.D. 3 Dept]).

Here claimant's cross-motion for summary judgment was supported by the affirmation of claimant's attorney who attached thereto and incorporated therein by reference the following documents: the pleadings; defendant's responses to claimant's notice to admit; defendant's responses to claimant's interrogatories; defendant's response to claimant's request for discovery and inspection and a copy of a letter decision, order and judgment issued in a related article 78 proceeding by the Hon. Vincent G. Bradley, J.S.C.

Opposition to the motion consisted exclusively of the affirmation of defendant's attorney who merely reiterated his previously asserted allegations offered on the State's motion regarding the defendant's sovereign immunity and the Court's alleged lack of jurisdiction to adjudicate the claim.

Claimant's proof, including the pleadings and the defendant's discovery responses, are sufficient in this instance to meet the movant's initial burden on the motion of establishing a prima facie violation of the FLSA. As a result the burden shifted to the defendant to come forward with proof in admissible form sufficient to raise a triable issue of fact as to the existence of a violation or that any such violation was not willful as relates to the imposition of liquidated damages. The defendant offered no proof in admissible form to establish an issue of fact in either regard and defendant's liability may be determined as a matter of law.

The defendant, through counsel, has conceded that the State failed to pay claimant on the dates scheduled (response to notice to admit, claimant's Exhibit [c]) and further conceded that various courts have determined the failure to pay wages on the day they are regularly due constitutes a violation of the Fair Labor Standards Act (see, Biggs v Wilson, 1 F3d 1537 (9th Cir 1993), cert denied 510 US 1081; cf., Rogers v City of Troy, N.Y., 148 F3d 52 [no violation found]). The federal courts which have addressed the issue of the ramification of late payment of wages under FLSA § 206 are quick to admit that "the FLSA does not in terms say that a minimum wage must be paid promptly" (Biggs v Wilson, supra at 1539). This fact, however, has not dissuaded the federal Circuit Courts of Appeal in Biggs or in other cases (see, United States v Klinghoffer Bros. Realty Corp., 285 F2d 487 [2nd Cir 1960]; Calderon v Witvoet, 999 F2d 1101 [7th Cir 1993]) from holding that failure to pay wages promptly on the day they are regularly due constitutes a violation of the Act. In fact the Ninth Circuit in arriving at its determination in Biggs, supra cited to the U.S. Supreme Court's 1945 decision in Brooklyn Savings Bank v O'Neil, 324 US 697 which made repeated references to an employer's obligation to pay employees on time. Since the defendant in the instant case has conceded that the claimant was not paid on the regularly scheduled payday and that late payment of wages violates the FLSA it need not be developed further. That violation standing alone, however, does not necessarily merit the recovery of liquidated damages as sought herein.

Thus, while the Court finds that there are no material issues as to the underlying facts on which the claim is based, claimant's success on this cross-motion and the recovery of liquidated damages pursuant to 29 USC § 206 (b) rests upon the Court's determination that the defendant willfully violated § 206 (b) by its delayed payment of claimant's wages.

Prior to 1947 if a violation of § 6 (now § 206) of the FLSA were found an award of liquidated damages was compulsory. Congress, however, amended the FLSA effective May 14, 1947 to make the awarding of liquidated damages discretionary[2] in cases in which "the employer shows to the satisfaction of the court that the act or omission giving rise to such action was in good faith and that he had reasonable grounds for believing that his act or omission was not a violation of the Fair Labor Standards Act of 1938, as amended" (29 USC § 260).

Section 260 places the burden of establishing the defense of good faith upon the employer and "requires plain and substantial evidence of at least an honest intention to ascertain what the Act requires and to comply with it" (Brock v Wilamowsky, 833 F2d 11, 19 [2nd Cir 1987]; see also Williams v Tri- County Growers, Inc., 747 F2d 121, 129 [3d Cir 1984]; Barcellona v Tiffany English Pub, Inc., 597 F2d 464, 468-469 [5th Cir 1979]). Upon such proof the Court is provided discretion to deny or reduce the liquidated damages requested. The Court of Appeals for the Second Circuit in Brock (supra, at 19) observed that "[t]he burden is a difficult one to meet, however, and '[d]ouble damages are the norm, single damages the exception. . .' Walton v United Consumers Club, Inc., 786 F 2d at 310."

