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Hancock v. A&R Flag Car Service

United States District Court, E.D. Pennsylvania

August 24, 2017

CHRISTIAN HANCOCK, et al, Plaintiffs
v.
A&R FLAG CAR SERVICE, et al, Defendants

          MEMORANDUM

          STENGEL, C.J.

         The defendants have filed a motion to set aside and vacate the entry of default and default judgment in the above-captioned case. The plaintiffs have responded. For the following reasons, I will deny the motion.

         I. BACKGROUND

         The plaintiffs filed a five count collective action against the defendants for unpaid overtime compensation, unpaid minimum wage compensation, and unlawful deductions, alleging violations of the Fair Labor Standards Act, the Pennsylvania Minimum Wage Act, the Pennsylvania Wage Payment and Collection Law, and Pennsylvania's common law. It also claims that the defendants failed to implement a system to track the number of hours worked each workweek. The defendants further allegedly forced the plaintiffs to pay for business expenses without reimbursement.

         The complaint alleges that Defendant A&R Flag Car Service operates an escort driving service. The plaintiffs operate what are called "flag cars" which "escorted" oversized wide load trucks on the highway. Defendant John Flagler had control over the plaintiffs' employment including processing payment and implementing/enforcing the above policies and practices. There are ten John Doe defendants who allegedly directed, aided, abetted, and/or assisted with creating and/or executing the other defendants' policies and practices which resulted in the failure to pay the plaintiffs proper compensation. Five of these ten defendants allegedly had control over processing payroll.

         The complaint further alleges that the plaintiffs regularly worked more than forty hours per week. The defendants compensated the plaintiffs by paying them $0.85 per mile for the miles that they drove while escorting oversized loads. The defendants also paid the plaintiffs $10.00 per hour for time spent sitting during delays, and paid them approximately $25.00 and $55.00 per day for trips which required the plaintiffs to stay overnight in motels. The plaintiffs were required to transport their flag cars to and from the locations where each escort trip began and ended. They were compensated for the miles driven and hours worked while transporting the flag cars. The plaintiffs also had to pay for gasoline for their flag cars and were not reimbursed. The plaintiffs allege that they were not paid at least $7.25 per hour, and no overtime compensation was paid for hours worked in excess of forty in a work week.

         The plaintiffs filed this action on November 13, 2013. A Summons was returned and filed on January 2, 2014, indicating that service had been accepted by Authorized Agent John Flagler on behalf of Defendant A&R Flag Car Service on December 19, 2013. See Document #2. Federal Rule of Civil Procedure 12(a)(1)(A)(i) required the defendant to file a responsive pleading with the court within twenty-one days after being served with the summons and complaint, i.e., January 9, 2014.

         A Summons was returned and filed on January 2, 2014, indicating that Defendant John Flagler had been personally served on December 19, 2013. See Document #3. Federal Rule of Civil Procedure 12(a)(1)(A)(i) required the defendant to file a responsive pleading with the court within twenty-one days after being served with the summons and complaint, i.e., January 9, 2014.

         On February 4, 2014, because the defendants did not file an Answer, the plaintiffs requested the Clerk of Court to enter a default against the defendants pursuant to Federal Rule of Civil Procedure 55(a) for failure to respond to the complaint. See Document #5. On the same day, the Clerk of Court entered such a default.

         On May 7, 2014, the plaintiffs filed an application for default judgment against the defendants pursuant to Rule 55(b) of the Federal Rules of Civil Procedure. See Document #6. At that point, the defendants had not filed a responsive pleading to the complaint, or a response to the application for default judgment. Further, no attorney had filed an entry of appearance on behalf of the defendants.

         On June 4, 2014, 1 ordered the defendants to show cause on or before June 16, 2014, as to why the court should not grant the relief sought in the plaintiffs' Application for Entry of Default Judgment. See Document #7. The defendants neither responded nor attended the hearing.

         Following the hearing, I entered default judgment in favor of the plaintiffs and against the defendants in this case, for an amount of $70, 894.20. In attempting to collect on the judgment, the plaintiffs filed praecipes for writs of execution, which the Clerk's Office entered. Writs of garnishment were also entered as to two banks.

         Because the defendants did not provide the plaintiffs with any answers, the plaintiffs filed a motion to compel post-judgment discovery, which I granted on May 13, 2015. In addition, I ordered the defendants to answer the plaintiffs' interrogatories in aid of execution within fifteen days. On July 17, 2015, the plaintiffs filed a motion for sanctions against the defendants for failure to comply with your Order. I scheduled a hearing for September 9, 2015, giving the defendants yet another chance to appear and show cause why an Order should not have been entered finding them in contempt of court for failure to comply with my Order dated May 13, 2015. I also ordered the defendants to file a written response to the Order to Show Cause by August 28, 2015. The defendants chose not to respond to that Order, and chose not to attend the hearing. The plaintiffs filed a brief informing the court that Defendant John Flagler had filed for bankruptcy under Chapter 13 of the U.S. Bankruptcy Code in this district on August 26, 2015.

         Following the argument of plaintiffs' counsel at the hearing, I granted the plaintiffs' motion for sanctions, and found the defendants to be in contempt[1]of court for failure to comply with my Order dated May 13, 2015. I further requested that the plaintiffs file an affidavit of costs and attorney's fees for their attempt at post-judgment discovery, and for the preparation of the motions to compel and for sanctions.

         After a review of that affidavit, I ordered the defendants to pay attorney's fees and costs of $1, 125.00 to the plaintiffs on October 26, 2015. I also ordered them to provide full, complete, and verified responses to the plaintiffs' discovery without objection, within ten days of the date of that Order. Finally, I ...


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