Frisby v. Sky Chefs Inc

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

LARRY FRISBY, )

)

Plaintiff, )

)

vs. ) Case No. 19 C 7989

)

SKY CHEFS, INC. and LSG GROUP, LLC, )

)

Defendants. )

MEMORANDUM OPINION AND ORDER

MATTHEW F. KENNELLY, District Judge:

Larry Frisby, on behalf of himself and others similarly situated, has sued his

former employer, an airline catering business, along with the company that owns it.

Frisby has asserted claims of negligence and violation of the Illinois Biometrics Privacy

Information Act (BIPA), both based on his former employer's acquisition and use of

employees' fingerprints for timekeeping. Additionally, Frisby has sued under various

labor laws for unpaid overtime wages. The defendants have moved to dismiss all of

these claims.

Background

LSG Group LLC owns several companies in the travel industry. One of its

companies, Sky Chefs, Inc., provides catering services to airlines.

Sky Chefs collects employees' fingerprints at time of hire, and its hourly

employees must clock in and out of their shifts via fingerprint scans. A third-party

vendor administers this fingerprint-based time tracking, and Sky Chefs therefore shares

its employees' fingerprint data with this vendor.

Sky Chefs requires its employees to clock in five to six minutes before the start

time of their shifts, and it disciplines those who fail to do so. Frisby alleges that despite

this policy, Sky Chefs does not compensate its employees for this mandatory pre-shift

time or for any post-shift work. Instead, Sky Chefs typically rounds the time for which it

compensates employees to their scheduled shift times.

From November 2015 through March 2019, Frisby worked as a driver for Sky

Chefs at O'Hare International Airport. He was paid by Sky Chefs on an hourly basis.

Frisby regularly clocked in five to six minutes before start of his shift time, consistent

with Sky Chefs' policy described earlier, and he typically worked fifty to fifty-five hours

per week. During his employment, Frisby alleges, he worked more than 100 hours of

overtime for which Sky Chefs never compensated him.

Frisby has filed this suit on behalf of himself and other similarly situated Sky

Chefs employees, asserting claims of negligence and violation of BIPA and several

labor laws by Sky Chefs and the LSG Group. The defendants have moved to dismiss

all of the claims in Frisby's complaint, and the Court held a hearing on the motion.

Discussion

A. Claims based on acquisition and handling of fingerprint data

BIPA regulates private entities' acquisition and management of biometric

information, which includes fingerprints. 740 ILCS 14/10, 15. Before acquiring an

individual's fingerprints, a "private entity" must inform the individual or his "legally

authorized representative," in writing, about the purpose of acquisition, how the data will

be stored, and how long the entity plans to keep it. 740 ILCS 14/15(b). The private

entity may acquire a person's fingerprints only if it has received written consent from the

person or his legally authorized representative. Id. BIPA also requires consent for

disclosure or "other[] disseminat[ion]" of an individual's fingerprints. Id. 15(d). Finally, a

public entity that obtains biometric information must publicly issue protocols for retention

and destruction of biometric information once its purpose has been satisfied. Id. 15(a).

In count 1, Frisby has alleged that Sky Chefs violated BIPA because it failed to

provide the required disclosures prior to obtaining his fingerprints; it never received

written consent to acquire the prints or share them with the third-party timekeeping

vendor; and it never published protocols for retention and destruction of employee

fingerprints. Count 2, a common law negligence claim, is largely based on the same

conduct: Frisby alleges that the defendants breached their duty of reasonable care by

obtaining and using employee fingerprints without complying with the procedural

safeguards set forth in BIPA.

The defendants have moved to dismiss counts 1 and 2 under Federal Rule of

Civil Procedure 12(b)(1) for lack of subject matter jurisdiction, arguing that they are

preempted by the federal Railway Labor Act (RLA). "A motion to dismiss under Rule

12(b)(1) tests the jurisdictional sufficiency of the complaint, accepting as true all well-

pleaded factual allegations and drawing reasonable inferences in favor of the plaintiffs."

Bultasa Buddhist Temple of Chi. v. Nielsen, 878 F.3d 570, 573 (7th Cir. 2017). The

plaintiff's well-pleaded factual allegations must "plausibly suggest a claim of subject

matter jurisdiction." Silha v. ACT, Inc., 807 F.3d 169, 174 (7th Cir. 2015). When a party

contends that the pleadings are formally sufficient but that "there is in fact no subject

matter jurisdiction," a court may review "any evidence submitted to determine if subject

matter jurisdiction exists." Id. at 173.