The Second Circuit in Brock v Wilamowsky, supra engaged in a detailed comparison of its own standard developed in the case of Donovan v Carls Drug Co., 703 F2d 650 [2d Cir 1983] with standards developed by the Third Circuit Court of Appeals in Brock v Richland Shoe Co., 799 F2d 80, cert granted 484 US 813, the Seventh Circuit in Walton v United Consumers Club, Inc., 786 F2d 303, 308-311 and the District of Columbia Circuit in Laffey v Northwest Airlines, Inc., 567 F2d 429 (D.C. Cir 1976) cert denied 434 US 1086, to determine whether or not the employer's violation of the FLSA minimum wage/overtime provision was willful. That Court found that liquidated damages were recoverable irrespective of which of the three standards was applied since the District Court found that although the employer had known it was subject to the FLSA it "had failed to seek an opinion either from counsel or from the Secretary, and had taken no other steps to determine the lawfulness of its pay practices until after an official investigation had been commenced".

In the instant case in written interrogatories the defendant was asked to describe in as much detail as practicable the "good faith action by agents of the defendant." Defendant's response to this interrogatory was as follows:
RESPONSE: Upon information and belief the source of which is employees of the Department of Taxation and Finance the good faith of the Department of Taxation and Finance has [sic] demonstrated by the relatively short period of time which elapsed between when the paycheck was payable and when it was actually mailed. Mr. Dolan was discharged because of his failure to reveal a criminal conviction on his application for employment and the employees of Taxation and Finance were double checking to make sure that he was paid only the amount that he was due.
In the second propounded interrogatory the defendant was asked to "set forth all active steps taken by the defendant and its agents to ascertain the dictates of the Fair Labor Standards Act and its efforts to comply with them in connection with the payment of wages at issue." The defendant supplied the following non-responsive answer:
RESPONSE: Upon information and belief the source of which is employees of the Department of Taxation and Finance, there is no specific provision in the Fair Labor Standards Act which requires the timely payment of wages or salaries. The Fair Labor Standards Act has been construed by various courts to require such timely payment. The acts and actions of the employees of the Department of Taxation and Finance were reasonable and timely in affecting the payment of the claimant given the fact that he was discharged from his employment.
The claimant's proof on the motion is sufficient to establish the elements of a willful violation of the FLSA. In the absence of any contradictory proof in admissible form, the defendant has failed to meets its burden of demonstrating a material issue of fact as to its reasonable good faith belief that its actions were not inconsistent with the Fair Labor Standards Act.

Accordingly, claimant's motion for summary judgment is granted on the issue of liability. The Clerk shall enter interlocutory judgment in conformity with this decision and order.

The amount of damages to be awarded is not capable of resolution on the motion and an immediate trial by the Court is ordered in accordance with CPLR 3212 (c) to be arranged at the convenience of both the parties herein and the Court. At least ten days prior to such scheduled trial date claimant's attorney shall submit to the Court an affidavit or affirmation of attorneys services including usual and customary charges for such services in support of claimant's request for reasonable attorneys fees and a copy thereof shall be served upon the defendant's attorney.


July 1, 2002
Saratoga Springs, New York

HON. FRANCIS T. COLLINS
Judge of the Court of Claims


The Court considered the following papers:
  1. Notice of motion dated March 7, 2002;
  2. Affirmation of Kevan J. Acton dated March 7, 2002;
  3. Notice of cross-motion dated April 9, 2002;
  4. Affirmation of Mark T. Walsh dated April 10, 2002 with exhibits;
  5. Affirmation of Kevan J. Acton dated April 15, 2002.

[1]For purposes of this motion the Court presumes that the motion was made pursuant to paragraph 2 of subdivision (a) of section 3211 of the CPLR on the ground that the Court lacks subject matter jurisdiction. Such motion may be made at any time (see, CPLR 3211 [e]).
[2]Awarding attorneys fees and costs, however, remained mandatory for prevailing plaintiffs under 29 USC 216 (b) (see, Dominici v Bd. of Educ. (Chicago), 881 F Supp 315; Christiansburg Garment Co. v Equal Employment Opportunity Comm'n., 434 US 412; Shorter v Valley Bank & Trust Co., 678 F Supp 714).