Hernandez v. Global Prisoner Services, LLC D/b/a Texas Prisoner Transportation Services

Western District of Texas, txwd-5:2019-cv-00374

Exhibit PTSs Motion to Dismiss, or in the Alternative, Motion to Transfer Venue

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6 UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION AMANDA HERNANDEZ and DAVID) RINCON, Individually and) on Behalf of all Others) Similarly Situated,) Case No. 5:19-cv-00374-FB) Plaintiffs,) vs.)) GLOBAL PRISONER SERVICES, LLC d/b/a TEXAS PRISONER) TRANSPORTATION SERVICES,) PTS OF AMERICA, LLC, and) RYAN WHITTEN Defendants. PTS OF AMERICA, LLC'S MOTION TO DISMISS, OR IN THE ALTERNATIVE, MOTION TO TRANSFER VENUE AND MEMORANDUM OF LAW IN SUPPORT Respectfully submitted, Mary E. Buckley, Texas Bar # 24101571 Gregory J. Northen, Ark. Bar # 20111891* CROSS, GUNTER, WITHERSPOON & GALCHUS, P.C. 500 President Clinton Avenue, Suite 200 Little Rock, Arkansas 72201 Phone: 501-371-9999 / Fax: 501-371-0035 E-mail: mbuckley@cgwg.com /gnorthen@cgwg.com *Pro Hac Vice pending 6 TABLE OF CONTENTS I. INTRODUCTION............................................................................................................. 1 II. PROCEDURAL BACKGROUND .................................................................................. 2 III. FACTUAL BACKGROUND ........................................................................................... 3 IV. STANDARD FOR DISMISSAL ...................................................................................... 5 V. ARGUMENT ..................................................................................................................... 8 A. Plaintiff's Complaint Should be Dismissed Because She Failed to Plead Facts to Support the Critical Elements for Successor Liability, and Therefore, Failed to State a Claim. .............................................................................................................................. 8 B. Even Assuming, Arguendo, that Successor Liability Is Sufficiently Alleged, Plaintiff's Complaint Should be Dismissed Because She Was Not a "Covered Employee" Under the FLSA, or Likewise, Is Exempt from the Overtime Requirements of the FLSA. ........................................................................................... 10 1. PTS's Prison Transport Operations are Regulated by the Department of Transportation. .......................................................................................................... 12 2. Plaintiff's Employment as a Prison Transport Driver is the Quintessence of a Safety- Affecting Position within the MCA Exemption. ...................................................... 15 C. The Court Should Dismiss Plaintiff's Recordkeeping Violation Claim Because There Is No Private Cause of Action for Alleged Violations of the FLSA's Recordkeeping Requirements................................................................................................................... 16 D. The Complaint Fails to State a Claim for Relief for the Putative Group of Individuals who Plaintiff Seeks to Represent. .............................................................. 17 E. Plaintiff's Complaint Should be Dismissed for Improper Venue Pursuant to Fed. R. Civ. P. 12(b)(3) & 28 U.S.C. § 1391, or Transferred to the Austin Division.............. 19 VI. CONCLUSION ............................................................................................................... 23 6 TO THE HONORABLE JUDGE FRED BIERY: COMES NOW Defendant PTS of America, LLC (PTS), and files its Motion to Dismiss, under Rule 12(b)(6) of the Federal Rules of Civil Procedure for failure to state a claim. PTS further files its Motion to Dismiss under Rule 12(b)(3) of the Federal Rules of Civil Procedure for improper venue, or in the alternative, to transfer venue to the United States District Court for the Western District of Texas, Austin Division pursuant to 28 U.S.C. 1404(a), and in support thereof, respectfully states the following: I. INTRODUCTION Plaintiff Amanda Hernandez filed her First Amended Complaint on October 3, 2019 (Plaintiff's Complaint), alleging that PTS is liable as a successor employer for alleged unpaid overtime in violation of the Fair Labor Standards Act of 1938, 29 U.S.C. §§ 201 et seq. (FLSA). See ECF No. 21, ¶¶ 3, 21-22. Plaintiff also sets forth a claim for "failure to maintain accurate records" in violation of the FLSA. Id. at ¶¶ 49-51. Plaintiff seeks to certify a collective action in this matter as to a class of extradition officers. Id. at ¶¶ 52-62. As demonstrated below, PTS moves the Court for an Order dismissing Plaintiff's Complaint with prejudice because Plaintiff, who purports to seek relief on behalf of others alleged to be similarly situated, failed to state a claim on which relief could be granted as to her. Specifically, Plaintiff's Complaint must be dismissed because: (1) PTS is not a successor employer under the FLSA; (2) she is exempt from the overtime pay requirements of the FLSA under the Motor Carrier Act (MCA) Exemption, 29 U.S.C. § 213(b); and, (3) Plaintiff was not a "covered employee" under 29 U.S.C. § 207 pursuant to the SAFETEA–LU Technical Corrections Act (Corrections Act) of 2008, Pub. L. No. 110–244, 122 Stat. 1572 (2008) (codified in 29 U.S.C. § 207). Further, there is no claim for relief for recordkeeping violation under the FLSA. 1 245744 6 PTS also moves the Court to dismiss Plaintiff's case for improper venue, or in the alternative, for the Court to transfer venue the Western District of Texas, Austin Division. Specifically, the case should be dismissed or transferred as (1) venue was proper in the Austin Division at the outset pursuant to 28 U.S.C. § 1391; and, (2) a related case is currently pending in the Austin Division, with the same counsel and same causes of action,1 which will likely impact the outcome of this litigation such as to warrant the consolidation of the cases to Judge Lee Yeakel's docket pursuant to 28 U.S.C. 1404(a). II. PROCEDURAL BACKGROUND On April 10, 2019, Plaintiff filed her Complaint (ECF No. 1) against Global Prisoner Services, LLC d/b/a Texas Prisoner Transportation Services (GPS), alleging that GPS violated the FLSA by failing to pay her overtime at a rate not less than one and one-half times the regular rate of pay for hours worked in excess of forty in a work week. ECF No. 1, ¶¶ 3-4.2 On April 10, 2019, David Rincon consented to join as an opt-in Party Plaintiff. ECF No. 5. The caption of the case was not changed to reflect his addition as a Party Plaintiff. Id. On June 19, 2019, a request for issuance of summons was made. ECF No. 6. On June 20, 2019, summons to GPS was issued by the Clerk. ECF No. 7. Service was not attempted by Plaintiff until July 8, 2019, which was one day before the 90-day service period expired. See ECF Nos. 8 & 10. Plaintiff attempted service through process agent on July 8, 2019 via Thor Catalogne, the purported registered agent, 1 There is no minimum wage violation claim in the case pending before Judge Lee Yeakel, however, the allegations regarding unpaid overtime and failure to maintain records are alleged in both cases and center on a common nucleus of operative facts. 