Choi v. SD Tools, Inc

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

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YOUNG TAEK CHOI, YUN SEOB SHIN, JI

HYUN KIM, and RACHEL SON,

MEMORANDUM & ORDER

Plaintiffs, 19-CV-2008(EK)(VMS)

-against-

SD TOOLS, INC., ZERED, INC., and HAK

JIN HAN,

Defendants.

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ERIC KOMITEE, United States District Judge:

The four plaintiffs in this case assert that the

defendants failed to comply with various provisions of the Fair

Labor Standards Act (“FLSA”) and New York Labor Law (“NYLL”).

They bring claims for: (1) FLSA overtime wages; (2) NYLL

overtime wages; (3) “spread of hours” compensation under the

NYLL; (4) violation of the NYLL’s time of hire wage notice

requirement; and (5) violation of the NYLL’s pay stub

requirement. The defendants are two companies — SD Tools, Inc.

and Zered, Inc. — and their owner, Hak Jin Kim.

The defendants have moved for summary judgment against

one defendant — Choi — on the ground that, as an “outside

salesperson,” he is exempt from the wage-and-hour requirements

at issue. Choi disputes that he qualifies for the outside-

salesperson exemption. In addition, all plaintiffs have moved

for summary judgment on all of their claims. They contend that

judgment is warranted because they are not covered by any

exemption and because it is undisputed that they were not paid

for all overtime hours worked.

For the reasons that follow, the plaintiffs’ motion

for summary judgment is denied. The defendants’ motion is

granted.

I. Background

The facts in this order are drawn from the parties’

submissions in connection with the motion for summary judgment,

including the plaintiffs’ Local Rule 56.1 Statement (“Pl. 56.1”

(ECF No. 70-2)), and the defendants’ opposition thereto (“Def.

56.1 Response” (ECF No. 71)). Citations to a party’s Rule 56.1

Statement incorporate the documents cited therein. The

defendants have not filed an affirmative Rule 56.1 statement in

support of their motion for partial summary judgment, but rely

on excerpts from Mr. Choi’s deposition and their earlier Rule

56.1 Response in opposition to summary judgment .

The parties (and, as applicable, their claims) are as

follows:

Defendants

SD Tools, Inc. Defendant SD Tools is located in

College Point, New York. Like its sister company Zered, it sold

industrial tools and fabricated components. Pl. 56.1 ¶ A(2),

A(8); Decl. of Jiwoo Han ¶ 1, ECF No. 70-15. SD Tools

functioned in the New York tristate area as a retail and

wholesale reseller. Id.; Decl. of Hak Jin Han (“Han Decl.”) ¶¶

1-2. ECF No. 76.

Zered, Inc. Zered is a nationwide wholesale reseller

of industrial tools. Han Decl. ¶ 2. It is operated out of the

same location as SD Tools, under the same ownership. Pl. 56.1 ¶

A(8); Han Decl. ¶ 1.

The parties do not distinguish between Zered and SD

Tools when referring to the plaintiffs’ employment

relationships.1

Hak Jin Han. Defendant Han (who went by the name

James) is the sole owner of both SD Tools and Zered. Pl. 56.1 ¶

A(1); see 7/9/21 Dep. of Hak Jin Han (“Han Dep.”) 7:22-9:2, ECF

No. 70-3; Han Decl. ¶¶ A(1)–(2). Han continues to manage both

companies, which sell their products by sending employees to

visit customers along designated sales routes. Def. 56.1

Response ¶ 2.

Plaintiffs

Young Taek Choi. Plaintiff Choi (also known as David)

worked for the defendants from approximately October 2016 to

1 Indeed, the defendants themselves repeatedly refer to each plaintiff

as working for “Defendants” collectively. See, e.g., Def. Opp. 2; Defs. Mot.

for Partial Summary J. 1, ECF No. 82. And two plaintiffs testified that the

companies effectively functioned as a single operation. See Shin Dep.

110:22–111:12; Son Dep. 5–12.

November 2017, and then again from February or March 2018 to

November 2018. See Pl. 56.1 ¶ B(a)(1); Han Decl. ¶ 5. Choi was

hired as a salesperson. See Han Decl. ¶ 6; Dep. of Young Taek

Choi2 (“Choi Dep.”) 31:23. Like other sales employees, Choi had

an assigned company vehicle and was responsible for selling the

defendants’ products in a designated area. Choi Dep. 52:18–22,

180:23–25. David left this job in fall of 2017, due to an

injury to his elbow. Pl. 56.1 ¶¶B(a)(1), (B)(a)(9); Def. 56.1

Response ¶(B)(a)(1). He returned the following year — to work

again as a salesperson, but with a different compensation

structure. Pl. 56.1 ¶¶ 1, 9-11.

Choi moves for summary judgment on all five causes of

action. The defendants have cross-moved for summary judgement

on three of Choi’s claims: his FLSA overtime wages, NYLL

overtime wages, and spread-of-hours claims (Counts I-III). The

defendants’ motion is predicated on the assertion that Choi

clearly qualifies, on the evidentiary record submitted, for the

“outside salesperson” exemption. Defs. Mot. for Partial Summary

J., ECF No. 82.

Yun Seob Shin. Plaintiff Shin, too, was hired as a

salesman. Dep. of Yun Seob Shin (“Shin Dep.”) 11:21-24, 26:14-

2 The Plaintiffs and Defendants submitted different excerpts from the

same deposition of Choi. See ECF Nos. 70-5, 82-1, 83-1. The deposition is

continuously paginated, and therefore consistently paginated in each excerpt.

Accordingly, the court refers to all Choi deposition excerpts as “Choi Dep.”

19, ECF No. 70-7; Han Decl. ¶ 12. He worked for the defendants

from July 2016 to March 2019. See Pl. 56.1 ¶ B(a)(1); Han Decl.

¶ 12;Shin Dep. 25:5–17.

The parties do not agree on the nature of Shin’s job

duties. Compare Han Decl. ¶¶ 16 with Shin Dep. 55:5–56:25. Han

testified that after six months, Shin became the companies’

Chief Marketing Officer (“CMO”), see Han Dep. 32:2–9; Shin

testified that he was never asked to take on the

responsibilities of a CMO and never actually did so. See Shin

Dep. 55:5–56:25. They agree that towards the end of his

employment, Shin also assisted Han in managing the defendants’

warehouse. Pl. 56.1 ¶¶ B(b)(5); see Oct. 26, 2021 Han Dep.

36:13-20.

They also diverge in their descriptions of his

compensation structure: Shin says he was to be paid weekly, Pl.

56.1 at (B)(b)(12)-(13), whereas the defendants claim he was

compensated through car payments and paid a base weekly salary

and monthly commission based on sales, Def. 56.1 Response ¶¶

(B)(1)(12)-(13); Def. Han Decl. ¶¶ 17-18.

It is undisputed that Shin spent seven months based in

Cleveland, Ohio, during which he also traveled to Pittsburgh for

work. Pl. 56.1 at ¶¶ (B)(b)(14)-(15). He also spent seven

months in Orlando, Florida, during which time he occasionally

worked in Georgia. See Shin Dep. 83:7-15, 101:4-15; Han Decl. ¶

13.

Shin moves for summary judgment on each of his claims.

The defendants oppose summary judgment, arguing that Shin, too,

is an exempt outside salesman, though (unlike with Choi) they

have not moved affirmatively for summary judgment on this basis.

As an alternative basis for denying Shin’s motion, the

defendants contend that Shin qualifies for the administrative

exemption, and / or that he is exempt under the “combined

exception,” for employees who perform multiple types of exempt

work. They also deny that he ever worked more than forty hours

per week. Defs. Mem. in Opp. to Pl. Summary Judgment (“Def.

Opp.”) 9-17, ECF No. 72.

Rachel Son. Plaintiff Son worked for the defendants

from May 2018 to March 2019. Pl. 56.1 ¶ B(d)(29); Han Decl. ¶

38. She performed “basic” “office job” duties including filing

and answering phones. Dep. of Rachel Son (“Son Dep.”) 11:17-

12:8, ECF No. 70-8. Son moves for summary judgment on each

claim. The defendants concede that Son is non-exempt, but they

oppose summary judgment nonetheless, contending there is a

material dispute over whether she ever worked more than forty

hours in a workweek. Def. Opp. 20-22.

