United States District Court, S.D. Ohio, Eastern Division
TOMMY L. FENLEY, et al., Plaintiff,
WOOD GROUP MUSTANG, INC., Defendant.
Jolson, Magistrate Judge.
OPINION AND ORDER
C. SMITH, JUDGE UNITED STATES DISTRICT COURT.
matter is before the Court upon several motions: (1)
Plaintiffs' Motion for Class Certification (Doc. 108);
(2) Defendant Wood Group Mustang Inc.'s
(“WGM”) Motion to Decertify Conditionally
Certified Class (“Motion to Decertify”) (Doc.
110); and (3) WGM's Motion to Exclude the Testimony of
Plaintiffs' Expert Colleen Vallen (“Motion to
Exclude”) (Doc. 119). All three motions are fully
briefed and ripe for disposition. For the following reasons,
(1) Plaintiffs' Motion for Class Certification is
(2) WGM's Motion to Decertify is DENIED;
(3) WGM's Motion to Exclude is DENIED.
case arises out of WGM's treatment of various Inspectors
as exempt from the overtime provisions of the Fair Labor
Standards Act, 29 U.S.C. § 201, et seq.
(“FLSA”) the Ohio Minimum Fair Wage Standards
Act, Ohio Revised Code Chapter 4111, et seq.
(“OMWA”), the Pennsylvania Minimum Wage Act, 43
P. S. § 333.104(c); 34 Pa. Code § 231.41
(“PMWA”); and the Illinois Minimum Wage Law
(“IMWL”) 820 Ill. Comp. Sta. 105 § 4a (1).
Named Plaintiffs Tommy Fenley (Ohio), William Peveto
(Illinois), and Brockrobert Tagarook (Pennsylvania) are all
current or former Inspectors at WGM for all or part of the
relevant class periods. Plaintiffs claim that WGM classified
them, and all other Inspectors employed by WGM around the
country during this time period, as “DAY-Non Exempt Day
Rate” employees, but improperly treated them as exempt,
salaried employees under the FLSA and applicable state wage
laws. Plaintiffs further allege they, and other Inspectors,
often worked more than 40 hours per week and were not paid
overtime in violation of 29 U.S.C. § 207(a)(1).
a publicly-traded corporation incorporated in Ohio and
headquartered in Houston, Texas. (Doc. 99, Am. Compl. ¶
8). WGM operates in the gas and oil industry, with its
business including “project management, construction
management, engineering and procurement services to the
offshore, onshore, oil sands, pipeline, refining, chemicals,
and automation sectors.” (Id. ¶ 9). WGM
assigns its Inspectors to projects at the request of its
clients for the purpose of inspecting the
construction/assembly of pipeline systems. (Doc. 110-7, Gust.
Decl. ¶ 3).
Court previously described WGM's business structure, as
it pertains to Inspectors, as follows:
WGM's business structure includes five business units
within its oil and gas division, one of which is named the
“Pipeline Business Unit.” The Pipeline Business
Unit is tasked with “design[ing] and oversee[ing] the
building of the pipeline.” The Inspection Services
Department is a “job family” within the Pipeline
Business Unit. All Inspectors that Plaintiff seeks to
represent here are- or were-employed within the Inspection
54, Cond. Cert. Op. and Ord. at 3) (internal citations
omitted). The Inspections Services Department is managed by
Andrew Gust (Doc. 108-4, VanDyk Dep. at 84:1-10). Gust
reports directly to the Vice President of the Pipeline
Business Unit, Mark Nussbaum. (Id. at 85:4-12). The
Pipeline Business Unit was overseen by its Business Unit
President, John Ellison. (Id. at 85:13-86:1).
is no dispute that upon being hired by WGM, all Inspectors
were assigned the pay code “DAY-Non Exempt Day
Rate” within WGM's Human Resources Information
System (“HRIS”). (Id. at 88:22-89:5).
Further, WGM's employee handbook and internal Overtime
Policy manual clarifies that all Exempt personnel are
“compensated on a salary basis” and
“Non-Exempt day rate Mustangers (DAY) receive a day
rate that is inclusive of all hours worked, including
overtime.” (Doc. 108-3, Overtime Policy). At all times
relevant, all Inspectors were categorically classified as
described above. (Doc. 108-4, VanDyk Dep. at 105:8-10).
identified at least 13 different types of Inspectors
comprising the conditionally certified class. Unsurprisingly,
the parties disagree over these positions' job
responsibilities and the extent to which different types of
Inspectors perform similar duties. Both parties extensively
cite record deposition testimony to support their respective
positions. Irrespective of Inspectors' specific titles or
duties, the mechanics of how they were compensated was
uniform. Four different WGM employees with firsthand
knowledge regarding how the payroll process works testified
to a common practice. Inspectors were instructed to enter a
“1” on their timesheets for days worked and a
“0” for days they did not work. There were also
circumstances in which Inspectors entered a “.5”
for a half day worked. The timesheets do not reflect how many
hours an Inspector worked on a given day. These timesheets
are given to a field office where clerks manually enter the
“1's or .5's” recorded by the Inspectors.
