Ramos v. Daood

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

WELMAN VICENTE RAMOS,

Plaintiff,

v. No. 24-cv-5183

Judge Franklin U. Valderrama

SHAN FOOD CORPORATION and

SHAWN DAOOD,

Defendants.

ORDER

The Federal Labor Standards Act (FLSA) 29 U.S.C § 201 et seq. requires

certain employers to pay overtime. Plaintiff Welman Vincente Ramos (Ramos)

worked at Defendant Shan Food Corporation as a dishwasher and food preparer.

Defendant Shawn Daood (Daood) (collectively, Defendants) is the owner of Shan Food

Corporation. Ramos alleges that Defendants violated the FLSA and the Illinois

Minimum Wage Law (IMWL), 820 ILCS 105/1, et seq. by failing to pay him for

overtime work. R. 59,1 SAC. Defendants move to dismiss Ramos’s Second Amended

Complaint (SAC) pursuant to Federal Rule of Civil Procedure 12(b)(6).2 R. 26, Mot.

Dismiss. For the reasons that follow, Defendants’ motion is denied.

1Citations to the docket are indicated by “R.” followed by the docket number or filing name,

and where necessary, a page or paragraph citation.

2After the motion to dismiss was fully briefed, Ramos moved for, and the Court granted, leave

to file a SAC. R. 39, R. 58. The SAC only substituted the name of a party and otherwise

remained substantively identical to the First Amended Complaint (FAC). See R. 39 ¶ 4.

Defendants informed the Court via a status report that they intended to stand on their

previously filed motion to dismiss the FAC as their responsive pleading to Plaintiff's SAC. R.

63.

Background3

Ramos worked as a dishwasher and cook for Shan Food Corporation from

March 2014 to August 7, 2023. SAC ¶ 11–12. Daood is the owner and manager of

Shan Food Corporation. Id. ¶ 4. In 2021, Daood told Ramos that he would be paid

$725 per week worked in 2021 and thereafter, which was how much Daood paid

Ramos in cash during this period. Id. ¶¶ 11, 16. Daood set Ramos’s schedule and

required Ramos to work 57 hours per week. Id. ¶ 14. Ramos worked 57 hours per

week, but also often regularly worked more than 57 hours per week. Id. ¶¶ 15, 19.

Ramos had no managerial authority, could not hire or fire anyone, and could not set

his own work schedule or his own rate of pay—rather, Daood had those duties over

Ramos. Id. ¶ 13. Ramos’s rate of pay was below the Chicago minimum wage

requirement. Id. ¶ 18. Defendants also allegedly failed to pay Ramos for the overtime

he worked. Id. ¶ 20.

Ramos sued Defendants asserting violations of the FLSA (Count I) and (IMWL)

(Count II). Defendants move to dismiss the SAC under Federal Rule of Civil

Procedure 12(b)(6). Mot. Dismiss. Defendants’ fully briefed4 motion to dismiss is

before the Court.

Legal Standard

A motion to dismiss under Rule 12(b)(6) challenges the sufficiency of the

complaint. Hallinan v. Fraternal Order of Police of Chi. Lodge No. 7, 570 F.3d 811,

3The Court accepts as true all the well-pled facts in the Complaint and draws all reasonable

inferences in favor of Ramos. Platt v. Brown, 872 F.3d 848, 851 (7th Cir. 2017).

4Defendants did not file a reply in support of their motion to dismiss.

820 (7th Cir. 2009). Under Rule 8(a)(2), a complaint must include only “a short and

plain statement of the claim showing that the pleader is entitled to relief.” Fed. R.

Civ. P. 8(a)(2). To survive a motion to dismiss, a complaint need only contain factual

allegations, accepted as true, sufficient to “state a claim to relief that is plausible on

its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing 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.” Id. The allegations “must be enough

to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555. The

allegations that are entitled to the assumption of truth are those that are factual,

rather than mere legal conclusions. Iqbal, 556 U.S. at 678–79.

Analysis

The FLSA requires an employer “engaged in commerce or in the production of

goods for commerce” to pay its employees at least a specified minimum hourly wage

for work performed, 29 U.S.C § 206(a) and overtime in the amount of “one and one-

half times the regular rate” of pay for all hours worked over forty in one workweek,

29 U.S.C § 207 (a)(1); Dalton v. Sweet Honey Tea, Inc., 2023 WL 8281524, at *6 (N.D.

Ill. Nov. 30, 2023) (citing Howard v. City of Springfield, 274 F.3d 1141, 1148 (7th Cir.

2001) (“[The FLSA] is designed to protect workers from the twin evils of excessive

work hours and substandard wages.”)). Defendants raise several arguments in

support of dismissal, which the Court addresses in turn.

I. Sufficiency of the Allegations Regarding Hours Worked

Defendants first argue that the SAC “does not provide sufficient factual detail

regarding the specific weeks or time periods” Ramos allegedly worked. Mot. Dismiss

at 1–25 (citing Hirst v. Skywest, Inc., 910 F.3d 961 (7th Cir. 2018); Hall v. DIRECTV,

LLC, 846 F.3d 757 (4th Cir. 2017)6). Ramos counters that the SAC adequately alleges

the hours he worked over which time periods. R. 30, Resp. at 2. The Court agrees.

