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In re Enterprise Rent-A-Car Wage & Hour Employment Practices Litigation

August 13, 2010

IN RE: ENTERPRISE RENT-A-CAR WAGE & HOUR EMPLOYMENT PRACTICES LITIGATION
NICKOLAS HICKTON, ET. AL. PLAINTIFFS,
v.
ENTERPRISE RENT-A-CAR COMPANY, ET. AL. DEFENDANTS.



The opinion of the court was delivered by: Conti, District Judge.

MDL No. 2056

THIS DOCUMENT RELATES TO: All Actions

MEMORANDUM OPINION

Pending before this court are two motions filed by defendant Enterprise Rent-A-Car Company*fn1 ("ERAC-Missouri" or "defendant parent"). The first is a motion to dismiss the amended master complaint with respect to claims asserted against defendant parent. (Docket No. 65, Misc. No. 09-210.) The second is a motion seeking summary judgment in favor of defendant parent on joint employer issues. (Docket No. 124.)

I. Procedural Background

The issues raised in the motion to dismiss the amended master complaint were briefed in connection with two motions to dismiss, stay, or transfer, which, on November 6, 2009, were dismissed without prejudice due to the filing on September 18, 2009 of the amended master complaint (Docket No. 35).

The first motion to dismiss, stay, or transfer (Docket No. 12, Civ. No. 07-1687) was filed by defendants ERAC-Missouri and Enterprise Rent-A-Car Company of Pittsburgh*fn2 ("ERAC-Pittsburgh," and together with ERAC-Missouri, "Hickton defendants"). The movant sought to dismiss, stay, or transfer the claims set forth in the complaint (Docket No. 1) filed by Nickolas C. Hickton ("Hickton"), on behalf of himself and all others similarly situated. The motion alleged, inter alia, that this court lacks personal jurisdiction over ERAC-Missouri and asked for the claims against ERAC-Missouri to be dismissed. After a hearing on April 23, 2008, the court ordered a stay, among other things, of all claims against ERAC-Missouri, due to a prior pending action against ERAC-Missouri in the United States District Court for the Eastern District of Missouri, Zabady v. Enterprise Rent-A-Car Co., No. 4:07-CV-04494 (E.D. Mo.). (Docket No. 39.)

In a letter submitted on September 15, 2008, Hickton informed the court that all collective action claims were dismissed in Zabady. (See Docket No. 48.) In response, Hickton defendants submitted a letter on October 10, 2008. (Docket No. 48.) In the letter, Hickton defendants argued that the stayed portions of the lawsuit cannot proceed because the court lacks personal jurisdiction over ERAC-Missouri and that the claims against ERAC-Missouri should be dismissed or transferred to the United States District Court for the Eastern District of Missouri. (Id.) Following a status conference on October 15, 2008, this court ordered the parties to brief the issue whether personal jurisdiction exists over ERAC-Missouri. On April 10, 2009, Hickton submitted a memorandum of law in support of this court‟s exercise of personal jurisdiction. (Docket No. 63.) On May 8, 2009, Hickton defendants filed a memorandum of law in opposition to the exercise of personal jurisdiction and in further support of ERAC-Missouri‟s motion to dismiss. (Docket No. 80.) On May 27, 2009, Hickton filed a reply memorandum of law. (Docket No. 93.)

The second motion to dismiss, stay, or transfer (Docket No. 18, Civ. No. 09-832) was filed on September 29, 2008 in Averill v. Enterprise Rent-A-Car Co., No. 1:08-cv-04191 (N.D. Ill.), by defendant ERAC-Missouri. The motion sought to dismiss for lack of jurisdiction, stay, or transfer to the United States District Court for the Eastern District of Missouri the complaint of plaintiff Michael Keith Averill ("Averill," and together with Hickton and the other plaintiffs in the consolidated actions, "plaintiffs"). (Docket No. 6.) On November 3, 2008, Averill filed a response to ERAC-Missouri‟s motion to dismiss, stay, or transfer (Docket No. 32), raising arguments similar to those raised in the Hickton case. ERAC-Missouri filed a reply memorandum in support of the motion to dismiss, stay, or transfer on December 1, 2008. (Docket No. 40.)

On June 10, 2009, the Hickton and Averill cases, among others, were consolidated by the Judicial Panel on Multidistrict Litigation for pretrial purposes in this court. This court heard oral argument on the two pending motions to dismiss on August 12, 2009. The court ordered subsequent briefing on several issues. On September 14, 2009, ERAC-Missouri filed a supplemental brief on personal jurisdictional matters (Docket No. 30), and plaintiffs filed a supplemental memorandum of law in support of this court‟s exercise of jurisdiction (Docket No. 31). On October 5, 2009, ERAC-Missouri filed a reply to plaintiffs‟ supplemental memorandum of law (Docket No. 50), and plaintiffs filed a response to ERAC-Missouri‟s supplemental jurisdictional brief (Docket No. 51).

Hickton and Averill each filed separate collective actions under the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. §§ 201 et seq. ("FLSA"), among other claims. Hickton‟s action was brought against ERAC-Missouri, its operating subsidiary, ERAC-Pittsburgh, and Does 1 through 10. Hickton‟s complaint was filed December 11, 2007 in this district. (Docket No. 1, Civ. No. 07-1687.) Averill‟s action was brought only against ERAC-Missouri. Enterprise Leasing Company of Chicago*fn3 ("ELC-Chicago") was ERAC-Missouri‟s operating subsidiary at issue in that case. Averill‟s complaint was originally filed on July 23, 2008 in the United States District Court for the Northern District of Illinois. (Docket No. 1, Civ. No. 09-832.) Hickton and Averill filed notices of adoption of the amended master complaint with respect to their actions. (See Docket Nos. 38, 39, Misc. No. 09-210.) The amended master complaint names as defendants, among others: ERAC-Missouri, ERAC-Pittsburgh, and ELC-Chicago. (Docket No. 35.) Averill‟s action is now proceeding against ERAC-Missouri and ELC-Chicago. (See Docket No. 38.)

The motion for summary judgment was filed on February 26, 2010 (Docket No. 124, Misc. No. 09-210). In that motion, ERAC-Missouri argues that, although plaintiffs allege that ERAC-Missouri is a joint employer of plaintiffs under the FLSA, the undisputed facts show that it did not employ plaintiffs. On March 15, 2010, ERAC-Missouri filed a brief in support of the motion (Docket No. 147), an appendix of exhibits (Docket No. 150), and a statement of facts (Docket No. 148). On March 29, 2010, plaintiffs filed a memorandum in opposition to ERAC-Missouri‟s motion (Docket No. 154), an appendix of exhibits (Docket No. 155), and a reply statement of facts (Docket No. 153). On April 12, 2010, ERAC-Missouri filed a reply memorandum in support of its motion (Docket No. 162), an additional exhibit (Docket No. 164), and a reply and consolidated statement of facts (Docket No. 163). On May 10, 2010, ERAC-Missouri filed a notice of supplemental authority (Docket No. 168). Plaintiff responded to notice of supplemental authority on May 13, 2010. (Docket No. 170.)

