Motion for Writ in Vincent Settecasi, Pamela Graham, Coree Spencer, Individually And On Behalf Of Others Similarly Situated v. Gotham Hall, Llc, Gotham Hall Operating Entity, Llc, Core Ziegfeld, Llc D/B/A Ziegfeld Balroom, Simon Auerbacher, Bruce A. Kurtz| Trellis.Law

On March 29, 2018 a Motion-Secondary was filed involving a dispute between Coree Spencer, Individually And On Behalf Of Others Similarly Situated, Pamela Graham, Vincent Settecasi, and Bruce A. Kurtz, Core Ziegfeld, Llc D B A Ziegfeld Balroom, Gotham Hall, Llc, Gotham Hall Operating Entity, Llc, Simon Auerbacher, for Other Matters - Contract - Other in the District Court of New York County.

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SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
VINCENT SETTECASI, PAMELA GRAHAM, and
COREE SPENCER, individually and others similarly
situated, Index No.: 152791/2018
Plaintiffs,

- against -

GOTHAM HALL, LLC; GOTHAM HALL
OPERATING ENTITY, LLC; CORE ZIEGFELD, LLC
d/b/a ZIEGFELD BALLROOM; SIMON
AUERBACHER; BRUCE A. KURTZ; and any other
related entities,

Defendants.

MEMORANDUM OF LAW
IN SUPPORT OF PLAINTIFFS’ MOTION FOR CLASS CERTIFICATION
PURSUANT TO CPLR §§ 901 AND 902

Brett R. Cohen
Michael A. Tompkins
Suzanne Leeds Klein
LEEDS BROWN LAW, P.C.
One Old Country Road, Suite 347
Carle Place, New York 11514

Attorneys for Plaintiffs & the Putative Class

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TABLE OF CONTENTS

TABLE OF CONTENTS .............................................................................................................. i

TABLE OF AUTHORITIES ....................................................................................................... ii

PRELIMINARY STATEMENT ................................................................................................. 1

PROCEDURAL HISTORY & BACKGROUND ...................................................................... 4

SUMMARY OF FACTS & ARGUMENTS ............................................................................... 4

ARGUMENT ................................................................................................................................. 7

A. CLASS CERTIFICATION IS ROUTINELY GRANTED IN ACTIONS FOR
UNPAID WAGES AND GRATUITIES ....................................................................... 7

B. THIS ACTION SATISFIES ALL SECTION 901 PREREQUISITES .......................... 9

1. The Class Is So Numerous That Joinder Of All Members Is
Impracticable...............................................................................................................9

2. The Questions of Law and Fact Common to the Class Predominate
Over Questions Affecting Only Individual Class Members .......................................9

a. Predominance is Satisfied Even Though Damages Will Differ............................ 12

3. The Named Plaintiff’s Claims Are Typical of the Claims of the
Putative Class ............................................................................................................13

4. The Named Plaintiff Will Fairly and Adequately Protect the Interests
of the Putative Class..................................................................................................14

5. A Class Action Is Superior to Other Available Methods ..........................................16

C. SECTION 902 FACTORS SUPPORT CLASS CERTIFICATION ............................ 17

CONCLUSION ........................................................................................................................... 18

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TABLE OF AUTHORITIES

Cases

"Agent Orange" Prod. Liab. Litig.,
506 F. Supp. 762 (E.D.N.Y. 1980) ...................................................................................................... 17

Borden v. 400 E. 55th St. Assoc., L.P.,
24 N.Y.3d 382 (2014) .................................................................................................................. passim

Brandon v. Chefetz,
106 A.D.2d 162 (1st Dep’t 1985) .................................................................................................... 9, 11

Brandy v. Canea Mare Contr., Inc.,
34 A.D.3d 512 (2d Dep’t 2006) ...................................................................................................... 2, 16

Canavan v. Chase Manhattan Bank,
234 A.D.2d 493 (2d Dep’t 1996) .......................................................................................................... 7

Cardona v. Maramont Corp.,
2009 N.Y. Misc. LEXIS 5010 (Sup. Ct. New York Cty. Nov. 12, 2009) .............................................. 5

Cherry v. Res. Am., Inc.,
15 A.D.3d 1013 (4th Dep’t 2005) ....................................................................................................... 10

Dabrowski v. Abax Inc.,
84 A.D.3d 633 (1st Dep’t 2011) ........................................................................................................ 2, 8

Friar v. Vanguard Holding Corp.,
78 A.D.2d 83 (2d Dep’t 1980) ..................................................................................................... passim

Galdamez v. Biordi Constr. Corp.,
13 Misc. 3d 1224(A) (Sup. Ct. N.Y. Cty. 2006) .......................................................................... passim

Geiger v. Am. Tobacco Co.,
181 Misc. 2d 875 (Sup. Ct. Queens Cty. 1999) .................................................................................. 10

