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Brown v. Pegasus Research Group LLC

United States District Court, D. Arizona

June 6, 2017

Stormee J Brown, et al., Plaintiffs,
Pegasus Research Group LLC, et al., Defendants.


          G. Murray Snow United States District Judge

         Pending before the Court are Plaintiffs Stormee Brown, Julie Leggett and Megan East's Motion for Conditional Certification of FLSA Collective Action, (Doc. 12), and Defendant Pegasus Research Group, LLC d/b/a Televerde's (“Televerde”) Motion for Leave to File a Surreply, (Doc. 32).[1] For the following reasons, the Court grants Televerde's Motion for Leave to File a Surreply and grants the Motion for Conditional Certification in part.


         Televerde operates a “virtual sales and marketing service company” headquartered in Phoenix, Arizona. (Doc. 24 at 2.) Televerde employs over 350 sales agents throughout the country, including incarcerated women at state prisons in Arizona and Indiana. (Doc. 12 at 2.) Televerde has several distinct tiers of sales agents. There are Lead Development Representatives (“LDRs”), Inside Marketing Representatives (“IMRs”), and Inside Sales Representatives (“ISRs”). (Doc. 24 at 2-3.) Of these positions, the IMRs and the ISRs were classified as exempt under the Fair Labor Standards Act (“FLSA”).

         Each of the named Plaintiffs was employed as an IMR or an ISR with Televerde in the last two years. The named Plaintiffs allege that ISRs and IMRs share the same principal duties, including performing online research for potential customers, contacting potential customers, and preparing and submitting activity reports. (Doc. 12 at 3.) The Plaintiffs allege that Televerde systematically misclassified these positions as exempt under FLSA, and thus improperly denied them overtime pay.

         Pursuant to 29 U.S.C. § 216(b), the Plaintiffs now seek conditional certification to bring a collective action claim on behalf of all ISRs and IMRs employed by Televerde within the last two years who worked over forty hours per week during that period.


         I. Legal Standard

         An employee may bring an FLSA collective action on behalf of himself and other employees that are “similarly situated.” 29 U.S.C. § 216(b). However, neither the statute nor the Ninth Circuit has defined the phrase “similarly situated.”

         District courts within the Ninth Circuit “generally follow the two-tiered or two-step approach for making a collective action determination.” Colson v. Avnet, Inc., 687 F.Supp.2d 914, 925 (D. Ariz. 2010). Under this approach, “a court typically makes an initial ‘notice stage' determination of whether plaintiffs are ‘similarly situated.'” Thiessen v. Gen. Elec. Capital Corp., 267 F.3d 1095, 1102 (10th Cir. 2001). The burden is on the plaintiff to establish that she is similarly situated to the rest of the proposed class, but the standard “requires nothing more than substantial allegations that the putative class members were together the victims of a single decision, policy, or plan.” Id. (internal quotation and citation omitted). “This determination is made under a ‘fairly lenient standard, ' which in the Ninth Circuit typically results in conditional certification.” Shaia v. Harvest Mgmt. Sub LLC, 306 F.R.D. 268, 272 (N.D. Cal. 2015). To be successful, it is generally accepted that the plaintiff's allegations should be supported by declarations or affidavits by the plaintiff. See id.; Velasquez v. HSBC Fin. Corp., 266 F.R.D. 424, 427 (N.D. Cal. 2010) (“The notice stage determination is made under a fairly lenient standard and typically results in conditional certification. However, unsupported assertions of FLSA violations are not sufficient to meet Plaintiff's burden.” (internal quotation and citation omitted)). At the close of discovery, typically upon a motion to decertify, the court will revisit the issue and consider a number of factors to determine whether the proposed class is truly similarly situated for the purposes of FLSA. Thiessen, 267 F.3d at 1102.

         But, at this stage of the proceedings, “the Court is concerned only with whether a definable group of similarly situated plaintiffs exists.” Warren v. Twin Islands, LLC, No. 1:11-CV-00098-BLW, 2012 WL 346681, at *2 (D. Idaho Feb. 2, 2012). Thus, “in making a determination in whether to conditionally certify a proposed class for notification purposes only, courts do not review the underlying merits of the action.” Colson, 687 F.Supp.2d at 926.

         II. Analysis

         The Plaintiffs in this case request conditional certification for “all contact center sales agents, ” including “IMRs and ISRs and/or employees with the same or similar job duties as the Plaintiffs who were employed or are employed at the Arizona location.” (Doc. 12 at 2.) In support of this, the Plaintiffs submitted a number of exhibits, including declarations from each named Plaintiff, a declaration from a potential plaintiff, Ms. Renee Ruggiero, email correspondence between Ms. Ruggiero and Plaintiff's counsel, and an organizational chart from February 2015. (Doc. 13-1.) The Plaintiffs also provided a model Notice form to be distributed amongst potential plaintiffs should the Plaintiffs succeed in obtaining conditional certification.

         The declarations submitted by the Plaintiffs are sufficient to show that IMRs and ISRs “were together the victims of a single decision, policy, or plan” by the Defendant to misclassify certain employees as exempt under the FLSA. Thiessen, 267 F.3d at 1102 (internal quotation and citation omitted). The declarations establish that each of the named Plaintiffs, as well as Ms. Ruggiero, worked at Televerde's Phoenix office and held similar positions. Ms. Brown and Ms. Leggett's responsibilities as IMRs included performing online research, contacting potential customers, taking and communicating notes to team members, and establishing activity logs. (Doc. 13-1 at 2, 5.) Throughout their respective time at Televerde, both Plaintiffs were classified as exempt employees and therefore did not qualify for overtime pay, despite working more than forty hours a week.[2] (Id.) Both Plaintiffs also affirmed that other IMRs in the Phoenix office performed similar duties, and were also denied overtime pay. (Id.) In support of this, a potential plaintiff, Ms. Ruggiero, filed a declaration affirming that she was also an IMR, and she shared the same responsibilities as Ms. Leggett and Ms. Brown, and she was also denied overtime pay. (Doc. 13-1 at 10.) The other ...

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