The court originally scheduled oral argument to take place on May 21, 2010 with respect to the motion for summary judgment on joint employer issues, but at that hearing the court ordered additional briefing on several topics. On May 27, 2010, ERAC-Missouri filed a supplemental brief (Docket No. 177), and on May 28, 2010, plaintiffs filed their brief (Docket No. 179) and a declaration of counsel Peter Muhic to which exhibits were attached (Docket No. 180). On June 7, 2010, the court heard oral argument on the issues raised in the motion for summary judgment.

For the reasons explained more fully in this memorandum opinion, the court will deny without prejudice ERAC-Missouri‟s motion to dismiss and grant ERAC-Missouri‟s motion for summary judgment on joint employer issues.

II. Factual Background

A. ERAC-Missouri

ERAC-Missouri is incorporated under Missouri law and maintains a principal place of business in St. Louis, Missouri. (Ex. 1 ¶ 3 to Hickton defendants‟ memorandum of law in opposition to the exercise of personal jurisdiction and in further support of ERAC-Missouri‟s motion to dismiss (Docket No. 80, Civ. No. 07-1687) ("Def.‟s Br. Hickton").) At the time these actions were commenced, ERAC-Missouri was the sole shareholder of thirty-eight subsidiaries in the United States that rent and sell vehicles.*fn4 (Consolidated statement of facts (Docket No. 163) ("C.S.F.") ¶ 1; appendix of exhibits in support of motion for summary judgment on joint employer issues (Docket No. 150) ("Def.‟s App."), Ex. 1 ¶ 5.) ERAC-Missouri is a subsidiary of The Crawford Group, Inc. (the "Crawford Group"). (Ex. A ¶ 3 to ERAC-Missouri‟s reply memorandum in support of the motion to dismiss, stay, or transfer (Docket No. 40, Civ. No. 09-832) ("Def.‟s Reply Averill").)

The Crawford Group is the sole owner of The Crawford Group-Information Systems ("CGIS"). CGIS owned and maintained the "Enterprise brand"*fn5 website, www.enterprise.com. (Id.)*fn6 The website does not distinguish between ERAC-Missouri and its operating subsidiaries, and the website states that Enterprise Rent-A-Car has 878,000 vehicles, 64,000 employees,*fn7 and 6,900 offices in the United States and other countries. (Ex. R ¶¶ 5, 6 to Hickton‟s memorandum of law in support of this court‟s exercise of personal jurisdiction (Docket No. 63, Civ.No. 07-1687) ("Pl.‟s Br. Hickton").) Based upon these statistics, Enterprise Rent-A-Car claims on the website that it is the largest rental car company in North America, with a "World Headquarters" in St. Louis, Missouri. (Ex. L to Pl.‟s Br. Hickton; see appendix of exhibits in support of plaintiffs‟ memorandum of law in opposition to motion for summary judgment on joint employer issues (Docket No. 155) ("Pls.‟ App."), Ex. 12.) ERAC-Missouri, however, maintains that it has no offices or employees in Pennsylvania or Illinois. (Ex. 1 ¶ 5 to Def.‟s Br. Hickton; Ex. D ¶ 6 to ERAC-Missouri‟s memorandum of points and authorities in support of ERAC-Missouri‟s motion to dismiss, stay, or transfer (Docket No. 20, Civ. No. 09-832) ("Def.‟s Br. Averill").)

ERAC-Missouri does not directly rent or sell vehicles anywhere in the world. (Ex. 1 ¶ 11 to Def.‟s Br. Hickton.) Instead, wholly-owned operating subsidiaries of ERAC-Missouri conduct all rental services and vehicle sales. (Id. ¶ 14.) ERAC-Missouri directly or indirectly supplies each operating subsidiary with administrative services including, but not limited to: business guidelines, employee benefit plans, rental reservation tools like enterprise.com, a customer contact center, insurance, information technology, and legal services. (Id. at ¶ 11; Ex. 5 at 46, 227, 239 to Def.‟s Br. Hickton.) ERAC-Missouri offers many of these services to the operating subsidiaries at an advantageous price, because ERAC-Missouri achieves economies of scale. (See Def.‟s App., Ex. 2 ¶ 15.) The business guidelines are distributed to the employees of the subsidiaries in a policy manual, titled "Business Ethics Guide, Personnel Policy, and Benefits Summary Plan Description," that states "Information contained in the Business Ethics Guide, Personnel Policy, and Benefits Summary Plan Description refers to employees of: The Crawford Group, Inc., Enterprise Rent-A-Car Company and their various operating subsidiaries." (Ex. 13 at P0157 to Averill‟s response to defendant‟s motion to dismiss, stay, or transfer (Docket No. 32, Civ. No. 09-832) ("Pl.‟s Br. Averill").) Later in the policy manual, the word "employee" is defined as "the person (who is not a dependent) on whose behalf the plan is established.

Employees include only the common-law employees of Enterprise." (Id. at P0181.) ERAC-Missouri also authorizes its operating subsidiaries to use the name "Enterprise Rent-A-Car" and other registered trademarks. (Ex. Q ¶ 3 to Def.‟s Reply Averill.)

Each operating subsidiary remunerated ERAC-Missouri in the form of corporate dividends and management fees. (Ex. 1 ¶ 10 to Def.‟s Br. Hickton; Ex. 3 ¶ 10 to Def.‟s Br. Hickton; Ex. D ¶ 9 to Def.‟s Br. Averill.) The board of directors for each operating subsidiary decided on a quarterly basis whether to pay a dividend to ERAC-Missouri.*fn8 (Ex. I at 11 to Hickton‟s reply memorandum of law in support of this court‟s exercise of personal jurisdiction (Docket No. 93, Civ. No. 07-1687) ("Pl.‟s Reply Hickton").) ERAC-Missouri recognized these dividends as an increase in equity and did not report the dividend on its federal income tax statements. (Id.) Likewise, the operating subsidiaries did not take a deduction for dividends paid. (Id.) ERAC-Missouri determines annually the amount of management fees to charge each operating subsidiary. (Id.) Management fees offset the expenses for services provided by defendant parent to the operating subsidiaries and are recorded as income and reported on ERAC-Missouri‟s federal income tax statements. (Id.) Since the management fees are considered an ordinary business expense, operating subsidiaries claim a tax deduction for their payment. (Id.)

