United States District Court, N.D. Ohio, Eastern Division
LINDSAY RAFFERTY, on behalf of herself and all other similarly situated, PLAINTIFF,
DENNY'S, INC., DEFENDANT.
MEMORANDUM OPINION AND ORDER
HONORABLE SARA LIOI UNITED STATES DISTRICT JUDGE.
the Court is the motion to dismiss filed by defendant
Denny's, Inc. (“Denny's”) pursuant to
Fed.R.Civ.P. 12(b)(2) and 12(b)(6). (Doc. No. 7
(“Mot.”).) Plaintiff Lindsay Rafferty
(“Rafferty”) has filed a response in opposition,
with two supplements. (Doc. No. 11 (“Opp'n”);
Doc. No. 13 (“Suppl.”); Doc. No. 14.) Denny's
filed a reply. (Doc. No. 12
(“Reply”).) For the reasons set forth herein,
defendant's motion to dismiss is granted in part and
denied in part.
October 17, 2018, Rafferty filed her complaint (Doc. No. 1,
Complaint [“Compl.”]) under the Fair Labor
Standards Act (“FLSA”), 29 U.S.C. § 201,
et seq., on behalf of herself and all others
similarly situated (the “collective members”).
The FLSA provides, in relevant part:
An action to recover the liability [for violations of
provisions of the FLSA] may be maintained against any
employer (including a public agency) 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. No. employee shall be a party
plaintiff to any such action unless he gives his consent in
writing to become such a party and such consent is filed in
the court in which such action is brought.
29 U.S.C. § 216(b).
alleges that, from February 2012 until the present, she has
been employed by Denny's as a server at its restaurant
located at 2943 S. Arlington Road, Akron, Ohio 44312. (Compl.
¶ 13.) She has been paid by Denny's as a tipped
employee under the FLSA, performing various tipped and
nontipped duties, including, but not limited to, serving
drinks and food to customers, cleaning, busing tables,
washing dishes, and other side work. (Id.
declaration accompanying Denny's motion to dismiss,
Lester Nail (“Nail”), Assistant General Counsel
for Denny's, attests that Denny's is incorporated in
Florida and has its corporate headquarters in South Carolina.
(Doc. No. 7-2, Declaration of Lester Nail (“Nail
Decl.”) ¶ 7.) Nail further attests that
Denny's owns and operates 181 restaurants in twenty-one
(21) U.S. states, employing 9, 429 individuals. (Id.
¶¶ 8-9.) Denny's directly owns and operates
four (4) restaurants in Ohio; it employs 177 people in Ohio
(all but two (2) of whom work at the restaurants); and it has
generated approximately 1.7% of its total annual revenue in
Ohio, year-to-date. (Id. ¶¶ 10, 12- 13.)
alleges, on behalf of the collective members, that
Denny's violates the FLSA by paying servers sub-minimum,
tip-credit wages without informing them of the tip-credit
provisions of the FLSA. (Id. ¶¶ 1, 3-5.)
She sets forth three counts against Denny's under the
FLSA: (1) failure to provide notice of the provisions of the
“tip credit” in 29 U.S.C. § 203(m)
(id. ¶¶ 50-56); (2) enforcing a policy or
practice of paying servers sub-minimum, tip-credit wages even
when it requires those employees to perform nontipped work
that is unrelated to their tipped occupation (id.
¶¶ 6, 57-60); and (3) enforcing a policy or
practice of requiring servers to perform nontipped work that,
even if it was related to their tipped occupation, exceeded
20% of their time worked in one or more individual workweeks
(id. ¶¶ 7, 61-65).
no motion to certify the collective has yet been filed, the
complaint identifies as follows a nationwide collective
plaintiff will seek to certify:
All individuals who worked at any time during the past three
years at any restaurant owned or operated by [d]efendant in
the job position of server and who were paid for their work
on an hourly basis according to the tip credit provisions of
the FLSA, (i.e. an hourly rate less than the
applicable minimum wage, excluding tips).
(Id. ¶ 44.) Because Rafferty alleges that the
claims arise out of willful violations of the FLSA by
Denny's, she alleges that a three-year statute of
limitations applies. (Id. ¶ 45.)
has filed a motion to dismiss. It seeks dismissal for lack of
personal jurisdiction of the FLSA claims of any putative
collective members not arising from employment by Denny's
in Ohio. It also seeks dismissal of Counts Two and Three of
the complaint for failure to state a claim. Each of these
grounds for dismissal is discussed separately herein.
Lack of Personal Jurisdiction (Claims of Nonresidents Arising
Out of non-Ohio Employment)
plaintiff bears the burden of establishing the existence of
personal jurisdiction. Neogen Corp. v. Neo Gen Screening,
Inc., 282 F.3d 883, 887 (6th Cir. 2002). Where the Court
makes a dismissal determination based on the pleadings and
any supporting affidavits, without an evidentiary hearing,
the plaintiff “‘need only make a prima facie
showing of jurisdiction.'” Id. (quoting
CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1262
(6th Cir. 1996)). The Court must construe the allegations
“in a light most favorable to the plaintiff[.]”
CompuServe, Inc., 89 F.3d at 1262.
as here, subject-matter jurisdiction is based on federal
question alone, but “there is no provision authorizing
nationwide service, federal courts must follow Rule 4(k) of
the Federal Rules of Civil Procedure, which, inter
alia, limits a court's exercise of personal
jurisdiction to persons who can be reached by the forum
state's long-arm statute.” Alisoglu v. Cent.
States Thermo King of Okl., Inc., No.
12-cv-10230, 2012 WL 1666426, at *3 (E.D. Mich. May 11, 2012)
(citing Omni Capital Int'l v. Rudolf Wolff &
Co., 484 U.S. 97, 108, 108 S.Ct. 404, 98 L.Ed.2d 415
Where a federal court's subject matter jurisdiction over
a case stems from the existence of a federal question,
personal jurisdiction over a defendant exists “if the
defendant is amenable to service of process under the [forum]
state's long-arm statute and if the exercise of personal
jurisdiction would not deny the defendant[ ] due
Bird v. Parsons, 289 F.3d 865, 871 (6th Cir.
satisfy due process, a court's exercise of its power over
an out-of-state defendant must “not offend
‘traditional notions of fair play and substantial
justice.'” Int'l Shoe Co. v.
Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95
(1945) (quoting Milliken v. Meyer, 311 U.S. 457,
463, 61 S.Ct. 339, 85 L.Ed. 278 (1940)). “[T]he
defendant's conduct and connection with the forum State
[must be] such that he should reasonably anticipate being
haled into court there.” World-Wide Volkswagen
Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62
L.Ed.2d 490 (1980).
are two types of personal jurisdiction under the Due Process
Clause, general and specific jurisdiction, either one of
which is adequate to confer jurisdiction.” Maclin
v. Reliable ...