Li v. The Chinese Nail Salon Association of East America Inc.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

--------------------------------------X

WEIDONG LI,

Plaintiff, MEMORANDUM AND ORDER

20-cv-6390 (KAM)(LB)

-against-

THE CHINESE NAIL SALON ASSOCIATION OF

EAST AMERICA INC., JIAN YU a/k/a PETER

YU, YINDI WEN a/k/a YIN DI WEN a/k/a/

WENDY WEN, JOHN DOE, and NICOLE DOE,

Defendants.

--------------------------------------X

MATSUMOTO, United States District Judge:

Plaintiff Weidong Li (“Li” or “Plaintiff”) commenced this

action on December 31, 2020 against Defendants Jian Yu a/k/a

Peter Yu (“Defendant Yu”), Yindi Wen a/k/a Yin Di Wen a/k/a

Wendy Wen (“Defendant Wen”), John Doe, Nicole Doe (collectively,

the “Individual Defendants”), and the Chinese Nail Salon

Association of East America (the “Association”), which Plaintiff

describes as a domestic, not-for-profit trade association

comprised of Chinese nail salon owners and workers throughout

the eastern region of the United States. See (ECF No. 1,

original Complaint, “Compl.” ¶¶ 9-10.) Plaintiff alleges that

Defendants directed members of the Association, specifically

nail salon owners, to refrain from employing Li because he had

sued a number of nail salons in connection with alleged

violations of the Fair Labor Standards Act of 1938, 29 U.S.C. §

201 (the “FLSA”). See generally (Compl.) Plaintiff further

alleges that Defendants’ actions constitute retaliatory conduct

in violation of the anti-retaliation provisions of the FLSA, 29

U.S.C. § 215(a)(3), and corresponding New York law, N.Y.L.L. §

215(1)(a)(iii). (Id.)

Before the Court is Defendant Yu’s and the Defendant

Association’s (the “Moving Defendants”) joint motion to dismiss

Plaintiff’s December 9, 2021 Second Amended Complaint (ECF No.

24, “SAC”), pursuant to Federal Rule of Civil Procedure

12(b)(6), on the grounds that Plaintiff failed to state a claim

upon which relief can be granted. See generally (ECF Nos. 49-3,

Motion to Dismiss, “Def. Mot.”; 51, “Def. Reply”). Plaintiff

opposes the Moving Defendants’ joint motion to dismiss his

claims. (ECF No. 50, “Ptf. Opp.”) For the reasons set forth

below, the Moving Defendants’ joint motion to dismiss is GRANTED

and the Second Amended Complaint is DISMISSED in its entirety

with prejudice, as against all Defendants.

BACKGROUND

I. Factual Background

Between 2017 and 2020, Plaintiff filed four separate

lawsuits in New York federal courts alleging that four different

New York nail salons had engaged in unfair and abusive labor

practices in violation of the FLSA and New York labor law. (SAC

¶¶ 20-25.)1 According to Plaintiff, each of the first three

civil actions resulted in a settlement and was not resolved on

the merits. (SAC ¶ 21.) However, Li v. Spa Nail 9, Inc., No

19-cv-873 (TJM)(CFH), which was filed in the U.S. District Court

for the Northern District of New York on June 30, 2019, is

ongoing. (SAC ¶¶ 21, 25.)

Plaintiff alleges that on or about July 11, 2020, Li

learned from his friend that a WeChat user with the user ID

“Elena5250” and the username “Lanxin” shared a picture of Li

accompanied by a caption warning that Li “professionally sues

nail salon owners” (the “July 11, 2020 Post”), with a WeChat

group entitled “Nail Salon Boss 4 Group, New York Intel Station”

(the “Nail Salon Owners’ WeChat Group”). (SAC ¶¶ 27, 29-30.)

Plaintiff further alleges that on July 22, 2020, he learned from

his friend that the July 11, 2020 Post had been reposted by the

Defendant Association’s official WeChat account (the “July 22,

2020 Repost”) in a separate WeChat group entitled “Hiring and

Seeking Work, Eastern America” (the “Job Posting WeChat Group”).

(SAC ¶ 35.) Plaintiff has named the unidentified WeChat user

who is purportedly responsible for the July 22, 2020 Repost as a

1 See Li v. Tina Nail Spa Salon Inc., No. 17-cv-4277 (KHP) (S.D.N.Y. June 7,

2017); Li v. Hui Yang Nails & Beauty Spa Inc., No. 18-cv-6430 (GVWG)

(S.D.N.Y. July 17, 2018); Li v. Wiwi 1 Nail & Spa Inc, No. 19-cv-6120 (JGK)

(S.D.N.Y. July 1, 2019), transferred to No. 19-cv-1488 (FJS) (N.D.N.Y. Mar.

17, 2020); and Li v. Spa Nail 9, Inc., No. 19-cv-873 (TJM) (N.D.N.Y. June 30,

2019).