Finally, this information is compiled in WGM's corporate
office and checks are issued. (See Doc. 123-14,
Archer Dep. at 43:12-23 (describing that Inspectors track
days, not hours); Doc. 123-15, Geigler Dep. at 53:4-54:19
(same); Doc. 123-17, Fournerat Dep. at 21:6-22:19, 75:10-79:2
(confirming that Inspectors are paid on the number of days
they work and describing the payroll process in general);
Doc. 123-16, Zammit Dep. at 64:9-66:2 (generally describing
payroll process). In general, whatever is reported on the
timesheet is what Inspectors are paid. (Doc. 123-17,
Fournerat Dep. at 90:4-6). Accordingly, Plaintiffs'
theory of the case is that Inspectors are paid a full
day's rate for each day they report as worked, and
thereby do not satisfy the salary basis test.
this seemingly straightforward methodology of payment, WGM
contends that Inspectors were actually paid a guaranteed
weekly day rate (of 5, 6, or 7 days) depending on the terms
of contracts between WGM and clients for individual projects.
(Doc. 110-7, Gust Decl. ¶ 5). WGM argues that this
arrangement, subject to certain permissible reductions,
satisfies the salary basis test.
filed their Complaint on January 26, 2015. On July 20, 2105,
Plaintiff Tommy Fenley moved for conditional certification of
a collective action pursuant to the FLSA's provisions at
29 U.S.C. § 216(b). (Doc. 31). On March 17, 2016, the
Court conditionally certified the collective comprising:
All current and former employees of [WGM] who were classified
with the pay code “DAY - Non Exempt Day Rate, ”
and who worked in WGM's Pipeline Services Inspection
Department as an inspector (or an equivalent position) in the
United States in any workweek between three years prior to
the date of the Court's Order and the present
54). Fenley then distributed Court-approved notice of the
FLSA collective action to potential members of the
Collective. The FLSA notice period has closed, and a total of
93 Inspectors (including the four named Plaintiffs) who
worked for WGM around the country have filed consent forms to
join the FLSA collective action. On November 21, 2016, Fenley
was granted leave to amend his Complaint to add additional
plaintiffs and causes of action arising under the state laws
of Illinois, Pennsylvania, and California. (Doc. 98).
the parties conducted discovery regarding Rule 23 class
certification of Ohio, Illinois, Pennsylvania, and California
classes, decertification of the nationwide
collective action, and dispositive motions. WGM deposed 12 of
the Opt-In Plaintiffs, Plaintiffs deposed at least 6 WGM
employees (other than Inspectors), and both WGM and
Plaintiffs retained an expert to opine on WGM's pay
policies. The parties do not agree on the exact number, but
there appear to be at least 122 current or former employees
falling within the definition of Plaintiffs' proposed
Rule 23 classes. (Doc. 117-2, Briles Decl. ¶ 3).
18, 2017, Plaintiffs filed their Motion for Class
Certification of the state claims under Federal Rule of Civil
Procedure 23(b)(3) on behalf of those Inspectors who had
worked for WGM in Ohio, Illinois, and Pennsylvania. (Doc.
108). The same day, WGM filed its Motion to Decertify the
FLSA collective action. (Doc. 110). While those motions
remained pending, WGM moved to exclude the expert testimony
of Plaintiffs' expert witness, Colleen Vallen. (Doc.
filed last out of the three pending motions, the Court will
address WGM's Motion to Exclude first because it bears on
the record to be considered in deciding the Motion to
Decertify. The Court will then consider WGM's Motion to
Decertify and Plaintiffs' Motion for Class Certification
WGM's Motion to Exclude
Standard for Excluding Expert Testimony
admissibility of expert witness testimony is governed by
Federal Rule of Evidence 702, which provides:
A witness who is qualified as an expert by knowledge, skill,
experience, training, or education may testify in the form of
an opinion or otherwise if:
(a) the expert's scientific, technical, or other
specialized knowledge will help the trier of fact to
understand the evidence or to determine a fact in issue;
(b) the testimony is based on sufficient facts or data;
(c) the testimony is the product of reliable principles and
(d) the expert has reliably applied the principles and
methods to the facts of the case.
Evid. 702. In parsing the rule, the Sixth Circuit has read it
to require three criteria: (1) the witness must be qualified;
(2) the witness's testimony must be relevant; and (3) the
witness's testimony must be reliable. In re Scrap
Metal Antitrust Litig., 527 F.3d 517, 528-29 (6th Cir.
rule reflects the well-established judicial precedent that
district courts must act as “gatekeepers” in
determining the admissibility of such testimony. Johnson
v. Manitowoc Boom Trucks, Inc., 484 F.3d 426, 429 (6th
Cir. 2007) (discussing Daubert v. Merrell Dow
Pharms., 509 U.S. 579 (1993) and Kumho Tire Co. v.