Gilman v. Merrill Lynch, Pierce, Fenner & Smith, Inc.,
93 Misc. 2d 941 (Sup. Ct. New York Cty. 1978) ......................................................................... passim

Globe Surgical Supply v. GEICO Ins. Co.,
59 A.D.3d 129 (2d Dep’t 2008) .......................................................................................................... 12

Godwin Realty Assocs. v. CATV Enters.,
275 A.D.2d 269 (1st Dep’t 2000) ........................................................................................................ 12

Jacobs v. Macy's E., Inc.,
17 A.D.3d 318 (2d Dep’t 2005) ............................................................................................................ 2

Krebs v. Canyon Club, Inc.,
22 Misc. 3d 1125(A) (Sup. Ct. Westchester Cty. Jan. 2, 2009) .................................................. passim

Kudinov v. Kel-Tech Constr. Inc.,
65 A.D.3d 481 (1st Dep’t 2009) ............................................................................................................ 7

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Maor v. Hornblower N.Y., L.L.C.,
No. 160993/14, 2016 N.Y. Misc. LEXIS 2111 (Sup. Ct. New York Cty. June 13, 2016)............ passim

Martin v. Rest. Assoc. Events Corp.,
35 Misc. 3d 215 (Sup. Ct. Comm. Part. Westchester Cnty. Jan. 12, 2012) ........................................ 12

Membrives v. HHC TRS FP Portfolio L.L.C.,
No. 607828/15, 2017 N.Y. Misc. LEXIS 5754 (Sup. Ct. Mar. 10, 2017) ……………………… passim

Membrives v. HHC TRS FP Portfolio L.L.C.,
No. 607828/15, 2018 N.Y. Misc. LEXIS 4470 (Sup. Ct. July 23, 2018) …………………………….. 6

Nawrocki v. Proto Constr. & Dev. Corp.,
82 A.D.3d 534 (1st Dep’t 2011) ................................................................................................... passim

Ortiz v. J.P. Jack Corp.,
286 A.D.2d 671 (2d Dep’t 2001) .......................................................................................................... 8

Pajaczek v. Cema Const. Corp.,
859 N.Y.S.2d 897 (Sup. Ct. New York Cty. 2008) ...................................................................... passim

Pesantez v. Boyle Envtl. Servs., Inc.,
251 A.D.2d 11 (1st Dep’t 1998) ................................................................................................... passim

Pruitt v. Rockefeller Center Props., Inc.,
167 A.D.2d 14 (1st Dep’t 1991) ........................................................................................................ 7, 9

Samiento v. World Yacht Inc.,
10 N.Y.3d 70 (2008) ......................................................................................................................... 1, 2

Smellie v. Mount Sinai Hosp.,
2004 U.S. Dist. LEXIS 24006 (S.D.N.Y. Nov. 29, 2004) .................................................................. 16

Spicer v. Pier Sixty L.L.C.,
269 F.R.D. 321 (S.D.N.Y. 2010) .......................................................................................................... 3

Stecko v. RLI Ins. Co.,
2014 N.Y. App. Div. LEXIS 7065 (1st Dep’t Oct. 21, 2014) ............................................................ 2, 8

Super Glue Corp. v. Avis Rent A Car Sys., Inc.,
132 A.D.2d 604 (2d Dep’t 1987) .................................................................................................. 13, 15

Super Glue Corp. v. Avis Rent A Car Sys., Inc.,
159 A.D.2d 68 (2d Dep’t 1990) ……………………………………………………………………... 13

Tamburino v. Madison Sq. Garden, LP,
115 A.D.3d 217 (1st Dep’t 2014) .......................................................................................................... 2

Tart v. Lions Gate Entm’t Corp.,
2015 U.S. Dist. LEXIS 139266 (S.D.N.Y. Oct. 13, 2015) .................................................................. 15

Velasquez v. Sunstone Red Oak, LLC,
Index No. 51015/2016, 2018 N.Y. Misc. LEXIS 4476 (Sup. Ct. Westchester Cty. Aug. 21, 2018).. 3, 8

iii

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Weinstein v. Jenny Craig Operations, Inc.,
138 A.D.3d 546 (1st Dep’t 2016) .......................................................................................................... 2

Wilder v. May Dep’t Stores Co.,
23 A.D.3d 646 (2d Dep’t 2005) ............................................................................................................ 2

Statutes
N.Y. C.P.L.R. 901 .............................................................................................................................. passim
N.Y. C.P.L.R. 902 .............................................................................................................................. passim
N.Y. Lab. Law § 196-d ...................................................................................................................... passim

Other
12 NYCRR Part 146 (“Hospitality Wage Order”) .............................................................................. passim

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PRELIMINARY STATEMENT

Named Plaintiffs Vincent Settecasi, Pamela Graham, and Coree Spencer (“the Named

Plaintiffs”), individually and on behalf of others similarly situated (collectively “Plaintiffs”), by

their attorneys Leeds Brown Law, P.C., submit this Memorandum of Law in support of their

motion for class certification under Article 9 of the Civil Practice Law and Rules (“CPLR”).