Defendant using the placeholder “John Doe” and alleges that John

Doe authored the July 22, 2020 Repost “using the Association’s

WeChat account[.]” (SAC ¶ 14.) However, Plaintiff does not

allege that either John Doe or any other defendant is

responsible for the original July 11, 2020 Post. See (Ptf. Opp.

at 5) (“defendants did not directly post the retaliatory

information”).

The Nail Salon Owners’ WeChat Group with which the July 11,

2020 Post was shared is comprised of nail salon owners, at least

some of whom are alleged to be members of the Defendant

Association. (SAC ¶ 27.) Although Plaintiff does not allege

that the Nail Salon Owners’ WeChat Group is owned, operated, or

otherwise controlled by the Defendants, Plaintiff alleges that

the Nail Salon Owners’ WeChat Group is used by members of the

Defendant Association to share information, including by posting

to the Defendant Association’s WeChat Moments2 page. (SAC ¶ 27.)

Neither does Plaintiff allege that the Job Posting WeChat Group,

to which the July 22, 2020 Repost was shared, is owned,

operated, or otherwise controlled by the Defendants.

Plaintiff also does not allege that the Defendant Association

owns, operates, or otherwise controls the WeChat Moments page,

although he alleges the WeChat Moments page “allows the

2 WeChat Moments is a feature of WeChat that serves a social-networking

function by aggregating content for a closed group of connected WeChat users

and permitting members of a WeChat group to share content. (SAC ¶ 28.)

Association to signal-boost content to its followers and

members.” (SAC ¶ 28.) According to the Second Amended

Complaint, members of the Job Posting WeChat Group typically use

the WeChat Moments page to advise of job openings and to both

solicit and discuss nail technician candidates. (SAC ¶¶ 35-39.)

Plaintiff does not explain how Defendant John Doe is

associated with the Defendant Association, though Plaintiff

speculates as to multiple possibilities in the Second Amended

Complaint. Plaintiff alleges that Defendant John Doe used the

Defendant Association’s WeChat account to share the July 22,

2020 Repost. (SAC ¶ 14). Plaintiff also alleges that John Doe

is Defendant Yu or, in the alternative, that John Doe is

Defendant Wen. (SAC ¶¶ 12-14.) In yet another alternative

assertion, Plaintiff alleges that if John Doe is neither

Defendant Yu nor Defendant Wen, then John Doe was authorized to

share the July 22, 2020 Repost using the Defendant Association’s

WeChat account by either or both Defendant Yu and Defendant Wen.

(SAC ¶¶ 12-14.)

Plaintiff alleges that Nicole Doe “assisted in the

blackballing of Plaintiff” by telling nail salon owners “not to

engage with Plaintiff,” but does not elaborate on how or when

Nicole Doe purportedly engaged in the alleged “blackballing” or

how Nicole Doe is related to or affiliated with the Defendant

Association’s nail salon owner members. (SAC ¶ 15.)

Plaintiff alleges that a number of WeChat Group members

responded to the July 11, 2020 Post and the July 22, 2020

Repost, including by reposting the July 11, 2020 Post. (SAC ¶¶

37-38.) Subsequent engagement with the content of the July

11,2020 Post also includes one user who responded that “[t]en

out of ten people in the bosses’ group gave [Li] negative

reviews” (SAC ¶ 39), another user who stated that Li “is very

unreasonable [and] wanted to sue our boss too” (SAC ¶ 40), and

another user who stated that Li “is a pretty bad person.” (SAC

¶ 41.) Other users appeared to push back on the negative

commentary cautioning that members of the WeChat groups should

“not spread rumors” and should not “believe in rumors” unless

they “have evidence” of the alleged conduct. (SAC ¶ 43.)

Plaintiff alleges that at the time of the July 11, 2020

Post, the July 22, 2020 Repost, and the subsequent discussion

regarding his conduct and work history, he was working at a nail

salon affiliated with the Defendant Association and located in

Syracuse, New York (the “Syracuse Salon”). (SAC ¶ 26.) In this

role, Plaintiff alleges that he earned approximately $1,200.00

per week, including salary and tips. (SAC ¶ 26.)

Plaintiff alleges that following the discussions stemming

from the July 11, 2020 Post, on or about July 24, 2020, he was

terminated from his role at the Syracuse Salon “because of the

Association’s blacklisting him.” (SAC ¶ 47.) Following the

discontinuance of his employment in Syracuse, Plaintiff moved to

Maryland where he worked at a nail salon that is not a member of

the Defendant Association (the “Maryland Salon”), and earned

approximately $706.54 per week, including salary and tips. (SAC

¶¶ 48-49.) Plaintiff alleges that he was “paid less [in

Maryland] . . . than he was in Syracuse, because of the

Association’s blacklisting him” and that he was eventually

terminated from his role at the Maryland Salon on or about

December 12, 2020. (SAC ¶¶ 49-50.) Although Plaintiff

attributes his termination to the logistical and economic

challenges facing the Maryland Salon in light of the COVID-19

pandemic, Plaintiff alleges that his inability to find work at a

nail salon thereafter can be attributed to the Defendant

Association’s “willful retaliation against him,” which Plaintiff

notes also caused him to “lose self-esteem” and to experience

both insomnia and general “mental anguish.” (SAC ¶¶ 50-52.)

