WALSH v. ELDER RESOURCE MANAGEMENT

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF PENNSYLVANIA

MARTIN J. WALSH, Secretary of the )

United States Department of Labor, )

) 2:19-CV-00546-CCW

Plaintiff, )

)

v. )

)

)

ELDER RESOURCE MANAGEMENT,

)

INC.; STAFF SOURCE, INC.; ANNA

)

ZAYDENBERG; and MARSHA )

SIMONDS, )

Defendants.

MEMORANDUM ORDER DENYING PLAINTIFF’S MOTION FOR

RECONSIDERATION

Before the Court is Plaintiff’s Motion for Reconsideration, ECF No. 108, of the Court’s

Order on Cross Motions for Summary Judgment, ECF No. 105. For the reasons that follow,

Plaintiff’s Motion will be denied.

I. Background

Plaintiff R. Alexander Acosta, then-Secretary of Labor, filed this action against

Defendants, alleging that Defendants’ employment practices violated the Fair Labor Standards

Act. See generally ECF No. 1. After discovery, the parties filed cross motions for summary

judgment. ECF Nos. 40 and 44. Each of the parties’ motions requested summary judgment on a

variety of issues. The parties fully briefed the cross motions and, after careful consideration, the

Court granted Plaintiff’s Motion in part and denied it in part, and denied Defendants’ Motion in

full. See ECF No. 105. Relevant to the instant Motion for Reconsideration, the Court denied

Plaintiff’s Motion to the extent it sought summary judgment that Defendant Staff Source was

subject to the FLSA. ECF No. 105 at ¶ 2. The Court denied summary judgment on that issue

because, based on the record evidence before the Court, there is a material question of fact whether

Defendant Staff Source generated the threshold $500,000 in annual revenue required to be an

“enterprise” subject to the FLSA under 29 U.S.C. § 203(s). See ECF No. 104 at 6–7.

Plaintiff filed a Motion for Reconsideration which argues that the Court’s Order, ECF No.

105, denying summary judgment that Staff Source is subject to the FLSA demonstrates a clear

error of law. ECF No. 109 at 2. Plaintiff argues that the Court erred because regardless of whether

Staff Source is an “enterprise” under §§ 203(s), there is no dispute that Defendants’ employees, as

“domestic service” workers, are entitled to overtime protections under § 207 of the FLSA given

that Congress found that “the employment of persons in service in households affects commerce”

as provided in § 205(a)(5). ECF No. 109 at 3–6.

Defendants’ Response to Plaintiff’s Motion for Reconsideration, ECF No. 113, does not

address the merits of Plaintiff’s argument or the merits of the Court’s summary judgment decision,

but rather indicates that Defendants prefer to focus their litigation resources on the remainder of

the proceedings as opposed to on opposing Plaintiff’s Motion. ECF No. 113 at 2.

II. Legal Standard

On a motion for reconsideration, the party seeking to have a judgment altered or amended

must demonstrate either: (1) a change in controlling law; (2) the availability of new evidence not

previously before the court; or (3) “the need to correct a clear error of law or fact or to prevent

manifest injustice.” Allaham v. Naddaf, 635 Fed. Appx. 32, 35–36 (3d Cir. 2015) (quoting U.S.

ex rel. Schumann v. Astrazeneca Pharm. L.P., 769 F.3d 837, 848-49 (3d Cir. 2014); see also Max’s

Seafood Café by Lou-Ann, Inc. v. Quinteros, 176 F.3d 669, 677 (3d Cir. 1999). Plaintiff’s Motion

for Reconsideration implicates only the third basis for an appropriate motion to reconsider—i.e.,

Plaintiff asserts a need to correct a clear error of law. ECF No. 109 at 2.

III. Application

Plaintiff is incorrect that the Court’s Order demonstrates a clear error of law. Plaintiff’s

Brief in Support of its Motion for Summary Judgment opened its Argument Section with a first

subsection titled “Defendants are Subject to the Jurisdiction of the FLSA.” ECF No. 41 at 8. That

subsection contained a single paragraph, as follows:

Defendants are an enterprise covered under FLSA section 3(s)(1)(A)

because their employees are engaged in domestic service and the

annual dollar value of corporate defendants ERM and Staff Source

each individually exceeds $500,000. SOF ¶¶ 1–5. Defendants

concede that ERM employed all of the employees named on

Schedule A of Plaintiff’s Complaint during the relevant time period.

SOF ¶ 2. Accordingly, the undisputed material facts prove that this

Court has jurisdiction and that Defendants are subject to the FLSA.

ECF No. 41. The Court agreed with that assessment with respect to Defendant Elder Resource

Management, but disagreed with respect to Defendant Staff Source. ECF No. 104 at 6–7. The

Court explained that the record indicated a dispute as to whether Staff Source generated the

requisite $500,000 in annual revenue required to be considered an “enterprise” under

§ 203(s)(1)(A). The Court noted that while the General Ledger Plaintiff attached as Exhibit 3 to

its Statement of Facts clearly indicates that Staff Source received payments in excess of $500,000

during at least one of the years in issue, the General Ledger did not indicate what those payments

represented, including whether they could be considered “sales” to be counted toward the $500,000

threshold established by § 203(s)(1)(A). ECF No. 104 at 7. Given that Defendants dispute that

Staff Source generated at least $500,000 in sales, and that Plaintiff failed to establish beyond

reasonable dispute that Staff Source had more than $500,000 in sales, the Court declined to enter

summary judgment in Defendants’ favor on this issue. To clarify, the Court declined to enter

summary judgment on the limited issue of whether Defendant Staff Source was subject to the

FLSA as an “enterprise” under § 203(s).

Plaintiff’s Motion for Reconsideration asks the Court to reconsider its ruling and grant

summary judgment on an altogether different question: irrespective of whether Staff Source

qualifies as an “enterprise” under § 203(s)(1)(A), are Defendants’ employees entitled to FLSA

protections because they are domestic service workers who are individually covered under

§ 202(a)(5)? ECF No. 109 at 5–6. Plaintiff did not brief that issue in the first instance in its Brief

in Support of Motion for Summary Judgment. The Third Circuit is clear: Motions for

reconsideration cannot be used to raise a new argument that could have been raised before the

court’s ruling. See Gibson v. State Farm Mut. Auto. Ins. Co., 994 F.3d 182, 191 (3d Cir. 2021)

(“motions for reconsideration are not a vehicle to argue facts of issues that were not raised.”)

(citing Exxon Shipping Co. v. Baker, 554 U.S. 471, 485 n.5 (2008)); Mid-American Salt, LLC v.

Morris Cty. Coop. Pricing Council, 964 F.3d 218, 230 (3d Cir. 2020). Here, the question

Defendants ask the Court to “reconsider” was not properly presented to the Court in the parties’

summary judgment briefing. Rather, the Court appropriately declined to enter summary judgment

on the issue that was before the Court—whether Staff Source is an “enterprise” under

§ 203(s)(1)(A). Given the dispute regarding whether Staff Source had over $500,000 in “sales” as

required by that section, summary judgment is not appropriate on that limited issue.

IV. Conclusion

For the foregoing reasons, Plaintiff’s Motion for Reconsideration, ECF No. 108, is

DENIED.

DATED this 9th day of August, 2021.

BY THE COURT:

/s/ Christy Criswell Wiegand

CHRISTY CRISWELL WIEGAND

United States District Judge

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