The Named Plaintiffs have commenced this action on behalf of themselves and a putative

class of individuals who performed food services at catered events held at Defendants’ catering

event venues, namely Gotham Hall (“Gotham”) and/or Ziegfeld Ballroom (“Ziegfeld”), from

March 2012 to the present. Plaintiffs allege that Defendants violated 12 NYCRR Part 146

(“Hospitality Wage Order”, attached as Exhibit A1) and the New York Labor Law (“Labor Law”)

by collecting and retaining mandatory charges (“Mandatory Charges”) that the reasonable

customer would have understood to be in the nature of a gratuity, in contravention of Labor Law

Article 6 § 196-d (“§ 196-d”). [See Plaintiffs’ Amended Class Action Complaint, as filed via

NYSCEF (“Doc. No.”) 19, ¶¶ 1-6, 8].

According to § 196-d, “[n]o employer or his agent or an officer or agent of any corporation,

or any other person shall demand or accept, directly or indirectly, any part of the gratuities,

received by an employee, or retain any part of a gratuity or of any charge purported to be a gratuity

for an employee.” The Court of Appeals’ landmark decision in Samiento v. World Yacht Inc., 10

N.Y.3d 70 (2008) established that “the standard under which a mandatory charge or fee is

purported to be a gratuity should be weighed against the expectation of the reasonable customer…

our holding [is] that a banquet charge, like any charge can ‘purport[] to be a gratuity’ and that the

reasonable patron standard should govern when determining whether a banquet patron would

1
All exhibits referenced herein are attached to the Affirmation of Brett R. Cohen (“Cohen Aff.”).

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understand a service charge was being collected in lieu of a gratuity.” Id. at 79. As articulated by

the Appellate Division, “an employer cannot withhold from its employees any portion of a

mandatory service charge that is added to a customer’s bill unless the employer makes it clear to

the customer that it is retaining some or all of the charge.” Tamburino v. Madison Sq. Garden,

L.P., 115 A.D. 3d 217, fn* (1st Dep’t 2014); see also 12 NYCRR §§ 146-2.18, 2.19.

The instant motion seeks an Order pursuant to Article 9 of the CPLR certifying the

following the class (hereinafter the “Putative Class”):

All individuals who performed work as servers, bartenders, or in related
service positions during catered events held at Gotham Hall and/or Ziegfeld
Ballroom between March 2012 and the present (“the Relevant Period”).2

The Appellate Division has acknowledged that class actions are the best method of

adjudicating wage and hour disputes. See Pesantez v. Boyle Envtl. Servs., Inc., 251 A.D.2d 11, 12

(1st Dep’t 1998). This principle that wage and hour cases are generally certified as class actions

has been repeatedly upheld. See, e.g., Brandy v. Canea Mare Contracting, Inc., 34 A.D.3d 512 (2d

Dep’t 2006); Wilder v. May Department Stores Company, 23 A.D.3d 646, 649 (2d Dep’t 2005);

Jacobs v. Macy’s East, Inc., 17 A.D.3d 318 (2d Dep’t 2005); Weinstein v. Jenny Craig Operations,

Inc., 138 A.D.3d 546 (1st Dep’t 2016) (“Class action is an appropriate method of adjudicating

wage claims arising from an employer’s alleged practice of underpaying employees…”); Stecko

v. RLI Insurance Company, 2014 N.Y. App. Div. LEXIS 7065 (1st Dep’t Oct. 21, 2014);

Dabrowski v. Abax Incorporated, 84 A.D.3d 633 (1st Dep’t 2011).

More specifically, New York courts routinely certify class actions brought on behalf of

service and catering workers to recover unpaid gratuities under § 196-d, as “[t]here are no

2
The Putative Class does not include maintenance workers, corporate officers, salespersons, cooks, food preparers,
chefs, dishwashers, directors, clerical, office workers or any other person whose trade, classification or profession
does not customarily receive gratuities.

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individual questions presented that are unique to any particular special event waitstaff member.”

Krebs v. Canyon Club, Inc., 22 Misc. 3d 1125(A) (Sup. Ct. Westchester Cty. Jan. 2, 2009) (J.

Sheinkman) [Ex. B]. See, e.g., Medina v. Fairway Golf Mgmt., LLC, Index No. 607829/2015 (Sup.