2 Plaintiff also alleges PTS failed to maintain accurate time and pay records as required under the FLSA. ECF No. 21, ¶ 5. Importantly, however, there is no private cause of action for any purported recordkeeping violation. O'Quinn v. Chambers Cnty., 636 F. Supp. 1388, 1392 (S.D. Tex. 1986), amended on other grounds, 650 F. Supp. 25 (S.D. Tex. 1986). 2 245744 6 at the location of 108 E. Highway 79 Thrall, Texas. ECF No. 10. Plaintiff also attempted service by serving the Texas Secretary of State on July 8, 2019. ECF No. 8. Texas public records indicate that GPS's right to transact business in Texas was forfeited at some point in 2019. Public records also indicate that GPS, a Tennessee company (ECF No. 1, ¶ 10), was administratively dissolved on or around March 12, 2019.3 On August 8, 2019, the Court issued an Order to Show Cause for why service had not been timely made. See ECF No. 9. On August 13, 2019, Plaintiff responded to the Order to Show Cause, and stated she served the Texas Secretary of State, which was sufficient for service of process. See ECF No. 11. On August 21, 2019, Plaintiff moved for default against GPS (ECF No. 15), which was granted by the Clerk (ECF No. 16), but later withdrawn by Plaintiff (ECF No. 18). On October 3, 2019, Plaintiff filed her First Amended Complaint (ECF No. 21), adding two new defendants, Ryan J. Whitten and PTS, though the additional defendants are not reflected in the caption of the case. See ECF No. 21. III. FACTUAL BACKGROUND PTS engages in the business of intrastate and interstate prisoner transport. See ECF No. 21, ¶ 14. In this highly-specialized field regulated in pertinent part by the Secretary for the U.S. Department of Transportation (DOT), PTS employs drivers to transport prisoners—in its DOT- approved fleet of passenger vans capable of transporting up to fourteen passengers—between correctional facilities across the United States. See Public Notice by Nat'l Surface Transp. Bd. 3 See Tennessee Secretary of State, Business Entity Detail, Global Prisoner Services, LLC, available at https://tnbear.tn.gov/Ecommerce/ FilingDetail.aspx?CN=1662200610511832080802 37081001160045009004109178. 3 245744 6 Regarding PTS's Approval to Operate (NSTB Approval) at 41369.4 Indeed, the Secretary authorized PTS's drivers to take custody, transport, and house prisoners en route to the requesting agency and/or transfer prison facility. Id.; see also ECF No. 21, ¶¶ 14, 17. As such, DOT's Federal Motor Carrier Safety Administration (FMCSA) classifies PTS as an interstate motor carrier for passenger transportation. Public Information Regarding PTS available on FMCSA Website.5 See also ECF No. 21, ¶¶ 14, 17, 23-25. PTS is not the only private prisoner transportation company operating in Texas. GPS, a competitor of PTS, also operated a private prisoner transportation company in Texas prior to February 2019. See ECF 1, ¶¶ 12, 16. However, in or around February 11, 2019, GPS began to wrap up its business affairs and ceased operations. See ECF No. 21, ¶¶ 19-20, and n. 1. GPS allegedly closed its operations due to an increase in insurance rates making it too expensive to continue to operate. Id. As of February 11, 2019, GPS referred its remaining and/or incoming transportation jobs to alternative companies. See ECF No. 21, ¶ 20; n.1. PTS neither bought assets from GPS, nor merged with GPS. PTS continues to operate its own private prisoner transportation service. As discussed below, because Plaintiff's Complaint fails to sufficiently allege that PTS is a successor employer, and that it had notice of the wage and hour issues, Plaintiff's claims must be dismissed. Alternatively, because PTS's prisoner transportation drivers are subject to the 4 This public notice is a matter of public record that the Court can and should consider for Rule 12(b)(6) purposes. See Prisoner Transportation Services, LLC-Control U.S. Corrections, LLC d/b/a U.S.C., 81 Fed. Reg. 122, 41368 (June 24, 2016), available at https://www.govinfo.gov/content/pkg/FR-2016-06-24/pdf/2016-15009.pdf (last accessed June 12, 2019). 5 This information is also publicly available. See SAFER Web – PTS of America, LLC Company Snapshot, Fed. Motor Carrier Safety Admin., available at https://safer.fmcsa.dot.gov/query.asp?searchtype=ANY&query_type=queryCarrierSnapshot&qu ery_param=USDOT&query_string=1106950 (last accessed October 28, 2019). PTS's DOT- issued license is number is 1106950, and its FMSCA Carrier Registration Number is MC- 6869407. Id. 4 245744 6 Secretary of Transportation's authority—and particularly the power to set maximum hours of service and qualifications pursuant to 49 U.S.C. § 31502—Plaintiff's Complaint fails to state a claim upon which relief can be granted for unpaid overtime because Plaintiff (and all who she purports are similarly situated), are exempt from the FLSA's overtime requirements under the MCA Exception. Accordingly, PTS respectfully requests that the Court enter an Order dismissing Plaintiff's Complaint with prejudice. PTS also requests the Court to dismiss, or in the alternative, transfer Plaintiff's case to the Austin Division due to improper venue and in the interests of judicial economy. IV. STANDARD FOR DISMISSAL Rule 12(b)(6) of the Federal Rules of Civil Procedure mandates dismissal of Plaintiff's claims as a matter of law. The Court should reach this inescapable conclusion by determining whether Plaintiff's Complaint satisfies the federal pleading standard. Initially, Rule 8(a)(2) requires each complaint to contain "a short and plain statement of the claim showing that the pleader is entitled to relief," FED. R. CIV. P. 8(a)(2), "in order to give the defendant fair notice of what the claim is and the grounds upon which it rests." