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Camp v. Bimbo Bakeries USA, Inc.

United States District Court, D. New Hampshire

December 17, 2018

David Camp and Keith Hadmack, on behalf of themselves and all others similarly situated, Plaintiffs
Bimbo Bakeries USA, Inc. and Bimbo Foods Bakeries Distribution, LLC, Defendants

          Harold L. Lichten, Esq. Matthew Thomson, Esq. Christopher B. Coughlin, Esq. William D. Pandolph, Esq. Michael J. Puma, Esq. Siobhan E. Mee, Esq.


          Steven J. McAuliffe United States District Judge.

         Plaintiffs bring this wage and hour class action, asserting that defendants unlawfully treated them as independent contractors when, in fact, they were employees. As a consequence, say plaintiffs, they were wrongfully denied overtime pay, denied reimbursement for work-related expenses, and subjected to unlawful withholdings from their pay. Defendants deny plaintiffs allegations and move to dismiss their class action complaint, asserting that none of plaintiffs' claims states a viable cause of action. The motion is necessarily denied.

         Standard of Review

         When ruling on a motion to dismiss under Fed.R.Civ.P. 12(b)(6), the court must “accept as true all well-pleaded facts set out in the complaint and indulge all reasonable inferences in favor of the pleader.” SEC v. Tambone, 597 F.3d 436, 441 (1st Cir. 2010). Although the complaint need only contain “a short and plain statement of the claim showing that the pleader is entitled to relief, ” Fed.R.Civ.P. 8(a)(2), it must allege each of the essential elements of a viable cause of action and “contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face, ” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citation and internal punctuation omitted).

         In other words, “a plaintiff's obligation to provide the ‘grounds' of his ‘entitlement to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). Instead, the facts alleged in the complaint must, if credited as true, be sufficient to “nudge[] [plaintiff's] claims across the line from conceivable to plausible.” Id. at 570. If, however, the “factual allegations in the complaint are too meager, vague, or conclusory to remove the possibility of relief from the realm of mere conjecture, the complaint is open to dismissal.” Tambone, 597 F.3d at 442.


         Accepting the factual allegations set forth in plaintiffs' complaint as true - as the court must at this juncture - the relevant background is as follows. The Defendants, Bimbo Bakeries USA and Bimbo Foods Bakeries Distribution, are in the business of manufacturing, selling, and delivering baked goods under brand names that include Sara Lee and Nature's Harvest. Complaint (document no. 1) at para. 11. In New Hampshire, they operate out of terminals located in Hooksett, Lebanon, and Keene. Id. at para. 12. Defendants employ approximately 50 people to deliver their products and stock the shelves at various stores. Defendants designate those individuals, including the named plaintiffs, as “independent contractors, ” rather than “employees, ” and refer to them as “distributors.” Id. at paras. 13-14.

         According to plaintiffs, during a typical week they work at least forty hours delivering baked goods for defendants (plaintiff Camp, for example, alleges that he typically works six or seven days each week, for 45-50 hours). Id. at para. 31. Distributors' work consists mainly of driving to stores within their designated territories, delivering defendants' products, and arranging products on the store shelves according to defendants' display standards. Id. at para. 17. To secure their employment with defendants, plaintiffs and other distributors were required to pay a substantial sum of money to purchase “distribution rights” and then enter into a “distribution agreement” with defendants. Based upon the limited record before the court, those agreements appear to have been between plaintiffs and defendant Bimbo Foods Bakeries Distribution (or its predecessor). See Exhibits A and B to Defendants' Motion to Dismiss (documents no. 16-2 and 16-3). Most distributors finance the acquisition of those distribution rights through loans facilitated by defendants. Complaint at para. 20. Often, defendants deduct loan payments directly from the pay provided to distributors. Id. at para. 27.

         The distribution agreements classify the distributors as “independent contractors, ” but defendants retain (and exercise) substantial control over the work performed by the distributors. Id. at paras. 23-24. According to plaintiffs, that control includes maintaining supervisory and disciplinary authority over the distributors; determining the price at which distributors must sell all food products; dictating the frequency of deliveries, the manner in which deliveries are conducted, and the dates by which stale products must be removed; requiring express approval before a distributor may sell his or her route (or arrange for a substitute driver); prohibiting distributors from exercising independent business judgment, such as determining when a store is no longer profitable and should no longer receive deliveries; and prohibiting distributors from participating in activities, or working for entities, that defendants consider competitive. Id. at para. 25.

         Plaintiffs also assert that, even if they were not contractually prohibited from serving defendants' “competitors, ” given the substantial time required to make their deliveries on behalf of defendants, they would be precluded, as a practical matter, from making deliveries for any other companies. Consequently, distributors are not customarily engaged in an independently established trade, occupation, or business of the same nature as the services they provide to defendants. Id. at para. 29. Moreover, say plaintiffs, defendants require them to assume many of defendants' general business expenses, including the cost of fuel and lease payments for their delivery vehicles, as well as insurance and maintenance costs for those vehicles. Finally, defendants do not provide workers' compensation insurance for plaintiffs and the other distributors.

         In their complaint, plaintiffs advance five claims against defendants, under both state and federal law: failure to pay overtime wages, in violation of the Fair Labor Standards Act; unlawful withholdings and deductions from wages, in violation of N.H. Rev. Stat. Ann. (“RSA”) 275:48; failure to reimburse plaintiffs for various employment-related expenses, in violation of RSA 275:57; failure to pay overtime wages, in violation of RSA 279:21; and unjust enrichment, in violation of New Hampshire common law. As noted above, defendants assert that none of those claims states a viable cause of action.


         I. Claims Against Bimbo Bakeries USA.

         As a preliminary matter, defendants move to dismiss all claims against Bimbo Bakeries USA (“BBUSA”), asserting that plaintiffs have failed to specifically identify any alleged wrongdoing on its part. Instead, the complaint simply groups the named defendants together and routinely ascribes allegedly wrongful conduct to “defendants, ” without identifying which defendant engaged in which conduct. Moreover, defendants point out that BBUSA is not a party to either of the distribution agreements at issue in the case. Plaintiff David Camp executed his agreement with Bestfood Baking Distribution Company (not a party, but apparently the predecessor to one of the named defendants), and plaintiff Keith Hadmack executed his agreement with defendant Bimbo Foods Bakeries Distribution, Inc. Consequently, say defendants, the complaint fails to adequately allege the factual predicate necessary to state any viable claims against BBUSA. The court disagrees.

         Plaintiffs' complaint is sufficient - albeit barely - to survive a motion to dismiss. Plaintiffs' primary complaint is that they were improperly treated as independent contractors, rather than employees. If they prevail on that claim, it will be necessary to determine which entity acted as their employer -that is, which entity exercised control over the details of the performance of plaintiffs' work and the means by which they performed that work. At this juncture, the complaint adequately alleges that one or both named defendants may be liable as ...

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