B. Administrative Services Offered to Subsidiaries

ERAC-Missouri also wholly owns operating subsidiaries that do not rent or sell vehicles. A financial subsidiary, ERAC USA Finance, serves as the treasury department for ERAC-Missouri and the ERAC operating subsidiaries. (Ex. B at 27 to Pl.‟s Br. Hickton.) ERAC USA Finance‟s primary responsibility is to borrow funds from third-party lenders and lend them to the operating subsidiaries for use in their day-to-day business operations. (Id.) ERAC-Missouri wholly owns ELCO Administrative Services Co. ("ELCO"), a subsidiary devoted to securing a high level of insurance and facilitating the settlement of liability claims. (Id. at 225.) While the rental operating subsidiaries obtain their own insurance for vehicle damage and limited amounts for personal injury claims, the coverage sourced by ELCO is for claims in excess of the individual subsidiary‟s coverage. (Id. at 227.) The costs for this additional group insurance are divided proportionately and billed directly by ELCO to the individual operating subsidiaries. (Id. at 227.)

Prior to January 2008, ERAC-Missouri directly operated a contact center for customer support in St. Louis. (Ex. D at 22-23 to Pl.‟s Br. Hickton.) In January 2008, ERAC-Missouri reorganized the contact center division into an operating subsidiary. (Id. at 22.) The functionality of the contact center as an operating subsidiary is identical to its role as a division of ERAC-Missouri. (Id.) Customers call the contact center by dialing a toll-free number that corresponds with the customer‟s concern. (Ex. E at 20 to Pl.‟s Br. Hickton.) One function of the contact center is to allow customers to book vehicle reservations at any of ERAC-Missouri‟s operating subsidiaries. (Ex. D at 46 to Pl.‟s Br. Hickton.) ERAC-Missouri‟s operating subsidiaries refer to the contact center as "National Reservations" or "Nat Res." (Id. at 22.) The contact center also serves as the primary point of contact for ERAC customers needing roadside assistance. (Id. at 46.) The contact center‟s roadside assistance phone number is on every vehicle rental contract throughout the ERAC vehicle rental network. (Id.at 47-48.) The phone services and systems utilized by the contact centers are maintained by ERAC-Missouri‟s information technology ("IT") team. (Ex. E at 21 to Pl.‟s Br. Hickton.)

ERAC-Missouri directly operates an IT division known as the e-commerce team. (Id. at 23.) The primary responsibility of the e-commerce team is to monitor and update the content on ERAC‟s network of websites, including enterprise.com, enterprise.ca, enterprise.code.uk, enterprise.de, and enterprisecarsales.com. (Id.) These websites allow customers to book a vehicle rental reservation or obtain information regarding vehicles for sale. (Id. at 83-84, 89-90.) The individual operating subsidiaries interact with the websites by informing the e-commerce team when a vehicle class is no longer available and should be removed from the website. (Id. at 34.)

When visiting an ERAC rental website such as enterprise.com, a potential customer can input a state, address, or zip code convenient to where they would like to rent a vehicle, along with the corresponding rental dates. (Ex. 7 at P0105 to Pl.‟s Br. Averill.) The customer may select where the customer would prefer to pick-up a rental vehicle from a list of the nearest ERAC locations. (Id. at P0107.) After selecting a location, a list of that location‟s available vehicles and prices is presented. (Id. at P0119.) The customer may select a vehicle to hold for reservation, and input personal information such as name, phone number, and credit card information to hold the reservation. (Id. at P0120; Ex. J to Pl.‟s Reply Hickton.) The rental is not complete, however, until the customer signs a ticket contract at the ERAC operating subsidiary‟s rental location and takes the vehicle. (Ex. E at 31 to Pl.‟s Br. Hickton.)

When a customer completes a rental entry on enterprise.com, a vehicle is reserved. (Id.) The data from the enterprise.com reservation is sent to and stored in Missouri at ERACMissouri‟s data server facility. (Id. at 28.) A data retrieval system known as ECARS is used by each ERAC operating subsidiary to view the stored reservation data. (Id. at 29.) ECARS data is stored exclusively in Missouri until a rental ticket is created by an operating subsidiary‟s branch.

The ECARS system is also utilized for rentals booked through other avenues such as the contact center, the Automated Rental Management System ("ARMS"), which is a rental system used by auto body shops and insurance companies to provide vehicle reservations to their own customers through ERAC, and third-party booking channels such as Orbitz.com and Travelocity.com. (Id. at 25-26; 29-30.)

Enterprise Rent-A-Car‟s website is optimized to generate "hits" on search engines for users searching for rental cars in Chicago. (Ex. 21 ¶¶ 5-9 to Pl.‟s Br. Averill.) Examples of optimization include the use of metatags and purchasing of sponsored listings on search engines. (Id.)

To promote the ERAC brand, ERAC-Missouri‟s marketing and communications division ("Mar Com") provides individual operating subsidiaries with marketing materials, and produces national advertisements. (Ex. I at 13 to Pl.‟s Reply Hickton.) Marketing materials include locally targeted discounts for free upgrades, ten percent off standard daily rates, five percent off standard weekly rates, and one free weekend day. (Ex. I at E-005523, E-005524 to Pl.‟s Br. Hickton.) To take advantage of the discounts, customers are directed to visit enterprise.com or call the toll free number to make a reservation. (Id.) Each advertisement contains ERACMissouri‟s trademarked Enterprise Rent-A-Car logo and does not mention any subsidiaries. (Id.)

Mar Com creates special discounts for use over the internet on the ERAC websites. (Ex. E at 58-59 to Pl.‟s Br. Hickton.) These promotions are loaded into the websites by the National Reservations team at the contact center. (Id.at 62.) Each operating subsidiary can participate in the special discounts, or opt out on a branch-by-branch basis. (Id. at 61-63.)

ERAC-Missouri has an acquisition department. This department consists of a team of individuals that deals with the automobile manufacturers to acquire vehicles for the operating subsidiaries. (Pls.‟ App., Ex. 1 at 23.) Although the acquisition department deals with manufacturers, the operating subsidiaries make the decisions about which vehicles will comprise their fleets. (Def.‟s App., Ex. 3 ¶ 15; Def.‟s App., Ex. 4 ¶ 15; Def.‟s App., Ex. 5 ¶ 15; Def.‟s App., Ex. 6 ¶ 21; Def.‟s App., Ex. 7 ¶ 15.) Some operating subsidiaries have local acquisition personnel that negotiate and purchase vehicles in their local markets. (Pls.‟ App., Ex. 1 at 23; Def.‟s reply exhibit (Docket No. 164, Misc. No. 09-210), Ex. 26 at 107 ("I have my department that handles it locally is referred to as the Vehicle Acquisition Department.... I negotiate what I‟m going to pay the dealer here in Pittsburgh or in my market area.").)

