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Wolfe v. Tobacco Express II, Inc.

United States District Court, S.D. Mississippi, Southern Division

June 16, 2014


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[Copyrighted Material Omitted]

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For Kevin Wolfe, Plaintiff: Joseph A. LoCoco, LEAD ATTORNEY, LOCOCO AND LOCOCO, PLLC, D'Iberville, MS; Virginia Carothers LoCoco, LOCOCO AND LOCOCO, PA, D'Iberville, MS.

For Tobacco Express, II, Inc., Shelia Ann Thomas-Gatian, Mardi Gras Wine and Spirits, Inc., Defendants: Chester D. Nicholson, Gail D. Nicholson, LEAD ATTORNEYS, NICHOLSON AND NICHOLSON, Gulfport, MS.

For Mardi Gras Wine and Spirits, Inc., Shelia Ann Thomas-Gatian, Tobacco Express, II, Inc., Counter Claimants: Chester D. Nicholson, Gail D. Nicholson, LEAD ATTORNEYS, NICHOLSON AND NICHOLSON, Gulfport, MS.

For Kevin Wolfe, Counter Defendant: Joseph A. LoCoco, LEAD ATTORNEY, LOCOCO AND LOCOCO, PLLC, D'Iberville, MS; Virginia Carothers LoCoco, LOCOCO AND LOCOCO, PA, D'Iberville, MS.

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BEFORE THE COURT are three motions for summary judgment filed by the parties in this employment-related case. Plaintiff Wolfe claims he worked for defendants Tobacco Express II, Inc. and Thomas-Gatian for an eight-month period and was not paid for his work, in violation of the Fair Labor Standards Act. The Court finds questions of material fact and therefore denies both parties' motions for summary judgment in regard to this claim.

Wolfe also claims that after he was formally hired by Thomas-Gatian to work at Tobacco Express and Mardi Gras Wine and Spirits, Inc., the defendants violated the Employee Polygraph Protection Act by requesting or requiring him to take a polygraph examination and terminating his employment when he refused. The Court finds no question of material fact regarding the EPPA claims. Wolfe prevails on the issue of defendants' liability for the request or requirement that he take a polygraph examination, but defendants

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prevail on the issue of retaliation for Wolfe's refusal to take the examination.

The defendants claim that Wolfe has converted notebooks containing business records, cash, and inventory of Tobacco Express. Wolfe has shown that there is no question of material fact regarding this claim, and therefore his motion for summary judgment will be granted. The defendants also move for dismissal of this case as a sanction for spoliation of evidence. The Court finds sanctions inappropriate and therefore this request will be denied.


According to his Complaint (ECF No. 1), Wolfe was employed by Tobacco Express, II, Inc. and Mardi Gras Wine and Spirits, Inc. for approximately seventeen months, from February 18, 2011 to July 2, 2012.[1] Both stores are operated and/or owned by defendant Thomas-Gatian.

Wolfe alleges that from February 18 through September 9, 2011, he maintained the same hours at Tobacco Express as his girlfriend, Elizabeth Rutherford,[2] who was employed there as a cashier. Wolfe alleges that even though he restocked coolers, stocked shelves, unloaded trucks, assisted customers and helped Rutherford during that time period, he was not paid for his work. Wolfe was placed on the payroll on September 12, 2011. He worked between thirty-five and forty hours per week, at a wage of eight dollars per hour. Although it is not clear in the Complaint, it appears that Wolfe claims to have been an employee of both Tobacco Express and Mardi Gras Wine from September 12, 2011 to July 2, 2012.

In June 2012, the defendants noticed that inventory and cash were missing from Tobacco Express. In the course of investigating the shortage, the defendants required three employees, including Wolfe and Rutherford, to undergo a polygraph. Each of the three employees was given a 48-hour notice to sign prior to administration of the test. Wolfe alleges he questioned the legality of the requirement that he submit to the test, but was informed by Thomas-Gatian that he would be terminated immediately if he refused. Wolfe therefore appeared at the scheduled time for the polygraph test. However, he refused to take the test when the polygraph examiner notified Wolfe of his rights and that he was not required to take the test to maintain his employment. Wolfe left the test site and returned to the Mardi Gras Wine store to complete his shift. He alleges that when he arrived, the manager requested his keys, terminated his employment, and told him to never return to the premises.

In August of 2012, Wolfe made a complaint to the U.S. Department of Labor regarding the polygraph test. (Pl. Mot. Part. Summ. J. Ex. A 3, ECF No. 114-1). He also complained that he not been paid for six months of work at Tobacco Express. ( Id. at 2). An investigator for the U.S. Department of Labor concluded that although Wolfe was not expressly employed by Tobacco Express from February through September of 2011, Tobacco Express had nonetheless " suffered or permitted" him to work there for the same hours as Rutherford, and therefore he was owed minimum wage for those hours. ( Id. at 3). The parties indicate that the investigator

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found no violation of the EPPA, but that portion of the narrative does not appear to be in the record. Tobacco Express has refused to pay the $8,616.63 in back wages calculated by the investigator for the FSLA violation.