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (emphasis added) (cleaned up). Although a complaint need not contain detailed factual allegations, the "showing" contemplated by Rule 8 requires the plaintiff to do more than simply allege legal conclusions or recite the elements of a cause of action. Twombly, 550 U.S. at 555 & n.3. Therefore, while courts accept factual allegations as true at the motion to dismiss stage—with only reasonable inferences drawn in Plaintiff's favor—the Complaint, at a minimum, "must contain sufficient factual matter. . . to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662 (2009) (internal quotations omitted). "A pleading that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will 5 245744 6 not do.' Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Id. In other words, Rule 8's pleading standard "demands more than an unadorned, the defendant-unlawfully-harmed-me accusation," Id. (citing Twombly, 550 U.S. at 555)—more than the bare-bones allegations outlined in Plaintiff's Complaint. Moreover, to survive scrutiny under Rule 12(b)(6), the facts asserted in the Complaint must allow the court to infer that the plaintiff's right to relief is plausible as a factual and legal matter. Iqbal, 556 U.S. at 678. In Iqbal, the Supreme Court established a two-step approach for assessing the sufficiency of a complaint in the context of a Rule 12(b)(6) motion. First, the Court should identify and disregard conclusory allegations, for they are "not entitled to the assumption of truth." Iqbal, 556 U.S. at 664. Second, the Court "consider[s] the factual allegations in [the complaint] to determine if they plausibly suggest an entitlement to relief." Id. To allege a plausible right to relief, the facts pleaded must suggest liability; allegations that are merely consistent with unlawful conduct are insufficient. Id. In other words, where the facts pleaded do no more than permit the court to infer the possibility of misconduct, the complaint has not shown that the pleader is entitled to relief. Id. at 679. "Determining whether a complaint states a plausible claim for relief. . . [is] a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. Where a complaint pleads facts that are "merely consistent with" a defendant's liability, it "stops short of the line between possibility and plausibility of 'entitlement to relief." Twombly, 550 U.S. at 557. Importantly, the Court may also consider facts susceptible to judicial notice or otherwise within the public record, along with matters necessarily embraced by the Complaint, in properly granting a Rule 12(b)(6) motion without applying the standards that govern motions under Rule 56. In fact, where the facts alleged in the Complaint, along with those susceptible to judicial 6 245744 6 notice, establish an affirmative defense, Rule 12(b)(6) mandates dismissal. Kansa Reinsurance Co., Ltd. v. Cong. Mortgage Corp., 20 F.3d 1362, 1366 (5th Cir. 1994); Watts v. Graves, 720 F.2d 1416, 1422–23 (5th Cir. 1983). Here, the Court must dismiss Plaintiff's Complaint because, although Plaintiff alleges that PTS has enterprise coverage under the FLSA (e.g., that PTS is engaged in interstate commerce), see ECF No. 21, ¶ 23, Plaintiff's overtime claims cannot survive Rule 12(b)(6) scrutiny because PTS is not a "successor employer" of Plaintiff, as there was no allegation of asset purchase or merger, and critically no notice of suit alleged. Alternatively, and regardless of successor liability, drivers, like Plaintiff are exempt from the FLSA's overtime requirements under the MCA Exemption. Specifically, and as discussed below Plaintiff's meritless claims must be dismissed because: (A) PTS, an unrelated prisoner transportation company, is not a successor employer of Plaintiff and Plaintiff has failed to even allege facts to state a plausible claim; (B) PTS, as a DOT-regulated entity, has no legal obligation to pay overtime to its MCA- Exempt drivers; (C) there is no private cause of action for alleged violations of the FLSA's recordkeeping requirements; (D) the Complaint fails to state a claim for relief for the putative group of individuals who Plaintiff seeks to represent; and (E) the case was brought in an improper venue. Therefore, Plaintiff's Complaint must be dismissed with prejudice, or in the alternative transferred to the Austin Division. 7 245744 6 V. ARGUMENT A. Plaintiff's Complaint Should be Dismissed Because She Failed to Plead Facts to Support the Critical Elements for Successor Liability, and Therefore, Failed to State a Claim. Plaintiff failed to set out any facts regarding notice or any "continuity of business" that could plausibly make PTS liable as a successor employer, and as such cannot sustain her assertion of successor liability. To establish successor liability, Plaintiff must establish nine factors: (1) whether the successor company had notice of the charge or pending lawsuit prior to acquiring the business or assets of the predecessor; (2) the ability of the predecessor to provide relief; (3) whether there has been a substantial continuity of business operations; (4) whether the new employer uses the same plant; (5) whether he uses the same or substantially the same work force; (6) whether he uses the same or substantially the same supervisory personnel; (7) whether the same jobs exist under substantially the same working conditions; (8) whether he uses the same machinery, equipment, and methods of production; and (9) whether he produces the same product. Rojas v. TK Communications, Inc., 87 F.3d 745 (5th Cir. 1996). Indeed, "[w]hether an employer qualifies as a bona fide successor will hinge principally on the degree of business continuity between the successor and predecessor." Valdez v. Celerity Logistics, Inc., 999 F. Supp. 2d 936, 943 (N.D. Tex. 2014) (citing Steinbach v. Hubbard, 51 F.3d 843 (9th Cir. 1995)). Importantly though, for there to be successor liability, the first two of the nine factors, (1) whether the successor company had notice of the charge or pending lawsuit prior to acquiring the business or assets of the predecessor; and (2) the ability of the predecessor to provide relief, are considered "critical." See