Ji Hun Kim. Plaintiff Kim worked for the defendants

from approximately January or February 2016 to December 2017.

See Pl. 56.1 ¶ B(c)(18); Han Decl. ¶ 27. Like Son, Kim worked

in administrative roles at the corporate defendants’ offices.

See Pl. 56.1 ¶¶ B(c)(19), (30); Han Decl. ¶ 45. Her duties

included accounting, billing, and customer relations. See Dep.

of Ji Hyun Kim (“Kim Dep.”) 7:18-20, 11:21-23, ECF No. 70-6.

The parties dispute the scope of Kim’s authority. Han described

Kim as an “office manager” with the ability to hire, fire, and

train employees. Han Dep. 33:18–35:6; Han Decl. ¶ 31. But Kim

disputes that she ever held that title or any supervisory

responsibilities. Kim Dep. 15:11–22, 19:13-23. Kim also moves

for summary judgment on each claim; the defendants assert she is

an exempt administrative employee and see genuine disputes of

material fact as to the number of hours she worked.

* * *

Defendants’ Record-Keeping. The defendants concede

that they maintained no time clock, timecard machine, or other

standardized procedure to track any of the hours that the

plaintiffs worked. Pl. 56.1 ¶ A(6); see Han Dep. 25:1–9, 66:24–

67:2. They likewise admit that the plaintiffs never received

any “time-of-hire” notices or pay stubs. Pl. 56.1 ¶¶ B(a)(13),

B(b)(17), B(c)(28), B(d)(36); see Def. 56.1 Response 8, 13, 17,

20.

II. Legal Standard

Summary judgment is appropriate when the record

demonstrates that “there is no genuine dispute as to any

material fact and the movant is entitled to judgment as a matter

of law.” Fed R. Civ. P. 56(a). “A fact is material for these

purposes if it might affect the outcome of the suit under the

governing law. An issue of fact is genuine if the evidence is

such that a reasonable jury could return a verdict for the

nonmoving party.” Lovejoy–Wilson v. NOCO Motor Fuel, Inc., 263

F.3d 208, 212 (2d Cir. 2001).

The moving party has the burden of demonstrating the

absence of a dispute of material fact. Anderson v. Liberty

Lobby, Inc., 477 U.S. 242, 256 (1986). The movant can carry

that burden by “pointing out to the district court . . . an

absence of evidence to support the nonmoving party’s case.”

Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986).

If the movant carries its burden, “the nonmoving party

must come forward with admissible evidence sufficient to raise a

genuine issue of fact for trial in order to avoid summary

judgment.” Jaramillo v. Weyerhaeuser Co., 536 F.3d 140, 145 (2d

Cir. 2008). If the non-moving party fails to do so, the Court

should grant summary judgment. In performing this analysis, the

Court must “construe the facts in the light most favorable to

the non-moving party and must resolve all ambiguities and draw

all reasonable inferences against the movant.” Cunningham v.

Cornell Univ., 86 F.4th 961, 980 (2d. Cir. 2024).

When plaintiffs and defendants cross-move for summary

judgment, “the court must evaluate each party’s motion on its

own merits, taking care in each instance to draw all reasonable

inferences against the party whose motion is under

consideration.” Heublein, Inc. v. United States, 996 F.2d 1455,

1461 (2d Cir. 1993).

III. Discussion

A. Rule 56.1 Statement

Local Rule 56.1(a) requires that a short and concise

statement of undisputed material facts be filed with any motion

for summary judgment. The rule further provides that “[f]ailure

to submit such a statement may constitute grounds for denial of

the motion.” As mentioned above, the defendants have not

submitted an affirmative 56.1 statement in support of their

motion for partial summary judgment. Still, “[a] district court

has broad discretion to determine whether to overlook a party’s

failure to comply with the local rules,” including Rule 56.1.

Holtz v. Rockefeller & Co., 258 F.3d 62, 73 (2d Cir. 2001),

abrogated on other grounds by Gross v. FBL Fin. Servs., 557 U.S.

167, 176 (2009). The Court “may in its discretion opt to

conduct an assiduous review of the record even where one of the

parties has failed to file such as statement.” Id.; see also

Gilani v. GNOC Corp., No. 04-CV-2935, 2006 WL 1120602 (E.D.N.Y.

Apr. 26, 2006) (looking past parties’ failure to submit 56.1

statements and ruling on summary judgment motion based on the

record).3 I consider the defendants’ motion on its merits.

B. Plaintiffs’ Overtime Claims

The Fair Labor Standards Act and New York Labor Law

both require employers to pay time-and-a-half for hours worked

in excess of forty per week, unless a given employee falls into

one or more exempt categories. 29 U.S.C. § 207; Isett v. Aetna

Life Ins. Co., 947 F.3d 122, 125 (2d Cir. 2020). All plaintiffs

assert that they were non-exempt employees, that they worked

overtime, and that the defendants failed to pay them time-and-a-

half.

The defendants respond that there are genuine disputes

of material fact regarding whether Plaintiffs were exempt

employees and worked overtime. And as to plaintiff Choi, the

defendants cross-moved for summary judgment arguing there is no

genuine dispute of material fact that he was an exempt employee.

As set forth below, the defendants are entitled to

summary judgment based on Choi’s exempt status. There are,

however, triable issues of fact about the other three

3 This approach can be appropriate when, as here, all parties cite to

the record in their briefing. See Conte v. Cnty. of Nassau, No. 06-CV-4746,

2010 WL 3924677, at *1 n.2 (E.D.N.Y. Sept. 30, 2010).

plaintiff’s employment. Accordingly, none of the plaintiffs are

entitled to summary judgment on their overtime wage claims.

1. FLSA and NYLL Overtime Requirements

The FLSA generally requires employers to pay employees

overtime compensation for work in excess of forty hours per

week. 29 U.S.C. § 207(a). The NYLL has the same requirement.

See N.Y. Lab. L. § 651; 12 N.Y.C.R.R § 142-2.2.4

“To establish liability under the FLSA for a claim for

unpaid overtime, a plaintiff must prove that [he or she]

performed work for which [he or she] was not properly

compensated, and the employer had actual or constructive

knowledge of that work.” Kuebel v. Black & Decker Inc., 643

F.3d 352, 361 (2d Cir. 2011). The plaintiffs’ burden is

diminished, however, when an employer has not kept time records.

Both the FLSA and NYLL require employers to maintain

records of their employee’s work hours and wages. See 29 U.S.C.

§ 211(c); N.Y. Lab. L. §§ 196-a, 195(4). Here, the defendants

admit that they did not do so. Defs. 56.1 Response ¶ 6; Han

Decl. Tr. 66:24-67:2. Because of this, the plaintiffs “need

only present sufficient evidence to show the amount and extent

4 The NYLL may require an employer to pay overtime even when the FLSA

does not. See 12 N.Y.C.R.R § 142-2.2; Hayward v. IBI Armored Services Inc.,

954 F.3d 573, 575-76 (2d Cir. 2020) (under the NYLL, “employees subject to

FLSA exemptions” may be “nonetheless entitled to overtime compensation at a

rate of one and one-half times the minimum wage”).

of the uncompensated work as a matter of just and reasonable

inference.” Kuebel, 643 F.3d at 362.

A plaintiff may meet this burden “through estimates”

formed “based on his own recollection.” Id.; see Doo Nam Yang

v. ACBL Corp., 427 F. Supp. 2d 327, 335 (S.D.N.Y. 2005). “It is

well settled that this burden may be met solely through a

plaintiff’s testimony . . . .” Canela-Rodriguez v. Milbank Real

Est., No. 09-CV-6588, 2010 WL 3701309 (S.D.N.Y. Sept. 20, 2010);

see also Mangoni v. Smith & Laguercia, LLP, 661 F.Supp.2d 412,

417 (S.D.N.Y. 2009) (“[Plaintiff] has provided evidence of the

approximate number of hours for which she believes she is

entitled to overtime compensation, and Defendants dispute this

evidence. There is therefore a genuine dispute of material fact

on the issue.”). Once the plaintiff has submitted such

evidence, the burden shifts to the employer to present “evidence

of the precise amount of work performed or . . . evidence to

negative the reasonableness of the inference to be drawn from

the employee’s evidence.” Kuebel, 643 F.3d at 362.