Ct. Nassau Cty. Aug. 4, 2017) aff’d 12 N.Y.S.3d 187 (2d Dep’t 2019); Ramlochan v. Westchester

Shores Event Holdings, Inc., Index No. 53509/2018 (Sup. Ct. Westchester Cty. Apr. 23, 2020);

Contreras v. Yonkers Racing Corporation, Index No. 67170/2018 (Sup. Ct. Westchester Cty. Mar.

16, 2020); Velasquez v. Sunstone Red Oak, LLC, 2018 N.Y. Misc. LEXIS 4476 (Sup. Ct.

Westchester Cty. Aug. 21, 2018); Cornejo v. Rose Castle Corp., Index No. 500178/2016 (Sup. Ct.

Kings Cty. June 30, 2017); Membrives v. HHC TRS FP Portfolio LLC, 2017 N.Y. Misc. LEXIS

5754 (Sup. Ct. Nassau Cty. Mar. 10, 2017); Maor v. Hornblower New York, LLC, 2016 N.Y.

Misc. LEXIS 2111 (Sup. Ct. N.Y. Cty. June 13, 2016); see also Spicer v. Pier Sixty LLC, 269

F.R.D. 321, 337 (S.D.N.Y. 2010).

This case, like the other § 196-d cases that have been certified, seeks the resolution to three

uniform questions of law and fact, as they apply across the board to all service employees:

1. Did Defendants assess a mandatory charge in the administration of their
catered events (commonly known referred to as a “service charge” or
“administrative fee” in the industry)?
2. Did Defendants fail to distribute proceeds from such charge in its
entirety to the service staff that worked those catered events?
3. Did the reasonable patron believe the proceeds from such charge would
be passed along to the service staff as a purported gratuity?

Here, the documentary evidence clearly demonstrates that Defendants did assess a

Mandatory Charge. [See, e.g. representative3 catering documents, attached Exhibit C (sample

Gotham contract), Exhibit D (sample Gotham invoices), Exhibit E (sample Ziegfeld contract),

3
Defendants’ corporate representative, Bruce A. Kurtz, testified the documents attached to the Cohen Aff. were
generally representative of the documents utilized throughout the Relevant Period at the respective venues. See
Exhibit G, Deposition Transcript (“Dep. Tr.”) of Bruce A. Kurtz at pgs. 87-99.

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and Exhibit F (sample Ziegfeld invoices). Defendants do not dispute that the Mandatory Charge

was retained. Therefore, only one uniform question remains, and is thus ripe for class-wide

resolution: did the reasonable patron believe that Mandatory Charge would be distributed to the

service staff in full?

Accordingly, the claims of the Named Plaintiffs and all other members of the Putative

Class arise from the same conduct by Defendants, whereby the Named Plaintiff and the Putative

Class suffered from the same alleged wrongs. As Plaintiffs’ claims satisfy all elements of Article

9 of the CPLR, the instant motion for class certification should be granted.

PROCEDURAL HISTORY & BACKGROUND

This action was initially commenced on March 29, 2018 by Plaintiff Settecasi against

Gotham Hall, LLC, Gotham Hall Operating Entity, LLC, Core Ziegfeld, LLC, Simon Auerbacher,

and Bruce A. Kurtz (collectively “Defendants”). See Doc. No. 1, Plaintiffs’ Summons & Class

Action Complaint. On September 12, 2019, Plaintiffs filed an amended complaint, adding Pamela

Graham and Coree Spencer as additional Plaintiffs.4 See Doc. No. 19, Plaintiffs’ First Amended

Class Action Complaint.

SUMMARY OF FACTS & ARGUMENTS

Throughout the Relevant Period, at all times during their respective existences, Gotham

Hall and Ziegfeld Ballroom (collectively the “Venues”) have been owned, and/or operated by one

or more of the Defendants. The Venues, which are both located in Manhattan, New York, inter

4
Additionally, two causes of action were also added, but which arise out of the same underlying concept as
Plaintiffs’ § 196-d cause of action (i.e., monies were collected by Defendants that were intended to be passed along
to the service staff, but were not).

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alia, host social (e.g., weddings, graduations, birthdays) and corporate (e.g., fundraisers and

seminars) catered events where food and beverages are typically served. For each catered event,

numerous service workers in positions like server and bartender are typically required.

As proposed here, the Putative Class includes employees who have collectively worked at

hundreds, if not thousands, of catered events at Gotham and Ziegfeld since March 2012. [See Ex.