ERAC-Missouri operates another corporate division called ERAC USA Fleet Services ("Fleet Services"). (Ex. B, at 85 to Pl.‟s Br. Hickton.) The primary function of Fleet Services is to collect various incentives received from vehicle manufacturers and redistribute them to ERAC operating subsidiaries. (Id. at 85-86.) When ERAC operating subsidiaries purchase the vehicles, the various incentives associated with group vehicle purchases are sent to Fleet Services and then distributed to the operating subsidiaries based upon the number of individual vehicle purchases. (Id.)

ERAC-Missouri maintains an external job recruiting website, www.erac.com/recruit. (Ex. 6 ¶ 2 to Pl.‟s Br. Averill.) Prospective employees select a part of the country where they would like to work. (Ex. 8 at P0121 to Pl.‟s Br. Averill.) Available positions in the region are displayed, and prospective employees may submit an online application for a position or contact a local recruiter by calling the contact center. (Id. at P0122-P0123; Ex. 6 at P0095-0104 to Pl.‟s Br. Averill; Ex. 10 at P0137 to Pl.‟s Br. Averill.)

The www.erac.com website is hosted by an unaffiliated third-party recruiting firm, TMP Worldwide. (Def.‟s Reply Averill, Ex. B ¶ 3.) Users of www.erac.com can obtain information about careers at all subsidiaries and at defendant parent. (Id.) If users wish to submit an employment application, they must follow a link to www.us-erac-icims.com, which is hosted by another unaffiliated third-party firm, iCIMS.com, Inc. ("iCIMS"). (Id. ¶ 4.) Before a user can submit an employment application, the user must indicate the city and state in which he or she would like to work. (Id. ¶ 5.) Completed applications are sent by iCIMS to the recruiting department of the appropriate operating subsidiary, which conducts all follow-up communication with the applicant. (Id.) The subsidiary makes the hiring decision without oversight or approval from ERAC-Missouri. (Id.) ERAC-Missouri is billed by iCIMS for the cost of maintaining the www.us-erac-icims.com site. ERAC-Missouri forwards these costs to the relevant operating subsidiary depending upon the number of applications that subsidiary receives. (Id. ¶ 7.)

ERAC-Missouri has a vice-president of customer service. That position is held by Dan Gass ("Gass"). Gass is responsible for overseeing a customer service evaluation program, known as the Enterprise Service Quality Index ("ESQI"). Customers of the operating subsidiaries are surveyed by a third-party company called Maritz, and Maritz forwards the results of the surveys to the operating subsidiaries. ESQI is used by the operating subsidiaries to evaluate customer satisfaction at their branch locations. (Pls.‟ App., Ex. 1 at 85-86.)

In addition to customer service evaluations, ERAC-Missouri distributes employee satisfaction surveys to the operating subsidiaries. (Pls.‟ App., Ex. 6 at 194-95.) A third-party facilitates the compilation of the results of the surveys. (Pls.‟ App., Ex. 1 at 177.) The results are disseminated to the operating subsidiaries from which the information came. (Id.) At least one operating subsidiary, however, creates and uses its own employee satisfaction survey. (Def.‟s App., Ex. 5 ¶ 63.)

C. Human Resources Services

ERAC-Missouri directly operates a corporate human resources ("HR") department. (Ex. A, at 23-24 to Pl.‟s Br. Hickton.) The HR department provides a variety of services to ERACMissouri‟s operating subsidiaries, including: a 401(k) plan and profit-sharing plan; best practices for hiring and selection of employees; general job descriptions; employee performance review forms; a suggested "management track" for employee advancement; recommended policies and programs, including paid time off policy, paternity leave policy, and breath alcohol testing program; and a compensation guide for employee salaries. (Id. at 21-23, 137-41, 220; Pl.‟s App., Ex. 8; Pls.‟ App., Ex. 6 at 193-95.) Through the best practices and compensation guides, the HR department at ERAC-Missouri recommends which employees at operating subsidiaries should be salaried and which should receive hourly wages. (Ex. A at 295-96 to Pl.‟s Br. Hickton.) The best practices guide provides: "The employee is the person (who is not a dependent) on whose behalf the plan is established. Employees include only the common-law employees of Enterprise." (Ex. 13 at P0181 to Pl.‟s Br. Averill.) The guide also provides: "Information contained in the... Benefit Summary Plan Description refers to employees of: The Crawford Group, Inc., Enterprise Rent-A-Car Company and their various operating subsidiaries." (Ex. 13 at P0157 to Pl.‟s Br. Averill.)

The HR department negotiates benefit plans with national providers to offer employees of defendant parent and the operating subsidiaries health insurance, life insurance, accidental death and dismemberment, and long-term disability coverage. (Ex. F ¶¶ 3, 4, 8 to Def.‟s Reply Averill.) Benefits plans are developed by Dana Beffa, head of the corporate benefits department. (Pls.‟ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 157.) Participation in the benefit plans is not required, but if employees of an operating subsidiary enroll, defendant parent will bill the relevant operating subsidiary for the specific benefits elected. (Ex. F ¶¶ 6, 7, 9 to Def.‟s Reply Averill.) Each employee can view his or her individual benefits by logging onto an employee website provided by defendant parent to all operating subsidiaries. (Ex. J at 23-24 to Pl.‟s Reply Hickton.) The best practices guide, which provides information relevant to the benefits plans, states: "At their own discretion, each [operating subsidiary] may elect to provide other benefits specific to their employees and may elect to implement its own business practices and personnel policies unique to its operations and employees." (Def.‟s App., Ex. 22 at E-002420.) With the exception of operating branches located in Hawaii and Puerto Rico, operating subsidiaries never offered benefits plans outside of those created by the HR department. (Pl.‟s App., Ex. 5, Adams Dep. Dec. 17, 2009 at 157.)

The HR department compiles a list of available employment opportunities throughout the ERAC network. (Ex. A at 216 to Pl.‟s Br. Hickton.) This list is available on ERAC-Missouri‟s email server and can be accessed by all employees of ERAC-Missouri and its operating subsidiaries. (Id.) If an employee transfers from one ERAC subsidiary to another, the HR department will assist in the employee relocation. (Id. at 218-19.) ERAC-Missouri has a centralized website, www.enterprise.com/eracpeople, that provides access to various information regarding benefits and retirement plans, as well as other company-related information. (Ex. 13 at P0165 to Pl.‟s Br. Averill.)

When Edward Adams ("Adams") first started working at ERAC-Missouri‟s HR department, he developed practices for the hiring and selection of employees. (Ex. A at 23 to Pl.‟s Br. Hickton; Pls.‟ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 53-54.) He provided "insight into some best practices for those activities," (Ex. A at 23 to Pl.‟s Br. Hickton), based upon a review of the practices being used by the operating subsidiaries (Pls.‟ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 53; Def.‟s App., Ex. 2 ¶ 10). In general, Adams would survey the practices being used by the operating subsidiaries in a variety of ways, including telephone communications, email communications, and in-person meetings. (Pls.‟ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 54.)