2. Exemptions

Certain employees, however, are exempt from the FLSA’s

overtime protections. 29 U.S.C.A. § 213. The NYLL’s overtime

provisions likewise turn on these exemptions. See 12 N.Y.C.R.R.

§ 142–2.2 (providing different overtime coverage to employees

who are exempt under the FLSA than those who are not); id. at

§ 142–2.14 (excluding “outside salesperson[s]” and individuals

employed in an “[e]xecutive, administrative, or professional

capacity” from the NYLL’s definition of “employee” for overtime

pay). Where the same exemptions are relevant to the NYLL and

the FLSA, courts conduct a single analysis. See, e.g., Ramos v.

Baldor Specialty Foods, Inc., 687 F.3d 554, 556 n.1 (2d Cir.

2012); Kinney v. Artist & Brand Agency LLC, 13-cv-08864, 2015 WL

10714080 at *12 (S.D.N.Y. Nov. 25, 2015), report and

recommendation adopted, Case No. 13-cv-08864, 2016 WL 1643876

(S.D.N.Y. Apr. 22, 2016). The employer “bears the burden to

establish the applicability of an[y] exemption under the FLSA.”

Flood v. Just Energy Mktg. Corp., 904 F.3d 219, 227 (2d Cir.

2018). Two exemptions are at issue in this case: the “outside

salesperson” and “administrative” exemptions. If the employee’s

primary duties involve a combination of exempt categories — for

example, if she spends half her time on exempt “executive” work,

and half working as an outside salesperson, the employee will be

exempt under the “combined exception.” 29 CFR § 541.708.

Outside Salespeople. The FLSA’s overtime provisions

do not apply to “any employee employed . . . in the capacity of

outside salesman.” 29 U.S.C. § 213(a)(1). Congress delegated

authority to the Department of Labor to “issue regulations from

time to time to define and delimit” the term outside salesman.

Christopher v. SmithKline Beecham Corp., 567 U.S. 142, 147

(2012). “In light of the statute’s express delegation to the

Secretary of Labor, all of these regulatory definitions have the

force of law as much as though they were written in the

statute.” Flood v. Just Energy Marketing Corp., 904 F.3d 219,

228 (2d Cir. 2018).

As the DoL currently defines it, an outside salesman

is an employee whose “primary duty” is “making sales” or

“obtaining orders or contracts,” and who is “customarily and

regularly engaged away from” the employer’s premises in that

effort. 29 C.F.R. § 541.500(a); see also 12 N.Y.C.R.R. § 142–

2.2 (applying FLSA Exemption 13(a)(1), the outside salesman

exemption); 12 N.Y.C.R.R. § 142–2.14(c)(5) (defining outside

salesperson). The term “sale” is defined to include “any sale,

exchange, contract to sell, consignment for sale, shipment for

sale, or other disposition.” 29 U.S.C. § 203(k).

Administrative Employees. The FLSA’s overtime

provisions do not apply to “any employee employed in a bona

fide . . . administrative . . . capacity.” 29 U.S.C.

§ 213(a)(1); see also 12 N.Y.C.R.R. § 142–2.2 (applying FLSA

Exemption 13(a)(1)); id. § 142–2.14(4)(ii) (definition of

administrative capacity). The administrative exemption applies

to an employee “[w]hose primary duty is the performance of

office or non-manual work directly related to the management or

general business operations of the employer or the employer’s

customers.” 29 C.F.R. § 541.200(a)(2) (2019). Clerical roles

do not qualify: the administrative employee’s duties must

include “the exercise of discretion and independent judgment

with respect to matters of significance.” Id. § 541.200(a)(3).

Identifying Primary Duties. In the context of both

exemptions, the phrase “primary duty” refers to the “principal,

main, major or most important duty that the employee performs,”

based on the totality of the relevant circumstances. 29 C.F.R.

§ 541.700(a). The identification of a primary duty depends on

“all the facts in a particular case, with the major emphasis on

the character of the employee’s job as a whole.” Id. That

said, “employees who spend more than 50 percent of their time

performing exempt work will generally satisfy the primary duty

requirement.” Id. § 541.700(b).

The DoL has identified four non-exclusive factors

relevant to this determination: (1) “the relative importance of

the exempt duties as compared with other types of duties”; (2)

“the amount of time spent performing exempt work”; (3) “the

employee’s relative freedom from direct supervision”; and

(4) “the relationship between the employee’s salary and the

wages paid to other employees for the kind of nonexempt work

performed by the employee.” Id. § 541.700(a); see Domenech v.

Parts Authority, Inc., 653 F. App’x 26, 27 (2d Cir. 2016). The

DoL has also adopted “primary duty” regulations specific to

certain types of employment. One is relevant here: the

regulations defining the outside-sales exemption provide

guidance on how to identify the primary duties of “[d]rivers who

deliver products and also sell such products.” See 29 C.F.R.

§ 541.504(a).

While these exemptions were previously narrowly

construed, that is no longer the case; courts now “have no

license to give the exemption anything but a fair reading.”

Vasto v. Credico (USA) LLC, 767 F. App’x 54, 56 (2d Cir. 2019);

see also Encino Motorcars, LLC v. Navarro, 584 U.S. 79, 89

(2018) (“Those exemptions are as much a part of the FLSA’s

purpose as the overtime-pay requirement.”). “The question of

how an employee spends his or her time working is one of fact,

while the question of whether those work activities exempt him

or her from the FLSA is one of law.” Flood, 904 F.3d at 227.

3. Plaintiff Choi

Both Choi and the defendants move for summary judgment

on Choi’s overtime claims. The defendants’ motion is based on

their contention that Choi was an “outside salesperson” and is

therefore exempt from the overtime-wage requirements at issue.

To succeed, the defendants must demonstrate that there is no

genuine dispute that the exemption’s two requirements are

satisfied: (1) Choi’s “primary duty” was making sales, and (2)

he was “customarily and regularly engaged away from his

employer’s place of business in performing that duty.” 29

C.F.R. § 541.500(a). In conducting this analysis, courts look

not only to the wording of the exemption itself, but also to the

examples of outside salespeople that the DoL has provided at 29

C.F.R. §§ 541.504(c)(1)–(4). And some courts have looked to

certain “indicia” or “hallmarks” of sales work, including the

receipt of commissions. See, e.g., Heras v. Metropolitan

Learning Inst. Inc., Case No. 19-cv-2694, 2023 WL 5810784 at *9

(E.D.N.Y Aug. 18, 2023; Martin v. Sprint United Mgmt. Co., 273

F. Supp. 3d 404, 439–40 (S.D.N.Y. 2017).

Choi argues that he does not qualify for the exemption

because:

he was not paid commissions for much of his

employment with Defendants, he spent a

significant portion of his workday at

Defendants’ offices loading, organizing or

unloading his vehicle or entering

information into Defendants’ computer

systems, and he was required to regularly

work in Defendants’ offices on Saturdays to

perform inventory and organize the

warehouse.

Choi Letter in Opposition to Def. Mot. for Summary Judgment

(“Choi Opp.”), ECF 84 at 2. These arguments do not carry the

day.

Choi does not dispute that his role included “making

sales.” And the undisputed facts show that to have been his

primary duty.

The DoL construes sales activity broadly, to include

efforts in preparation for the selling effort as well as the

sales pitch itself. “In determining the primary duty of an

outside sales employee, work performed incidental to and in

conjunction with the employee’s own outside sales or

solicitations, including incidental deliveries and collections,

shall be regarded as exempt outside sales work.” 29 C.F.R.

§ 541.500(b); 5 see also 29 U.S.C. § 203(k) (defining “sale” to

include an ”exchange,” “consignment,” “shipment for sale, or

other disposition.” And Section 541.504, which addresses

salespeople who drive, states: “In determining the primary duty

of drivers who sell, work performed incidental to and in

conjunction with the employee’s own outside sales or

solicitations, including loading, driving or delivering

products, shall be regarded as exempt outside sales work.”