Unlike the plaintiffs in Hirst, who alleged only that they “worked many hours” and

cited “several weeks in which they were paid the minimum wage,” 910 F.3d at 966,

here the SAC contains several allegations regarding Ramos’s work schedule and the

actual number of hours worked. See SAC ¶¶ 11, 14, 15. This is sufficient to put

Defendants on notice of the claims against them. See, e.g. Dalton, 2023 WL 8281524,

at *7.

II. Allegations Against Both Defendants

Next, Defendants argue that while Ramos has sued two different entities, he

fails to identify which allegations are asserted against which Defendant. Mot.

Dismiss at 2–3. Ramos responds that the SAC properly alleges FLSA and IMWL

5Inexplicably, Defendants fail to paginate their motion to dismiss. The page numbers

referenced herein are those per the ECF filing.

6Defendants incorrectly cited Hall as a Seventh Circuit case, when in reality it is a Fourth

Circuit case. Moreover, Defendants blatantly misrepresent the Fourth Circuit’s holding. The

motion to dismiss states that the circuit court “dismissed an FLSA claim where the plaintiffs

failed to allege facts that could plausibly suggest they were denied overtime pay.” Mot.

Dismiss at 2. However, while the district court dismissed the plaintiffs’ FLSA claims, the

Fourth Circuit reversed and remanded the case, holding that the “allegations provide[d] a

sufficient basis to support a reasonable inference that Plaintiffs worked uncompensated

overtime hours while serving as DIRECTV technicians.” 846 F.3d at 777. The Court warns

counsel that it is unacceptable to misrepresent the holdings of cases to the Court.

claims against both Daood and Shan Food Corporation, as Daood is the sole owner of

Shan Food Corporation and thus both parties are responsible for the alleged

violations. Resp. at 2–3.

To determine whether individual owners are “employers” under the FLSA and

IMWL, courts within the Seventh Circuit applies an “economic realities” test. Iqbal

v. Integra Staffing Servs. Inc., 2019 WL 3408814, at *3 (N.D. Ill. July 24, 2019).

Although no factor is dispositive, the Court may consider the following when

determining whether an individual is an “employer” for purposes of the statutes:

whether the individual “(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.” Id. (cleaned up).

The Court agrees with Ramos that the SAC adequately pleads that Daood

satisfies the factors. Resp. at 4. Specifically, Daood was able to hire and fire

employees, including Ramos; he set Ramos’s work schedule and determined his rate

of pay; and he maintained employee work records as the owner of Shan Food

Corporation. Id. (citing SAC ¶ 4); see also SAC ¶¶ 14–16. As stated above, Defendants

did not file a reply, and therefore waived any response to Ramos’s argument that

Ramos and Shan Food Corporation are his employers under the FLSA and IMWL.

See In re GT Automation Grp., Inc., 828 F.3d 602, 605 (7th Cir. 2016) (“An argument

not responded to is ordinarily deemed waived.”). Accordingly, the Court finds that

Daood was Ramos’s employer, and Ramos’s claims are properly alleged against both

Defendants.

III. Liquidated Damages

Defendants also contend that Ramos fails to plead facts supporting liquidated

damages. Mot. Dismiss at 3. Defendants cite only one case in support of the

proposition that the mere inclusion of damages claims without supporting facts

cannot survive a motion to dismiss. Id. at 4 (citing Adams v. City of Indianapolis, 742

F.3d 720 (7th Cir. 2014)). Adams, however, neither addresses FLSA and IMWLA

claims, nor damages allegations, and therefore does not support Defendants’

argument. Defendants have therefore waived the argument. See United States v.

Cisneros, 846 F.3d 972, 978 (7th Cir. 2017) (“We have repeatedly and consistently

held that perfunctory and undeveloped arguments, and arguments that are

unsupported by pertinent authority, are waived.”) (cleaned up).

Waiver aside, “[u]nder FLSA Sections 216(b) and 260, there is a presumption

of double damages for a violation, absent a showing of good faith and reasonable belief

that the employer was in compliance with the FLSA. The burden to prove good faith

and reasonableness is substantial and lies with the employer.” Berger v. Perry’s

Steakhouse of Illinois, LLC, 430 F. Supp. 3d 397, 408 (N.D. Ill. 2019) (cleaned up); see

also Solis v. Int’l Detective & Protective Serv., Ltd., 819 F. Supp. 2d 740, 754 (N.D. Ill.

2011). Defendants have failed to overcome this presumption at this stage.

IV. Enterprise Coverage

Defendants next argue that the SAC fails to adequately allege “enterprise

coverage” under the FLSA. Mot. Dismiss at 4 (citing Brown v. Club Assist Rd. Serv.