Rojas, 87 F.3d at 750. "[T]he remaining seven factors are used to determine whether there was a continuity of business operations from the predecessor to the successor." Washington v. Patterson-UTI Energy, Inc., No. 5:16-cv-130-RP, at *8 (W.D. Tex. May. 31, 2016). Thus, the nine-factor test adopted in Rojas can largely be reduced to three 8 245744 6 factors: (1) whether the successor company had notice of the potential liability prior to acquiring the business or assets of the predecessor; (2) whether the predecessor has the ability to provide relief; and, (3) whether there has been a substantial continuity of business operations between the predecessor and the successor. Id. As a threshold matter, to be liable under a theory of successor liability, a company must acquire assets from another company. See Id. (emphasis supplied); see also Rojas, 87 F.3d at 750 ("[T]he successor doctrine arises. . . in situations where the assets of a defendant employer are transferred to another entity."). The factual allegations proffered in Plaintiff's Complaint concerning PTS's successor liability are confined to just two paragraphs of Plaintiff's Complaint. See ECF No. 21, ¶¶ 21-22. The sum total of those allegations being her beliefs that, (1) Whitten is the CEO of both PTS and GPS (an incorrect statement), and (2) Whitten transferred assets to PTS (also incorrect). Plaintiff follows her sole factual beliefs by dutifully setting out the above nine factors completely devoid of factual support. See ECF No. 21, ¶ 22. However, Plaintiff cannot meet her burden by stating conclusions of law in place of facts, especially as to those critical factors required to set out successor liability. See Valdez, 999 F. Supp. 2d at 945 n.11 ("The amended complaint is silent about which, if any, employees knew about potential FLSA liability and what their level of responsibility was."). In addition to failing to state sufficient facts to support her claim, she cites statements from separate defendant Ryan Whitten clearly indicating GPS planned to transition its clients and/or orders to "alternative transportation companies" ECF No. 21, ¶ 20 (emphasis added), which is contrary to Plaintiff's assertions that PTS purchased and continued GPS's operations. See ECF No. 21, n.1.6 6 Interestingly, the news article cited by Plaintiff indicates that Plaintiff knew or should have known that GPS ceased operations, closed its principle office, and stopped answering calls on or before February 11, 2019. See ECF No. 21, n.1. It seems that Plaintiff should have or 9 245744 6 It is clear from the face of the Complaint that Plaintiff fails to allege facts sufficient to establish PTS "stepped into the shoes" of GPS, or that GPS was even PTS's predecessor in the business. Plaintiff must allege facts sufficient to support she is entitled to recover on her claims for unpaid overtime from PTS. Her facts must establish a plausible case of successor liability, not just a mere possibility of successor liability by reciting conclusions of law. See Iqbal, 556 U.S. at 679, 129 S.Ct. 1937. Even under a liberal pleading standard, complaints must do more than simply allege legal conclusions or recite the elements of a cause of action. Because Plaintiff's allegations of successor liability fail as a matter of fact (or lack thereof), the Complaint must be dismissed. Plaintiff's own allegations coupled with the procedural history of this matter itself establishes that GPS dissolved before Plaintiff filed her Original Complaint, which itself destroys any plausible allegation of prior notice by PTS. As such, PTS must be dismissed as a Defendant in this matter. B. Even Assuming, Arguendo, that Successor Liability Is Sufficiently Alleged, Plaintiff's Complaint Should be Dismissed Because She Was Not a "Covered Employee" Under the FLSA, or Likewise, Is Exempt from the Overtime Requirements of the FLSA. 7 Plaintiff, and only Plaintiff, bears the burden of showing she is a "covered employee" under the FLSA: she fell woefully short of meeting this burden. See Gomez v. Loomis Armored would have known about GPS ceasing operations by April 2019, and likely well before September 27, 2019 (see ECF No. 18). At the very least, Plaintiff knew GPS was no longer in business by July 8, 2019, as Plaintiff's process server noted "Defendant [GPS] moved 4 to 5 months ago." See ECF 10, p. 2. This information undermines Plaintiff's contention of successor liability. 7 PTS makes the following argument subject to its position that Plaintiff failed to establish successor liability. PTS is not responding on behalf of GPS, but to the extent Plaintiff seeks unpaid overtime from PTS from her employment with GBS, PTS puts forth its position that Plaintiff did not establish she was a "covered employee" and that she is exempt from overtime pursuant to the MCA Exemption. The determination of whether Plaintiff is a "covered employee" and applicability of the MCA Exemption, would inure to the benefit of GPS. 10 245744 6 US LLC, 2018 WL 6265114, at *4 n.6 (W.D. Tex. Aug. 17, 2018); Carley v. Crest Pumping Techs., L.L.C., 890 F.3d 575, 579 (5th Cir. 2018) ("There is no dispute that [p]laintiffs bear the initial burden of proving that they were covered under FLSA's overtime pay requirement); Johnson v. Heckmann Water Res. (CVR), Inc., 758 F.3d 627 (5th Cir. 2014). Indeed, as made clear throughout this Brief, Plaintiff is not a "covered employee" under 29 U.S.C. § 207. The Corrections Act clarified the types of transportation employees who are subject to the FLSA's overtime requirements, to wit: (a) APPLICABILITY FOLLOWING THIS ACT.