G, Kurtz Dep. Tr., pgs. 67-68 (testifying that approximately 160 events and 140 events were held

annually at Gotham and Ziegfeld, respectively, over the last couple of years)]. Plaintiffs allege that

the service workers who tended these events, including the Named Plaintiffs, were subject to

Defendants’ unlawful policy of failing to remit gratuities to Plaintiffs as required under § 196-d at

events where a Mandatory Charge was assessed to the customer. See generally Doc. No. 19. More

specifically, Plaintiffs claim that Defendants contracted with customers to provide catering

services at hundreds or thousands of catered events held at the Venues throughout the Relevant

Period, and that for each such event, Defendants assessed Mandatory Charge in addition to the

charges for food and beverage. Plaintiffs further allege that the reasonable patron would have

understood the Mandatory Charge to have been in the nature of a gratuity – either due to

Defendants’ acts and/or omissions – and, and thus would have expected such monies to be passed

along to the service workers, namely, the Named Plaintiffs and members of the Putative Class.

There is no dispute that such monies were not distributed to Plaintiffs, but were instead

retained by Defendants.

At this class certification stage, it is well-settled that the inquiry is limited to “whether there

appears to be a cause of action that is neither spurious nor a sham.” Cardona v. Maramount Corp.,

2009 N.Y. Misc. LEXIS 5010, *8 (Sup. Ct. N.Y. Nov. 12, 2009) (citing Simon v. Cunard Line,

Ltd., 75 A.D.2d 283, 288 (1st Dep’t 1980)). Although Plaintiffs are not required to prove liability

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at this juncture (e.g. that reasonable customers did believe such charges to be gratuities to be

distributed to the waitstaff), the documentary evidence more than substantiates that the claims are

not a sham. [See generally Exs. C, D, E, & F (evidencing a failure to adequately disclose the

purpose of the Mandatory Charge assessed in violation of 12 NYCRR §§ 146-2.18, 146-2.19)].

As a result of Defendants’ standard-form catered event documents failing to adequately

disclaim that the Mandatory Charge is not a gratuity, there is a presumption that the Mandatory

Charge is a gratuity. See 12 NYCRR §§ 146-2.18(b), 146-2.19(c); Membrives v. HHC TRS FP

Port. LLC, 2018 N.Y. Misc. LEXIS 4470 (Sup. Ct. Nassau Cty. July 23, 2018) (granting the

plaintiffs’ motion for summary judgment as to liability). Plaintiffs will prove, when appropriate,

that Defendants’ use of the Mandatory Charge led or allowed reasonable customers to believe that

the entire Mandatory Charge was a gratuity that would be paid to service workers, including the

Named Plaintiffs and Putative Class members. To date, there has been only limited discovery5 on

the reasonable patron standard as articulated by the Court of Appeals in Samiento, to the extent

that some pre-class certification discovery inevitably overlaps with merits-based discovery.6 At

issue on this motion, however, is whether Plaintiffs have common claims that can, or should, be

adjudicated on a class-wide basis. As set forth below, Plaintiffs’ submissions show that Plaintiffs

satisfy the prerequisites to class certification under Article 9 of the CPLR.

5
Nevertheless, Plaintiffs’ submissions fully demonstrate that Defendants uniformly: (1) assessed Mandatory
Charges for catered events; (2) failed to properly disclaim Mandatory Charges in accordance with the law; and yet
(3) failed to distribute these Mandatory Charges to the service workers. As demonstrated by the documentary
evidence, the proper disclaiming language required under the Hospitality Wage Order did not appear on all
documents that were utilized for Defendants’ catered events. As a result, customers reasonably did believe that the
Mandatory Charge was a gratuity that should have been distributed to service workers.
6
Other courts have previously recognized that for § 196-d matters with similar allegations and nearly identical
factual predicates that “there appears to be little need for pre-certification discovery.” See, e.g., Lopez v. Bethpage
Associates LLC, Index No. 3465/2012 (Sup. Ct. Nassau Cty. Jan. 9, 2013).

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ARGUMENT

CLASS CERTIFICATION IS PROPER BECAUSE PLAINTIFFS HAVE MET ALL
ELEMENTS OF CPLR §§ 901 AND 902

A. CLASS CERTIFICATION IS ROUTINELY GRANTED IN ACTIONS
FOR UNPAID WAGES AND GRATUITIES

In order to obtain class certification, Plaintiffs must satisfy each of the five statutory

requirements of CPLR §901 and the factors in CPLR §902. See, e.g., Canavan v. Chase Manhattan

Bank, 234 A.D.2d 493, 494 (2d Dep’t 1996). CPLR § 901(a) provides that one or more members

of a class may sue as representative parties on behalf of a class if:

1. the class is so numerous that joinder of all members whether otherwise
required or permitted is impracticable [“numerosity”];
2. there are questions of law or fact common to the class which predominate
over any questions affecting only individual members [“predominance” or
“commonality”];
3. the claims or defenses of the representative parties are typical of the
claims or defenses of the class [“typicality”];
4. the representative parties will fairly and adequately protect the interests of
the class [“adequacy”]; and
5. a class action is superior to other available methods for the fair and efficient
adjudication of the controversy [“superiority”].