Choi testified that he was “hired as a salesperson”

and originally worked the “Brooklyn route.” Choi Dep. 9:25-

10:2, 79:20-25. He had “seven to eight” years of sales

experience when he joined the defendant companies. Id. at 32:7-

10. In lieu of formal training with the defendants, he “went

out with a former salesperson on the sales route together” for

5 The same regulation continues: “Other work that furthers the

employee’s sales efforts also shall be regarded as exempt work including, for

example, writing sales reports, updating or revising the employee's sales or

display catalogue, planning itineraries and attending sales conferences.”

Id.

“two to three weeks” after he started. Id. at 31:5-11. His

“job involved door-to-door work,” as he visited and sold tools

to the customers along his route. Id. at 87:3–5, 180:23-24.

Choi testified that his sales performance grew over

time: after five or six months in the role, he “was at the top”

of the sales group in terms of volume of goods sold. Id. at

137:22-138:6; 170:8-10. In his assessment, “new accounts [that

he] established” had a “closer relationship with [him] than the

company itself.” Id. at 33:19-22. See Chenensky v. N.Y. Life

Ins. Co., 7-CV-11504, 2009 WL 4975237, at *5 (S.D.N.Y. Dec. 22,

2009) (considering, among other “hallmark activities,” “whether

the employee independently solicits new business”).

He also spent a substantial amount of his time on the

road, showing he was “customarily and regularly engaged away

from his employer’s place of business in performing [his sales]

duty.” 29 C.F.R. § 541.500(a). Choi described his work as

“door-to-door visiting [of customers] and driving.” See Choi

Dep. at 86:2-3, 87:3–5. He testified that he “would mostly

arrive at 8:00, and [do] the loading and unloading for about an

hour or an hour and a half,” and then “leave right away” for his

sales route. Id. at 179:22-180:13. After he visited “12 to 15

[customer] locations a day,” id. at 166:15-16, he would return

to the office by 5:00 P.M. to “do loading and unloading and

input information in the computer,” id. at 182:14-22. See 29

C.F.R. § 541.500(b) (exempt sales work includes “writing sales

reports, updating or revising the employee’s sales or display

catalogue, [and] planning itineraries”).

Based on this evidence, “no reasonable juror could

conclude that Plaintiff’s non-sales duties accounted for more

than 50% of his job duties—particularly because Plaintiff admits

that they took less than half of his work time.” Tortorici v.

Bus-Tev, LLC, No. 17-CV-7507, 2021 WL 4177209, at *2 (S.D.N.Y.

Sept. 14, 2021). And “employees who spend more than 50 percent

of their time performing exempt work will generally satisfy the

primary duty requirement.” 29 C.F.R. § 541.700.

In opposing the outside-salesman designation, Choi

relies, first, on the assertion that he was not paid on

commission for “much of his employment” — a reference to the

second period of Choi’s work for Defendants. But the Second

Circuit has counseled that the outside-sales analysis should

turn on the contents of the “regulation defining what it means

for an employee to be ‘making sales,’” Flood, 904 F.3d at 233,

and that regulation does not require commission payments. It is

true that the Supreme Court referred to the pharmaceutical

employees in Christopher as bearing the “external indicia of

salesmen,” including that “they were rewarded for their efforts

with incentive compensation.” 567 U.S. at 166. But as the

Second Circuit has noted, this was a “passing reference.”

Flood, 904 F.3d 233; see also Vasto v. Credico, 767 Fed. App’x

54, 57 (2d. Cir. 2019)(plaintiffs’ invocation of the “indicia of

outside salespersons” referred to “what is arguably dicta in

Christopher”). Moreover, nothing in Christopher (whether dicta

or not) suggests that each and every indicium is a necessary

condition for the exemption’s application.6

The DoL regulations at issue are plainly focused on

the nature of the work the employee does, rather than the manner

of compensation. See 29 C.F.R. §§ 541.500, 541.504. Moreover,

the regulations’ single reference to commission-based

compensation actually militates against a determination that

such compensation is a necessary condition to the exemption’s

application. In Section 504’s list of four examples of drivers

who may qualify as exempt, the first one refers explicitly to a

driver who “receives compensation commensurate with the volume

of products sold.” Id. § 541.504(c)(1). The next three

examples, in contrast, make no reference to compensation at all.

See id. This omission plainly suggests that commission

compensation is not a necessary ingredient. Further, the nature

6 In Christopher, the Court referenced five potential indicia of an

outside salesman: “sales experience,” sales training, “work[ing] away from

the office,” “minimal supervision,” and “incentive compensation.”

Christopher, 567 U.S. at 165-66. The Second Circuit has counseled against

over-reliance on these indicia. Flood, 904 F.3d at 233 n.8. Even so, of the

Christopher indicia, all but one clearly favor categorizing Choi as an exempt

outside salesperson: He was hired for his sales experience, see Choi Dep.

32:7-10, 92:11-20, received on-the-job sales training, see id. at 31:5-11,

worked away from the office regularly, see id. at 87:3-5, 166:13-23, 180:23-

24, and was relatively minimally supervised, see id. at 86:9-87:24, 166:9-12.

of Choi’s employment maps neatly onto the characteristics listed

in three of the DoL’s examples. He “obtain[ed] or solicit[ed]

orders for the employer’s products from persons who ha[d]

authority to commit the customer for purchases.” 29 C.F.R..

§ 541.504(c)(2); see Choi Dep. 33:19-22, 51:13-15, 165:10-

166:12. And the record reflects that Choi both “call[ed] on new

prospects” and “established customers” along his sales route to

persuade them “to accept delivery of increased amounts of goods

or of new products.” 29 C.F.R. §§ 541.504(c)(3)–(4); see Choi

Dep. 33:11-22, 92:11-20, 166:15-16.

Choi briefly argues that the outside salesman

exemption is intended to apply to employees who “typically earn

salaries well above minimum wage,” and that he did not. Choi

Opp. at 1-2. But, the Second Circuit has rejected the argument

that “poor[] compensation” means someone is not an outside

salesman. Vasto, 767 Fed. App’x 54, 57. “In the absence of

words in the statute or regulation that require consideration of

the plaintiff’s level of compensation when deciding if an

employee is ‘making sales,’ we decline to add a ‘subject to

compensation’ exception to the ‘making sales’ requirement of the

outside salesmen exemption under the FLSA.” Id. Choi’s

argument is thus unavailing.

Choi also points to evidence of his other job

responsibilities, which he characterizes as unrelated to making

sales. These include: organizing his assigned sales truck,

making deliveries, collecting payment, exchanging defective

products, entering sales information into the computer system,

and organizing the warehouse and taking inventory. Pl. 56.1 ¶

B(a)(2); see also Choi Dep. 74:16-20 (“I’m suing because I

didn’t get overtime for all the loading and unloading delivery

and driving the van. That’s why I filed the lawsuit. They

wouldn’t pay me for that.”).

The majority of these tasks are, however, actually

consistent with the outside-salesperson exemption. This

includes loading and unloading: for drivers who sell, “loading

[and] delivering products” are expressly identified as exempt

work. 29 C.F.R. § 541.504(a). So are “incidental deliveries

and collections.” Id.; see also id. § 541.500(b) (stating that

“work performed incidental to and in conjunction with the

employee’s own outside sales . . . shall be regarded as exempt

outside sales work”).

To be sure, Choi has adduced evidence that he

performed tasks that are not explicitly exempted. Each of

these, however, is either clearly incidental to his sales work,

or took only a very small fraction of Choi’s time (or both).

For example, the defendants held monthly meetings for sales

employees. Pl. 56.1 ¶ 8. Although the record reveals little

about what transpired at those meetings, other district courts

have found sales meetings to be exempt activities. See

Cangelosi, 2015 WL 6107730, at *1 (finding “attending trade

shows and meetings” to be incidental to sales); Marcus v. AXA

Advisors, LLC, 307 F.R.D. 83, 99 n.20 (E.D.N.Y. 2015) (“[T]he

in-office follow-up meetings conducted by some 20th edition

agents could be considered in-office work ‘in conjunction with

the employee’s own outside sales’ within the meaning of 29

C.F.R. § 541.500.”). Given that these sessions are specifically

identified as sales meetings, Pl. 56.1 ¶ B(b)(8), there is no

logical reason to distinguish them from activities like

“attending sales conferences” which are specifically exempted.