II. Procedural Background

Plaintiff served the Defendant Association with the

original Complaint and Summons on January 14, 2021. (ECF No.

9.) Plaintiff filed an Amended Complaint 32 days later, on

February 15, 2021. (ECF No. 10.) In his Amended Complaint,

Plaintiff added Defendant Yu and Defendant Wen as individual

Defendants.

On June 10, 2021 Plaintiff sought leave of the Court to

file a Second Amended Complaint in order to add claims for

emotional distress and punitive damages pursuant to 29 U.S.C. §

216(b). (ECF Nos. 15-17.) Plaintiff also sought to add the

alternative names of Defendant Yu and Defendant Wen, and to add

Nicole Doe and John Doe as individual Defendants. (ECF No. 17.)

Plaintiff’s motion for leave to file the Second Amended

Complaint was granted by Magistrate Judge Lois Bloom and

Plaintiff proceeded to file the Second Amended Complaint on

December 9, 2021.

LEGAL STANDARD

I. Motion to Dismiss

“To survive a motion to dismiss, a complaint must contain

sufficient factual matter, accepted as true, to state a claim to

relief that is plausible on its face.” Ashcroft v. Iqbal, 556

U.S. 662, 678 (2009) (internal quotation marks omitted). The

Court reviews the operative Second Amended Complaint, accepting

the factual allegations in the Amended Complaint as true, for

the purposes of [] Defendants’ 12(b)(6) motion, and drawing all

reasonable inferences in Plaintiff’s favor. Melendez v. City of

New York, 16 F.4th 992, 1010 (2d Cir. 2021). To the extent

Plaintiff draws “legal conclusion[s] couched as factual

allegation[s],” however, the Court is not bound to accept such

statements as truth. Drimal v. Tai, 786 F.3d 219, 223 (2d Cir.

2015) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).

The Court must dismiss Plaintiff’s Second Amended Complaint

if he has failed to plead “enough facts to state a claim to

relief that is plausible on its face.” Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007). “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.

II. Retaliation under the FLSA and NYLL

Title 29 U.S.C. § 215(a)(3) prohibits any person from

“discharg[ing] or in any other manner discriminat[ing] against

an[] employee because such employee has filed any complaint or

instituted or caused to be instituted any proceeding under or

related to” the FLSA. Similarly, N.Y.L.L. § 215(a) states that

“[n]o employer . . . shall discharge, threaten, penalize, or in

any other manner discriminate or retaliate against any employee”

that has engaged in activity protected by the NYLL. “NYLL § 215

and FLSA § 215(a)(3) are nearly identical provisions.” Jones v.

Pawar Bros. Corp., 434 F. Supp. 3d 14, 27 (E.D.N.Y. 2020)

(citing Torres v. Gristede’s Operating Corp., 628 F. Supp. 2d

447, 471 n.18 (S.D.N.Y. 2009)) (internal quotation marks

omitted). Indeed, “district courts in this Circuit have

consistently interpreted the . . . New York Labor Law

coextensively with the” FLSA. Inclan v. New York Hospitality

Group, Inc., 95 F. Supp. 3d 490, 511 (S.D.N.Y. 2015) (internal

citation omitted). Accordingly, the Court’s analysis of the

anti-retaliation provision of the FLSA is equally applicable to

Plaintiff’s anti-retaliation claims under N.Y.L.L. § 215. See

Hong v. Quest Int’l Limousine, Inc., No. 21-cv-7908 (SN), 2022

WL 2829907, at *4 (S.D.N.Y. July 20, 2022) (“the Court’s

construction of the FLSA anti-retaliation provisions is [] also

dispositive of [plaintiff’s] claims under” the NYLL anti-

retaliation provision) (collecting cases).

A. Employer Status

Under both the FLSA and NYLL, a plaintiff may only seek

“legal and equitable relief for retaliation” where defendants

are adequately alleged to be plaintiff’s employer. Hong, 2022

WL 2829907, at *3. Although liability for retaliatory conduct

proscribed by the FLSA and NYLL is exclusively reserved for

actual employers, the Second Circuit treats the concept of

“employment for FLSA [and NYLL] purposes as [] flexible” and

courts consider the employer-employee relationship “on a case-

by-case basis by review of the totality of the circumstances.”

Barfield v. New York City Health and Hosps. Corp., 537 F.3d 132,

141-42 (2d Cir. 2008) (internal citation omitted). Because the

FLSA [and NYLL] are written “in the broadest possible terms” and

are remedial in nature, “a full inquiry into the true economic

reality [of an employer-employee relationship] is necessary” to

evaluate the scope of employer liability. Carter v. Dutchess

Cmty. Coll., 735 F.2d 8, 12-14 (2d Cir. 1984). This inquiry,

which is referred to as the “economic reality” test, requires

courts to determine “‘whether (1) the alleged employer (1) had

the power to hire and fire the employees, (2) supervised and

controlled employee work schedules or conditions of employment,

(3) determined the rate and method of payment, and (4)

maintained employment records.’” Carter, 735 F.2d 8, 12 (2d

Cir. 1984).