U.S., Inc., 2013 WL 5304100, at *1 (N.D. Ill. Sept. 19, 2013)7). Like their citation to

Adams in support of their liquidated damages argument, Defendants citation to

Brown appears to be misplaced, as Brown does not analyze enterprise coverage. So,

again, Defendants have waived their argument by failing to support it. See Cisneros,

846 F.3d at 978.

No matter, because again the Court agrees with Ramos that he has sufficiently

pled enterprise coverage under the FLSA. “The FLSA has two grounds for coverage:

individual and enterprise. If neither is met, FLSA doesn’t apply.” Dalton, 2023 WL

8281524, at *8 (cleaned up). Under 29 U.S.C. § 206(a), enterprise coverage is

established when an employee is “employed in an enterprise engaged in commerce or

in the production of goods for commerce.” It requires that the employer (1) have

employees engaged in commerce and (2) have an annual gross volume of sales made

or business done of at least $500,000. Id. § 203(s)(1)(A). Here, as Ramos points out in

response, the SAC alleges that Shan Food Corporation has an “annual gross volume

of sales made or business done of at least $500,000” and is engaged in interstate

commerce because it “sold to its customers cigars, lamb meat, milk products, coca cola

products, potatoes, rice and other like kind out-of-state products that crossed

7Defendants inexplicably do not include the citation to Brown, rather just the case name,

District, and year. While it matters not whether a party cites to cases using Lexis or Westlaw,

or even the case number and docket number, the Court expects counseled parties to include

a citation to assist the Court in its review of the cited cases.

interstate borders, were delivered to Shan Food Corporation, and sold to Illinois

customers.” Resp. at 5–6 (citing SAC ¶ 5).

The Court agrees with Ramos that the SAC adequately pleads the

prerequisites for enterprise coverage to apply.

V. Statute of Limitations

Last, Defendants contend that Ramos’s FLSA claim based on any allegations

from 2021 and partially from 2022 are barred by the 2-year statute of limitations.8

Mot Dismiss at 4. Both parties recognize that when a willful violation of the FLSA is

pled, a 3-year, rather than 2-year, statute of limitations applies. Id.; Resp. at 6; 29

U.S.C. § 255(a). At the pleading stage, “all that is required is a general allegation that

the defendant’s actions were willful.” Divine v. Volunteers of Am. of Illinois, 319 F.

Supp. 3d 994, 1001 (N.D. Ill. 2018) (citing Diaz v. E & K Cleaners, Inc., 2018 WL

439120, at *4 (N.D. Ill. Jan. 16, 2018) (“[C]ourts in this district have determined that

bare allegations of willfulness are sufficient to stave off statute of limitations

challenges at the pleadings stage.”)). The Court agrees with Ramos that he has

satisfied notice pleading standards as to his claim that Defendants’ conduct was

willful. Resp. at 4–5 (citing SAC ¶¶ 20–23).

VI. Fee Request

Finally, Ramos requests that the Court award it fees “from Defendant[s] for

time spent drafting this needless response to discourage this type of motion practice.”

8It does not appear that Defendants attack Ramos’s IMWL claim as beyond the statute of

limitations, but to the extent that they do, as Ramos argues in response, the statute of

limitations for all IMWL claims is 3 years. Resp. at 6 (citing 820 ILCS 105/12).

Resp. at 4. Ramos contends that Defendants’ motion simply reiterates the arguments

from their first motion to dismiss, which ignoring the updated allegations in the First

Amended Complaint (and SAC), which addressed those concerns. Id. at 1. As the

Court has previously noted, Defendants did not file a reply, and therefore did not

respond to Ramos’s fee request, thereby waiving a response. See In re GT Automation

Grp., 828 F.3d at 605.

“Before imposing sanctions for litigation misconduct, the district court must

make a finding of bad faith, designed to obstruct the judicial process, or a violation of

a court order. Mere clumsy lawyering is not enough. When findings of bad faith are

properly made, district courts have inherent authority to award attorneys’ fees as a

sanction.” REXA, Inc. v. Chester, 42 F.4th 652, 671 (7th Cir. 2022) (cleaned up). The

Court agrees with Ramos that most arguments in Defendants’ motion to dismiss are

not well taken, and indeed, in at least one instance, Defendants misstate a case

holding. However, based on the record before it, the Court cannot say that Defendants

acted in bad faith. It therefore declines to award attorneys’ fees to Ramos. The Court

warns Defendants, however, that that they may find a different fate for repeated

transgressions.

Conclusion

For the foregoing reasons, the Court denies the motion to dismiss [26] in all

respects. Defendants must answer the SAC on or before September 12, 2025. Since

discovery closed on May 5, 2025, the Court directs the parties to file, by September

19, 2025, a status report stating whether either party intends to move for summary

judgment, and if so, provide a proposed briefing schedule. If neither party intends to

move for summary judgment, the status report should indicate: (1) whether the

parties are interested in participating in a settlement conference before Magistrate

Judge Weisman; (2) whether the parties consent to proceeding with trial before

Magistrate Judge Weisman, (3) whether the parties consent to a bench trial before

this Court, (4) the anticipated number of days for trial, and (5) the expected number

of witnesses.

Dated: August 29, 2025

United States District Judge

Franklin U. Valderrama

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