In any event, these meetings took only an hour to three-and-a-

half hours a month. Id.

Choi also worked some Saturdays, for roughly six hours

a day (or, according to the defendants, three to four hours).

Pl. 56.1 ¶ B(a)(6); Def. 56.1 Resp. ¶ B(a)(6). He testified

that he worked on a Saturday “probably once a month, because we

had to check the inventory.” Choi Dep. at 103:4-17; see also

id. (“So they were afraid that salesmen might steal something,

so they have us check the inventory. That was about once a

month or every two months.”). In addition to this “inventory

check,” Choi and others “had to clean the van and [see to]

organization.” Id. 103:15-17; see also id. 107:12-13 (“Most of

the time when I went in [on Saturdays], it was to organize the

van.”).

For purposes of the defendants’ motion, and drawing

all inferences in Choi’s favor, we count the “inventory check”

that Choi testified about in the non-exempt category. Choi does

not specify what the check consisted of, but the deposition

transcript is fairly read to indicate that he was checking

inventory separate and apart from his own sales activity. See

Killion v. KeHE Distributors, LLC, 761 F.3d 574, 585-86 (6th

Cir. 2014) (describing inventory management for others as not

incident to sales). Even so, Choi testified he spent six hours

a month engaged in this activity. Adding those six hours to the

eight-hour days he worked, five days a week, yields a total of

166 hours a month. On that denominator, the six hours of

Saturday work constituted roughly 3.6% of his time. This is

well below the 50% threshold that generally satisfies the

“primary duty” test. 29 C.F.R. § 541.502.

Finally, Choi spent some amount of time exchanging

defective items. Pl. 56.1 ¶ B(a)(2). The parties agree that

the salespeople would do exchanges for “their” customers, see

id., and to the extent Choi was exchanging items that he had

sold himself, that work was clearly “directly and closely

related” to Choi’s exempt sales work and therefore was itself

exempt. 29 C.F.R. § 541.703. Indeed, as the DoL’s “Making

Sales” regulation points out, the authorizing statute itself

defines a “sale” to include any “exchange” or “other

disposition.” Id. § 541.501(b) (citing 29 U.S.C. § 203); see

also Chenensky, 2009 WL 4975237, at *6 (holding that maintaining

good relationships with and “presenting . . . solution[s]” to

customers constituted work incidental to sales).

The undisputed record therefore indicates that Choi

was an exempt outside salesman and Defendant’s summary judgment

motion on Choi’s FLSA and NYLL overtime wage claims is granted.

4. Plaintiff Shin

a. Material disputes of fact exist regarding whether

Shin qualifies as an exempt outside salesperson

Shin moved for summary judgment on all counts; the

defendants did not cross-move but they oppose Shin’s motion by

arguing he should be treated as an exempt outside salesman. As

noted above, for Shin to be treated as an exempt outside

salesman, the defendants must raise triable issues of fact that:

(1) his primary duty was “making sales,” and (2) he was

“customarily and regularly engaged away from [his] employer’s

place of business” in performing that duty. 29 U.S.C.

§ 213(a)(1). Shin effectively concedes the second prong. He

testified to spending most of his day on the road when working

out of New York. Shin Dep. 24:5-13, 26:21-23. And for the

seven months he spent in Cleveland and seven months he spent in

Florida, he maintained a similar schedule on the road. Id. at

25:25-26:2, 113:20-22, 121:22-122:5.

The first prong has two elements: does the employee

make sales and is that the employee’s primary duty. See 29

U.S.C. § 213(a)(1). On this prong, Shin does not dispute that

he made sales and a reasonable juror could comfortably conclude

that that was Shin’s primary duty. First, as to the relative

importance of his exempt and non-exempt duties, Shin’s own

deposition testimony indicates that his position primarily

involved making sales. Shin testified that he was hired for a

sales position and remained “a salesman,” even if “doing other

things as well.” Shin Dep. at 11:21-24, 26:14-19. Like Choi,

he would drive a truck along an assigned route to solicit and

make sales to customers. Id. at 24:8-10, 26:20-27:13. When

Shin first started at the company, he covered routes for other

sales representatives while they were away. Id. at 29:22-30:4.

His time in Cleveland is particularly indicative of a sales

focus. Shin testified that, while Cleveland had no existing

customers when he arrived, he was able to establish at least

fifty to seventy customers in the area. Id. at 30:7-16, 115:18-

21. He also was a primary point of contact between customers

and the company; for example, he would give customers his

personal number, which they would call directly. Id. at 28:4-

16.

Shin asserts that he, like Choi, had various other job

responsibilities that were unrelated to making sales, including:

organizing products in the defendants’ trucks, making product

deliveries, and organizing the warehouse and taking inventory.

See Pl. 56.1 ¶ B(b)(4); Pl. Mem. 10–11. Shin estimated, for

example, that he spent fifty to eighty minutes every morning

loading up his van prior to leaving for his sales route. Shin

Dep. 24:5-22. He also testified that he would spend minutes to

an hour daily logging sales after he had finished his route.

Id. at 27:5-11. At the very least, the defendants raise triable

issues of fact as to whether these activities were “incidental

to and in conjunction with the employee’s own outside sales or

solicitations.” 29 C.F.R. § 541.500(b).

Second, evidence in the record reflects that Shin

spent the majority of his time visiting clients to make sales.

Shin testified that he spent most of his day on the road: he

would spend fifty to eighty minutes in the morning loading his

van and then leave between 8:30 a.m. and 9:00 a.m.; drive his

route; and then return to the office between 5:00 p.m. and 7:00

p.m. to input sales information into the office computers. See

Shin Dep. 24:5-22, 26:23-27:13.

Third, Shin’s relative lack of supervision supports

the outside sales exemption. The defendants point, in

particular, to Shin’s time in Cleveland, where he successfully

built up the company’s customer base and sales through his

efforts. Shin testified that he gave his personal number to

customers and could adjust his route based on calls from them.

Id. at 30:13-16. He also testified that he had authority to

negotiate price with customers, provided a certain minimum was

achieved. Id. at 34:16-21.

In the end, the record does not clearly establish

Shin’s duties throughout the length of his tenure. For example,

in addition to his salesman duties, and those described below in

relation to the administrative exemption, Shin also helped

manage the defendants’ warehouse for the last year of his

employment. Pl. 56.1 ¶ 5. Han testified that Shin did this

with Han and one other individual after Jiwoo Han left the

company (which was in March 2018). Han Dep. 36:13-23. The

record does not indicate precisely what this warehouse-

management role entailed, or how long Shin spent on it.

Thus, because the defendants raise triable issues of

fact regarding whether Shin falls within the outside salesman

exemption, summary judgment is denied on his overtime wage

claims.

b. Disputes of fact remain as to whether Shin

qualifies as an exempt administrative employee

The defendants also assert that Shin was a “bona fide

administrative” employee and therefore exempt from the FLSA and

NYLL’s overtime-pay requirement. Administrative employees are

those who are “[c]ompensated on a salary or fee basis” in

accordance with certain salary requirements, and whose primary

duty: (1) is the performance of office or non-manual work

directly related to the management or general business

operations of the employer or the employer’s customers; and (2)

includes the exercise of discretion and independent judgment

with respect to matters of significance.” 29 C.F.R. § 541.200;

Isett v. Aetna Life Ins. Co., 947 F.3d 122, 127 n.7 (2d Cir.

2020). The NYLL similarly recognizes an administrative employee

exemption, see 12 N.Y.C.R.R. § 142-2.1(c)(4)(ii), and courts

typically conduct one combined analysis. See, e.g., Timberg v.

