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Litzendorf v. Property Maintenance Solutions LLC

United States District Court, D. Arizona

November 30, 2017

William J. Litzendorf, Plaintiff,
v.
Property Maintenance Solutions LLC, et al., Defendants.

          ORDER

          Honorable G. Murray Snow United States District Judge.

         Pending before the Court is the Motion for Summary Judgment of Defendant Property Maintenance Solutions, LLC, et. al, (Doc. 56) and the Motion for Summary Judgment of Plaintiff William Litzendorf (Doc. 58). For the following reasons, the Court denies both motions.

         Background

         In May 2014, William Litzendorf began working as a handyman for Cluff Property Management, LLC (CPM). CPM is a property management company based in Arizona that manages residential rental properties. CPM is owned by Daniel Shreeve, Chad Cluff, and James Israel. CPM uses Property Maintenance Solutions, LLC (PMS) to coordinate the maintenance needs of CPM's properties. PMS is owned by three members: Wallin Holdings, LLC, Empire Capital, LLC, and Mission Capital, LLC. Wallin Holdings is owned by James Wallin, Empire Capital is owned by Daniel Shreeve and Lindsay Shreeve, and Mission Capital is owned by Chad Cluff and Brittany Biggs. PMS's sole purpose is to schedule and coordinate the maintenance needs of CPM. Mr. Litzendorf was hired after responding to a Craigslist advertisement and interviewing with Mr. Wallin and Mr. Shreeve. Mr. Litzendorf signed an agreement that classified him as an independent contractor. Mr. Litzendorf was initially paid $18.00 an hour, and his pay was later raised to $20.00 an hour.

         When a residential rental property managed by CPM needed maintenance work, CPM would notify PMS of the work opportunity. PMS would then send a text message or email to the maintenance workers, such as Mr. Litzendorf. The maintenance workers would then respond to the opportunity, on a first-come basis. Maintenance workers would go to the rental property and do the repair work. When special tools or materials were required, either the maintenance workers themselves, Mr. Shreeve, or Mr. Wallin would purchase such materials from Home Depot. After the maintenance work was completed, Mr. Litzendorf would submit a work order to Mr. Shreeve. Mr. Shreeve reviewed the work order and would then issue a weekly paycheck to Mr. Litzendorf.

         Mr. Litzendorf alleges that he was an “employee” of Defendants, and therefore entitled to the protections of the Fair Labor Standards Act (FLSA). Mr. Litzendorf estimates that he worked 50-60 hours per week, but claims that he was never paid overtime compensation. Defendants agree that Mr. Litzendorf was never paid overtime compensation, but argue that Mr. Litzendorf was an “independent contractor” and therefore not owed overtime compensation. Mr. Litzendorf further alleges that he was not fully compensated for time spent travelling to work sites or purchasing necessary materials. Defendants respond that Mr. Litzendorf was compensated for all reasonable time spent on these activities.

         The parties filed cross motions for summary judgment on both FLSA claims and Arizona Wage Act claims.

         Discussion

         I. Legal Standard

         Summary judgment is appropriate if the evidence, viewed in the light most favorable to the nonmoving party, demonstrates “that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Substantive law determines which facts are material and “[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “A fact issue is genuine ‘if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'” Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002) (quoting Anderson, 477 U.S. at 248). Thus, the nonmoving party must show that the genuine factual issues “‘can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party.'” Cal. Architectural Bldg. Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir. 1987) (quoting Anderson, 477 U.S. at 250).

         II. Analysis

         The FLSA requires that “no employer shall employ any of his employees who in any workweek is engaged in commerce or in the production of goods for commerce, or is employed in an enterprise engaged in commerce or in the production of goods for commerce, for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.” 29 U.S.C. § 207(a)(1). In order for the FLSA protections to attach, however, Defendants must be “employers” under the Act and Plaintiff must be an “employee” under the Act.

         A. Disputes of Fact Preclude Summary Judgment on Whether Plaintiff is an Employee or an Independent Contractor

         The FLSA defines an “employee” as “any individual employed by an employer.” 29 U.S.C. § 203(e)(1). An “employer” is “any person acting directly or indirectly in the interest of an employer in relation to an employee.” Id. at § 203(d). To “employ” is “to suffer or permit to work.” Id. at § 203(g). The wide definitions of these key terms have led courts to develop “expansive interpretation[s] of the definitions of ‘employer' and ‘employee' under the FLSA, in order to ...


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