Wolfe brings an EPPA claim against Mardi Gras Wine, Tobacco Express and Thomas-Gatian, for which he seeks damages pursuant to 29 U.S.C. § § 216(b) and 2005(c). Additionally, he brings a FLSA claim against Tobacco Express and Thomas-Gatian for unpaid wages in the amount of $8,616.63, plus damages as allowed by 29 U.S.C. § 216(b).

According to the Counterclaim (ECF No. 68), Thomas-Gatian is a principal of Tobacco Express and Mardi Gras Wine, both of which are S corporations. The businesses are operated out of a single building owned by Thomas-Gatian. Wolfe was employed as a retail sales clerk from September 2011 until his resignation in June 2012.

Management noticed inventory irregularities in the spring and summer of 2012, primarily involving Tobacco Express. Three employees, including Wolfe and Rutherford, who were in a position to have regular access to the goods and/or money were offered polygraph examinations. Rutherford and the other employee took and passed the examination. Wolfe refused the test, returned to the store, turned in his keys and never returned to work or otherwise communicated with the defendants. He filed a claim for unemployment benefits, which was denied initially and on appeal on the basis of the finding that Wolfe had not been fired but had voluntarily resigned his employment. The defendants allege that Wolfe was criminally charged by his subsequent employer with embezzlement, giving credence to their suspicions that he was responsible for the inventory losses at Tobacco Express.

The defendants further allege that during this litigation, Wolfe has provided his attorneys with notebooks taken from Tobacco Express which are defendants' business records. The defendants contend these notebooks were created and maintained for management's purposes and contain entries that would substantiate their defense to Wolfe's claims. However, Wolfe has not returned the notebooks to Tobacco Express.

The defendants' counterclaims against Wolfe are for conversion of merchandise, money, and business records. They seek compensatory and punitive damages.


In his summary judgment motions, Wolfe seeks judgment in his favor as to the defendants' conversion counterclaims, and as to the liability portion of his own claims against the defendants. The defendants move for summary judgment on all claims against them.

The Court analyzes the motions under the well-established summary judgment standard. Fed.R.Civ.P. 56(c); see generally, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Burge v. Parish of St. Tammany, 187 F.3d 452, 464 (5th Cir. 1999).


The defendants move for dismissal of Wolfe's claims against them as a sanction for spoliation of the evidence. They argue that Rutherford removed at least five notebooks containing business records from the stores, and although she produced five notebooks in discovery, the notebook containing the manager's comments about Wolfe's presence at the store was not produced.

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The manager testified that " I do know that I wrote a lot about [Wolfe] being up there, about complaints that I had received, and I don't see any of that in here." (Def. Ex. 36 at 35, ECF No. 111-16). Defendants conclude that Rutherford has not produced or perhaps destroyed at least one notebook. ( Id. at 9).

In earlier proceedings in this case, the defendants filed a motion to compel requesting, among other things, that Elizabeth Rutherford be ordered to respond to questions about the notebooks. (ECF No. 67). The Court granted this motion in part, allowing the defendants to ask Rutherford certain questions about the notebooks. (Order Jan. 10, 2014, ECF No. 86). Rutherford's answers were clearly unsatisfactory to defendants, because she testified both that the notebooks were her property because she purchased them, and also that they were store records that she had mistakenly brought home with some of her own items. ( See Def. Resp. Ex. 41 at 140-41, ECF No. 119-2). The defendants argue that there remains at least one other notebook in Rutherford's possession, and her retention of it shows bad faith. They argue that the notebook is necessary to show that Rutherford received specific instructions from the manager regarding the conditions under which Wolfe could be on the premises during Rutherford's shifts. Defendants did not file a motion to compel production of the notebook(s).

The law regarding spoliation requires that the moving party show that the party alleged to have concealed or destroyed evidence has acted in bad faith. King v. Ill. Cent. R.R., 337 F.3d 550, 556 (5th Cir. 2003). The Court should demand even more compelling evidence of bad faith when asked to apply the more severe sanction of dismissal or summary judgment. Stahl v. Wal-Mart Stores, Inc., 47 F.Supp.2d 783, 786-87 (S.D.Miss. 1998).

The defendant's request for dismissal on the grounds of spoliation must be denied. Rutherford, although closely aligned with Wolfe, is not a party to this lawsuit. The Court has not located a case in which a non-party's alleged bad faith has constituted grounds for dismissal for spoliation. Even so, the evidence concerning Rutherford's conduct does not unequivocally show bad faith, considering that she testified to both negligent and knowing removal of the notebooks. There is no evidence at all of Wolfe's involvement in the disappearance of the notebooks or that he knew they were stored in a closet in his home. Further, the notebook is not the only source of the information defendants wish to present to the jury, as the person who created the record has testified that she advised Rutherford of the circumstances under which Wolfe could remain at the store during Rutherford's shifts. (Def. Ex. 36 at 33-34, ECF No. 111-16). Thus, the evidence has not been " lost." Dismissal of the ...

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