Toombs, No. 20-CV-6060, 2022 WL 954739, at *5 (E.D.N.Y. Mar. 30,

2022) (collecting cases); Sethi v. Narod, 974 F. Supp. 2d 162,

184 (E.D.N.Y. 2013).7

7 The NYLL exemption also requires that the individual “regularly and

directly assist[] an employer, or an employee employed in a bona fide

executive or administrative capacity (e.g., employment as an administrative

assistant),” or “perform[], under only general supervision, work along

specialized or technical lines requiring special training, experience or

First, the parties do not dispute that Shin’s

compensation met the FLSA’s base-salary threshold in full and

the NYLL’s threshold in part. During the relevant period,

FLSA’s administrative exemption applied to employees who

received a base salary exceeding $455 per week. 29 C.F.R.

§ 541.200(a). The NYLL also has a base-salary requirement,

which was as follows for New York City employers with eleven or

more employees: $825.00 per week, from December 31, 2016 through

December 30, 2017; $975.00 per week from December 31, 2017

through December 30, 2018; and $1,125.00 per week after December

31, 2018. 2 NY.C.R.R. 142-2.14(c)(4)(i)(1).

Han attested that Shin’s salary was $560 per week from

July 4, 2016 to July 10, 2016; $600 per week from July 11, 2016

to September 11, 2016; $650 per week from September 12, 2016 to

November 6, 2016; November 7, 2016 to January 31, 2017, $700.00

per week; and $1,800 per week from February 1, 2017 to March 8,

2019. Han Decl. ¶ 12. Shin does not dispute these

representations. Thus, Shin’s salary exceeded the FLSA minimum

for the full period of employment and exceeded the NYLL minimum

from February 1, 2017, through the end of his employment.

Because his salary does not meet the NYLL threshold from July 4,

2016 to February 1, 2017, the defendants argue instead that the

knowledge” — in addition to the salary minimum, office or nonmanual work, and

exercise of discretion and independent judgment requirements found in FLSA.

12 N.Y.C.R.R. § 142–2.14(c)(4)(ii).

outside salesman exemption should apply to this time period for

that claim.

There are, however, disputes of fact regarding whether

Shin’s primary duty of office or non-manual work directly

related to management or general business operations of the

employer or employer’s customers.” 29 C.F.R. § 541.200(a)(2).

To satisfy the second element of the administrative exemption,

an employee must “perform work directly related to assisting

with the running or servicing of the business, as distinguished,

for example, from working on a manufacturing production line or

selling a product in a retail or service establishment.” 29

C.F.R. § 541.201(a). “[E]mployees performing general

administrative work applicable to the running of any business”

may fall within the administrative exemption, while “employees

directly producing the good or service that is the primary

output of a business” do not. Davis v. J.P. Morgan Chase & Co.,

587 F.3d 529, 535 (2d Cir. 2009).

As most relevant here, administrative operations may

include “advising the management, planning,” “representing the

company,” “promoting sales,” and “business research and

control.” Reiseck v. Universal Commc’ns of Miami, Inc., 591

F.3d 101, 106 (2d Cir. 2010) (citing 29 C.F.R. § 541.205(b)).

“[S]ales promotion consists of marketing activity aimed at

promoting (i.e., increasing, developing, facilitating, and/or

maintaining) customer sales generally,” and “an employee

encouraging an increase in sales generally among all customers

is an administrative employee” under FLSA. Id. at 107.

The record contains evidence that, notwithstanding the

parties’ dispute over his formal title, Shin engaged in some

sales promotion activities — and not simply sales — during his

employment. The defendants point, in particular, to his work

outside New York. Shin was sent to Cleveland for seven months,

where he developed a new market from scratch, identified

potential customers, and established the company brand. Shin

Dep. 30:7-16, 115:18-21. After creating a viable sales

territory there, he identified and trained a salesman to take on

a sales role in that territory. Id. at 84:11-13. He also went

to Orlando for seven months, where he was tasked with helping a

struggling regional manager, “mak[ing] a sales territory” and

expanding the customer base. Id. at 114:20-115:21.

Additionally, Shin traveled to Columbus, Ohio to conduct market

research, see id. at 92:18-19, and went to Las Vegas at least

once a year to attend a trade show, where he met wholesalers and

performed market research into the products sold by potential

competitors, see id. at 93:24-95:5.

Disputes of fact also exist as to the third element of

the exemption: whether Shin’s primary duty included “the

exercise of discretion or independent judgment on matters of

significance.” 29 C.F.R. § 541.200(a)(3). Exercising

discretion and independent judgment “involv[es] the comparison

and the evaluation of possible courses of conduct, and acting or

making a decision after the various possibilities have been

considered.” Id. § 541.202(a). Responsibilities like “clerical

or secretarial work, recording or tabulating data, or performing

other mechanical, repetitive, recurrent or routine work” do not

count. Id. § 541.202(e). “Matters of significance,” in turn,

“refers to the level of importance or consequence of the work

performed.” Id. § 541.202. The defendants proffer evidence

that Shin’s work required him to exercise discretion and

independent judgment— again, especially during his time outside

of New York. As discussed above, he established a new market

for the company in Cleveland, which efforts included identifying

and training a new salesman for that area, and worked to expand

the customer base in Orlando. Shin Dep. 83:6-84:13. While

Plaintiffs assert that Han “made [the] decisions about expanding

the [Cleveland and Orlando] territory[ies] and hiring new

salespeople there,” they concede that Chin went to “set up new

sales territories” in those cities. See Pl. Mem. 5. Han also

attested that Shin supervised and trained various other

employees, including salesman in Florida, Georgia, and New York.

See Han Decl. ¶ 16. These responsibilities at least raise

triable issues of fact as to whether Shin exercised discretion

and independent judgment.

In sum, disputes of material fact remain regarding

whether Shin is exempt as an individual employed in an

administrative capacity, apart from or in addition to the

applicability of the outside salesman exemption. Summary

judgment as to Shin’s overtime wages claim is therefore denied.

c. Material disputes of fact exist regarding Shin’s

working hours

Genuine disputes of facts also exist regarding Shin’s

hours during his time spent working in New York. On the one

hand, Shin testified that he generally reported to work at 7:40

a.m., but many times came in before then. Shin Dep. 18:19-

19:14, 59:4-18. On weekdays, an early return to the office from

his sales route was 5:00 p.m., but he often did not return until

6:00 p.m. or 7:00 p.m., and sometimes as late as 10:00 p.m.,

depending on how far he had to travel. Id. at 26:20-27:13,

49:20-50:3. Shin further testified that the defendants held

monthly meetings on Friday evenings for sales employees, which

would start at 7:30 p.m. or 8:00 p.m. and end around 10:00 p.m.

or 11:00 p.m. Id. at 52:23-53:22. He also often had to work

Saturdays and Sundays, including doing inventory once or twice a

month, which “usually [took] six to seven hours.” Id. at 74:13-

75.

In rebuttal, the defendants offer evidence regarding

the salespeople’s typical workdays, early morning hours, and the

frequency and duration of weekend work: namely, that salespeople

arrived in the morning around 8:00 a.m. and returned in the

afternoon between 3:00 p.m. and 5:30 p.m. See Han Decl. ¶ 4,

23; Jiwoo Han Decl. ¶ 5. Han also placed the frequency and time

of weekend work as occurring only “once every three or six

months” and lasting three to four hours each time. See Han Dep.

104:21–22; Han Decl. ¶ 25.

The defendants do not, however, dispute Shin’s

assertions of hours worked during his seven months in Ohio and

seven months in Florida. At his deposition, Shin testified that

he worked three days in Pittsburgh and two days in Cleveland

each week, and sometimes on Saturday. See Shin Dep. 83:8-11.

On days that he went to Pittsburgh, he would leave at 5:00 a.m.

and finish work at 8:00 p.m. or 9:00 p.m. Id. at 83:11-15.

According to Shin, he maintained this schedule for the “whole

six months.” Id. at 83:16-19. Similarly, Shin testified that,

while working in Florida, he worked from 8:00 a.m. until 6:00

p.m. or 7:00 p.m. every day, and worked on Saturdays three times

a month. Id. At 121:24-122:20. The defendants point to no

evidence to rebut these assertions. See Def. 56.1 Response 16–

17.

Notwithstanding the undisputed evidence indicating

that Shin worked more than forty hours at least during some

weeks, summary judgment is nevertheless denied because the

defendants raise triable issues of fact regarding whether he

falls within the outside salesman or administrative exemption

(or a combined exemption).