Adams testified that defendant parent‟s HR department would develop job descriptions for various positions utilized by the operating subsidiaries. (Ex. A at 213 to Pl.‟s Br. Hickton.) Similarly, the HR department would develop dress codes for the various positions. (See, e.g., Pls.‟ App., Ex. 7 at E-009705.) The job descriptions included the general duties and responsibilities for the positions. (Ex. A at 213, 219-20 to Pl.‟s Br. Hickton.) Defendant parent recommended salaries for these positions, and the salary recommendations were set forth in a compensation guide. (Id. at 219-20.) The compensation guide‟s recommendations were based upon "information from a variety of sources," including responses from operating subsidiaries or suggestions from operating subsidiaries. (Id. at 230.) During his deposition, Adams stated that defendant parent is involved in the classification of the operating subsidiaries‟ employees by providing input to operating subsidiaries in the form of recommended compensation practices:

Q:... So we have a clean record, let me ask you the question again. Does the parent have any involvement in recommending to the subsidiary or to any of the subsidiaries whether or not people holding the position of branch manager are exempt from the overtime laws?

A: The parent has input, yes.

Q: And how does the parent provide that input?

A: Well, through best practices based upon sharing with the sub once we, being the parent, have gotten information from the sub whether or not we believe that that is an exempt position or an hourly position.

Q: And is that information conveyed in the compensation guide that the branch managers are -- should be -- are exempt?

A: It is -- it is identified as an exempt job.

Q: Okay.

A: It is not specifically conveyed as to why it is or how it became.

Q: Okay. Does the parent have any involvement in recommending to the subsidiaries whether or not people holding the title assistant branch managers are exempt from the overtime laws?

A: It would be the same process with the branch manager.

Q: Okay. So your answer would be yes, they have -- they have involvement, and the involvement is through the best practices -- development of the best practices?

A: Yes.

Q: Okay.

A: Input through the best practices. (Id. at 295-96.)

Adams testified that he had conversations with employees of operating subsidiaries that wished to deviate from the compensation recommendations in the best practices guide:

Q: Okay. Ed, if there‟s a deviation from the compensation guide, is there a protocol for notifying the parent?

A: Yes.

Q: Okay. What is that protocol?

A: The protocol is that the parent would talk with the sub; and in most cases, it would be the sub initiating contact with the parent in order to discuss what the exception would be.

Q: Okay. And to whom does that conversation occur?

A: In many cases, it occurs with the corporate vice president of group operations or senior vice president of group operations or myself.

Q: Have you had conversations with operating subsidiaries in which they‟ve conveyed to you that there‟s a -- they have deviated from the compensation guide?

A: I‟ve had some conversations on some areas of the compensation guide, yes. (Id. at 298.) Adams asserted that the protocol for deviation was not formally stated:

Q: Does the parent -- is the parent made aware of when a sub chooses not to follow an individual practice as set forth in this guide?

A: It might be.

Q: Is there a protocol for ensuring the parent is made aware?

A: Well, I think the protocol really is common courtesy to share with us if there's something that they're not doing, but I can't say that that always occurs.

Q: Okay. Ed, is it my understanding that the parent company has approximately 50 or so, plus or minus a few, operating subsidiaries and that the only way it ensures that the business practice guide which it develops and disseminates the policies therein are followed or deviated from is through common courtesy of the individual subs?

A: I think that's one of the ways, but what I'm saying is that they may call, they may not call. So I can't always tell you whether people are contacted on that. It depends on the issue. (Ex. 7 at 323 to Def.‟s Br. Hickton.)

Robert Keyes ("Keyes"), vice president and general manager of Enterprise Leasing Company of Philadelphia, LLC, testified that he did not follow the recommendations with respect to compensation of certain employees:

A: We have set up in our group a pay range that we would like to see folks achieve. And if the business does not support that within their commission structure we will put in place a nonstandard plan so that they will get their -- as an example, if we feel an assistant manager should be in the $40,000 pay range, yet the profits of the business don‟t support that, we would put something in place to allow them to achieve something near that $40,000 or exceed it.

Q: Can you give me an example of what you would put in place to do that.

A: Incentives, bonuses over and above just a percentage of the profits. (Ex. 6 at 225-26 to Pls.‟ App.) Keyes had conversations with Rick Allen ("Allen"), a vice president of his subsidiary, about the use of nonstandard pay plans, and Allen supported Keyes‟ decision. (Id. at 226.) Keyes used nonstandard pay plans for a variety of employees, including certain assistant branch managers. (Def.‟s App., Ex. 10 at 225.)

Adams testified that the ultimate decision to classify a position as exempt was up to the operating subsidiary:

A:... We would recommend to the subs that these are exempt positions.

Q: Okay.

A: It is for them to decide.

Q: To your knowledge, do any of the subsidiaries pay -- despite the recommendations made in the compensation guide, pay assistant branch managers on an hourly basis?

A: Yes.

Q: Okay. To your knowledge, are the -- are those locations within California?

A: To the best of my knowledge, they're in California.

Q: Okay. To your knowledge, do any of the subsidiaries outside of California pay assistant branch managers on an hourly basis?

A: I'm not aware of any.

Q: Okay. To your knowledge, despite the recommendation in the compensation guide, do any operating subsidiaries pay branch managers on an hourly basis?

A: I'm not aware of any.

Q: Okay. And that's both within California, outside of California?

A: That is correct. (Id. at 297 (emphasis added).)

In 2005, Adams attended a meeting at which ERAC-Missouri‟s in-house counsel and general managers of the operating subsidiaries were present. (Pls.‟ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 90.) At that meeting, Adams communicated his recommendation -- which was later memorialized in the best practices guides -- that assistant branch managers outside of California should be classified as exempt. (Id. at 89 ("The job title of assistant branch manager outside of California was recommended to be exempt, and we shared that with the individual subs.").) With respect to the subsidiaries operating branch locations in California, Adams testified:

A:... I do not determine what [the activities and job responsibilities] would be for that assistant branch manager in California.

All I can do is tell you as I have generally that they would not have employees reporting to them and that their responsibilities would not include the kind of judgment and problem solving that we have in the other 49 states.

But I can‟t tell you specifically what they do. Nor could I tell you specifically what any individual would do. That would be the general manager in that particular sub.

....

Q: Well, you would still ultimately be responsible for giving recommendations to California as to the classification of the employees in the branch locations as exempt or nonexempt. Correct?

....

A:... I would -- if asked, I could make a recommendation based upon an understanding of what their job responsibilities are today in a particular sub. But I don‟t know what they do and I never was an assistant branch manager, nor have I examined the assistant branch manager job in order to determine what they‟re doing today.

....

Q: Well, it‟s accurate to say that in your position you are overseeing corporate HR with respect to recommendations that go out to subsidiaries regarding the classification of the job positions in the subsidiaries as exempt or nonexempt. Correct?

A: That is correct.

Q: That includes California?

A: That includes California.

