United States District Court, W.D. Kentucky, Louisville Division
MEMORANDUM OPINION AND ORDER
Rebecca Grady Jennings, District Judge
matter is before the Court on Defendant Floorco Enterprises,
LLC's (“Floorco”) Motion to Dismiss. [DE 19].
The parties filed a timely Response and Reply. [DE 20; DE
21]. The matter is now ripe for adjudication. For the reasons
outlined below, the Motion is GRANTED IN
PART and DENIED IN PART.
is located in Bardstown, Kentucky and operates as a
wholesaler of materials used in the construction and
installation of hardwood flooring. [DE 18, Am. Compl. at ¶
5]. Plaintiff, Michael Jacobs (“Jacobs”), was a
citizen of Nassau County, New York during the time relevant
to this litigation. [Id. at ¶ 1]. Jacobs began
working as a commission-based independent contractor for
Floorco in early 2002. [Id. at ¶ 6]. In July
2005, the president and sole owner of Floorco, Paul Tu
(“Tu”), offered Jacobs the position of Vice
President of Sales and Marketing, a full-time position that
would pay $150, 000 per year. [Id. at ¶¶
6-8]. Tu presented the offer orally, and Jacobs accepted
orally. [Id. at ¶¶ 8-9]. The parties
understood that Jacobs would perform the work for an
indefinite period. [Id. at ¶ 8].
duties included contacting new and existing customers and
providing information regarding Floorco products, as well as
taking customer orders and arranging for product shipment.
[Id. at ¶ 11]. Jacobs claims, however, that for
large orders, he was required to receive permission from at
least two superiors before filling the orders and shipping
the product. [Id.]. Jacobs lacked the authority to
hire and fire, did not supervise two or more employees, or
possess discretionary authority in matters of significance.
[Id. at ¶ 12].
2005 through 2008, Jacobs performed his duties, and Floorco
paid him the agreed upon $150, 000 per year. [Id. at
¶ 13]. Jacobs asserts that, around July 16, 2007, Tu
transferred all company assets and liabilities into the
business now known as Floorco. [Id. at ¶ 15].
Jacobs further asserts that Tu reassured him that their prior
employment relationship was still in effect, and Floorco
would continue to pay Jacobs for performing the same duties.
late January 2009, Jacobs's paychecks began coming up
short. [Id. at ¶ 16]. Jacobs approached Tu
about the discrepancy. Tu informed Jacobs that the company
was experiencing hard times, but that Jacobs would be paid
back in full if he were patient. [Id. at ¶
16-17]. Floorco continued to short Jacobs intermittently
through June 2013, at which time Tu fired Jacobs with Floorco
owing Jacobs $287, 580.35. [Id. at ¶¶ 17,
19]. Upon firing Jacobs, Floorco admitted in writing that it
owed Jacobs back wages and made efforts to make good on its
debt, paying the balance down to $218, 750.02. [Id.
at ¶ 9 n.2; DE 18-1, Letter from Frieda Bayliss].
filed a complaint with the Kentucky Labor Cabinet on December
28, 2015. [DE 18 at ¶ 20]. Tu initially accepted
responsibility for the debt and told Labor Cabinet
investigator Patricia Major (“Major”) that he
intended to pay Jacobs the wages owed him in a series of
installment payments. [Id.; DE 18-8, Letter from Tu
to Major]. Tu continued making these promises until fall
2016, when he abruptly changed course. [DE 18 at ¶ 20].
Kyle Johnson (“Johnson”), counsel for Floorco,
informed the Labor Cabinet that Floorco would no longer
cooperate with the Labor Cabinet's investigation. [DE
18-11, Johnson Letter]. In this letter, Johnson claimed it
was Floorco's position that it did not owe Jacobs any
additional money. [Id.]. Finally, Johnson claimed
that Jacobs had never been an “employee” of
Floorco, as that term is defined in KRS Chapter 337.
[Id.]. The Labor Cabinet closed the investigation on
November 10, 2016. [DE 18 at ¶ 20]. This lawsuit
Amended Complaint, Jacobs asserts two claims against Floorco.
First, Jacobs asserts that Floorco's failure to pay
Jacobs was a material breach of an oral employment contract.
[Id. at ¶¶ 37-41]. In addition, Jacobs
claims that Floorco's failure to pay Jacobs violated the
Kentucky Wage and Hour Act, KRS Chapter 337. [Id. at
¶¶ 42-46]. In the present Motion, Floorco seeks
dismissal of both claims. [DE 19].
STANDARD OF REVIEW
Rule 12(b)(6) of the Federal Rules of Civil Procedure, a
court must dismiss a complaint if it “fail[s] to state
a claim upon which relief can be granted[.]”
Fed.R.Civ.P. 12(b)(6). To properly state a claim, a complaint
must contain “a short and plain statement of the claim
showing that the pleader is entitled to relief[.]”
Fed.R.Civ.P. 8(a)(2). When considering a motion to dismiss,
courts must presume all factual allegations in the complaint
to be true and make all reasonable inferences in favor of the
non-moving party. Total Benefits Planning Agency, Inc. v.
Anthem Blue Cross & Blue Shield, 552 F.3d 430, 434
(6th Cir. 2008) (citation omitted). “But the district
court need not accept a bare assertion of legal
conclusions.” Tackett v. M & G Polymers, USA,
LLC, 561 F.3d 478, 488 (6th Cir. 2009) (citation
omitted). “A pleading that offers labels and
conclusions or a formulaic recitation of the elements of a
cause of action will not do. Nor does a complaint suffice if
it tenders naked assertion[s] devoid of further factual
enhancement.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (internal citation and quotation omitted).
survive a motion to dismiss under Rule 12(b)(6), the
plaintiff must allege “enough facts to state a claim to
relief that is plausible on its face.” Traverse Bay
Area Intermediate Sch. Dist. v. Mich. Dep't of
Educ., 615 F.3d 622, 627 (6th Cir. 2010) (internal
quotation omitted) (quoting Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). A claim becomes
plausible “when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.”
Iqbal, 556 U.S. at 678 (citing Twombly, 550
U.S. at 556). “A complaint will be dismissed pursuant
to Rule 12(b)(6) if no law supports the claims made, if the
facts alleged are insufficient to state a claim, or if the
face of the complaint presents an insurmountable bar to
relief.” Southfield Educ. Ass'n v. Southfield
Bd. of Educ., 570 Fed.Appx. 485, 487 (6th Cir. 2014)
(citing Twombly, 550 U.S. at 561-64).