Once an entity is found to be an employer within the

meaning of the FLSA, a Court must also consider whether

individual defendants associated with the employer-entity are

individually liable for retaliatory conduct as well. That

inquiry was set forth by the Second Circuit in Irizarry v.

Catsimatidis, 722 F.3d 99 (2d Cir. 2013). Individual liability

is also grounded in the “economic reality” of the employer-

employee relationship, but also takes into account an

individual’s “operational control” or the degree to which an

individual possesses “control over a company’s actual operations

in a manner that relates to a plaintiff’s employment.” Alvarado

v. GC Dealer Services Inc., 511 F. Supp. 3d 321, 354 (E.D.N.Y.

2021) (quoting Tapia v. Blch 3rd Ave LLC, 906 F.3d 58, 61 (2d

Cir. 2018)) (internal quotation marks omitted).

Irrespective of how “expansive the nature of the FLSA’s

definitional scope” may be, the purpose of the “economic

reality” test is to determine whether an “employer-employee

relationship exists,” not to determine whether an individual or

entity outside the scope of the employer-employee relationship

may nevertheless be held liable for retaliation. Barfield, 537

F.3d at 141; see also Frankel v. Bally, Inc., 987 F. 2d 86, 89

(2d Cir. 1993) (“courts construing [the FLSA and NYLL] have

adopted the ‘economic realities’ test” to determine “if ‘as a

matter of economic reality, [employees] are dependent upon the

businesses to which they render service[]’” such that those

“individuals are considered employees”) (internal citation

omitted).

B. McDonnell-Douglas Burden-Shifting Framework

District courts within this Circuit evaluate FLSA and NYLL

retaliation claims under the three-step burden-shifting

framework established by McDonnell Douglas Corp. v. Green, 411

U.S. 792 (1973). Robinson v. De Niro, No. 19-cv-9156 (LJL),

2023 WL 4862772, at *21 (S.D.N.Y. May 25, 2023). A plaintiff

can “establish a prima facie case of retaliation by showing (1)

participation in protected activity known to the defendant[;] .

. . (2) an employment action disadvantaging the plaintiff; and

(3) a causal connection between the protected activity and the

adverse employment action.” Mullins v. City of New York, 626

F.3d 47, 53 (2d Cir. 2010). It is well established in this

Circuit that filing an FLSA lawsuit constitutes protected

activity. See Mullins, 626 F.3d at 53 (listing “the filing of a

FLSA lawsuit” as an example of protected activity); see also

Stih v. Rockaway Farmers Market, Inc., No. 22-cv-3228 (ARR),

2023 WL 2760492, at *5 (E.D.N.Y. Apr. 3, 2023) (“the filing of

[an FLSA] lawsuit clearly constitutes a protected activity”).

Under the FLSA and NYLL, an employment action disadvantages a

plaintiff, “if it well might have dissuaded a reasonable worker

from making or supporting similar charges.” Burlington Northern

and Santa Fe Ry. Co. v. White, 548 U.S. 53, 54 (2006). Finally,

at the prima facie stage, plaintiff can establish a causal

connection by pointing to “evidence of retaliatory animus” or by

showing that there was “a close temporal proximity between the

protected activity and the adverse employment action.” Torres,

628 F. Supp 2d at 473.

Once the plaintiff establishes a prima facie case of FLSA

retaliation, “the burden shifts to the defendant to articulate a

legitimate, non-retaliatory reason for the employment action.”

Velazquez v. Yoh Services, LLC, 803 F. App’x 515, 517 (2d Cir.

2020) (internal citation omitted). If the defendant is able to

demonstrate the requisite non-retaliatory reason for its

employment action, the burden shifts back to the plaintiff. At

this stage, the plaintiff must “produce sufficient evidence to

permit a reasonable juror to find that defendant’s proffered

explanation was pretextual, and that more likely than not,

retaliation was the real reason for the employment action.”

Soto v. Miss Laser Inc., No. 19-cv-4745 (MKB), 2021 WL 7287304,

at *3 (E.D.N.Y. Mar. 16, 2021).

Generally speaking, retaliation claims made in connection

with “post-employment conduct are [] allowed under ‘relatively

narrow’ circumstances.” Porter v. MooreGroup Corporation, No.

17-cv-7405 (KAM), 2020 WL 32434, at *11 (E.D.N.Y. Jan. 2, 2020)

(quoting Santos v. E T & K Foods, Inc., No. 16-cv-7107

(DLI)(VMS), 2017 WL 9256490, at *3 (E.D.N.Y. June 27, 2017)).

One such circumstance involves “blacklist[ing]” that may be

“injurious to [a plaintiff’s] current employment or the ability

[of the plaintiff] to secure future employment.” Sherman v.