5. Plaintiff Kim

Jeannie Kim testified, and Han did not meaningfully

contest, that she worked more than forty hours during at least

some weeks. Kim stated that she started work at 9:00 a.m. and

“usually” stopped around 8:00 p.m., for 11 hours a day. See Kim

Dep. 10:21-11:12. Defendant Han, in turn, testified that Kim

“[s]ometimes left at 6:00, sometimes at 7:00, sometimes at

8:00.” Han Dep. 17:10–16; see Han Decl. ¶ 34. The parties

dispute whether Kim took a lunch break. Compare Kim Dep. 30:8-

19, with Han Decl. ¶ 45. Even assuming she did take a full

lunch break each day, however, her post-6:00 p.m. work would

have put her over the forty-hour limit and would require

overtime compensation. Indeed, the defendants only “[d]ispute

. . . how often she worked past 6:00” — not that she ever did

so. Def. 56.1 Response 16.

As with Shin, however, Kim is not entitled to summary

judgment on her overtime wage claims: Even if she worked more

than forty hours a week, the defendants raise triable issues of

fact regarding how often she did so and whether she is an exempt

administrative employee.

There is no dispute that Kim’s compensation exceeded

both FLSA’s and NYLL’s base salary thresholds, satisfying the

first requirement of the exemption. In her responses to the

defendants’ interrogatories, Kim stated that she was paid

$800.00 per week from the beginning of her employment on January

15, 2016 until September 18, 2016, and then paid $925.00 from

September 19, 2016 until the end of her employment on December

15, 2017. See Pl. Inter. Responses 3, ECF No. 70-17. Thus,

Kim’s salary exceeded the both the FLSA and NYLL minimum salary

thresholds throughout the relevant period. See 29 C.F.R.

§ 541.200(a); 2 NY.C.R.R. 142-2.14(c)(4)(i)(1).

Nor does Kim meaningfully dispute that her “primary

duty of office or non-manual work directly related to management

or general business operations of the employer or employer’s

customers.” 29 C.F.R. § 541.200(a)(2). See Pl. Memo at 11

(focusing only on whether defendants can show Kim exercised

discretion and independent judgment in performing her duties).

She therefore satisfies the second requirement of the

administrative exception.

The parties sharply dispute, however, the third part

of the administrative exemption: whether Kim’s primary duties

included “the exercise of discretion or independent judgment on

matters of significance.” 29 C.F.R. § 541.200(a)(3). Han

testified that Kim acted as the “office manager” and had the

authority to hire, fire, and train employees, which she

exercised on at least one occasion by recruiting and hiring a

new employee who later became her executive assistant. See Han

Dep. 33:18–35:6; Han Decl. ¶¶ 30, 35. He also attested that she

“took care of the office and managed the office employees,”

including by monitoring their punctuality. Id. at ¶¶ 30, 32.

The defendants argue this required discretion as she dealt with

personnel and showed Kim’s implementation of a significant

company policy. See Def. Opp. 19. According to the defendants,

Kim also “trained employees in managing account receivable and

payable software, data entry and management, customer relations,

financial record organizing, bookkeeping and other

administrative tasks.” Id. ¶ 31.

Kim tells a different story, asserting that she sought

direction from Han in deciding how to do her work and did not

supervise any other employees. See Pl. 56.1 ¶ B(c)(19)—(21);

Kim Dep. 15:15–22. For example, Kim disputed that she worked as

an office manager or supervised anyone in that role, and she

denied hiring or firing anyone during her employment. See Kim

Dep. 15:11–22, 19:13-23. She also testified that all personnel

paperwork was handled by Han or a CPA, and she was not involved

in personnel issues. See id. at 96:11-97:16, 84:25-85:10.

Ultimately, these factual questions regarding the

scope and responsibilities of Kim’s position are best left for a

jury to resolve. Because the defendants raise triable issues of

fact regarding whether Kim falls within the administrative

exemption, summary judgment is denied on her overtime wage

claims.

6. Plaintiff Son

Finally, material disputes of fact exist regarding

Rachel Son’s weekly hours. On the one hand, Son testified that

she could never leave before 6:00 p.m., because she had to wait

for salespeople to return to the office, input their invoices,

and collect their checks for depositing. Son Dep. 18:2-14,

60:20-63:8. She “mostly picked up [her] kid” from childcare at

7:00 p.m. because she left work late. Id. at 52:7-14. She also

deposited the checks collected from the salespeople each day

after leaving the office, which took between five and fifteen

minutes. Id. at 52:15-54:21. On several occasions, she made

these deposits after picking up her child from daycare. Id. at

75: 21-25. Son also testified that she only took fifteen to

twenty minutes for lunch and did not receive a break. Id. at

30:19-31:25. Plaintiffs point to ATM deposit receipts as late

as 9:00 p.m. as indicative of her long working hours.

On the other hand, Han states that Son was given a one

hour lunch break and left early before 6:00 p.m. every day to

pick up her child. Han Decl. ¶¶ 38, 45. As the defendants

point out, Han worked in the same office as Son and therefore

had personal knowledge of her work hours and lunch break. Def.

Opp 21; see Pl. 56.1 ¶ A(7). Son herself acknowledged that when

Han was in the office (in other words, not out of town or on a

business trip), “there was [n]ever a day when he left before

[she] did.” Son Dep. 83:10-18. The defendants also produced an

affidavit from Hannah Ko, the principal of Son’s child’s daycare

center for the relevant time period. See Aff. of Hannah Ko (“Ko

Aff.”), ECF No. 70-16. Ko stated that “Son generally dropped-

off her child between 8:30 am and 8:40 am” and “usually picked

up her child by 5:30 p.m.” Id. ¶¶ 3, 5. “[A]pproximately 5 to 6

days per month, she picked up her child between 6:00 p.m. and

6:10 p.m..” Id. ¶ 5.

Because there are factual disputes regarding Son’s

weekly hours, summary judgment on her overtime claims is denied.

C. Plaintiffs’ NYLL Wage Notice and Statement Claims

Plaintiffs also move for summary judgment on their

NYLL claims that the defendants failed to provide proper wage

notice and statements. Summary judgment is denied because the

defendants raise affirmative defenses that turn on Plaintiffs’

hours worked and applicable exemptions, which are disputed for

the reasons set forth above. Moreover, Plaintiffs will be

directed to show cause why these claims should not be dismissed

for lack of standing.

1. Summary Judgment

Section 195(1) of the NYLL obligates an employer to

give a wage notice to an employee at the time of hiring. See

N.Y. Lab. L. § 195(1). That notice must include, among other

things, “the rate or rates of pay and basis thereof,”

information as to whether pay will be “by the hour, shift, day,

week, salary, piece, commission, or other,” “allowances,” “wage

supplements,” “the name of the employer,” and “the telephone

number of the employer.” Id. The notice must also “state the

regular hourly rate and overtime rate of pay” for “employees who

are not exempt from overtime compensation.” Id.

Section 195(3) of the NYLL further requires employers

to “furnish each employee with a statement with every payment of

wages” that lists information such as “the dates of work covered

by that payment of wages”; the “name of [the] employee”; the

“name of [the] employer”; the “rate or rates of pay and basis

thereof”; whether pay was “by the hour, shift, day, week, salary

piece, commission, or other”; “gross wages”; “deductions”; and

“allowances.” N.Y. Lab. L. § 195(3). That statement must also

“include the overtime rate or rates of pay” for “employees who

are not exempt from overtime compensation,” among other

information. Id.

Importantly, however, an employer’s “‘complete and

timely payment of all wages . . . to the employee who was not

provided notice’ or ‘who was not provided statements’ serves as

an affirmative defense to a wage notice or wage statement

claim.” See Mendez v. MCSS Rest. Corp., 564 F. Supp. 3d 195,

219 (E.D.N.Y. 2021) (quoting N.Y. Lab. L. §§ 198(1-b); 198(1-

d)).

