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Acosta v. Off Duty Police Services, Inc.

United States District Court, W.D. Kentucky, Louisville Division

June 30, 2017

R. ALEXANDER ACOSTA, Secretary of Labor, United States Department of Labor,[1] Plaintiff,
OFF DUTY POLICE SERVICES, INC., et al., Defendants.


          David J. Hale, Judge United States District Court

         The Secretary of Labor filed suit against Off Duty Police Services, Inc., (ODPS) and its owners, Darrell and Bonnie Spurgeon, claiming that ODPS failed to pay workers overtime in violation of the Fair Labor Standards Act (FLSA). (D.N. 1) After holding a bench trial on the matter, the Court issued its Memorandum of Decision and Order on June 17, 2016. (D.N. 62) The parties were ordered to submit briefs “detailing a calculation of damages commensurate with the Court's findings.” (Id.) Based on the post-hearing briefings, the Court entered an Order and Judgment, awarding back wages and limited damages to the Secretary of Labor and workers in the amount of $ 75, 993.14. (D.N. 66; D.N. 67) The Secretary also filed a Bill of Costs to be paid by the defendants. (D.N. 68) The defendants objected to the Bill of Costs (D.N. 69) and moved to amend, correct, or vacate the judgment, or alternatively for a hearing on the judgment (D.N. 71). Because the defendants have not demonstrated that the judgment should be altered, corrected, or vacated, the Court will deny their motion and will not hold a hearing on the matter. Additionally, because the defendants have not overcome the presumption that the plaintiffs are entitled to costs but have demonstrated that the parties agreed to share the cost of trial transcripts, the Court will sustain in part and overrule in part the defendants' objection to the Bill of Costs.

         I. Motion to Alter or Vacate Judgment

         As grounds for altering, correcting, or vacating the judgment, the defendants argue that (1) the Court's December 22, 2016 Order and Judgment is inconsistent with the Court's June 17, 2016 Decision and Order; (2) the Court did not adequately consider the defendants' evidence of Frank Medieros's earnings; and (3) the defendants met their burden of showing that Stephen Newman and Jason Petra were sworn officers and thus were not entitled to full compensation as calculated by the Department of Labor. (D.N. 71) In response, the Secretary asserts that the defendants have not asserted a clear error of law or fact and have not met their burden of refuting the Department of Labor's calculations with respect to Medieros, Newman, and Petra. (D.N. 72)

         Under Rule 59(e)of the Federal Rules of Civil Procedure, “the court may grant a motion to alter or amend ‘if there is a clear error of law, newly discovered evidence, an intervening change in controlling law, or to prevent manifest injustice.'” Boling v. Prospect Funding Holdings, LLC, No. 1:14-CV-00081-GNS-HBB, 2016 WL 1611383, at *2 (W.D. Ky. Apr. 21, 2016) (citing GenCorp v. Am. Int'l, 178 F.3d 804, 834 (6th Cir. 1999) (citations omitted)). “The moving party bears ‘[t]he burden of demonstrating the existence of a manifest error of fact or law.'” Id. at *2 (citing Doe v. Patton, 381 F.Supp.2d 595, 605 (E.D. Ky. 2005), aff'd sub nom. Doe v. Magoffin Cty. Fiscal Ct., 174 F. App'x 962 (6th Cir. 2006)). Notably, “the rule does not afford ‘defeated litigants a second chance to convince the court to rule in [their] favor by presenting new explanation, new legal theories, or proof.'” Ohio Midland, Inc. v. Proctor, No. 2:05-CV-1097, 2012 WL 580407, at *1 (S.D. Ohio Feb. 22, 2012) (citing Burnley v. Bosch Ams. Corp., 75 F. App'x 329, 333 (6th Cir. 2003)); see also Whitehead v. Bowen, 301 F. App'x 484, 489 (6th Cir. 2008) (“A motion under Rule 59(e) does not simply provide an opportunity to reargue a case.”); Ky. Petrol. Operating Ltd. v. Golden, No. CIV. 12-164-ART, 2015 WL 2153344, at *3 (E.D. Ky. May 7, 2015) (citing Sault Ste. Marie Tribe of Chippewa Indians v. Engler, 146 F.3d 367, 374 (6th Cir. 1998)) (“A Rule 59 motion is not the place ‘to raise arguments which could, and should, have been made before judgment issued.'”).

         A. Alleged Inconsistencies

         The defendants argue that there is a “clear error of law” here because the December 22, 2016 Order and Judgment is inconsistent with the June 17, 2016 Memorandum of Decision and Order. (D.N. 71, PageID # 1948-49) The defendants claim that only those workers who were nonsworn officers and relied on ODPS for their sole income should be compensated. (Id.) For support, the defendants quote the following sentences of the Court's June 17, 2016 ruling:

From the foregoing analysis, the Court concludes that eight individuals-Booker Polin, Brock Pittman, Johnnie Craig Pittman, Stephen Newman, Merle Brown, Jason Petra, Gary Asher, and Perry Cox-were improperly classified as independent contractors for at least part of the period that they worked for ODPS. Those individuals, and any other nonsworn officers similarly situated, should have been characterized as employees during the periods in which they worked for ODPS and relied on the defendants for their sole income.

