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Mayes v. Excelsior Ambulance Service, Inc.

United States District Court, D. South Carolina, Columbia Division

March 19, 2019

Tiffaney L. Mayes, Wanda J. Duckson, Roshawnda Simpson, Angela Y. Bouknight, Bernetta Lewis, Doretha Montgomery, Annette Walker, Emma Seibles, Lorna Gladden, Frenchie Hannah, Mary McClellan, Torey McClellan, Heather Davis, Dianne C. Williams, Taneshia Lewis, Tonia Armoni, Plaintiffs,
v.
Excelsior Ambulance Service, Inc., James A. Graham, M.D., Defendants.

          ORDER AND OPINION

         This matter is before the court for review of Defendants Excelsior Ambulance Service, Inc. and James A. Graham's (collectively, “Defendants”) Motion for Judgment on the Pleadings, or, Alternatively, Motion for Summary Judgment (ECF No. 28) filed on May 3, 2018. For the reasons set forth herein, the court DISMISSES AS MOOT Plaintiffs Tiffaney L. Mayes, Wanda J. Duckson, Roshawnda Simpson, Angela Y. Bouknight, Bernetta Lewis, Doretha Montgomery, Annette Walker, Emma Seibles, Lorna Gladden, Frenchie Hannah, Mary McClellan, Torey McClellan, Heather Davis, Dianne C. Williams, Taneshia Lewis, and Tonia Armoni's (collectively, “Plaintiffs”) Complaint (ECF No. 1-1 at 3). Accordingly, the court DENIES AS MOOT Defendants' Motion for Judgment on the Pleadings, or, Alternatively, Motion for Summary Judgment (ECF No. 28) and DENIES AS MOOT Defendants' Motion in Limine (ECF No. 54).

         I. FACTUAL AND PROCEDURAL BACKGROUND

         Plaintiffs provided “personal services” to Defendants, which included transporting veterans to “various locations.” (ECF No. 1-2 at 2.) Defendants' business “operated [as] an ambulance service pursuant to a contract with the Veterans Administration.” (ECF No. 1-1 at 5 ¶ 1.) As it relates to the provision of ambulance services, the contract between Defendants and the Veterans Administration fell under the McNamara-O'Hara Service Contract Act of 1965 (“the SCA”), 41 U.S.C. §§ 6702-6707 . (ECF No. 28-1 at 43-44.) Upon learning that Defendants were possibly underpaying them, Plaintiffs notified the Wage and Hour Division of the United States Department of Labor (“the Wage and Hour Division”) by filing a complaint. (ECF Nos. 33-1, 33-2, 33-3, 33-4, 33-5.) According to Defendants, the Wage and Hour Division concluded that Plaintiffs were improperly classified and sought retroactive pay for Plaintiffs. (ECF No. 1-2 at 2.) On February 13, 2017, the Wage and Hour Division determined that Defendants needed to pay a total of $352, 807.40 in unpaid wages to Plaintiffs. (ECF No. 28-2.)

         On July 26, 2017, Plaintiffs filed their Complaint in the Richland County Court of Common Pleas, in Columbia, South Carolina. (ECF No. 1-1.) Plaintiffs allege that Defendants “withheld a portion of [their] wages” and “a claim for back wages accrued.” (ECF No. 1-1 at 5 ¶ 3.) Plaintiffs' causes of action arise under South Carolina law and include: (1) breach of contract and (2) violations of the South Carolina Payment of Wages Act (“SCPWA”), SC Code Ann. §§ 41-10- 10 to 41-10-110. (ECF No. 1-1 at 5-6 ¶¶ 6-10.) On September 1, 2017, Defendants removed this matter to the United States District Court for the District of South Carolina. (ECF Nos. 1, 1-3, 1-4.) Plaintiffs submit that Defendants “agreed that they owed [] [P]laintiffs for back pay and agreed to pay them back pay by a certain date or dates but failed to do so.” (ECF No. 33 at 3.) Defendants contend that they did not agree to pay wages to Plaintiffs, as mandated by the Wage and Hour Division, but that they decided “not to contest the wages that the Wage and Hour Division determined” was due to Plaintiffs. (ECF No. 28 at 5.) At the same time, however, Defendants state that they “committed themselves to pay the Plaintiffs these wages.” (Id.)