Q: So someone within corporate HR needs to have an understanding of what the job duties and responsibilities are for the positions in order to give those recommendations. Correct?

A: Someone in corporate may have an idea of -- well, in fact someone in corporate may have been a part of developing a job description for California.

But once it‟s provided to California, it‟s up to those individual subs to determine what in fact they‟re going to do of that general nature type of an assistant branch manager job. (Pls.‟ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 94-95.)

The best practices guide is sent to all full-time employees of defendant parent and the operating subsidiaries. (Ex. A at 334-35 to Pl.‟s Br. Hickton.) Adams testified that defendant parent‟s HR department provides assistance to employees of all operating subsidiaries, and this assistance includes the ability to participate in the retirement savings plan and 401(k) plan. (Id. at 21-23.) The HR department does not maintain personnel files for the operating subsidiaries‟ branch managers or assistant branch managers. (Def.‟s App., Ex. 2 at ¶ 21.)

Adams testified that he could recall at least one individual who went from a corporate vice president position at defendant parent to a vice president or general manager position at a subsidiary, and he believed that such position changes have happened more than once. (Ex. A at 58 to Pl.‟s Br. Hickton.) He stated that "at virtually any point in [their] career," a person can move from a corporate position at defendant parent to a position at an operating subsidiary. (Id. at 141.) The operating subsidiaries do not have an arrangement to interchange their branch managers or assistant branch managers with ERAC-Missouri or each other. (Def.‟s App., Ex. 3 ¶ 76; Def.‟s App., Ex. 4 ¶ 79; Def.‟s App., Ex. 5 ¶ 78; Def.‟s App., Ex. 6 ¶ 73; Def.‟s App., Ex. 7 ¶ 77.)

The HR department provides training and direction to management level employees of the operating subsidiaries. (Ex. F ¶ 33, 52-53 to Pl.‟s Reply Hickton.) ERAC-Missouri‟s corporate training department has approximately twenty employees and develops best practices for training that are distributed to the operating subsidiaries. (Pls.‟ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 31.)

Another ERAC-Missouri division related to the HR department is the employee communications division. (Ex. A at 50 to Pl.‟s Br. Hickton.) The primary responsibility of the employee communications division is to communicate about the Enterprise brand. (Id. at 51.) Those communications encompass a wide range of issues affecting the ERAC network. (Id. at 50.) ERAC-Missouri sends magazines to employees of the subsidiaries on a quarterly basis. (Ex. 14 ¶ 7 to Pl.‟s Br. Averill.)

ERAC-Missouri maintains a toll-free hotline for employees to voice concerns that they do not wish to raise with their direct superiors at an operating subsidiary. (Ex. B at 338 to Pl.‟s Reply Hickton.) Messages on the hotline are received and addressed by business managers within ERAC-Missouri. (Id. at 338.) The same concerns can also be reported directly to the HR department. (Id. at 337.)

D. ERAC-Missouri's Contacts in Pennsylvania and Illinois

ERAC-Missouri alleges that it is not registered with the Secretary of State of Pennsylvania or Illinois for the purpose of conducting business in either Pennsylvania or Illinois and does not have agents for service of process in those jurisdictions. (Ex. 1 ¶ 6 to Def.‟s Br. Hickton; Ex. D ¶ 7 to Def.‟s Br. Averill.) ERAC-Missouri, however, on July 30, 2008 -- approximately eight months after the action in Pennsylvania was commenced -- filed a certificate of authority with the Pennsylvania Secretary of State stating that it is an active foreign business corporation providing "administrative services." (Ex. A to Pl.‟s Reply Hickton.) The filing states it is "perpetual," and was on file as of May 5, 2009. (Id.) ERAC-Missouri asserts that the filing resulted from an error and on June 1, 2009, withdrew the filing. (Notice of Correction (Docket No. 96, Civ. No. 07-1687), Exs. A, B.)

ERAC-Missouri registered the "e and design" service mark with the Illinois Secretary of State in 1969 for use with "services in connection with the sale and leasing of automobiles," which registration expired on December 31, 2009. (Ex. 2 at P0017 to Pl.‟s Br. Averill.) ERAC-Missouri registered the "executive" service mark with the Illinois Secretary of State in 1997 for use with "vehicle renting and leasing services," which registration will expire on August 12, 2012. (Id. at P0018.)

In August 2004, ERAC-Missouri initiated a lawsuit against Collision Industry Management Solutions in the United States District Court for the Northern District of Illinois. (See Ex. 1 to Pl.‟s Br. Averill.) The lawsuit claimed that Collision Industry Management Solutions infringed ERAC-Missouri‟s trademarks registered with the United States, when Collision Industry Management Solutions created a system offering a similar service to Enterprise Rent-A-Car‟s ARMS system and called it by the same name. (Id. at P0001-P0003.) In the complaint, defendant parent alleged:

Enterprise is a Missouri corporation with a principal place of business at 600 Corporate Park Drive, St. Louis, Missouri 63105.....

Enterprise operates a large number of locations in the Northern District of Illinois. Both Enterprise and [the defendant] conduct business in the Northern District of Illinois, including the offering of their respective ARMS services and computer programming. (Id. at P0002.)

E. Boards of Directors of ERAC-Missouri's Operating Subsidiaries

At the time the complaints were filed, the board of directors at every operating subsidiary was comprised of directors from ERAC-Missouri. (Ex. H at 175 to Pl.‟s Reply Hickton.) Andrew C. Taylor ("Taylor"), Pamela Nicholson ("Nicholson"), and William W. Snyder ("Snyder") are members of ERAC-Missouri‟s board of directors, and they also serve as executive officers for ERAC-Missouri. (Ex. B at 79 to Pl.‟s Br. Hickton; Pls.‟ App., Ex. 2 at 14.) Those three individuals served on the three-person boards of directors of all operating subsidiaries.*fn9 (Id. at 175.) In Nicholson‟s biography she represents that she oversees the efforts of 68,000 employees, and in Snyder‟s biography he represents that he has overall responsibility for more than 68,000 employees. (Pls.‟ App., Exs. 10, 11.) In Taylor‟s biography he similarly represents that "Enterprise Holdings has a fleet of more than one million vehicles and 68,000 employees." (Pl.‟s App., Ex. 16.)