(D.N. 62, PageID # 1898) The defendants specifically contest the amounts awarded to Ronald Cheak, John Duerr, Barry Wilding, and Ronald Stallings. (D.N. 71, PageID # 1949) According to the defendants, these men are not entitled to back wages because they testified that they received supplemental income during the time that they worked for ODPS. (Id.) The Secretary responds that the defendants have failed to demonstrate how these “claimed inconsistences amount to an error of law.” (D.N. 72, PageID # 1959)

         The defendants first made this argument in their post-hearing brief on damages. (D.N. 64, PageID # 1906 (“Many of the individuals listed in Plaintiff's calculations did not rely on ODPS for their sole income during the relevant period.”)) As the defendants acknowledge in their motion, the Court specifically addressed the argument in its December 22, 2016 Order. (D.N. 71, PageID # 1948 (citing D.N. 66, PageID # 1933)) Additionally, the defendants have not shown that the Court's decision amounted to a clear error of law. (D.N. 72, PageID # 1959) Other than the Court's own Order, the defendants do not point to any case law that the Court has misapplied. (D.N. 71, PageID # 1948-49) Because the Court has previously addressed this argument and the defendants have not provided any new law or facts to support it, the Court need not reconsider the issue. Proctor, 2012 WL 580407, at *1 (citing Burnley, 75 F. App'x at 333); see also Whitehead, 301 F. App'x at 489; Golden, 2015 WL 2153344, at *3 (citing Engler, 146 F.3d at 374).

         Even if the Court were to reconsider its ruling, the outcome would be the same. Based on the Court's June 17, 2016 Decision and Order, the distinction in this case is between sworn and nonsworn officers, regardless of supplemental sources of income. (D.N. 62) The Court considered workers' supplemental income throughout the Order because the Sixth Circuit has held that courts are to consider the “economic realities test” when determining whether an employer-employee relationship exists. (Id., PageID # 1886 (citing Imars v. Contractors Mfg. Servs., Inc., No. 97-3543, 1998 WL 598778, at *3 (6th Cir. Aug. 24, 1998) (quoting Lilley v. BTM Corp., 958 F.2d 746, 750 (6th Cir. 1992))) The “economic realities test” looks to whether “the putative employee is economically dependent upon the principal, ” not whether the principal is the putative employee's sole source of income. Imars, 1998 WL 598778, at *3 (quoting Lilley, 958 F.2d at 750). In this case, most of the workers were sworn officers who had separate incomes, while the rest were generally nonsworn officers who relied solely on ODPS for their income. (D.N. 62, PageID # 1886) The Court's references to nonsworn officers relying on ODPS for their sole income are a reflection of the testimony in this case and not a requirement that nonsworn officers have no supplemental income in order to be eligible for back wages. (Id., PageID # 1886-94) Further, while no nonsworn officers testified to receiving supplemental income, even if a worker had supplemental income, he or she could still be considered economically dependent on ODPS. See Imars, 1998 WL 598778, at *3 (quoting Lilley, 958 F.2d at 750).

         In its June 17, 2016 Order, the Court recognized that the distinction between sworn and nonsworn officers could be “somewhat convoluted” when factoring in supplemental sources of income, but the Court ultimately concluded that the dividing line was between sworn and nonsworn officers. (Id., PageID # 1892-94) For example, the Court acknowledged that workers such as Booker Polin and Jason Petra earned supplemental income while working for ODPS but listed them among the workers who were improperly classified as independent contractors and thus entitled to back wages. (Id., PageID # 1891-93, 1898) In fact, ODPS brought Polin's supplemental income to the attention of the Court. (Id., PageID # 1891) Therefore, when Polin was listed among the workers entitled to back wages in the section that ODPS emphasizes in its motion, ODPS should have known that compensation was not limited to only those workers who had no supplemental income during their time working for ODPS. (Id., PageID # 1898; D.N. 71, PageID # 1948-49)

         While the defendants highlight two sentences of a twenty-two-page Decision and Order, the remainder of the Order repeatedly emphasized that the relevant distinction is between sworn and nonsworn officers. Throughout the Findings of Fact, the Court emphasized the numerous differences between sworn and nonsworn officers, including pay, discipline, equipment, and uniforms. (D.N. 62, PageID # 1879-84) In its Conclusions of Law, the Court pointed to these differences in concluding that only “nonsworn officers who are economically dependent on ODPS qualify as employees entitled to FLSA overtime.” (Id., PageID # 1886-87) As the Court explained in its June 17, 2016 Order:

[T]here were the eight witnesses who testified to ODPS being their sole income, and numerous witnesses testified that they would not turn down work for fear of not getting work later. Although it is a close call, th[e economic dependence] factor splits and breaks for the Department regarding the ...

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