         On May 3, 2018, Defendants filed their Motion for Judgment on the Pleadings, or, Alternatively, Summary Judgment. (ECF No. 28.) Defendants essentially argue that neither of Plaintiffs' causes of action are viable because the Wage and Hour Division is the only entity that may provide Plaintiffs with relief. (Id. at 7.) First, as to Plaintiffs' breach of contract claim, Defendants contend that Plaintiffs may not seek recovery under the SCA because they are merely third-party beneficiaries and do not possess a private right of action. (Id. at 7-8.) Defendants claim that the Wage and Hour Division may only enforce wage disputes concerning contracts under the SCA. (Id. at 8.) Secondly, as to Plaintiffs' second cause of action under the SCPWA, Defendants forcefully argue that Plaintiffs do not have employment agreements with Defendants, thereby depriving them of a cause of action under the SCPWA. (Id. at 12-13.) Moreover, Defendants reason that Plaintiffs' SCPWA claim is predicated upon the SCA and not state law. (Id. at 11.) Lastly, Defendants contend that the court lacks subject-matter jurisdiction over this matter because the Wage and Hour Division possesses the sole jurisdiction to enforce the SCA. (Id. at 14-15.)

         On May 31, 2018, Plaintiffs responded in opposition to Defendant's Motion. (ECF No. 33.) Plaintiffs claim that they “do not seek to recover on an alleged private cause of action under the [SCA].” (Id. at 3.) Plaintiffs argue that had Defendants “simply done what they had agreed to do” then “the matter would have been resolved.” (Id.) Citing to their own affidavits, Plaintiffs suggest that Defendants “obligated or pledged themselves to pay” proper wages. (Id. at 4.) Lastly, Plaintiffs assert that the court should consider remanding the case to state court because there is no diversity jurisdiction over the action. (Id. at 5.)

         On October 15, 2018, Defendants filed their Motion in Limine. (ECF No. 54.) Defendants request the court to preclude Plaintiffs from introducing numerous pieces of evidence at trial. (Id. at 9.) Plaintiffs responded in opposition to Defendants' Motion in Limine on October 29, 2018. (ECF No. 55.) In their response, Plaintiffs concede their breach of contract claim against Defendants and state that the only remaining claim is their second cause of action-violations of the SCPWA. (Id. at 1, 6.) Plaintiffs advised the court that they relinquish their breach of contract claim because “[s]ince this action was commenced, the [United States] Department of Labor has seized and has paid the amount due each plaintiff from the defendants for unpaid wages and has paid the plaintiffs their actual damages.” (ECF No. 55 at 1.)

         On January 31, 2019, the court heard oral arguments from the parties. (ECF No. 61.) Defendants stated that Plaintiffs affirmatively conceded their breach of contract claim and are foreclosed from seeking further relief under the SCPWA because the United States Secretary of Labor (“the Secretary”) has “exclusive jurisdiction” to enforce matters arising under the SCA. In other words, Defendants maintained that the SCA bars other private rights of action, including those arising under the laws of South Carolina. Defendants also acknowledged that, through the Wage and Hour's administrative proceedings, Plaintiffs have been “paid in full” under the SCA and “paid what was owed, ” meaning that “there is no longer any controversy.” Plaintiffs agreed that the Wage and Hour Division “seized the money” and paid them what was owed, thereby satisfying their breach of contract claim. However, Plaintiffs asserted that their SCPWA claim remains pending, and they have not sued under the SCA or any other federal statute. Plaintiffs further submitted that there is a genuine factual dispute that should proceed to trial. Because this matter has been extensively briefed and argued, it is now ripe for the court's review. See generally Sauls v. Wyeth Pharm., Inc., 846 F.Supp.2d 499, 501 (D.S.C. 2012) (“The parties have fully briefed the issues, and this matter is ripe for consideration.”).

         II. LEGAL STANDARD

         Subject-matter jurisdiction “involves a court's power to hear a case” and may never be “forfeited or waived.” United States v. Cotton, 535 U.S. 625, 630 (2002). A federal court has an “independent obligation to determine whether subject-matter jurisdiction exists, even in the absence of a challenge from any party.” Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006) (citing Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583 (1999)). When a court lacks subject-matter jurisdiction, it must dismiss the case. See Frank v. Commonwealth of Ant. & Barb., 842 F.3d 362, 367 (5th Cir. 2016); Winnett v. Caterpillar, Inc., 553 F.3d 1000, 1007 (6th Cir. 2009); Auster v. Ghana Airways Ltd., 514 F.3d 44, 48 (D.C. Cir. 2008); Williamson v. Tucker, 645 F.2d 404, 413 (5th Cir. 1981); Tarta v. Nation Care, Inc., 864 F.Supp.2d 173, 177 (D.D.C. 2012); Arcadia Valley Hosp. v. Bowen, 641 F.Supp. 190, 192 (E.D. Mo. 1986).