The RLA, which applies to "common carrier[s] by air," 45 U.S.C. § 181, requires

that any dispute regarding the interpretation or application of a collective bargaining

agreement—called a "minor dispute"—go to an adjustment board, not a court. Miller v.

Sw. Airlines Co., 926 F.3d 898, 900 (7th Cir. 2019). The Seventh Circuit ruled in Miller

that the RLA preempted airline employees' BIPA claims based on the airline's failure to

obtain consent and provide required disclosures before using employee fingerprints for

timekeeping via a third-party vendor. Id. at 904. The court explained that, "[a]s a matter

of federal law, unions in the air transportation business are the workers' exclusive

bargaining agents," and "how workers clock in and out" is "a mandatory subject of

bargaining." Id. at 903 (citing 45 U.S.C. § 152). The employees' union was their

"legally authorized representative" for the purpose of determining whether they had

received the disclosures and given the consent required under BIPA for the use of their

fingerprints for timekeeping. Id. at 903. The court explained: "It is not possible even in

principle to litigate a dispute about how an air carrier acquires and uses fingerprint

information for its whole workforce without asking whether the union has consented on

the employees' collective behalf." Id. at 904. Thus, the employees' BIPA claim was

preempted by the RLA, which directs such disputes to an adjustment board. Id.

The defendants point out that while working for Sky Chefs, Frisby was a member

of the Unite Here International Union, and his employment was subject to a collective

bargaining agreement (CBA) between Sky Chefs and the union. Frisby's BIPA and

negligence claims are based on allegations almost identical to those of the union airline

employees in Miller, and thus, the defendants argue, Frisby's claims are likewise

preempted by the RLA. Frisby does not dispute that his employment with Sky Chefs

was governed by the CBA. He argues, however, that his claims are not preempted

because Sky Chefs is a catering business and does not meet the definition of "common

carrier by air" under the RLA. This argument lacks merit.

The RLA does not define "common carrier by air," and the Seventh Circuit has

not yet interpreted this language. Federal courts that have considered the issue apply a

test similar to that set forth by the National Mediation Board (NMB), the agency that

administers the RLA. See, e.g., Allied Aviation Serv. Co. of N.J. v. NLRB, 854 F.3d 55,

61 (D.C. Cir. 2017); Thibodeaux v. Exec. Jet Int'l, Inc., 328 F.3d 742, 750 (5th Cir. 2003)

(Fifth Circuit's test "does not materially differ" from the NMB's test). The NMB's

"function and control test" has two elements: "(1) whether the nature of the work is that

traditionally performed by employees of rail or air carriers, and (2) whether the employer

is directly or indirectly owned or controlled by, or under common control with a carrier or

carriers." Allied Aviation Serv., 854 F.3d at 61 (quoting Signature Flight Support of

Nev., 30 N.M.B. 392, 399 (2003)). If the both the function and control elements are met,

then the entity qualifies as a carrier under the RLA. See Signature Flight Support, 30

N.M.B. at 399. The parties do not dispute that the function-and-control test should

apply.

Frisby argues that the control element of the test is not satisfied because the

defendants' operations are not under the control or ownership of any airline. But this

contention is unsupported by the evidence submitted by the defendants, which shows

that they are owned in full by Deutsche Lufthansa AG, an air carrier. See Silha, 807

F.3d at 173 (permissible for court to consider "any evidence submitted" on factual

challenge to subject matter jurisdiction). Thus, the control element is met.

As to the function element, Frisby argues that the defendants are food suppliers,

and food supply is not a function traditionally performed by air carriers. The defendants

explained at oral argument, however, that Sky Chefs is not simply a food supplier;

rather, it performs "catering," which includes preparation of food that airlines serve to

their passengers during flight. Preparation of food for in-flight service to airline

passengers, according to the defendants, is a traditional function of air carriers.

The Court agrees. As the defendants point out, the NMB has consistently

concluded that catering food for in-flight service is a function traditionally performed by

air carriers.1 See, e.g., Dobbs Int'l Servs., 34 N.M.B. 97, 108 (2007); LSG Sky Chefs,

Inc., 27 N.M.B. 55, 62 (1999); Sky Chefs, Inc., 15 N.M.B. 397, 403 (1988). In 1988, the

NMB issued an opinion letter, after a hearing at which both Sky Chefs and its

employees' union presented evidence, in which it concluded that Sky Chefs' business of

"provision of inflight food and beverage catering services" to airlines was a traditional

function of air carriers. Sky Chefs, Inc., 15 N.M.B. at 397, 403. The NMB explained

that Sky Chefs was originally established as a subsidiary of American Airlines, and thus

"[f]or over forty years [its] operations were conducted as part of American Airlines." Id.

at 402-03. Additionally, the NMB noted that, at the time of its opinion letter, several

other airlines employed personnel to perform the food service functions offered by Sky

Chefs. Id. at 403.