Fivesky, LLC, No. 19-cv-8015 (LJL), 2020 WL 5105164, at *5

(S.D.N.Y. Aug. 31, 2020) (citing Wanamaker v. Columbian Rope

Co., 108 F. 3d 462, 466 (2d Cir. 1997) (emphasis in original).

DISCUSSION

I. Defendants’ Status under the FLSA and NYLL

The Moving Defendants argue that the Second Amended

Complaint should be dismissed in its entirety because Defendants

are not subject to the FLSA or NYLL. Specifically, the Moving

Defendants contend that neither the Defendant Association nor

the Individual Defendants can be considered Plaintiff’s

employers within the meaning of the FLSA or NYLL. Additionally,

the Moving Defendants contend that because the Defendant

Association is accurately described in the Second Amended

Complaint as a non-profit organization and does not fall into a

relevant exception category, Defendants are not subject to the

FLSA and NYLL because they are not enterprises engaged in

ordinary commerce.

On the first point regarding the Defendant Association and

Individual Defendants not being “employers,” the Court agrees.

Plaintiff has failed to demonstrate that Defendants are

employers within the meaning of the FLSA and NYLL. On the

second point, the Moving Defendants misapply the enterprise

requirement from the wages-and-hours provisions of the FLSA to

the anti-retaliation provision of the FLSA. Defendants need not

be “enterprise[s]” within the meaning of 29 U.S.C. §§ 203(r) and

203(s) in order to be held liable for retaliatory conduct.

However, because Defendants are not employers within the meaning

of the FLSA, the Moving Defendants’ arguments regarding the

Defendant Association’s not-for-profit status is moot.

A. Employer Relationship

The Second Amended Complaint does not include any

allegation that Plaintiff was ever employed by any of the named

Defendants. To the contrary, Plaintiff acknowledges that

“defendants were not directly involved with plaintiff[’s]

employment” (Ptf. Opp. at 9), and that plaintiff “was not

directly an employee [of] defendants[.]” (Ptf. Opp. at 5.)

This alone is fatal to Plaintiff’s retaliation claims.

Even when “applying the economic reality test,” which

requires this Court to consider “whether the alleged employer

could hire and fire [Plaintiff], control work schedules and

conditions of employment, determine the rate and method of

payment, and maintain employment records[,]” Carter, 735 F.2d at

14, Plaintiff has failed to allege sufficient facts to support a

finding that the Defendant Association could be considered his

employer. Plaintiff does not allege that the Defendant

Association controlled his work schedule or the conditions of

his employment. Plaintiff also makes no mention of the

Defendant Association’s maintenance of his employment records.

Finally, although Plaintiff alleges that the “[Defendant]

Association’s blacklisting,” by virtue of the July 22, 2020

Repost,3 contributed to his difficulties securing and maintaining

gainful employment, Plaintiff fails to allege that the Defendant

3 The Court notes that Plaintiff has made conflicting assertions regarding

Defendants’ role in the alleged retaliatory action. On the one hand,

Plaintiff has alleged that Defendants are “directly responsible for

plaintiff[’s] inability to find work due to the post that they made of

plaintiff.” (Ptf. Opp. at 5.) On the other hand, Plaintiff has alleged that

“defendants did not directly post the retaliatory information,” but that

defendants “are indirectly associated with it and therefore are jointly and

severally liable in the matter.” (Ptf. Opp. at 5.)

Association determined the rate or method of his pay or that

Defendants had the power to hire or fire him.

Plaintiff’s allegations regarding the Individual Defendants

are similarly unavailing. Plaintiff asserts that, “upon

information and belief,” Defendants Yu and Wen “own[] and

manage[] the Association’s WeChat account[.]” (SAC ¶¶ 12-13.)

Plaintiff further asserts that Defendant Nicole Doe “assisted in

the blackballing of Plaintiff” and that John Doe “is the person

who posted” the July 22, 2020 Repost. (SAC ¶¶ 14-15.) These

assertions do not amount to a well pleaded allegation that the

Individual Defendants “exercise[d] operational control over”

Plaintiff as an employee. Irizarry, 722 F.3d at 110 (“A person

exercises operational control over employees if his or her role

within the company, and the decisions it entails, directly

affect the nature or conditions of the employees’ employment.”)

Nor has Plaintiff pointed to any facts that “indicate the

manifestation of, or, at least, a clear delineation of [the

Individual Defendants’] power over” Plaintiff’s employment.

Irizarry, 722 F.3d at 112.

Nevertheless, Plaintiff argues that Defendants should be

held liable under the anti-retaliation provisions of the FLSA

and NYLL under two interrelated theories. Plaintiff first

argues that because Defendants “play[ed] a large role in

plaintiff getting fired and also plaintiff not being able to

find another job” (Ptf. Opp. at 9), Defendants should be held

liable for retaliatory conduct even if they are not and never

were Plaintiff’s employers. According to Plaintiff, because

Defendants engaged in retaliatory conduct by allegedly

facilitating, promoting, or actively participating in either or

both the July 11, 2020 Post and July 22, 2020 Repost, and

because the result of the alleged conduct was one or more

adverse employment actions, Defendants should be found liable

for violations of 29 U.S.C. § 215(a)(3) and N.Y.L.L. §

215(i)(a)(iii). (Ptf. Opp. at 5.) This of course amounts to a

request that the Court place the cart before the horse.