It is well established that, in deciding whether to certify a class, “a court must be mindful

of [the Appellate Division’s] holding that the class certification statute should be liberally

construed.” Kudinov v.Kel-Tech Construction Inc., 65 A.D.3d 481, 481 (1st Dep’t 2009) (citing

Englade v. Harper Collins Publs., Inc., 289 A.D.2d 159, 159 (1st Dep’t 2001)); see also Borden v.

400 E. 55th St. Assoc., L.P., 24 N.Y.3d 382, 393-94 (2014); Pruitt v. Rockefeller Center

Properties, Inc., 167 A.D.2d 14, 21 (1st Dep’t 1991) (“[a]ppellate courts in this state have

repeatedly held that the class action statute should be liberally construed… any error, if there is to

be one, should be ... in favor of allowing the class action”); Friar v. Vanguard Holding Corp., 78

A.D.2d 83, 90-92, (2d Dep’t 1980); Galdamez v. Biordi Construction Corp., 13 Misc. 3d 1224(A)

(Sup. Ct. N.Y. Cty. 2006), aff’d 50 A.D.3d 357 (1st Dep’t 2008); Pajaczek v. Cema Const. Corp.,

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859 N.Y.S.2d 897 (Sup. Ct. N.Y. Cty. 2008) (citing Brandon v. Chefetz, 106 A.D.2d 162 (1st

Dep’t 1985)); see also Stecko, 2014 N.Y. App. Div. LEXIS 7065, *2 (1st Dep’t Oct. 21, 2014).

Class certification is routinely granted in wage and hour actions in New York. See

generally Stecko, 2014 N.Y. App. Div. LEXIS 7065; Dabrowski, 84 A.D.3d at 635 (class action

“is superior to the prosecution of individualized claims” in action to recover unpaid wages);

Nawrocki v. Proto Construction and Development Corp., 82 A.D.3d 534, 536 (1st Dep’t 2011)

(“class action is the superior vehicle for resolving this wage dispute”); Ortiz v. J.P. Jack Corp.,

286 A.D.2d 671 (2d Dep’t 2001); Pesantez, 251 A.D.2d at 12 (1st Dep’t 1998) (class action is the

“best method of adjudicating” wage and hour disputes). Class certification has been consistently

granted in the § 196-d context such as this seeking payment of unpaid gratuities as a result of a

mandatory charges assessed in the administration of a catered event. See, e.g., Medina, Index No

607829/2016 aff’d 12 N.Y.S.3d 187; Ramlochan, Index No. 53509/2018; Contreras, Index No.

67170/2018; Velasquez, 2018 N.Y. Misc. LEXIS 4476; Membrives, 2017 N.Y. Misc. LEXIS

5754; Maor, 2016 N.Y. Misc. LEXIS 2111; Krebs, [Ex. B]. In § 196-d cases, courts have found

that all requisites of class certification have been met by service workers seeking payment of

gratuities – as service charges, administrative fees, or derivations thereof – that were improperly

withheld by their employers. As the facts of this case are almost identical to those previously

mentioned, certification of the class is proper.

Labor Law § 196-d cases are uniquely situated for class certification since a finding that

the service charge was purported to be a gratuity can only be applied equally to the benefit of all

service workers, and not just one or a select few. As the court reasoned in Krebs:

There are no individual questions presented that are unique to any
particular special event wait staff member. Even as to damages, it
would seem that, if a gratuity or purported gratuity was collected
and should have been paid over, the damages would be shared pro

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rata by all of the staff members who worked the event in question.
Thus, damage trials focused on the individual claims of staff
members would not be required. Indeed, it would appear that a
separate damage inquiry would not be necessary at all, as, if liability
were established, the amount of damage would be known.

[Ex. B].

As demonstrated below, while the instant action clearly meets the requirements for class

certification, any doubts must be resolved in favor of class certification. Pruitt, 167 A.D.2d at 21

(“any error, if there is to be one, should be . . . in favor of allowing the class action”); Friar, 78

A.D.2d at 90-92; Brandon, 106 A.D.2d at 168.

B. THIS ACTION SATISFIES ALL SECTION 901 PREREQUISITES

1. The Class Is So Numerous That Joinder Of All Members Is Impracticable

Section 901(a)(1) requires that the class be so numerous that joinder of all class members

is impracticable. Courts have held the general threshold for impracticability of joinder to be around

40, although numerosity has been satisfied with less than 40 class members. See e.g., Pesantez,

251 A.D.2d at 11. Here, there should be no doubt that numerosity is satisfied, as Plaintiffs allege

that Defendants’ employed at least 100 service workers, such. See Doc. No. 19 ¶ 17. This allegation

was corroborated by Defendants’ corporate representative, who testified that during larger events

there could be “upwards of 60 people working as service staff.” [See Ex. G, Kurtz Dep. Tr., pgs.