Frisby has not presented any evidence tending to show that Sky Chefs' business

1 The defendants note, correctly, that the NMB's opinion letters may be considered but

are not binding on the Court. See Mendoza v. Sessions, 891 F.3d 672, 676 (7th Cir.

2018).

has changed since the 1988 NMB opinion letter such that it no longer satisfies the

function element. Nor does Frisby point to any authority or other evidentiary support for

his position that Sky Chefs' business of catering food for in-flight service is not a

function traditionally performed by air carriers. He analogizes to Dobbs Houses, Inc. v.

NLRB, 443 F.2d 1066 (6th Cir. 1971), in which the Sixth Circuit ruled that an airline

catering company was not a carrier subject to the RLA. Id. at 1072. But the court in

Dobbs Houses did not analyze whether catering was a traditional function of air carriers;

instead, it concluded that the catering company was not a carrier under the RLA

because, at the time, it was not under the direct or indirect ownership or control of an air

carrier. Id. at 1072.

In sum, Sky Chefs satisfies both elements of the NMB's function-and-control test.

This conclusion is consistent with the position of Frisby's union. The CBA between the

union and Sky Chefs states that the agreement was "made . . . in accordance with the

provisions of the Railway Labor Act" and that the parties "agreed to use voluntary efforts

to achieve industrial stability under the structure provided by the Railway Labor Act."

Defs.' Mem. of Law in Supp. of Mot. to Dismiss, Ex. 1, at 3.

Frisby argues that even if the defendants are subject to the RLA, the statute does

not preempt his BIPA and negligence claims because the claims involve rights

independent of the CBA. In support of this argument, Frisby relies on Westbrook v. Sky

Chefs, 35 F.3d 316 (7th Cir. 1994), in which the Seventh Circuit held that an individual

employee's state retaliatory discharge claim was not preempted by the RLA because it

involved "rights and obligations that exist independent of the collective bargaining

agreement." See id. at 318. Frisby's reliance on Westbrook is unavailing. The Seventh

Circuit later explained that state law claims that fall outside of the scope of the RLA are

those that are "person-specific and do[] not concern the terms and conditions of

employment." Miller, 926 F.3d at 904. Thus, the claim in Westbrook was not

preempted because it was specific to the individual plaintiff, who contended she had

been wrongfully discharged in retaliation for submitting a worker's compensation claim,

and it did not involve terms and conditions of employment. See Westbrook, 35 F.3d at

316. By contrast, Frisby's BIPA and negligence claims involve data privacy rights

common to all of the defendants' employees and deal with a mandatory subject of

collective bargaining: the mechanism through which workers clock in and out. Id. at

903-04. Under the RLA, these claims are appropriate determined by an adjustment

board.

For these reasons, the Court dismisses Frisby's BIPA and negligence claims,

counts 1 and 2 of Frisby's complaint, for lack of subject matter jurisdiction.

B. Claims for overtime pay

Frisby has alleged that the defendants' failure to pay overtime wages violated the

federal Fair Labor Standards Act (FLSA) (count 3), the Illinois Minimum Wage Law

(IMWL) (count 4), and the Chicago Minimum Wage Ordinance (CMWO) (count 5). The

defendants have moved to dismiss these for failure to state a claim, arguing that

Frisby's allegations are too vague and conclusory to state a viable claim under any of

these provisions.

1. Applicable standard

To survive a motion to dismiss under Rule 12(b)(6), a plaintiff must state a claim

for relief that is "plausible on its face." O'Brien v. Village of Lincolnshire, 955 F.3d 616,

621-22 (7th Cir. 2020) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). "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."

Iqbal, 556 U.S. at 678. In ruling on a motion to dismiss under Rule 12(b)(6), a court

must accept as true all well-pleaded facts in the complaint and draw all reasonable

inferences in favor of the non-moving party. O'Brien, 955 F.3d at 621.

2. Sufficiency of allegations

FLSA and IMWL have parallel provisions that require employers to pay their

workers one and a half times their regular rate for every hour worked in excess of forty

in a workweek. See 29 U.S.C. § 207(a)(1); 820 ILCS 105/4a. Frisby has alleged that

the defendants violated these statutes by failing to pay employees for overtime. The

CMWO requires employers to pay workers the city's minimum wage for every hour

worked in the city. Chi. Mun. Code Chap. 1-24-20. Frisby has alleged that the

defendants violated the ordinance because they did not compensate him for the hours

worked in excess of forty in many workweeks. Because Frisby's FLSA, IMWL, and

CMWO are similar claims based on the same factual allegations, the Court assesses

the sufficiency of the allegations underlying these claims together. See, e.g., LQD Bus.