As members of the boards of directors of the operating subsidiaries, Taylor, Nicholson, and Snyder collectively had the power, on behalf of an operating subsidiary, by majority vote to do all things necessary or convenient to carry out the business and affairs of the operating subsidiary.*fn10 (See Pls.‟ App., Ex. 3.*fn11

The boards of directors of the operating subsidiaries delegated the vast majority of their authority to the operating subsidiaries‟ management personnel, and principally to their general managers. (See Def.‟s App., Ex. 1 ¶ 33; Def.‟s App., Ex. 2 ¶ 3; Def.‟s App., Ex. 3 ¶¶ 23-25; Def.‟s App., Ex. 4 ¶¶ 23-25; Def.‟s App., Ex. 5 ¶¶ 23-25; Def.‟s App., Ex 6 ¶¶ 11, 27-28; Def.‟s App., Ex. 7 ¶¶ 23-25.) In particular, they delegated the power to sell, transfer, or purchase property. In accordance with this delegation of power, Keyes, vice president and general manager of Enterprise Leasing Company of Philadelphia, LLC, testified he made the decision to purchase a rental office location. (Pls.‟ App., Ex. 6 at 121.) Timothy Nettles ("Nettles"), the vice president and general manager of ERAC-Pittsburgh, testified that he "worked out a deal" to transfer two branch locations to another operating subsidiary. (Def.‟s reply exhibit, Ex. 26 at 11.) The boards of directors delegated the power to hire or fire branch managers and assistant branch managers of each operating subsidiary to that subsidiary‟s management personnel. (Def.‟s App., Ex. 1 ¶ 33.) General managers can earn annual compensation ranging from the mid-six figures to upper-seven figures. (Def.‟s App., Ex. 2 ¶ 4; Def.‟s App., Ex. 9 at 14-16.)

F. Characteristics of ERAC-Missouri's Operating Subsidiaries

Matthew Darrah, who serves as ERAC-Missouri‟s executive vice president of North America, testified that ERAC-Missouri‟s performance is related to the performance of the operating subsidiaries:

Q: Do you agree that the work of the employees at the branch locations is integral to the performance of the parent company Enterprise?

A: If the subsidiaries don‟t do well, yeah, the entire, yeah, company doesn‟t do well. The entity doesn‟t do well.

Q: So is the answer to the question yes?

A: Yes. (Pls.‟ App., Ex. 1 at 104.)

The operating subsidiaries hire, promote, discipline, and fire their own branch managers and assistant branch managers. (Def.‟s App., Ex. 2 ¶ 7; Def.‟s App., Ex. 3 ¶¶ 30, 32-33; Def.‟s App., Ex. 4 ¶¶ 30, 32-33; Def.‟s App., Ex. 5 ¶¶ 30, 32-33; Def.‟s App., Ex. 6 ¶¶ 30-31, 34-35; Def.‟s App., Ex. 7 ¶¶ 30, 32-33.) For example, Keyes, vice president and general manager of Enterprise Leasing Company of Philadelphia, LLC, testified that in "my 24-and-a-half years with the company there has never been any precedent" of involvement of any person from ERAC-Missouri in his decisions to hire or fire employees of the operating subsidiaries. (Def.‟s App., Ex. 10 at 240-41.) Although Taylor, Nicholson, and Snyder were the only members of the boards of directors and as board members could vote on various matters affecting the operating subsidiaries, they did not participate in hiring or firing branch managers or assistant branch managers. (Def.‟s App., Ex. 3 ¶ 36; Def.‟s App., Ex. 4 ¶ 36; Def.‟s App., Ex. 5 ¶ 36; Def.‟s App., Ex. 6 ¶ 38; Def.‟s App., Ex. 7 ¶ 36; Def.‟s App., Ex. 11 at 129-30.) Brian Mogauro ("Mogauro"), vice president and general manager of Enterprise Leasing of Orlando, LLC, testified that Taylor, Nicholson, and Snyder "were never involved in my -- in that process in Orlando," and any potential they possess for interjecting in that process is inconsequential because such interjection is "out of the norm of reality." (Def.‟s App., Ex. 11 at 130-32.) The operating subsidiaries review the performance of their branch managers and assistant branch managers. (Def.‟s App., Ex. 2 ¶ 8; Def.‟s App., Ex. 3 ¶ 31; Def.‟s App., Ex. 4 ¶ 31; Def.‟s App., Ex. 5 ¶ 31; Def.‟s App., Ex. 6 ¶ 33; Def.‟s App., Ex. 7 ¶ 31.) Keyes testified that in order to assess the performance of assistant branch managers at his operating subsidiary, he utilized an annual review form created by ERAC-Missouri. (Pls.‟ App., Ex. 6 at 93-94.)

The operating subsidiaries decide where they will open and operate branches. (Def.‟s App., Ex. 3 ¶ 45; Def.‟s App., Ex. 4 ¶ 46; Def.‟s App., Ex. 5 ¶ 46; Def.‟s App., Ex. 6 ¶ 46; Def.‟s App., Ex. 7 ¶ 46.) The operating subsidiaries decide the days and hours that their branches will be open for business. (Def.‟s App., Ex. 3 ¶ 46; Def.‟s App., Ex. 4 ¶ 47; Def.‟s App., Ex. 5 ¶ 47; Def.‟s App., Ex. 6 ¶ 49; Def.‟s App., Ex. 7 ¶ 47.) The operating subsidiaries decide when their employees will be moved from one branch location to another. (Def.‟s App., Ex. 3 ¶ 48; Def.‟s App., Ex. 4 ¶ 49; Def.‟s App., Ex. 5 ¶ 49; Def.‟s App., Ex. 6 ¶ 51; Def.‟s App., Ex. 7 ¶ 49.) The operating subsidiaries decide which days and hours their branch managers and assistant branch managers will work at the assigned branch locations. (Def.‟s App., Ex. 3 ¶ 49; Def.‟s App., Ex. 4 ¶ 50; Def.‟s App., Ex. 5 ¶ 50; Def.‟s App., Ex. 6 ¶ 52; Def.‟s App., Ex. 7 ¶ 50; Def.‟s App., Ex. 10 at 135.)

The operating subsidiaries set the compensation for their branch managers and assistant branch managers. (Def.‟s App., Ex. 3 ¶ 37; Def.‟s App., Ex. 4 ¶ 37; Def.‟s App., Ex. 5 ¶¶ 37, 39; Def.‟s App., Ex. 6 ¶ 39; Def.‟s App., Ex. 7 ¶ 37.) The operating subsidiaries determine whether branch managers and assistant branch managers are classified as exempt from the FLSA overtime provisions. (Def.‟s App., Ex. 3 ¶ 42; Def.‟s App., Ex. 4 ¶ 43; Def.‟s App., Ex. 5 ¶ 43; Def.‟s App., Ex. 6 ¶ 45; Def.‟s App., Ex. 7 ¶ 43; Def.‟s App., Ex. 12 at 34-35.) Keyes testified at his deposition that if he wanted to change the classification of assistant branch managers working for his operating subsidiary from exempt from receiving overtime to nonexempt, he would consult Allen. (Def.‟s App., Ex. 10 at 206-07.) Mogauro at his deposition was asked, "Who made the determination that assistant managers would be exempt under the [FLSA] for the Orlando group?" (Def.‟s App., Ex. 11 at 78.) Mogauro responded, "I can only speak for since I‟ve been here. Me." (Id.) The operating subsidiaries‟ classifications of assistant branch managers are consistent with the recommendations of ERAC-Missouri. (See C.S.F. ¶ 109.) While ERAC-Missouri creates and distributes job descriptions for assistant branch managers, the operating subsidiaries may or may not use these descriptions. For example, Nettles testified that he does not use the recommended job descriptions. (Def.‟s App., Ex. 26 at 179.)