—Beginning on the date of enactment of this act [June 6, 2008], § 7 of the Fair Labor Standards Act of 1938 (29 U.S.C. § 207) shall apply to a covered employee notwithstanding § 13(b)(1) of that Act [the Motor Carrier Exemption] (b) Covered employee defined. In this section, the term 'covered employee' means an individual: (1) who is employed by a motor carrier or motor private carrier (as such terms are defined by section 13102 of title 49, United States Code, as amended by section 305); (2) Whose work, in whole or in part, is defined (A) as that of a driver, driver's helper, loader, or mechanic; and (B) As affecting the safety of operation of motor vehicles weighing 10,000 pounds or less in transportation on public highways in interstate or foreign commerce, except vehicles (i) designed or used to transport more than 8 passengers (including the driver) for compensation; (ii) designed or used to transport more than 15 passengers (including the driver) and not used to transport passengers for compensation; or (iii) used in transporting material found by the Secretary of Transportation to be hazardous under section 5103 of title 49, United States Code, and transported in a quantity requiring placarding under regulations prescribed by the Secretary under section 5103 of title 49, United States Code; and 11 245744 6 (3) who performs duties on motor vehicles weighing 10,000 pounds or less. SAFETEA–LU Technical Corrections Act of 2008, Pub. L. No. 110–244, 122 Stat. 1572 (2008) (codified in 29 U.S.C. § 207) (emphasis added). The Corrections Act "provides generally that. . . the [MCA] exemption does not apply to employees who would otherwise fall within its ambit if the ["covered employee"] requirements are met." Allen v. Coil Tubing Servs., L.L.C., 755 F.3d 279, 291 n.6 (5th Cir. 2014). In other words, "covered employees" (e.g., non-exempt employees) are entitled to overtime, and those who do not fall within these requirements, are not. Plaintiff is not a covered employee, and therefore, Rule 12(b)(6) mandates dismissal with prejudice. 1. PTS's Prison Transport Operations are Regulated by the Department of Transportation. The first factor the Court must consider in applying the MCA Exemption—whether PTS is subject to DOT's regulatory control under § 204 of the MCA—is largely unopposed and effectively established by Plaintiff's Complaint allegations. See ECF No. 21 ¶ 14.8 A fair reading of the Complaint establishes that PTS is a "motor carrier"—which is simply defined as a person providing motor vehicle transportation for compensation within the ambit of DOT's regulatory control. 29 C.F.R. § 782.2(a); 49 U.S.C. §§ 13102(14), 13501, 31502. Indeed, a "commercial motor vehicle" is defined as a self-propelled or towed vehicle used on the highways in interstate commerce to transport passengers or property, if the vehicle: (A) has a gross vehicle weight rating or gross vehicle weight of at least 10,0001 pounds, whichever is greater; 8 Plaintiff acknowledges that PTS (and GPS) contracts with local and state governments to transport inmates. This allegation is a tacit admission that PTS, because it transports inmates across State lines (e.g., contracts with State governments), is engaged in interstate commerce. See Merchants Fast Motor Lines, Inc. v. I.C.C., 528 F.2d 1042 (5th Cir. 1976). This would also hold true for the same allegations against GPS in the Amended Complaint. 12 245744 6 (B) is designed or used to transport more than 8 passengers (including the driver) for compensation; (C) is designed or used to transport more than 15 passengers, including the driver, and is not used to transport passengers for compensation; or (D) is used in transporting material found by the Secretary of Transportation to be hazardous under section 5103 of this title and transported in a quantity requiring placarding under regulations prescribed by the Secretary under section 5103. 49 U.S.C. § 31132 (emphasis added). Importantly, the word "or" in the foregoing definition indicates a disjunctive standard, and thus, any one category of "commercial motor vehicle" may satisfy the MCA Exemption. Thus, the MCA Exemption applies to employees who operate vehicles weighing 10,001 pounds or more, as well as vehicles used or designated to transport more than eight passengers for compensation that do not weigh 10,001 pounds. See Avery v. Chariots For Hire, 748 F. Supp. 2d 492 (D. Md. 2010). PTS is alternatively within DOT's regulatory purview pursuant to the Interstate Transportation of Dangerous Criminals Act of 2000 (Jeanna's Act), which gives the Secretary the necessary power under 49 U.S.C. § 31502 to trigger the MCA Exemption analysis. Jeanna's Act effectively brings privately run prisoner transportation companies within the gambit of the MCA by specifically directing authority to the Secretary to set maximum hours of service and qualifications for these companies. 28 C.F.R. § 97.13 (prison transport companies "must adhere to the maximum driving time provisions applicable to commercial motor vehicle operators, as set forth in Department of Transportation regulations at 49 C.F.R. § 395.3"); see also 34 U.S.C. § 60102(2) (defining "private prisoner transport company" as any entity that "engages in the business of the transporting [prisoners] for compensation"). As the Fifth Circuit has made abundantly clear, the MCA Exemption conclusively applies where the Secretary of Transportation possesses the power to regulate a class of employees (like 13 245744 6 Plaintiff) at issue. See Vanzzini v. Action Meat Distributors, Inc., 995 F. Supp. 2d 703, 714–15 (S.D. Tex. 2014) (the Secretary "need only possess the power to regulate the employees at issue; it need not actually exercise that power"). Here, because Plaintiff admits that PTS is engaged in the interstate transportation of inmates through the channels of interstate commerce, ECF No. 21 ¶¶ 24-25, and alternatively because Plaintiff alleged sufficient facts in order to trigger the application of Jeanna's Act, the Court need look no further than the four-corners of Plaintiff's Complaint and Amended Complaint to properly hold that PTS (and by extension GPS) satisfies the first criterion for the MCA Exemption's application. Indeed, PTS's fleet of prison transport vehicles meets the disjunctive requirements for the overtime exemption set forth above. Although Plaintiff alleged she regularly drove vehicles weighing less than 10,001 pounds, ECF No. 21, ¶ 17, she did not allege, and thus tacitly admits by implication, that the passenger vans she drove were "commercial motor vehicles." To further demonstrate the application of the MCA Exemption, however, the Court can and should take judicial notice of the fact that PTS holds a DOT License as well as a FMCSA registration—each of which authorize PTS to operate vehicles whose weight and/or passenger capacities are within DOT's authority to regulate "commercial motor vehicles." See 49 U.S.C. §§ 31134, 13902. Taken together, PTS's status as a motor carrier combined with its use of "commercial motor vehicles" to transport prisoners in interstate commerce, fully vests the power to set the requirements