United States District Court, D. South Carolina, Charleston Division
Jennifer Hart, on behalf of herself and all others similarly situated, Plaintiff,
Barbeque Integrated, Inc. d/b/a Smokey Bones, Defendant.
PATRICK MICHAEL DUFFY UNITED STATES DISTRICT JUDGE.
matter is before the Court on Defendant's motion to
dismiss (ECF No. 30) and Plaintiff's motion for
conditional certification (ECF No. 33). For the reasons set
forth herein, Defendant's motion to dismiss is denied and
Plaintiff's motion for conditional certification is
January 24, 2017, Plaintiff commenced this action on behalf
of herself and all others similarly situated, seeking unpaid
minimum wages pursuant to the Fair Labor Standards Act
(“FLSA”) and the South Carolina Payment of Wages
Act (“SCPWA”). Plaintiff and the putative class
seek recovery from Defendant, who owns and operates
sixty-seven restaurants nationwide known as Smokey Bones.
primarily alleges that Defendant, while taking advantage of
the FLSA's tip credit provision, required her and the
putative class members to perform non-tipped side work that
was not related to their tipped occupations as
servers and bartenders, as well as requiring that Plaintiff
and the putative class members spend more than twenty percent
of their shifts performing non-tipped side work that
was related to their tipped occupations.
Additionally, Plaintiff alleges that she and the putative
class members were required to pay Defendant out of their
tips when a customer walked out, were required to purchase
additional Smokey Bones t-shirts with their tips, and were
never notified that Smokey Bones was paying them less than
minimum wage pursuant to the FLSA's tip-credit provision.
Plaintiff alleges that all three of those requirements
violate the tip-credit provision. See 29 U.S.C.
filed its motion to dismiss on May 31, 2017. Plaintiff
responded on June 14, and Defendant replied on August 31.
Plaintiff filed her motion for conditional certification on
June 2. Defendant responded on June 30, and Plaintiff replied
on July 7. Accordingly, these matters are now ripe for
Motion to Dismiss
moves to dismiss count one of Plaintiff's complaint on
the grounds that Plaintiff has failed to allege that she
earned less than minimum wage during a particular workweek,
that the twenty-percent rule does not support a cause of
action, and that Plaintiff's allegations do not violate
the FLSA's dual-jobs regulation. The Court will address
each argument in turn.
motion to dismiss pursuant Rule 12(b)(6) for failure to state
a claim upon which relief can be granted “challenges
the legal sufficiency of a complaint.” Francis v.
Giacomelli, 588 F.3d 186, 192 (4th Cir. 2009) (citations
omitted); see also Republican Party of N.C. v.
Martin, 980 F.2d 943, 952 (4th Cir. 1992) (“A
motion to dismiss under Rule 12(b)(6) . . . does not resolve
contests surrounding the facts, the merits of a claim, or the
applicability of defenses.”). To be legally sufficient,
a pleading must contain a “short and plain statement of
the claim showing that the pleader is entitled to
relief.” Fed.R.Civ.P. 8(a)(2).
Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007),
the Supreme Court articulated a “two-pronged
approach” to test the sufficiency of a complaint.
Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). First,
the complaint must “contain factual allegations in
addition to legal conclusions.” Robertson v. Sea
Pines Real Estate Cos., 679 F.3d 278, 288 (4th Cir.
2012). Under Rule 8's pleading standard, “a
formulaic recitation of the elements of a cause of action
will not do, ” id. (quoting Twombly,
550 U.S. at 555) (internal quotation marks omitted), and
“‘naked assertion[s]' devoid of
‘further factual enhancement'” will not
suffice, Iqbal, 556 U.S. at 678 (quoting
Twombly, 550 U.S. at 557). Second, the complaint
must “contain sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on
its face.'” Id. (quoting Twombly,
550 U.S. at 570). “A claim has facial plausibility when
the plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Id. (citing
Twombly, 550 U.S. at 556). More specifically, the
complaint must demonstrate that the plaintiff's right to
relief is more than a mere possibility, but it need not rise
to the level of evincing a probability of success.