Plaintiff must first establish that Defendants were his

employers within the meaning of the FLSA and NYLL before

Plaintiff can establish that Defendants engaged in retaliatory

conduct that resulted in an adverse employment action – not the

other way around.

Plaintiff also argues that because at least one of his

former and prospective employers “[was] [an] affiliate[] of

defendants” (Ptf. Opp. at 14), and because “Defendants were

self-consciously acting in the interests of the Association’s

employer members,” Defendants “were employers within the meaning

of the FLSA . . . as defined by Section 203(d)[.]” (SAC ¶ 56.)

Plaintiff’s argument does not hinge on a finding that Defendants

were Plaintiff’s actual employers, but rather that Defendants

were acting in the interest of Plaintiff’s former and

prospective employers such that Defendants should be held

“jointly and severally liable in the matter.” (Ptf. Opp. at 5.)4

This notion, that a non-employer defendant may be held civilly

liable for violations of 29 U.S.C. § 215(a)(3) and N.Y.L.L. §

215(1)(a)(iii) by virtue of their retaliatory conduct and

affiliation with an actual employer, was raised in Arias v.

Raimondo, 860 F.3d 1185 (9th Cir. 2017) and has been repeatedly

rejected by courts within this Circuit. See Kim v. Lee, 576 F.

Supp. 3d 14, 27 (S.D.N.Y. 2021); Hong, 2022 WL 2829907, at *3

(S.D.N.Y. July 20, 2022); Lima v. Napoli, No. 19-cv-1699 (JMA),

2023 WL 2731689, at *1 (E.D.N.Y. Mar. 31, 2023) (“the Court’s

determination that Defendants were not Plaintiff’s ‘employers’ .

. . precludes Plaintiff from pursuing a retaliation claim”).

As in Arias, Plaintiff argues that even though Defendants

“were not [his] employers,” Defendants’ “actions towards

plaintiff were retaliatory in nature and cost plaintiff his job

and his ability to work[.]” (Ptf. Opp. at 9.) See Kim, 576 F.

Supp. 3d at 27 (describing the plaintiff’s argument in Arias,

which was ultimately rejected by the court in Kim, that “[j]ust

4 Plaintiff’s allegations that Defendants acted in the “interest” of his

former and prospective employers does not appear to be limited to members of

the Defendant Association. Plaintiff does not specify any prospective

employers that are members of the Defendant Association and from whom he

sought employment; instead, Plaintiff alleges that the Maryland Nail Salon

was not a member of the Defendant Association. (SAC ¶ 48.)

because [Defendants] were not [Plaintiff’s] employers, “d[oes]

not mean that [Defendants] could not have retaliated against”

Plaintiff). Plaintiff also argues that, as in Arias,

“Defendants were employers within the meaning of the FLSA,

because ‘employer’ as defined by Section 203(d) of the FLSA

includes ‘any person acting directly or indirectly in the

interest of an employer in relation to an employee’ and

Defendants were self-consciously acting in the interests of the

Association’s employer members . . .” (SAC ¶ 56); see Kim, 576

F. Supp. 3d at 26 (describing plaintiff’s argument, which the

court ultimately rejected, that although “Defendants ‘are not

[his] employer,’ as that term has been understood in the wage-

and-hour context . . . Defendants are subject to Section

215(a)(3) because they fit within the definition of ‘any

person’” outlined in 29 U.S.C. § 203(d).)

The Supreme Court recognizes “the expansiveness of the

[FLSA’s] definition of employer” and has interpreted the term,

“employer,” as defined by 29 U.S.C. § 203(d), to include

individuals or entities that maintain extensive “managerial

responsibilities . . . which [provide for] substantial control

of the terms and conditions of [] work” in relation to a

plaintiff filing suit pursuant to the FLSA. Falk v. Brennan,

414 U.S. 190, 195 (1973). The Second Circuit synthesized this

definition in the formulation of the “economic reality” test.

Carter, 735 F.2d at 12. However, neither the Supreme Court, nor

the Second Circuit has interpreted the definition of “employer”

under 29 U.S.C. § 203(d) so broadly as to encompass a non-

employer defendant with no economic ties, responsibilities,

control, or power in relation to a plaintiff filing a civil

lawsuit pursuant to 29 U.S.C. § 215(a)(3) or N.Y.L.L. §

215(1)(a)(iii). Although, the relevant definitions prescribed

in 29 U.S.C. § 203(d) are “exceedingly broad,” the statute “does

have its limits.” Tony and Susan Alamo Foundation v. Sec. of

Labor, 471 U.S. 290, 295 (1985). The outer limitations of the

definition of “employer” and the scope of the employer-employee

relationship are marked by the “economic reality” test set forth

in Carter. As previously noted, Plaintiff has failed to allege

sufficient facts to support a finding that “an employment

relationship exists for purposes of the FLSA,” in light of the

“economic reality” of the alleged relationship. Carter, 735

F.2d at 12.