under 49 U.S.C. § 31502 for Plaintiff to the Secretary. As the Fifth Circuit's clear and unequivocal precedent in Vanzzini establishes, the key factor for this Court to consider is whether the Secretary possesses the power to regulate PTS. It does on the face of the pleadings, and because Plaintiff's employment clearly affected safety 14 245744 6 operations involving the instruments and channels of interstate commerce, her Complaint must be dismissed as to PTS. 2. Plaintiff's Employment as a Prison Transport Driver is the Quintessence of a Safety-Affecting Position within the MCA Exemption. The second factor for the Court's consideration in properly dismissing Plaintiff's Complaint requires an analysis of whether Plaintiff—a self-admitted prison transportation driver who operated through the channels and instruments of interstate commerce—was in safety- affecting position. The answer is unequivocally "yes." Individuals who are employed by covered motor carriers like PTS (or GPS) in safety- affecting positions—e.g., drivers, driver's helpers, loaders, and mechanics—all fall into the class of employees performing duties "directly affecting safety" operations sufficient to satisfy the requirements for exemption from the FLSA's overtime requirements. 29 C.F.R. § 782.2 ("safety of operation" as used in section 204 of the MCA means "the safety of operation of motor vehicles in the transportation of passengers or property in interstate or foreign commerce, and that alone."). The legislative findings of Jeanna's Act further sharpen the safety-sensitive nature of prison transportation driving positions: Congress finds the following: (1) Increasingly, States are turning to private prisoner transport companies as an alternative to their own personnel or the United States Marshals Service when transporting violent prisoners. (2) The transport process can last for days if not weeks, as violent prisoners are dropped off and picked up at a network of hubs across the country. (3) Escapes by violent prisoners during transport by private prisoner transport companies have occurred. ... 15 245744 6 (5) While most governmental entities may prefer to use, and will continue to use, fully trained and sworn law enforcement officers when transporting violent prisoners, fiscal or logistical concerns may make the use of highly specialized private prisoner transport companies an option. Nothing in sections 60101 to 60104 of this title should be construed to mean that governmental entities should contract with private prisoner transport companies to move violent prisoners; however when a government entity opts to use a private prisoner transport company to move violent prisoners, then the company should be subject to regulation in order to enhance public safety. 34 U.S.C. § 60101 (emphasis added). Jeanna's Act was meant to enhance public safety through regulation, in part, of driver qualifications and of the maximum hours during which a driver may be on duty. These are among the most important factors relating to safety of operations. Plaintiff's alleged duties as an Extradition Officer clearly and directly affected the safety of operation of motor vehicles in the transportation of passengers through the channels of interstate commerce. There is no universe of possibilities under which an Extradition Officer like Plaintiff—entrusted with both the authority and responsibility to transport violent inmates across the country—could escape the inevitable conclusion that this powerful position meets the safety of operations under the MCA Exemption. Because there is no plausible basis on which Plaintiff may proceed in her claims against PTS (or GPS), her Complaint must be dismissed with prejudice under the MCA Exemption. C. The Court Should Dismiss Plaintiff's Recordkeeping Violation Claim Because There Is No Private Cause of Action for Alleged Violations of the FLSA's Recordkeeping Requirements. The Court should also dismiss Count II of Plaintiff's Complaint—which alleges that PTS violated some undisclosed recordkeeping obligations under the FLSA, ECF No. 21, ¶¶ 50-51— because: (1) there is no private cause of action for a FLSA recordkeeping violation; and (2) even if a private cause of action was recognized, those allegations are wholly conclusory and unsupported by the requirement of factual predicate sufficient to survive Rule 12(b)(6) scrutiny. 16 245744 6 While the FLSA does require employers to maintain certain records, see 29 U.S.C. § 211(c), there is no private cause of action for a paperwork violation. See O'Quinn v. Chambers Cty., Tex., 636 F. Supp. 1388, 1392 (S.D. Tex. 1986), amended on other grounds, 650 F. Supp. 25 (S.D. Tex. 1986). Section 216 provides the exclusive remedy under the FLSA and clearly limits private actions to recovery of unpaid wages, unpaid overtime compensation, and violations of § 215(a)(3). See 29 U.S.C. § 216(b). Even if a private cause of action existed for recordkeeping violations—it does not— Count II of Plaintiff's Amended Complaint would nevertheless be subject to mandatory dismissal under Rule 12(b)(6) because Plaintiff alleged absolutely no facts to support her allegations. The full of extent of Plaintiff's recordkeeping-related allegations are as follows: "the FLSA requires employers to keep accurate records of hours worked by and wages paid to nonexempt employees" and PTS "failed to keep proper time and pay records as required by the FLSA." ECF No. 21, ¶¶ 50-51. Even under a liberal pleading standard, complaints must do more than simply allege legal conclusions or recite the elements of a cause of action. Because Plaintiff's § 211 allegations fail as a matter of law and as a matter of fact (or lack thereof), the Complaint must be dismissed as to this claim as well. D. The Complaint Fails to State a Claim for Relief for the Putative Group of Individuals who Plaintiff Seeks to Represent. Finally, the Court should also dismiss any extant collective-action claims remaining in the Amended Complaint, if any, because—without any real description of the other proposed party Plaintiffs—Plaintiff's allegations do not put PTS on notice of the putative class. As Senior District Judge Fish properly held in Flores v. Act Event Servs., Inc., PTS is entitled to "fair notice" of the putative class, to wit: 17 245744 6 The complaint also fails to state a claim for relief for the putative class. [. . .] In