Id. Accordingly, “[d]etermining whether a
complaint states a plausible claim for relief will . . . be a
context-specific task that requires the reviewing court to
draw on its judicial experience and common sense.”
Id. at 679.
ruling on a Rule 12(b)(6) motion to dismiss, the trial judge
must accept as true all of the facts alleged in the
plaintiff's complaint and construe all reasonable
inferences in favor of the plaintiff. E.g., E.I.
du Pont de Nemours & Co. v. Kolon Indus., Inc., 637
F.3d 435, 440 (4th Cir. 2011). The court must determine
whether the allegations give rise to a plausible right to
relief, Iqbal, 556 U.S. at 679; however, it should
“not accept ‘legal conclusions couched as facts
or unwarranted inferences, unreasonable conclusions, or
arguments, '” United States ex rel. Nathan v.
Takeda Pharm. N. Am., Inc., 707 F.3d 451, 455 (4th Cir.
2013) (quoting Wag More Dogs, LLC v.
Cozart, 680 F.3d 359, 365 (4th Cir. 2012)); see also
Iqbal, 556 U.S. at 678 (“[T]he tenet that a court
must accept as true all of the allegations contained in a
complaint is inapplicable to legal conclusions.”).
Thus, although the court must accept a plaintiff's
well-pleaded factual allegations as true for purposes of
ruling on the motion, the complaint must nevertheless satisfy
the “two-pronged” test articulated by the Supreme
Court. Iqbal, 556 U.S. at 679.
first argues that Plaintiff's failure to allege that she
earned less than minimum wage in any particular workweek is
fatal to count one of her complaint. Citing this Court's
decision in Schmidt v. Charleston Collision Holdings,
LLC, Defendant argues that so long as Plaintiff's
average wage per hour worked during the workweek is above
minimum wage, there is no violation of the FLSA. No.
2:14-cv-1094-PMD, 2014 WL 10102245, at *3 (D.S.C. July 14,
2014). Utilizing the FLSA's tip credit
provision, § 203(m), Defendant paid Plaintiff a direct
wage of $2.13 an hour and then applied Plaintiff's tips
to cover the gap between the $2.13 direct wage and the $7.25
federal minimum wage. According to Defendant, so long as
Plaintiff's average wage per hour, including her tips,
was above minimum wage over the course of the workweek, then
Defendant could not have violated the FLSA. Defendant's
argument derives from the Second Circuit's decision in
United States v. Klinghoffer Bros. Realty Corp., 285
F.2d 487 (2d Cir. 1961), where that court held that an
employer had not violated the FLSA because their average
hourly wage over the course of a workweek exceeded minimum
wage. Id. at 490. Thus, Defendant asserts that count
one should be dismissed.
disagrees, relying primarily on Romero v. Top-Tier
Colorado LLC, 849 F.3d 1281 (10th Cir. 2017). In
Romero, the Tenth Circuit addressed this question
and concluded that “an employer doesn't comply with
its federal minimum wage obligations just because its
employees receive at least $7.25 in tips. Instead, an
employer complies with its minimum-wage obligations if it
‘pays' its employees at least $7.25 an hour in
‘wages.'” Id. at 1282.
“[W]hile an employer can treat tips as wages under
certain circumstances, ” id., Plaintiff claims
that Defendant impermissibly did so here. In other words,
Plaintiff claims that when she was performing non-tipped side
work, she did not qualify as a tipped employee under §
203(m) of the FLSA and was entitled to be paid the full
minimum wage of $7.25 an hour for the hours she spent
performing non-tipped side work. Thus, Plaintiff claims that
even if her total direct wages and tips for the week averaged
to greater than minimum wage, Defendant was still not
entitled to pay her the $2.13 tip-credit wage when she was
performing non-tipped side work. Plaintiff's claim for
non-tipped related side work is based on the FOH's
twenty-percent rule,  while her claim for non-tipped unrelated
side work is based on the dual-jobs regulation. The FLSA treats
the related and unrelated non-tipped side work differently,
but the majority of courts, including this Court, have
concluded that a plaintiff can allege an FLSA cause of action
based on both types of non-tipped tasks. Irvine v.
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