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Gilliland v. Sanico Clanton, LLC

United States District Court, M.D. Alabama, Northern Division

November 4, 2019

SANICO CLANTON, LLC, et al., Defendants.



         Before the Court is Plaintiff's Supplemental Memorandum of Law on the Court's Jurisdiction to Hear Plaintiff's Title VII Claims (Doc. 22) and Defendant's Response to Plaintiff's Supplemental Memorandum of Law on the Court's Jurisdiction to Hear Plaintiff's Title VII Claims (Doc. 23). Previously, the Defendant moved for dismissal. (Doc. 7). This Court converted the motion to one for summary judgment and denied it, finding that the pleadings did not clearly establish this Court's subject-matter jurisdiction, and ordered the parties to report back after conducting limited jurisdictional discovery. (Doc. 21). After review, the undersigned construes the Defendant's Response as a renewed motion for partial summary judgment on Plaintiff's Title VII claims, and finds that the motion is due to be granted.[1]

         I. BACKGROUND

         On November 8, 2018, Plaintiff filed a Complaint (Doc. 1) against Defendants alleging three counts of retaliation and discrimination under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., and two counts of retaliation and discrimination under 42 U.S.C. § 1981. Id. at 1. Plaintiff's claims arise from events that occurred while Plaintiff was employed as a garment folder at Defendant Sanico Clanton, LLC's (“Sanico”) facility. Id. at 6. Plaintiff alleges Defendants, in aggregate, constitute a single “employer” under the “integrated enterprise” test and, hence, are subject to Title VII and its 15-employee threshold. See Lyes v. City of Riviera Beach, Fla., 166 F.3d 1332, 1341 (11th Cir. 1999) (en banc) (adopting the NLRB's “single-employer” factor test for purposes of determining when to aggregate multiple entities for purposes of counting employees, which includes analysis of (1) the interrelation of operations, (2) centralized control of labor relations, (3) common management, and (4) common ownership or financial control). On December 6, 2018, Defendants filed a Motion to Dismiss Plaintiff's Complaint pursuant to Rule 12(b)(1), arguing that the Court lacks subject matter jurisdiction over Plaintiff's claims because Defendants are three separate entities-not an integrated enterprise-and the one company Plaintiff worked for, Sanico, does not meet the statutory definition of “employer” under Title VII. (Doc. 7) at 5-11; see also Fed. R. Civ. P. 12(b)(1); 42 U.S.C. § 2000e(b).

         On January 2, 2019, Plaintiff filed a Brief in Opposition (Doc. 16) to Defendants' Motion to Dismiss, arguing that Defendants' Motion was improperly brought under Rule 12(b)(1) because “the threshold number of employees for application of Title VII is an element of a plaintiff's claim for relief, not a jurisdictional issue.” (Doc. 16) at 5 (quoting Arbaugh v. Y&H Corp., 456 U.S. 500, 516 (2006)). On January 9, 2019, Defendants filed a Motion to Convert (Doc. 17) their Motion to Dismiss into a Motion for Summary Judgment, conceding that “the question of whether [Sanico] is an ‘employer' for purposes of Title VII is a question related to the merits of Plaintiff's claims.” (Doc. 17) at 2. Defendants reiterated their argument that the Defendant entities do not meet the definition of a single “employer” under the “integrated enterprise” test. Id. at 9-13 (citing Lyes, 166 F.3d at 1341).

         On January 21, 2019, Plaintiff filed a Response (Doc. 20) to Defendants' Motion to Convert (Doc. 17) arguing that, because the evidentiary record is undeveloped, it “cannot present facts essential to justify its opposition” to Defendants' motion if converted to a motion for summary judgment. (Doc. 20) at 4 (quoting Fed.R.Civ.P. 56(d)). Plaintiff asked the Court to deny without prejudice Defendants' Motion and to allow discovery to proceed. Id. at 5.

         On August 5, 2019, this Court issued an order finding that Defendants were indeed making a factual challenge to this Court's jurisdiction that required further development. However, the undersigned found that determination of this Court's subject-matter jurisdiction “will, at the same time, effectively decide the merits of Plaintiff's claims.” (Doc. 21) at 5. Additionally, the undersigned found: “Where the jurisdictional issues are intertwined with the substantive merits, ‘the jurisdictional issues should be referred to the merits, for it is impossible to decide one without the other.'” Id. Accordingly, this Court denied Defendants' Motion for Summary Judgment without prejudice and ordered the parties to conduct limited discovery. Id.

         The undersigned directed the parties to conduct limited discovery to enable analysis of the four criteria that dictate whether the business should be viewed as an integrated enterprise under the Lyes analysis. The parties have done so and have included relevant findings in their memoranda. The undersigned will construe the Defendants' filing (Doc. 23) as a renewed motion for summary judgment and the Plaintiff's filing as the opposition thereto (Doc. 22). After review, and with the benefit of discovery, the Defendant's summary judgment motion is due to be granted with respect to Plaintiff's Title VII claims.


         A. Standard of Review

         Rule 56 requires that summary judgment be granted “if the movant shows 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). “The moving party bears ‘the initial responsibility of informing the . . . court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.'” Hickson Corp. v. N. Crossarm Co., 357 F.3d 1256, 1259 (11th Cir. 2004) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (internal quotations omitted)). Where the moving party makes such a showing, the burden shifts to the non-movant, who must go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 (1986). The applicable substantive law identifies which facts are material. Id. at 248. A fact is not material if a dispute over that fact will not affect the outcome of the suit under the governing law. Id. An issue is genuine when the evidence is such that a reasonable jury could return a verdict for the non-moving party. Id. at 249-50.

         In resolving a motion for summary judgment, the Court must view all evidence and draw all reasonable inferences in the light most favorable to the non-moving party. Patton v. Triad Guar. Ins. Corp., 277 F.3d 1294, 1296 (11th Cir. 2002). But, the Court is bound only to draw those inferences that are reasonable. “Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial.” Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)). The nonmovant must establish, with appropriate evidence beyond the pleadings, that a genuine dispute material to his case exists. Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir.1991); Celotex, 477 U.S. at 324 (holding that the nonmoving party is required to go beyond the pleadings and, by her own affidavits or by the record on file, designate specific facts showing there is a genuine issue).

         B. Discussion

         After conducting their limited discovery, the parties seem to have little dispute over the facts governing this dispute. From both memoranda and respective exhibits, the undersigned can deduce the following about Sancio's business structure: Sanico is a small chain of businesses that rents various types of industrial cleaning supplies. (Doc. 23-1) at 3. Sanico has three locations in Gulfport, Mississippi; Lake, Mississippi; and Clanton, Alabama. Id. The three entities are incorporated separately, but are owned by the same individual, John Sandras. Id. at 2-4. The locations are managed separately and maintain separate bank accounts, employees, customers, managers, and insurance carriers. Id. The managers at each branch make the bulk of the business decisions, such as hiring/firing, hours, and compensation (although Sandras retains ultimate firing authority by virtue of ownership). Id. The branches do not share inventory or ...

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