Fin., LLC v. Fundkite, LLC, No. 19 C 4416, 2020 WL 635906, at *6 (N.D. Ill. Feb. 11,

2020) (Kennelly, J.) (assessing plausibility of FLSA and IMWL claims together); Vann v.

Dolly, Inc., No. 18 CV 4455, 2019 WL 1785589, at *2 (N.D. Ill. Apr. 24, 2019) (assessing

plausibility of FLSA, IMWL, and CMWO claims together).

A claim for overtime wages is plausible if the plaintiff's factual allegations support

a reasonable inference that there was at least one workweek in which he worked more

than forty hours and did not receive overtime pay. See Hirst v. Skywest, Inc., 910 F.3d

961, 966 (7th Cir. 2018) (endorsing “one workweek” pleading standard from other

circuits). Frisby has alleged that during his employment with Sky Chefs, between

November 2015 and March 2019, he typically worked fifty to fifty-five hours a week. By

the time he quit his job at Sky Chefs, he alleges, he had accumulated over one hundred

overtime hours for which he was never compensated. These allegations are sufficient

to support a reasonable inference that there was at least one week between November

2015 and March 2019 in which Frisby worked more than forty hours and did not receive

overtime pay.

The defendants also argue that the Court should dismiss the overtime claims

because they are based on rounding employees' hours worked to their shift hours, a

permissible practice under FLSA regulations. The defendants are correct that 29 C.F.R.

§ 785.48(b) notes that employers may round employees' shift start and stop times. This

regulation also states, however, that rounding is acceptable only if "used in such a

manner that it will not result, over a period of time, in failure to compensate . . .

employees properly for all the time they have actually worked." Id. Frisby has alleged

that the defendants always rounded shift times down to employees' scheduled shift

times and therefore did not compensate them for pre- and post-shift work. This

supports a reasonable inference that the defendants' rounding practices—assuming that

is what they are—were impermissible because they resulted in the failure to

compensate employees for time actually worked.

The defendants also argue that their employees are not entitled to overtime pay

for clocking in five to six minutes before the start of their shifts, because they were not

actually working during that time. In support of this argument, the defendants cite two

cases in which the Seventh Circuit noted that "employees who clock in early do not

have to be paid so long as they are not working." Weil v. Metal Techs., Inc., 925 F.3d

352, 357 (7th Cir. 2019); Kellar v. Summit Sealing Inc., 664 F.3d 169, 177 (7th Cir.

2011) (citing 29 C.F.R. § 785.48).

The defendants' reliance on this language is unavailing, at least in the current

procedural context. The Seventh Circuit has explained that "work" includes activity

"pursued necessarily and primarily for the benefit of the employer," including time an

employee spends doing nothing, or doing nothing while waiting for something to

happen. Kellar, 664 F.3d at 176 & n.2 (citing IBP, Inc. v. Alvarez, 546 U.S. 21, 25

(2005)). Frisby has alleged that the defendants required employees to clock in five to

six minutes before the start of their shifts or they would be subject to discipline. This

supports a reasonable inference that what employees were doing during this pre-shift

time constituted work because the employees were engaged in activity primarily for the

benefit of the defendants. Finding otherwise would require the Court to draw inferences

in the defendants' favor, which is inappropriate on a motion to dismiss for failure to state

a claim.

Finally, the defendants contend that the CMWO claim should be dismissed

because Frisby has not alleged that he was working for them while physically present in

Chicago, as required for the applicability of the ordinance. Frisby has alleged, however,

that he performed work for the defendants at O'Hare International Airport, which is

located in Chicago.

For these reasons, the Court denies the defendants' motion to dismiss counts 3,

4, and 5.

Conclusion

For the foregoing reasons, the Court dismisses counts 1 and 2 of the plaintiff's

complaint for lack of subject matter jurisdiction but otherwise denies the defendants’

motion to dismiss [dkt. no. 12]. Defendants are directed to answer counts 3, 4, and 5 by

no later than August 10, 2020, and both sides are directed to make Rule 26(a)(1)

disclosures by August 17, 2020. They are to discuss and attempt to agree upon a

discovery and pretrial schedule and are to file a joint status report in this regard by

August 24, 2020. The case is set for a status hearing on August 27, 2020 at 9:05 a.m.

by telephone, using call-in number 888-684-8852, access code 746-1053. Counsel

should wait for the case to be called before announcing themselves.

United States District Judge

Date: August 3, 2020

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