Carmichael, 526 U.S. 137, 147 (1999)). “[T]he
gatekeeping inquiry must be tied to the facts of a particular
case, depending on the nature of the issue, the expert's
particular expertise, and the subject of his
testimony.” Id. at 430 (internal quotation
marks and citation omitted). Although “not a definitive
checklist or test, ” some factors that may bear on the
(1) whether a theory or technique . . . can be (and has been)
tested; (2) whether the theory has been subjected to peer
review and publication; (3) whether, with respect to a
particular technique, there is a high known or potential rate
of error and whether there are standards controlling the
technique's operation; and
(4) whether the theory or technique enjoys general acceptance
within a relevant scientific community.
Id. at 429-30 (internal quotation marks and
citations omitted). Moreover, “expert testimony
prepared solely for purposes of litigation, as opposed to
testimony flowing naturally from an expert's line of
scientific research or technical work, should be viewed with
some caution.” Id. at 434.
proponent of expert testimony must establish its
admissibility by a preponderance of proof. Nelson v.
Tenn. Gas Pipeline, Co., 243 F.3d 244, 251 (6th Cir.
2001) (citing Daubert, 509 U.S. at 592 n.10).
Whether to admit expert testimony is within the district
court's discretion. Johnson, 484 F.3d at 429
Admissibility of Vallen's Testimony
WGM challenges the admissibility of Vallen's testimony
because two out of the three conclusions she reached are not
relevant and the third was misleading and irrelevant. As
those are the only stated grounds for objecting to the
admission of her testimony-and this Court finding no
independent reason to exclude her testimony-the Court's
analysis will be limited to those issues.
Court will briefly summarize the facts leading up to and
surrounding Vallen's expert report before discussing the
merits of WGM's relevance argument. The central question
in this case centers around whether Inspectors were paid on a
day rate basis (as Plaintiffs contend) or a weekly day-rate
guarantee satisfying the salary basis test (as argued by
WGM). Consequently, Plaintiffs issued the following
interrogatory to WGM during discovery:
Identify each Project on which Plaintiff, any Opt-In
Plaintiff, and any State Law Class Member worked during the
applicable Relevant Time Period, and for each Project
identified, state (i) whether you allege that Inspectors
working on that Project would be guaranteed to be paid a
certain number of day rate payments each week; (ii) the
number of days per week you allege Inspectors were guaranteed
pay for that Project (i.e., 5, 6 or 7 days); and
(iii) whether the alleged guarantee for that Project was
dependent on the number of days the Inspector worked in a
(Doc. 123-5, WGM Resps. to Pls.' Second Set of Interrogs.
at Interrog. No. 22). WGM responded as follows:
All class members were guaranteed a weekly salary based on a
day-rate of 5, 6, or 7 days, dependent upon the particular
project. The guaranteed weekly salary was not dependent upon
the number of days an inspector worked.
(Id.). Plaintiffs retained Vallen to analyze
Inspectors' payroll records to determine whether, in her
opinion, the actual pay received by Inspectors was consistent
with the compensation plan described in WGM's
interrogatory response. Ultimately, Vallen concluded that
“a) Class Members' payroll and timesheet records
demonstrate that the number of days listed as worked is equal
to the number of days paid by Wood Group; b) Wood Group paid
certain Opt-In Plaintiffs a half day rate; and c) that Class
Members' records are inconsistent with Wood Group's
Alleged Minimum Guaranteed Paid Days.” (Doc. 123-8,
Vallen Report ¶ 54). Plaintiffs explain Vallen's
specific findings as follows:
Specifically, Ms. Vallen's analysis found that 65% of
Opt-In Plaintiffs were paid less than the minimum guaranteed
day rate on at least once instance, and 7.9% of all weeks
worked by Opt-In Plaintiffs were inconsistent with WGM's
alleged minimum guarantee. Similarly, when including the
relevant data for the Rule 23 Class Members as well, Ms.
Vallen's analysis found that 62.1% of all Opt-In
Plaintiffs and Class Members were paid less than the minimum
guaranteed day rate on at least once instance, and 7.2% of
all weeks worked were inconsistent with WGM's alleged
123, Pls.' Exclusion Resp. at 12 (citing Doc. 123-9,
Supp. Vallen Report ¶¶ 37-38)) (internal citations
claims that Vallen's first and third conclusions are
irrelevant and/or misleading because the numbers Vallen used
to calculate days worked by Inspectors “do not (and
were not intended to) reflect the days they actually
worked.” (Doc. 120, WGM Exclusion Mem. at 10). Further,
WGM bases its argument that Vallen's third conclusion is
misleading based on the fact that the FLSA permits employers
to reduce an exempt employee's salary in certain limited
circumstances without voiding the exemption. Plaintiffs
counter that making these determinations was plainly outside
the scope of Vallen's report because a) she cannot make
legal conclusions as to whether WGM properly made reductions
in accordance with the FLSA; and b) the purpose of her report
was to determine whether the actual amounts paid to
Inspectors comported with WGM's guarantee as set forth in
WGM's response to Plaintiffs' Interrogatory 22-not
whether they comported with the FLSA and its myriad of
exemptions and deductions. Vallen concluded that the number
of days Inspectors reported as working to WGM's payroll
(regardless of whether they worked 15 hours, half days, one
minute, or not at all) was equal to the days they ...