The operating subsidiaries elected to adopt many of the policies recommended by ERACMissouri. (Def.‟s App., Ex. 3 ¶ 53; Def.‟s App., Ex. 4 ¶ 54; Def.‟s App., Ex. 5 ¶ 54; Def.‟s App., Ex. 6 ¶¶ 55--56; Def.‟s App., Ex. 7 ¶ 52.) For example, Mogauro uses within his operating subsidiary a form consent agreement regarding drug testing that was provided by ERAC-Missouri. (Pls.‟ App., Ex. 4 at 123.) When Mogauro was asked if he expects employees who work at his operating subsidiary to comply with the policies recommended by ERAC-Missouri, he answered, "I would expect the employees in Orlando to adopt the policies that I set for Orlando." (Def.‟s App., Ex. 11 at 55.) Keyes testified that when a recommended policy "came in I would sit down with my HR manager and say, yes, this is something we are going to choose." (Pl.s‟ App., Ex. 6 at 194.) The operating subsidiaries may decide to vary from ERAC- Missouri‟s recommended policies. (Def.‟s App., Ex. 2 ¶ 16; Def.‟s App., Ex. 3 ¶ 54; Def.‟s App., Ex. 4 ¶¶ 55--56; Def.‟s App., Ex. 5 ¶ 54; Def.‟s App., Ex. 6 ¶ 55; Def.‟s App., Ex. 7 ¶ 55.)

With respect to training materials, the operating subsidiaries may use the materials provided by ERAC-Missouri. (Def.‟s App., Ex. 2 ¶ 18; Def.‟s App., Ex. 3 ¶ 57; Def.‟s App., Ex. 4 ¶ 58; Def.‟s App., Ex. 5 ¶ 57; Def.‟s App., Ex. 6 ¶ 57; Def.‟s App., Ex. 7 ¶ 58.) The operating subsidiaries tailor the training they provide the employees who work at their branch locations, in order to suit the operating subsidiaries‟ particular strategies and to best meet the unique needs of their businesses, clients, and locations. (Def.‟s App., Ex. 3 ¶ 58; Def.‟s App., Ex. 4 ¶ 59; Def.‟s App., Ex. 5 ¶¶ 57--58; Def.‟s App., Ex. 6 ¶¶ 57--58; Def.‟s App., Ex. 7 ¶ 59.) Training sessions for assistant branch managers are held locally by the operating subsidiaries, and the training sessions are staffed by employees of the operating subsidiaries. (Def.‟s App., Ex. 3 ¶ 59; Def.‟s App., Ex. 4 ¶ 60; Def.‟s App., Ex. 5 ¶¶ 59--61; Def.‟s App., Ex. 6 ¶¶ 59--60; Def.‟s App., Ex. 7 ¶ 60.) Newly-hired branch managers are invited to attend a single national meeting with other newly-hired branch managers from operating subsidiaries around the country, but assistant branch managers attend no such meetings. (Def.‟s App., Ex. 3 ¶¶ 59-60; Def.‟s App., Ex. 4 ¶¶ 60--62; Def.‟s App., Ex. 5 ¶¶ 59--60; Def.‟s App., Ex. 6 ¶¶ 59--60; Def.‟s App., Ex. 7 ¶¶ 60-61.)

The sample plaintiffs*fn12 deposed in this case did not physically work at ERAC-Missouri‟s headquarters. (Def.‟s App., Ex. 14 at 46-47; Def.‟s App., Ex. 15 at 99-100; Def.‟s App., Ex. 16 at 28-29; Def.‟s App., Ex. 17 at 135; Def.‟s App., Ex. 18 at 340; Def.‟s App., Ex. 19 at 11-12; Def.‟s App., Ex. 20 at 140-43.) Bajkowski, who worked as an assistant branch manager for ELC-Chicago, testified that the only direction he took from someone in corporate headquarters was during a training session. (Def.‟s App., Ex. 13 at 52-53.) Biski, who worked as an assistant branch manager at a branch in Schenectady, New York, testified that he was unaware of anyone from corporate headquarters evaluating performance, commenting on performance reviews, or conducting an interview. (Def.‟s App., Ex. 14 at 36, 40, 296-98.) Graham, who worked as an assistant branch manager at branches in Miami, Florida, testified that he understood his employment was with the subsidiary, not ERAC-Missouri. (Def.‟s App., Ex. 15 at 96-100.) Hagler, who worked as an assistant branch manager at a branch in Tuscaloosa, Alabama, testified that he "assumed [he] was employed by Enterprise Leasing Company South Central," not ERAC-Missouri. (Def.‟s App., Ex. 16 at 28-29.) Hagstrom, who worked as an assistant branch manager at branches in New York, New York, and Singleton, who worked as an assistant branch manager for ELC-Chicago, testified that they never had contact with anyone from ERAC-Missouri during their employment. (Def.‟s App., Ex. 17 at 87-88; Def.‟s App., Ex. 21 at 93, 95.) Hickton, who worked as an assistant branch manager for ERAC-Pittsburgh, testified that he did not have contact with anyone from ERAC-Missouri during his hiring or promotion processes, and he indicated on job applications that his employer was "Enterprise Rent-A-Car Company of Pittsburgh." (Def.‟s App., Ex. 18 at 22-23, 82-83, 120, 132-33, 180, 186-87.)

ERAC-Missouri has the authority to enter into nationwide rental agreements that provide for car rental rates for certain customers. Darrah, ERAC-Missouri‟s executive vice president of North America, testified about these contracts:

Q: You would want to make sure that Atlanta had sufficient vehicles to be able to service the demand?

A: Sufficient vehicles, sufficient operating space, space at airports is finite. You have to really watch the amount of business you bring on in some cases because it might be too much, believe it or not. But that is reality.

Q: Are there national sales contracts actually signed between the parties?

A: Oh, sure, yes.

Q: Who signs on behalf of Enterprise?

A: It would depend on the size of the account.

Q: What about somebody like IBM?

A: For somebody for like IBM, probably Brad Carr who you mentioned earlier. But for a small to medium size business, it would be somebody at the local group.

Q: Would Mr. Carr also be the one who would sign the contract for Enterprise with Siemens?

A: Yeah, more than likely.

Q: Would Mr. Carr be the one to negotiate any of the particular terms and conditions of those contracts with the customers?

A: He would be the one that would gather the information, would communicate with the groups that would be impacted by signing a customer that size, would get a -- sign off on the rates and ...


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