64-65]. Indeed, given that this number of workers can be required to staff one event, it is logical

to conclude that significantly more individuals worked during the entirety of the Relevant Period.

Under these circumstances, joinder is both impracticable and undesirable.

2. The Questions of Law and Fact Common to the Class Predominate
Over Questions Affecting Only Individual Class Members

The second requirement of § 901 is that common questions of law or fact predominate over

any questions affecting individual members. This standard requires “predominance, not identity

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or unanimity, among class members” and has been satisfied in other § 196-d cases where

defendants use a common scheme to affect the wages of its employees and the legality of that

scheme is called into question. Krebs, [Ex. B] (quoting Friar, 78 A.D.2d at 98 (holding that the

differences in the manner in which the defendant obtained money from class members does not

mean that individual questions predominate over common questions)); see also Cherry v. Resource

America, Inc., 15 A.D.3d 1013 (4th Dep’t 2005) (finding common questions of law and fact

predominated because defendants used a common method to manipulate calculation of royalties);

Maor, 2016 N.Y. Misc. LEXIS 2111 at *3 (courts “interpret this prerequisite broadly”).

“The fundamental issue…is whether the proposed class action asserts a common legal

grievance, i.e., whether the common issues predominate over or outweigh the subordinate issues

that pertain to individual members of the class.” Geiger v. Amer. Tobacco Co., 181 Misc.2d 875,

883 (Sup. Ct. Queens Cty. 1999) (quoting 3 Weinstein-Korn-Miller, N.Y. Civil Practice § 901.11);

see also Pesantez, 251 A.D.2d at 11 (citing Pruitt, 167 A.D.2d at 14)). Whether common questions

of law or fact predominate “should not be determined by any mechanical test, but rather, whether

the use of a class action would achieve economies of time, effort, and expense, and promote

uniformity of decision as to persons similarly situated.” Friar, 78 A.D.2d at 97. In determining

whether the claims of the Named Plaintiffs and Putative Class members share common questions

of law or fact, “factual identity between the Plaintiff’s claim and those of the class he seeks to

represent is not necessary if these claims arise, at least in part, from a common wrong or set of

wrongs regardless of individual factors.” Pajaczek, 859 N.Y.S.2d 897 (quoting Senter v. General

Motors Corp., 532 F.2d 511, 524 (6th Cir.), cert. denied, 429 U.S. 870 (1976)). “The statute clearly

envisions authorization of class actions even when there are subsidiary questions of law or fact not

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common to the class.” Krebs, [Ex. B] (citing Weinberg v. Hertz Corp., 116 A.D.2d 1, 6 (1st Dep’t

1986) aff’d 69 N.Y.2d 979 (1987)).

At this juncture, the inquiry is limited to whether the service workers at Defendants’ catered

events present common claims that are not a “sham.” See, e.g., Brandon, 106 A.D.2d at 168.

Clearly, there are substantial common questions of law and fact affecting all class members.

Indeed, the § 196-d claims presented here can only be decided on a class-wide basis since the

central issue is whether Defendants’ policy with respect to withholding Mandatory Charges was

lawful. Thus, if the Defendants are liable to one Putative Class member for a particular event,

Defendants will be liable to all Putative Class members who also worked the same event, and all

will be entitled to share in an equal distribution of the unpaid gratuity.

As articulated by the Krebs court, in the present §196-d action there are three essential

questions of law and fact common to all members of the putative class that will predominate over

questions affecting only individual class members:

1. whether Defendants imposed charges that were, or were purported to be, gratuities, as
understood by reasonable patrons;
2. whether Defendants had an obligation to pay these funds over to members of its wait
staff; and
3. if violations of § 196-d are found, whether the class members should receive
monetary compensation.

[Ex. B]. Each of these three core issues involves the existence of a common nucleus of operative

facts, and the evidence required to prove these issues will be the same. Indeed, the questions of

law and fact concerning Defendants’ failure to remit any Mandatory Charge that was purported to

be a gratuity to the service workers, and Defendants’ resulting liability, are not merely common

questions but are identical questions. The Named Plaintiffs’ claims and those of the Putative Class

members arise from a common wrong: namely, that Defendants imposed and received a

Mandatory Charge from their customers and that by doing so it “created the prospect that a

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reasonable customer could form a belief that the service charge was in lieu of a gratuity.” Martin

v. Restaurant Assoc. Events Corp., 35 Misc. 3d 215 (Sup. Ct. Comm. Part. Westchester Cty. Jan.

12, 2012).