Here, there is no dispute that the defendants failed

to provide time-of-hire notice or pay stubs to any of the

Plaintiffs. See Pl. 56.1 ¶¶ B(a)(13), B(b)(17), B(c)(28),

B(d)(36); see Def. 56.1 Response 8, 13, 17, 20. The defendants,

however, assert that each plaintiff received “complete and

timely payment of all wages due,” invoking the affirmative

defense to those Section 195 claims pursuant to N.Y. Lab. L.

§§ 198(1-b), 198(1-d). Def. Opp. 22–23; see Han Decl. ¶¶ 9, 17,

29, 36; Exs. B–E (Defendants’ pay records for Choi, Shin, Kim,

and Son).

Because there are genuine disputes regarding both

whether Son worked more than forty hours in a week, and whether

Shin and Kim are exempt employees, the merits of this defense

cannot be resolved at this time. In other words, if these

plaintiffs worked less than forty hours a week or fell within an

exemption such that they were not entitled to overtime pay, then

they would have been paid all wages due, which Han attested were

timely made. See Guohua Liu v. Elegance Rest. Furniture Corp.,

No. 15-CV-5787, 2017 WL 4339476, at *6 (E.D.N.Y. Sept. 25,

2017); Dudley v. Hanzon Homecare Servs., Inc., No. 15-CV-8821,

2018 WL 481884, at *4 (S.D.N.Y. Jan. 17, 2018). Summary

judgment on these claims is therefore denied with respect to

Shin, Kim, and Son.

The Court likewise denies summary judgment on Choi’s

claims.8 Even though the Court concluded above that Choi is an

exempt outside salesman, there is a material dispute of fact

regarding whether he received complete and timely payment of all

wages due: as noted above, Choi testified that he did not

received commissions to which he was entitled. Choi Dep. at

88:14-22; 137:10-138:12; cf. Rakeman v. MLD Mortg. Inc., No. 16-

CV-453, 2020 WL 13566471, at *13 (E.D.N.Y. Dec. 18, 2020)

(observing, on claim for unpaid commissions, that “NYLL entitles

a successful plaintiff to recover the full amount of wages

owed[.]”).

8 The court also finds it appropriate to retain supplemental

jurisdiction over Choi’s NYLL claims. See 28 U.S.C. § 1367. For a claim to

fall within the scope of a court's supplemental jurisdiction, it must be “so

related to claims in the action within such original jurisdiction that they

form part of the same case or controversy.” 28 U.S.C. § 1367(a). And claims

“form part of the same case or controversy” when they “derive from a common

nucleus of operative fact.” City of Chicago v. International College of

Surgeons,522 U.S. 156, 157 (1997). Choi’s claims relate to the same common

nucleus of operative fact as the other Plaintiff’s FLSA claims. See Fallon

v. 18 Greenwich Ave., LLC, No. 19 Civ. 9579, 2021 WL 1105066, at *8 (S.D.N.Y.

Mar. 23, 2021) (“Courts commonly find the common nucleus test satisfied where

. . . a non-FLSA plaintiff's NYLL claims involve the same issues of hours and

payments for plaintiffs who were employed in the same jobs, doing the same

work, during periods that overlap with many of the FLSA plaintiffs.”).

2. Standing

Plaintiffs have not established that they have

standing to maintain their wage notice and statement claims.

See Mahon v. Ticor Title Ins. Co., 683 F.3d 59, 64 (2d Cir.

2012) (“It is well established that a plaintiff must demonstrate

standing for each claim she seeks to press.”). Because the

issue of standing implicates the subject-matter jurisdiction of

a federal court, the Court has an affirmative obligation to

evaluate (and re-evaluate) whether standing exists as to each of

Plaintiffs’ claims. See DaimlerChrysler Corp. v. Cuno, 547 U.S.

332 (2006).

“Article III standing requires a concrete injury even

in the context of a statutory violation.” TransUnion LLC v.

Ramirez, 141 S. Ct. 2190, 2205 (2021). Thus, evidence that a

defendant violated a statute, even when the legislature has

created a statutory cause of action, is insufficient to confer

standing because “an injury in law is not an injury in fact.”

Id. Instead, “[o]nly those plaintiffs who have been concretely

harmed by a defendant’s statutory violation may sue . . . over

that violation in federal court.” Id. As a result,

“[t]echnical statutory violations that do not lead to either a

tangible injury or something akin to a traditional cause of

action cannot sustain Article III standing in federal court.”

Sevilla v. House of Salads One LLC, No. 20-CV-6072, 2022 WL

954740, at *7 (E.D.N.Y. Mar. 30, 2022).

For this reason, numerous courts in the Second Circuit

have concluded that employees lacked standing when they failed

to establish any concrete injury traceable to the violation of

the NYLL’s wage notice and statement requirements. See, e.g.,

Ramirez v. Urion Constr. LLC, 674 F.Supp. 3d 42, 55 (S.D.N.Y.

May 19, 2023) (collecting cases); Sanchez v. Trescly, No. 19-CV-

4524, 2023 WL 2473070, at *1 (E.D.N.Y. Mar. 13, 2023); Sevilla,

2022 WL 954740, at *7. The statutory violation is not enough,

as an employee must show that they suffered “a tangible injury”

or that the statutory violation would give rise to “something

akin to a traditional cause of action.” Ramirez, 674 F.Supp at

55. Such is the case here: Plaintiffs do not allege, let alone

proffer any evidence, “link[ing] any injury-in-fact to

Defendants’ failure to provide statutory notices under the

NYLL.” See Wang v. XBB, Inc., No. 18-CV-7341, 2022 WL 912592,

at *13 (E.D.N.Y. Mar. 29, 2022) (denying, after bench trial, any

recovery on NYLL statutory notice violations).

Accordingly, Plaintiffs are ordered to show cause, by

January 6, 2025, why the Court should not dismiss these claims

for lack of subject-matter jurisdiction.

D. Plaintiffs’ Spread-of-Hours Claims

Summary judgment on Plaintiffs’ spread-of-hours claims

must be denied for the same reasons as the wage notice and

statement claims: there are factual disputes as to how many

hours Plaintiffs worked each day, and whether they fall within

any applicable exemptions.

Under the NYLL, an employee is entitled to an

additional hour of pay at the “basic minimum hourly rate” for

each day on which that employee works more than ten hours. 12

N.Y.C.R.R. § 142-2.4. “Spread of hours” is defined as “the

length of the interval between the beginning and end of an

employee’s workday,” which “includes working time plus time off

for meals plus intervals off duty.” Id. § 142-2.18. As with

the NYLL’s overtime wage provisions, the term “employee”

excludes workers who fall within the outside salesman or

administrative exemptions. 12 N.Y.C.R.R. § 142-2.14(c)(4)–(5);

see Jeong Woo Kim v. 511 E. 5TH St., LLC, 133 F. Supp. 3d 654,

664 (S.D.N.Y. 2015).

As noted above, there are factual disputes regarding

whether Son worked more than ten hours on any given day, and

whether Shin, and Kim are exempt employees — either of which

could preclude the defendants from the obligation to pay spread-

of-hours wages. Thus, Son, Shin, and Kim are not entitled to

summary judgment on these claims. Kim, 133 F. Supp. 3d at 664;

Perez v. G & P Auto Wash Inc., 930 F. Supp. 2d 423, 436

(E.D.N.Y. 2013) (denying summary judgment where factual dispute

over whether “off-the-clock work” should be counted for spread-

of-hours purposes). However, because Choi is an exempt outside

salesman, the Court also grants summary judgment to the

defendants on his spread-of-hours claim. See 12 N.Y.C.R.R.

§ 142-2.14(c)(5).

E. Joint and Several Liability for All Defendants

Finally, Plaintiffs move for summary judgment on the

issue of whether SD Tools, Zered, and Han are all “employers”

under the FLSA and the NYLL and therefore can be held jointly

and severally liable for any damages. Because Plaintiffs’ are

not entitled to summary judgment on any of their substantive

claims, the Court concludes that this issue is best left for

determination at trial.

IV. Conclusion

For the foregoing reasons, Plaintiffs’ motion for

summary judgment is denied. The defendants’ motion for summary

judgment is granted.

SO ORDERED.

/s/ Eric Komitee__________

ERIC KOMITEE

United States District Judge

Dated: December 4, 2024

Brooklyn, New York