Moreover, the penalties outlined within the statutory text

of the FLSA explicitly limit civil liability for a violation of

the anti-retaliation provision of the FLSA, 29 U.S.C. §

215(a)(3), and for a violation of the wage-and-hour provisions

of the FLSA, 29 U.S.C. §§ 206–07, to “an[] employer,” 29 U.S.C.

§ 216(b), whereas criminal liability for a violation of 29

U.S.C. § 215 is extended to “any person.” 29 U.S.C. § 216(a).

The Court is persuaded by the Sixth Circuit’s reasoning in Diaz

v. Longcore, 751 F. App’x 755, 759 (6th Cir. 2018), which has

been adopted by other district courts within the Second Circuit,

that “Congress clearly knows how to create broader liability

when it wishes to” and with respect to the private right of

action for violations of the anti-retaliation provision of the

FLSA, “it did not” extend liability to “any person” – only to

employers. See Kim, 576 F. Supp. 3d at 26 (“The Court is

persuaded by Diaz, which is consistent with the limited relevant

caselaw in this Circuit”)(collecting cases). Just as other

courts within this Circuit have declined to follow Plaintiff’s

expansive theory of liability under the anti-retaliation

provisions of the FLSA and NYLL, so too does this Court. See

Kim, 573 F. Supp. 3d at 27-30 (“declin[ing] to follow Arias”);

Hong, 2022 WL 2829907, at *3 (S.D.N.Y. July 20, 2022) (“The

Court declines to follow Arias.”)

Even crediting the most expansive interpretation of the

relevant statutes, Defendants are not employers within the

meaning of the FLSA or NYLL. Nor does Plaintiff allege that

Defendants are his employers. Though Plaintiff concedes that

Defendants are not his employers, Plaintiff argues that they

should nevertheless be found to have violated 29 U.S.C. § 215

and N.Y.L.L. § 215, either because Defendants are affiliated

with his employers or because Defendants allegedly engaged in

retaliatory conduct regardless of their employer status.

Plaintiff’s argument is foreclosed by the relevant statutes and

undermined by decisions of other district courts within the

Second Circuit. Accordingly, Plaintiff has failed to allege

adequate facts to support a finding that Defendants are subject

to 29 U.S.C. § 215(a)(3) and has failed to articulate a

cognizable FLSA retaliation claim on this basis. As set forth

previously, “the Court’s construction of the term ‘employer’

under the FLSA and its application to retaliation claims under

that statute is [also] dispositive of Plaintiff’s claims under

[N.Y.L.L. § 215(1)(a)(iii)].” Kim, 576 F. Supp. 3d at 30

(“courts in this Circuit have consistently interpreted the

definition of ‘employer’ under the [NYLL] coextensively with the

definition used by the FLSA . . . [and] Plaintiff does not argue

[] that the term ‘employer’ should be given any different

meaning under the NYLL”) (internal quotation marks and citations

omitted).

B. Enterprise Status

As previously noted, the Second Amended Complaint alleges

that the Defendant Association as a “domestic not-for-profit

corporation” and “trade association” with an “excess of

$500,000.00 [in] gross annual revenue” for the year 2020. (SAC

¶¶ 8-11.) The Moving Defendants argue that notwithstanding

Plaintiff’s assertion that the Defendant Association earned

“$500,000 in gross revenues” in any given year, which the Moving

Defendants deny as false, Plaintiff has failed to plead

sufficient facts to support a finding that any Defendant is “a

covered enterprise under the FLSA[.]” (Def. Mot. at 20.) The

Moving Defendants contend that this flaw in Plaintiff’s factual

pleadings warrants dismissal for lack of subject matter

jurisdiction.5

The wage-and-hours provisions of the FLSA, 29 U.S.C. §§

206, 207, apply to an employee who (1) “is engaged in commerce

or in the production of goods for commerce,” or (2) “is employed

in an enterprise engaged in commerce or in the production of

goods for commerce.” Jacobs v. New York Foundling Hosp., 577

F.3d 93, 96 (2d Cir. 2009). Pursuant to 29 U.S.C. §

203(s)(1)(A), enterprise liability extends to entities that

either have “employees engaged in commerce or in the production

of goods for commerce” or “whose annual gross volume of sales .

. . is not less than $500,000.” The anti-retaliation provision

of the FLSA, however, does not include the same requirement that

a covered entity be an “enterprise engaged in commerce” and

“[s]everal circuit courts have [] concluded that FLSA’s

5 Although the Moving Defendants argue that this Court lacks subject matter

jurisdiction over Plaintiff’s claims in light of Plaintiff’s failure to

allege that Defendants constitute one or more enterprises within the meaning

of the FLSA, “the prevailing view in this Circuit is that the question of

whether enterprise coverage applies goes to the merits of an FLSA cause of

action and is not jurisdictional.” Gaughan v. Rubenstein, 261 F. Supp. 3d

390, 422 (S.D.N.Y. 2017) (collecting cases).

prohibition on retaliation applies regardless of whether an

employer qualifies as an enterprise engaged in commerce.”