this case, the plaintiffs fail "to provide any such description or details about the other proposed parties who are alleged to be 'similarly situated.'" Creech, 2012 WL 4483384, at *3, 2012 U.S. Dist. LEXIS 144838, at *7. The complaint states, "Named Plaintiffs seek to represent a nationwide class of all persons who worked or work for Defendants and who were/are subject to Defendants' unlawful pay practices and policies at any point from three years prior to the filing of the instant matter to the present...." Complaint ¶ 13. This allegation provides the defendants with notice that any employee from the past three years, regardless of job description, is a potential collective action plaintiff. Based on the pleadings, the court concludes this broadly defined class fails to provide the defendants with fair notice. The complaint notes that the plaintiffs "provided services such as assisting in setting up and taking down of the rentals for the events, final construction clean, power washing, fencing, barricade, crowd control, field and logo painting, sweeping, mopping, picking up trash and cleaning restroom facilities." Complaint ¶ 28. The plaintiffs should have used these job duties to assist in defining a more specific putative class. It is not the defendants' responsibility to define the putative class by piecing together factual allegations strewn throughout a complaint; rather, fair notice requires the plaintiffs to clearly define the putative collective class. Moreover, in this case, if the defendants crafted a narrower class by referencing factual allegations in the complaint, this class would directly conflict with the broad putative class specifically defined in the text of the complaint. Thus, the court concludes such inexact and broad notice is insufficient to withstand a Rule 12(b)(6) motion. 55 F. Supp. 3d 928, 940 (N.D. Tex. 2014) (emphasis added) (footnotes omitted). Here, Plaintiff's Complaint suffers the same defects as the failed putative collective allegation claims in Flores. Plaintiff's Complaint proposed the following class definition: "All current and former extradition officers who regularly worked in excess of forty hours per week and were not paid proper overtime compensation during the last three years." ECF No. 21, ¶ 57. This general statement, beyond identifying a job title, fails to provide any detail about other proposed parties who are allegedly similarly situated—it fails to identify a geographic scope, a set of applicable duties, a method of compensation, an applicable policy or practice relating to 18 245744 6 compensation, or even a statement with respect to whether the individuals are exempt or not exempt. Ultimately, the proposed class definition fails to provide PTS with fair notice. Consequently, such allegations should independently be dismissed for failing to meet Rule 8's pleading requirements. E. Plaintiff's Complaint Should be Dismissed for Improper Venue Pursuant to Fed. R. Civ. P. 12(b)(3) & 28 U.S.C. § 1391, or Transferred to the Austin Division. GPS's location at the time of suit and relevant period was Williamson County, Texas, ECF No. 1, ¶ 10, which places proper venue in the Austin Division—not San Antonio—making the current venue improper. In addition to the improper venue, judicial economy warrants a transfer to the Austin Division as there is a related case pending in that Division arising from a common nucleus of operative facts and law as that of Plaintiff's case. As such, Plaintiff's initiation of this action in the improper venue of the San Antonio Division warrants dismissal pursuant Fed R. Civ. P. 12(b)(3), and refiling in the Austin Division, or, alternatively, transfer of this case to the Austin Division pursuant to 28 U.S.C. § 1404(a). The initial inquiry into transferring venue is determining whether the suit could have originally been filed in the destination venue. In re Radmax, Limited, 720 F.3d 285, 312 (5th Cir. 2013). If it could have, the focus shifts to whether the party requesting the transfer has demonstrated the "convenience of parties and witnesses" requires transfer of the action, considering various private and public interest factors.9 See Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1974). 9 The private interest factors are: (1) the relative ease of access to sources of proof; (2) the availability of compulsory process to secure the attendance of witnesses; (3) the cost of attendance for willing witnesses; and (4) all other practical problems that make trial of a case easy, expeditious and inexpensive. 19 245744 6 To determine venue, 28 U.S.C. § 1391(b) provides: A civil action may be brought in— (1) A judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located; (2) A judicial district in which a substantial part of the events or omissions giving rise to the claim occurred. . .; or (3) If there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court's personal jurisdiction with respect to such action. Yet, "[f]or the convenience of the parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought." 28 U.S.C. § 1404(a). Section 1404(a) "is intended to place discretion in the district court to adjudicate motions for transfer according to an 'individualized, case-by-case consideration of convenience and fairness.'" Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988) (quoting Van Dusen v. Barrack, 376 U.S. 612, 622 (1964)). "There can be no question but that the district courts have broad discretion in deciding whether to order a transfer" under § 1404(a). In re Volkswagen of Am, Inc. ("Volkswagen II"), 545 F.3d 304, 313-15 (5th Cir. 2008) (internal quotation marks omitted), cert. denied, 555 U.S. 1172 (2009). The public interest factors are: (1) the administrative difficulties flowing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum with the law that will govern the case; and (4) the avoidance of unnecessary problems of conflict of laws [or in] the application of foreign law. In re Volkswagen AG ("Volkswagen I"), 371 F.3d 201, 203 (5th Cir. 2004) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 n. 6 (1981)). 