         It is well established that “[t]he inability of the federal judiciary to review moot cases derives from the requirement of Art[icle] III of the Constitution under which the exercise of judicial power depends upon the existence of a case or controversy.” United States v. Hardy, 545 F.3d 280, 283 (4th Cir. 2008). In other words, “[t]he doctrine of mootness constitutes a part of the constitutional limits of federal court jurisdiction . . . .” Brooks v. Vassar, 462 F.3d 341, 348 (4th Cir. 2006). “When a case or controversy ceases to exist, the litigation is moot, and the court's subject-matter jurisdiction ceases to exist also.” S.C. Coastal Conservation League v. U.S. Army Corps of Eng'rs, 789 F.3d 475, 482 (4th Cir. 2015) (citing Iron Arrow Honor Soc'y v. Heckler, 464 U.S. 67, 70 (1983) (per curiam)). “A case becomes moot ‘when the issues presented are no longer “live” or the parties lack a legally cognizable interest in the outcome.'” Deal v. Mercer Cty. Bd. of Educ., 911 F.3d 183, 191 (4th Cir. 2018) (quoting Simmons v. United Mort. & Loan Inv., LLC, 634 F.3d 754, 763 (4th Cir. 2011)). It is well established that “subsequent events can moot” a valid claim. Pashby v. Delia, 709 F.3d 307, 316 (4th Cir. 2013). Therefore, a case may become moot “due to a change in the facts or a change in the law.” S.C. Coastal Conservation League, 789 F.3d at 482 (citing Ross v. Reed, 719 F.2d 689, 693-94 (4th Cir. 1983)). The United States Court of Appeals for the Fourth Circuit has specifically held that “a claim is moot when the claimant receives the relief he or she sought to obtain through the claim.” Friedman's, Inc. v. Dunlap, 290 F.3d 191, 197 (4th Cir. 2002).

         III. DISCUSSION

         The SCA applies to “any contract” that is “made by the Federal Government, ” “involves an amount exceeding $2, 500, ” and “has as its principal purpose the furnishing of services in the United States through the use of service employees.” 41 U.S.C. § 6702(a)(1)-(3). The SCA specifically provides that “[t]he Secretary shall administer [the SCA].”[1] 41 U.S.C. §§ 6506(a), 6707(a). As it relates to the SCA's enforcement, only “[t]he Secretary, or an authorized representative of the Secretary, may make investigations and findings as provided in this chapter and may, in any part of the United States, prosecute an inquiry necessary to carry out [the SCA].” 41 U.S.C. §§ 6506(e), 6507(a) (emphasis added). Further, only “[t]he Secretary or an impartial representative designated by the Secretary may make decisions, based on findings of fact, that are necessary to enforce [the SCA].” 41 U.S.C. § 6507(f). Noticeably, the SCA's statutory scheme does not provide a private right of action to employees seeking to enforce its provisions.[2] See 41 U.S.C. §§ 6701-6707.

         When employees fall within the scope of the SCA or the related Davis-Bacon Act, federal courts have routinely held that state law claims may not serve as additional vehicles to vindicate injured employees' rights. See Danielsen v. Burnside-Ott Aviation Training Ctr., Inc., 941 F.2d 1220, 1226-27 (D.C. Cir. 1991) (holding that the statutory scheme of the SCA “leaves no room” for a civil action under the Racketeer Influenced and Corrupt Organizations Act (“RICO”) and a claim “couched under” RICO is preempted); Johnson v. Sys. Connection of Md., Inc., C/A No. JKB-16-630, 2016 WL 4124214, at *3 (D. Md. Aug. 2, 2016) (holding that state claims were “inappropriate vehicles” for obtaining back wages under the related Davis-Bacon Act because the claims were cloaked “in the garb of state law”); Ralton v. Collecto, Inc., C/A No. 14-13184-DJC, 2015 WL 854976, at *4 (D. Mass. Feb. 27, 2015) (holding that a plaintiff lacked standing as a third-party beneficiary to an employer's contract with the federal government and could not bring a breach of contract claim to pursue wages under the SCA); Miccoli v. Ray Commc'ns, Inc., C/A No. 99-3825, 2000 WL 1006937, at *4 (E.D. Pa. July 20, 2000) (holding that a plaintiff did not have a substantive right to compensation under the SCA and could not pursue a related state law claim, under the Pennsylvania Wage Payment and Collection Law, because there was no substantive right to enforce); Oji v. PSC Envtl. Mgmt. Inc., 771 F.Supp. 232, 233-34 (N.D. Ill. 1991) (dismissing a plaintiff's breach of contract claim under state law because only the Secretary of Labor has authority to enforce the provisions of the SCA). Put differently, a plaintiff is foreclosed from pursuing common law or statutory claims grounded in state law because the claim is “in reality a private claim for back wages under the . . . [SCA].” Miccoli, 2000 WL 1006937, at *3. This is so because the SCA provides an exclusive administrative scheme for its enforcement through the Secretary. See Danielson, 941 F.2d at 1227. Only the Secretary is permitted to make decisions and enforce the SCA. See 41 U.S.C. ยงยง 6506(e), ...


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