Adkinson v. Tiger Eye Pizza, LLC

          MEMORANDUM OPINION AND ORDER

          Susan O. Hickey, Chief United States District Judge.

         Before the Court is Defendants Tiger Eye Pizza, LLC and Ken Schroepfer ‘s Motion for Summary Judgment on Consent to Join Collective Action Filed by David Wright. (ECF No. 36). Plaintiffs Donald Adkinson and Kerry Wimley have responded. (ECF No. 44). Defendants have replied. (ECF No. 46). The Court finds the matter ripe for consideration.

         I. BACKGROUND

         On September 7, 2018, David Wright (“Wright”) filed a putative collective and class action against Defendants, pursuant to the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201, et seq., and the Arkansas Minimum Wage Act (“AMWA”), Ark. Code Ann §§ 11-4-201, et seq. That case was assigned civil case number 4:18-cv-4127-SOH (the “Wright case”). Wright alleged that he is employed by Defendants as an hourly paid pizza delivery driver in Texarkana, Arkansas and Texarkana, Texas, and that Defendants failed to pay him, and others similarly situated, proper minimum wage and overtime compensation. Specifically, Wright alleged that Defendants required him and other pizza delivery drivers to incur various business-related costs and expenses and failed to reimburse them for the same. One opt-in plaintiff joined the Wright case, and it was not certified as a class or collective action.

         The parties to the Wright case subsequently settled the claims therein, as captured in a settlement agreement signed by the plaintiffs on January 15, 2019, and by the defendants on January 25, 2019. The settlement agreement provided, in relevant part, that Wright released Defendants from “all claims which presently exist or may exist in the future arising out of or relating to the assertions in Plaintiffs' complaint.” (ECF No. 36-2, p. 1). On March 15, 2019, the Court dismissed the Wright case with prejudice, pursuant to the terms of the settlement agreement.

         On January 23, 2019, Plaintiffs filed this action, seeking relief pursuant to the FLSA and the AMWA. Plaintiffs make the same allegations that Wright did in his case: (1) that they were employed by Defendants as hourly paid delivery drivers at Defendants' pizza stores in Texarkana, Arkansas, and Texarkana, Texas; and (2) that Defendants failed to pay them, and others similarly situated, proper minimum wage and overtime compensation by requiring them to incur various business-related costs and expenses and failing to reimburse them for the same. On May 20, 2019, Wright opted into this case by filing a consent to join collective action.

         On July 25, 2019, Defendants filed the instant motion for summary judgment, contending that Wright's claims in this case are foreclosed because the settlement agreement in the Wright case released Defendants from liability on any and all claims relating to the assertions in that case. Defendants argue that the factual allegations in this case are essentially identical to those in the Wright case and, thus, Wright is seeking an improper second recovery on claims from which he has released Defendants. Accordingly, Defendants contend that there are no genuine issues of material fact on this issue and that the Court should dismiss Wright's claims herein. Plaintiffs oppose the motion.

         II. STANDARD

         The standard for summary judgment is well established. When a party moves for summary judgment, “[t]he court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact, and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); Krenik v. Cnty. of LeSueur, 47 F.3d 953, 957 (8th Cir. 1995). This is a “threshold inquiry of . . . whether there is a need for trial-whether, in other words, there are genuine factual issues that properly can be resolved only by a finder of fact because they reasonably may be resolved in favor of either party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). A fact is material only when its resolution affects the outcome of the case. Id. at 248. A dispute is genuine if the evidence is such that it could cause a reasonable jury to return a verdict for either party. Id. at 252.

         In deciding a motion for summary judgment, the Court must consider all the evidence and all reasonable inferences that arise from the evidence in a light most favorable to the nonmoving party. Nitsche v. CEO of Osage Valley Elec. Co-Op, 446 F.3d 841, 845 (8th Cir. 2006). The moving party bears the burden of showing that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. See Enter. Bank v. Magna Bank, 92 F.3d 743, 747 (8th Cir. 1996). The nonmoving party must then demonstrate the existence of specific facts in the record that create a genuine issue for trial. Krenik, 47 F.3d at 957. However, a party opposing a properly supported summary judgment motion “may not rest upon mere allegations or denials . . . but must set forth specific facts showing that there is a genuine issue for trial.” Anderson, 477 U.S. at 256.

         III. DISCUSSION

         Defendants contend that Wright's claims in this case should be dismissed because they are the same as those in the Wright case, from which he released them from liabiltiy. Plaintiffs concede that Wright settled and cannot pursue any FLSA claims against Defendants accruing before the execution of the Wright settlement agreement. The Court finds that Wright should not be allowed to assert claims in this case that accrued before March 15, 2019, the dismissal of the Wright case, as those claims are covered by the settlement agreement in that case.^[1]

         The only remaining question, then, is whether Wright may pursue FLSA claims accruing after the Wright case's dismissal. Defendants argue that he cannot because the Wright settlement agreement released them from “all claims which presently exist or may exist in the future arising out of or relating to the assertions in Plaintiffs' complaint.” Defendants argue that Wright case's settlement agreement encompasses Wright's FLSA claims in this case because both cases concern Defendants' alleged failure to pay their delivery-driver employees proper minimum wage and overtime compensation by requiring them to bear various business-related costs and expenses without reimbursement. Plaintiffs contend that Wright did not and could not prospectively waive his rights under the FLSA for any later-occurring violations and, thus, he is entitled to pursue any claims he may have against Defendants accruing after the date of the Wright settlement agreement.

         The parties disagree whether Wright's release of all claims related to his allegations in the Wright case is a valid waiver of prospective FLSA claims in light of the fact that the Court did not review the Wright settlement for fairness before dismissing the case. However, the Court need not address this issue because, regardless, Wright's release of claims related only to “the assertions in [the Wright] Plaintiffs' complaint.” (ECF No. 36-2, p. 1). The Wright parties fully executed their release on January 24, 2019, and the Court dismissed that case on March 15, 2019. Wright did not release Defendants from any claim that might ever accrue after the conclusion of the Wright case. Rather, he released them from all claims related to the specific allegations and the specific time period involved in that case. In other words, he released them from all present and future claims arising from the allegations involved in a three-year period ending at the time of that case's dismissal. Plaintiffs' allegations in this case, albeit ...