Acosta v. Foreclosure Connection, Inc., 903 F.3d 1132, 1135

(10th Cir. 2018) (collecting cases). The Second Circuit has not

definitively ruled on this issue and district courts within the

Second Circuit appear to be split. See Savor Health, LLC v.

Day, No. 19-cv-9798 (RA), 2022 WL 912236, at *8 n.13 (SD.N.Y.

Mar. 29, 2022) (comparing cases). This Court agrees with the

court in Savor Health and the many circuit courts that have

similarly held that, based on the plain text of the wage-and-

hour provisions of the FLSA, as compared to the anti-retaliation

provision of the FLSA, “the anti-retaliation provision does not

share the wage and overtime [hours] provisions’ commerce and

revenue requirements.” Id. The Defendant Association need not

be an enterprise engaged in commerce and the Individual

Defendant need not be affiliated with an enterprise engaged in

commerce for Defendants to be held liable for alleged violations

of 29 U.S.C. § 215(a)(3) and N.Y.L.L. § 215(1)(a)(iii). In any

case, because Plaintiff has failed to plead sufficient facts to

establish that Defendants are employers within the meaning of

the anti-retaliation provision of the FLSA, which the Court has

determined is a requirement of that provision, the Moving

Defendants’ arguments regarding Plaintiff’s purported failure to

establish any Defendant as an enterprise engaged in commerce is

moot.

II. The McDonnell-Douglas Framework for Retaliation

Because Plaintiff has failed to allege facts to establish

that the Defendant Association or the Individual Defendants are

employers within the meaning of the anti-retaliation provisions

of the FLSA or NYLL, the Court need not address Plaintiff’s

remaining contentions. Specifically, the Court need not

determine whether Plaintiff has made a prima facie showing that

he “(1) participat[ed] in protected activity known to the

defendant[s],” that he suffered from (2) an [adverse] employment

action,” or that there exists “(3) a causal connection between

the protected activity and the adverse employment action.” Soto

v. Miss Laser, Inc., 19-CV-4745 (MKB), 2021 WL 7287304, at *3-4

(E.D.N.Y. Mar. 16, 2021) (quoting Velasquez v. Yoh Servs., LLC,

803 F. App’x 515, 517 (2d Cir. 2020)). Nor is it necessary for

the Court to engage in the second or third steps of the

McDonnell Douglas burden-shifting framework because Plaintiff

has failed to establish a prima facie case of retaliation at the

first step.

III. Emotional Distress Damages and Punitive Damages

Finally, Plaintiff’s failure to plead facts supporting a

conclusion that Defendants are employers within the meaning of

the FLSA also forecloses any claim for emotional distress

damages and punitive damages under 29 U.S.C. § 216(b). As set

forth previously, the penalties outlined in 29 U.S.C. 216(b)

apply only to “employer[s]” whereas criminal liability under 29

U.S.C. § 216(a) is extended to “any person.” Because Defendants

are not Plaintiff’s employers, none of the penalties outlined in

29 U.S.C. § 216(b) are available to Plaintiff, including the

“unpaid minimum wages, or [] unpaid overtime compensation”

associated with a violation of 29 U.S.C. §§ 206, 207; or the

“legal and equitable relief,” such as damages, associated with a

violation of 29 U.S.C. § 215(a)(3).

CONCLUSION

For the forgoing reasons, the Moving Defendants’ motion to

dismiss Plaintiff’s retaliation claims under 29 U.S.C. §

215(a)(3) and N.Y.L.L. § 215(1)(a)(iii) is GRANTED. The Second

Amended Complaint is DISMISSED in its entirety with prejudice,

as against all Defendants.

Federal Rule of Civil Procedure 15(a) dictates that leave

to amend a complaint shall be freely given “when justice so

requires.” Although the Second Circuit has advised that “the

usual practice upon granting a motion to dismiss [is] to allow

leave to replead,” Cortec Indus., Inc. v. Sum Holding L.P., 949

F.2d 42, 48 (2d Cir. 1991) (internal citations omitted),

Plaintiff has already been granted leave to amend his Complaint

twice. See Ruotolo v. City of New York, 514 F.3d 184, 191 (2d

Cir. 2008) (“leave to amend, though liberally granted, may

properly be denied for . . . failure to cure deficiencies by

amendments previously allowed”) (internal citations omitted).

Moreover, because the Court has determined that Defendants are

not employers as a matter of law, any further amendment of the

Second Amended Complaint against Defendants would be futile.

See Kim, 576 F. Supp. 3d at 35.

The Clerk of Court is respectfully requested enter judgment

in favor of Defendants and to close this case.

SO ORDERED.

Dated: February 28, 2024

Brooklyn, New York

“2 —

¥) □ oye et bee

KIYO A. MATSUMOTO

United States District Judge

Eastern District of New York

28