United States District Court, E.D. Virginia, Alexandria Division
M. BRINKEMA, UNITED STATES DISTRICT JUDGE
the Court is defendant's Motion to Dismiss for Lack of
Subject Matter Jurisdiction [Dkt. No. 26], in which defendant
argues that plaintiffs complaint alleging unpaid wages under
the Fair Labor Standards Act (FLSA) must be dismissed because
neither the defendant nor the plaintiff qualify for coverage
under the statute. Id. For the reasons that follow,
defendant's motion will be denied.
Maria Transito Maravilla ("Maravilla" or
"plaintiff) has filed a complaint against Defendant Ngoc
Anh Restaurant, Ltd. ("Ngoc Ann Restaurant" or
"defendant"), her former employer, alleging that
the defendant failed to pay her in compliance with the Fair
Labor Standard Act (FLSA)'s required federal minimum wage
and overtime rate. [Dkt. No. 1].
prepared food for Ngoc Anh Restaurant from September 2010
through December 2015. Id. ¶ 10. She alleges
that she worked approximately 72 hours a week and was paid on
a salaried basis at a rate of $1, 700 per month from 2010
through 2013 and $2, 200 per month from 2014 through 2015.
Id. ¶ 11-12. This salary, she argues, is less
than the FLSA required minimum wage. Id. ¶ 14.
By her calculation, she is owed $55, 478.92 in unpaid wages.
Id. ¶ 20. She also alleges that the defendant
intentionally misinformed her that she was not entitled to
minimum wage compensation or overtime wages and failed to
place a notification regarding her employment rights in a
prominent place. Id. ¶¶ 16, 18. By way of
relief, plaintiff seeks all unpaid overtime wages in an
amount to be proven at trial, plus an equal amount in
liquidated damages, interest, and reasonable attorney's
fees and costs. Id. at 5.
Standard of Review
12(b)(1) permits a defendant to challenge federal court
jurisdiction over the subject matter of the complaint. The
question of subject-matter jurisdiction may be raised by the
parties or the court, sua sponte, at any stage of
the litigation. Ellenburg v. Spartan Motors Chassis.
Inc., 519 F.3d 192, 196 (4th Cir. 2008). A motion to
dismiss for lack of subject-matter jurisdiction raises the
issue of "whether the court has the competence or
authority to hear the case." Davis v. Thompson,
367 F.Supp.2d 792, 799 (D. Md. 2005). When subject-matter
jurisdiction is challenged, the plaintiff bears the burden of
proving the existence of jurisdiction by a preponderance of
the evidence. United States ex. rel. Vuyyuru v.
Jadhav, 555 F.3d 337, 347 (4th Cir. 2009).
FLSA requires covered employers to pay their employees a
minimum wage, currently fixed at $7.25 per hour. 29 U.S.C.
§ 206(a). Covered employers must also pay their
employees an overtime rate of one and one-half times the
regular rate of pay for each hour worked in excess of forty
hours per week. Id. at § 207(a). To recover for
minimum wage or overtime violations under the FLSA, a
plaintiff must demonstrate that either her employer is an
"enterprise engaged in commerce or in the production of
goods for commerce" or the plaintiff herself has
"engaged in commerce or in the production of goods for
commerce" in her capacity as an employee. 29 U.S.C.
§§ 206(a), 207(a)(1). Defendant's motion to
dismiss argues that the Court lacks jurisdiction because Ngoc
Anh Restaurant is not an enterprise covered under the FLSA
and the plaintiff does not qualify for individual coverage.
Def. Memo., [Dkt. No. 27] at 1, 6. In response, plaintiff
contends that enterprise coverage is not a jurisdictional
issue and therefore cannot be challenged under Rule 12(b)(1).
PI. Opp., [Dkt. No. 30] at 1. Plaintiff does not specifically
address the issue of individual coverage but her
jurisdictional argument applies with equal force to both
enterprise coverage and individual coverage.
die FSLA, enterprise coverage is expansive. The statute
defines such coverage to reach an employer with employees
"handling, selling, or otherwise working on goods or
materials that have been moved in or produced for commerce by
any person." 29 U.S.C. § 203(s)(1)(A)(i). To curb
this sweeping scope, Congress included a revenue threshold:
enterprise coverage will only attach to an organization whose
"annual gross volume of sales made or business done is
not less than $500, 000 (exclusive of excise taxes at the
retail level that are separately stated)." Id.
at § 203(s)(1)(A)(ii); see also 29 C.F.R.
§ 779.259(a) ("The annual gross volume of sales
made or business done of an enterprise consists of its gross
receipts from all types of sales made and business done
during a 12-month period.").
argues that because Ngoc Anh Restaurant has annual sales of
less than $500, 000 it is not a covered enterprise. Def.
Memo, at 1. According to the tax returns and sales records
attached to its motion, defendant's annual sales from
2012 to 2015 never exceeded $139, 107. Id. In
response, plaintiff contends that FLSA coverage cannot be
challenged under rule 12(b)(1) because coverage status is not
a jurisdictional issue. PI. Opp. at 1. Plaintiff also avers
that it intends to employ a Certified Fraud Examiner during
discovery and believes that a forensic investigation will
yield factual proof that Ngoc Anh Restaurant met or exceeded
the $500, 000 threshold. Id. at 2-3.
coverage under the FLSA is considerably narrower than
enterprise coverage. As the Supreme Court explained in
Mitchell v. Lublin. 358 U.S. 207, 211 (1959),
"Congress, by excluding from the [FLSA's] coverage
employees whose activities merely 'affect commerce, '
indicated its intent not to make the scope of the [FLSA]
coextensive with its power to regulate commerce."
Despite this limited scope, "within the tests of
coverage fashioned by Congress, the [FLSA] has been construed
liberally to apply to the furthest reaches consistent within
congressional direction." Id. "[W]hether
an employee is engaged 'in commerce' within the
meaning of the [FLSA] is determined by practical
considerations, not by technical conceptions." Cook
v. Nu-Tech Hous. Servs.. Inc., 953 F.2d 1383, 1992 WL
17301, at *2 (4th Cir. 1992) (unpublished table
decision). "To determine whether an employee is
'engaged in commerce'. .. 'the test is whether
the work is so directly and vitally related to the
functioning of an instrumentality or facility of interstate
commerce as to be, in practical effect, a part of it, rather
than isolated, local activity."' Bellows v.
Darby Landscaping, Civ. No. WDQ-15-885, 2016 WL 264914,
at *4 (D. Md. Jan. 21, 2016) (quoting Wirtz v. Modern
Trashmoval, Inc., 323 F.2d 451, 457 (4th Cir. 1963)).
contends that plaintiff alleges no facts that would establish
she was engaged in interstate commerce. Def Memo, at 6.
According to defendant, plaintiff simply helped in the
kitchen, never making bank deposits, traveling for the
restaurant, ordering supplies or conducting financial
transactions for the customers. Id. Plaintiffs
response does not address individual coverage or the
plaintiffs specific job functions while employed by