20 245744 6 Although these factors are "appropriate for most transfer cases, they are not necessarily exhaustive or exclusive." Volkswagen II, 545 F.3d at 315. In fact, the Fifth Circuit has said that none of the factors are of "dispositive weight." Id. Moreover, in reviewing the facts, a court should not be too formalistic in deciding whether to transfer venue. See Stewart, 487 U.S. at 29. Further, the movant need not show the Gilbert factors substantially outweigh the plaintiff's choice of venue—it is enough to show the new venue is clearly more convenient than the original one. See Volkswagen II, 545 F.3d at 314. This does not mean that the plaintiff's choice of forum is to be ignored. Volkswagen II, 545 F.3d at 314 n. 10. However, the weight to give a plaintiff's choice of venue remains case-specific; a plaintiff's chosen venue is not entitled to weight regardless location. See Apparel Prod. Servs. Inc. v. Transportes De Carga Fema, S.A., 546 F. Supp. 2d 451, 453 (S.D. Tex. 2008). This deference is lessened even further when the transfer sought is between divisions of the same district. In re Radmax, 720 F.3d at 289. As noted, GPS is listed as having its office in Thrall, Texas, which is in Williamson County. See ECF No. 21, ¶ 8. GPS's residence made venue proper in the Austin Division, which answers the first inquiry of whether the case "might have been brought" in the destination venue. As venue was originally proper in Austin, then "[t]he determination of 'convenience' turns on a number of public and private interest factors, none of which can be said to be of dispositive weight." Action Indus., Inc. v. U.S. Fidelity & Guar. Co., 358 F.3d 337, 340 (5th Cir. 2004). Although not specifically enumerated as one of the private or public interest factors, judicial economy is an important consideration in a motion to transfer venue, and courts generally consider it under the "other practical problems" private interest factor. See, e.g., Rembrandt Vision Technologies, L.P. v. Johnson Johnson Vision Car, Inc., 2011 WL 2937365, at * 2 (E. D. Tex. 2011) ("Issues of 'judicial economy' are generally considered in connection with the 'other 21 245744 6 practical problems' private interest factor.") (quoting Software Rights Archive, LLC v. Google, Inc., 2011 WL 2950351, at * 3-4 (E.D. Tex. 2010)). In this case, judicial economy warrants transfer to the Austin Division,10 because while "[a]ll of the public and private interest factors are part of a transfer of venue analysis, [] judicial economy can be a paramount consideration." Net Navigation Sys., LLC v. Extreme Networks, Inc., 4:13-cv-254, at *10 (E.D. Tex. Oct. 27, 2014) (citing In re Vistaprint, 628 F.3d 1342, 1347 (Fed. Cir. 2010)). As such, transferring this case to Judge Yeakel's court, where currently sits pending Dana White, et al v. U.S. Corrections, LLC, et al; 1:19-cv-00390 (White), would serve judicial economy and the interests of justice. Judge Yeakel and Magistrate Judge Hightower have already expended time and court resources familiarizing themselves with the private prisoner transportation industry, Jeanna's Act, and the MCA Exemption as applied to those in the private prisoner transportation industry. The main cause of action in the two cases is identical, calling for unpaid overtime for private prisoner transportation drivers, i.e. "extradition officers." Id. As such, the main cause of action requires an analysis of the MCA Exemption pursuant to 29 U.S.C. § 213(b), and analysis of Jeanna's Act on the FLSA and MCA Exemption. Id.11 Importantly, White, and any appeal from a dispositive ruling, would affect the outcome of Plaintiff's case in this forum. Indeed, if Plaintiff's case were to remain in the San Antonio 10 Any assertions as to the private factors would require the Court to make assumptions as to the location of sources of proof, witnesses, opt-in Party Plaintiffs, since the sources for these issues cannot be properly attached to PTS's Motion to Dismiss without converting it to a motion for summary judgment under Rule 56 of the Federal Rules of Civil Procedure. PTS concedes that an analysis of the other private and public factors at this point would be neutral. 11 Federal Magistrate Judge Hightower's Report and Recommendation to Judge Lee Yeakel was to dismiss plaintiff's complaint. See ECF No. 34. Plaintiff filed an objection. ECF No. 35. Time remains for US Corrections, LLC, or any other defendant in that action to respond to that objection filed by plaintiff, and then Judge Lee Yeakel will make his ruling on the dipositive recommendation from the Magistrate, and if adopted, it is likely plaintiff will appeal. 22 245744 6 Division, there would be a waste of judicial resources and a risk of inconsistent outcomes. Further, Plaintiff is represented by the same counsel as the plaintiff in White. Id. Given that venue was originally proper in the Austin Division, and in deference to judicial economy by having both of these cases before the same Court already familiar with the factual allegations and law, Plaintiff's Complaint should be dismissed and refiled, or, alternatively, transferred to the Austin Division pursuant to 28 U.S.C. § 1404(a). VI. CONCLUSION PTS transports prison inmates from various and sundry points across the United States using the instruments and channels of interstate commerce, which it operated prior to GPS's closure and dissolution. PTS has always been, and continues to be a separate entity from GPS, with no common ownership. PTS did not buy assets or equipment of GPS. PTS did not assume the mantle that was "GPS," or have notice of Plaintiff's alleged wage and hour issues. Accordingly, Plaintiff fails to establish a claim for successor liability against PTS, and as such her Complaint against PTS must be dismissed. Moreover, Plaintiff would not be entitled to overtime compensation as a matter of law under the MCA Exemption, and her Complaint— including all ancillary Counts—must be dismissed. Therefore, Defendant PTS of America, LLC respectfully requests this Court to grant its Motion to Dismiss Plaintiff's Complaint pursuant to Rules 12(b)(6) and 12(b)(3) of the Federal Rules of Civil Procedure, as Plaintiff is not entitled to the relief requested, or in the alternative, transfer the case to the Western District of Texas, Austin Division. Respectfully submitted, Mary E. Buckley, Texas Bar # 24101571 Gregory J. Northen, Ark. Bar # 20111891* CROSS, GUNTER, WITHERSPOON & GALCHUS, P.C. 23 245744 6 500 President Clinton Avenue, Suite 200 Little Rock, Arkansas 72201 Phone: 501-371-9999 / Fax: 501-371-0035 E-mail: mbuckley@cgwg.com/gnorthen@cgwg.com *Pro Hac Vice pending 24 245744