Here, the claims of the Named Plaintiffs undeniably raise common issues for adjudication

as they pertain to the Putative Class, as it is clear that all service workers performed at events

pursuant to the same contracts, and as such were subject to the same policies regarding

distribution (or lack thereof) of the Mandatory Charge.

a. Predominance is Satisfied Even Though Damages Will Differ

New York courts universally hold that the need to compute damages individually does not

defeat predominance or class certification. See, e.g., Nawrocki, 82 A.D.3d at 536 (“different levels

of damages does not defeat certification”) (citing Kudinov, 65 A.D.3d at 482); Globe Surgical

Supply v. GEICO Ins. Co., 59 A.D.3d 129, 139 (2d Dep’t 2008); Godwin Realty Assoc. v. CATV

Enter., 275 A.D.2d 269, 270 (1st Dep’t 2000) (holding that liability may be decided on a class

basis and individual damages determined afterwards). The Court of Appeals has noted that:

the legislature enacted CPLR 901 (a) with a specific allowance for
class actions in cases where damages differed among the plaintiffs,
stating “the amount of damages suffered by each class member
typically varies from individual to individual, but that fact will not
prevent the suit from going forward as a class if the important legal
or factual issues involving liability are common to the class.”

Borden, 24 N.Y.3d at 399.

Here, Plaintiffs’ central allegation speaks to a violation of § 196-d. Cases such as this are

perhaps the easiest for determining damages because only three basic documents are needed to

calculate the applicable underpayments – the contract (or final invoice) containing the amount of

the Mandatory Charge actually paid by the customer, the staffing sheets that contain the names of

the Putative Class members who worked the catered events, and the pay records that demonstrate

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whether the Mandatory Charge was distributed. Here, any calculation of damages would be

determined by following a mechanical rule whereby the court would: (1) determine the events

where Defendants imposed the Mandatory Charge on their customers; and (2) distribute the

unremitted portion of the Mandatory Charge equally to the Putative Class members who performed

work at those events, minus any amounts paid out.

3. The Named Plaintiffs’ Claims Are Typical of the Claims of the Putative
Class

Section 901(a)(3) requires that the Named Plaintiffs’ claims be “typical” of the putative

class. The typicality requirement is satisfied when the Named Plaintiffs’ claims “derive from the

same practice or conduct that gave rise to the remaining claims of the class members and is based

upon the same legal theory.” Friar, 78 A.D.2d at 98. The essence of typicality is that the

representative party must have an individual cause of action and that the representative’s interest

must be closely id

Case Info

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PERRY, W Track Judge’s New Case

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Document Filed Date

June 30, 2020

Case Filing Date

March 29, 2018

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Parties

BLUTH, VALERIE J Attorney for the Defendant
BLUTH, VALERIE J Attorney for the Defendants
BROWN, JEFFREY KEVIN Attorney for the Plaintiff
Bruce A. Kurtz Defendant
CALAMIA, JENNIFER Attorney for the Defendant
COHEN, BRETT R. Attorney for the Plaintiff
COREE SPENCER, individually and on behalf of others similarly situated Plaintiff
Core Ziegfeld, LLC d/b/a ZIEGFELD BALROOM Defendant
FUGAZY, AMANDA M. Attorney for the Defendant
FUGAZY, AMANDA M. Attorney for the Defendants
Gotham Hall, LLC Defendant
Gotham Hall Operating Entity, LLC Defendant
LEEDS, SUZANNE BROOKE Attorney for the Plaintiff
PAMELA GRAHAM Plaintiff
ROONEY, PAUL PATRICK Attorney for the Defendant
ROONEY, PAUL PATRICK Attorney for the Defendants
SANON, STEPHANIA CABRINI Attorney for the Defendant
SANON, STEPHANIA CABRINI Attorney for the Defendants
SHIHABI, MOHAMMAD BASHIER Attorney for the Defendant
SHIHABI, MOHAMMAD BASHIER Attorney for the Defendants
Simon Auerbacher Defendant
TOMPKINS, MICHAEL ALEXANDER Attorney for the Plaintiff
VINCENT SETTECASI Plaintiff
WEISER, ILAN Attorney for the Defendant
WEISER, ILAN Attorney for the Defendants
WILLIAM RAND Attorney
STEPHEN SONNENBERG Attorney
DANA GOTTLIEB
ANDREW MARKS Attorney
Clifford Chen Attorney
JADE BROWN Attorney
LOIS TRAUB Attorney
Mark Bisard Attorneys for Defendants
EDWARD PHILLIPS Attorneys for Defendants
MARTIN SCHEINMAN Attorney
MARIA BIANCO Attorney
LEEOR KLEIN
Michael Tompkins Attorneys for Plaintiffs

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Motion-Secondary: Vincent Settecasi, Pamela Graham, Coree Spencer, Individually And On Behalf Of Others Similarly Situated v. Gotham Hall, Llc, Gotham Hall Operating Entity, Llc, Core Ziegfeld, Llc D/B/A Ziegfeld Balroom, Simon Auerbacher, Bruce A. Kurtz

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