United States District Court, D. Connecticut
SIMON MUJO and INDRIT MHARREMI, on behalf of themselves and all others similarly situated, Plaintiffs,
JANI-KING INTERNATIONAL, INC., JANI-KING INC., and JANI-KING OF HARTFORD, INC., Defendants.
RULING ON DEFENDANT'S MOTION TO DISMISS
A. BOLDEN UNITED STATES DISTRICT JUDGE
Mujo and Indrit Muharremi, on behalf of a putative class of
over 100 Jani-King franchisees (collectively
“Plaintiffs”), have sued Jani-King International,
Inc., Jani-King, Inc., and Jani-King of Hartford, Inc.
(collectively “Jani-King”). In this diversity
action, Mr. Mujo and Mr. Muharremi allege that Jani-King has
unlawfully classified them as independent contractors under
Connecticut Wage Laws, Conn. Gen. Stat. § 31-58 et
seq., and that the various fees, costs, client sales
tax, and charge backs under Jani-King's franchise
agreement violate Sections 31-71(e) and 31-73(b) of the
Connecticut General Statues.
King now moves to dismiss Plaintiffs' class-action
reasons that follow, Jani-King's motion to dismiss is
GRANTED in part and DENIED
the parties' franchisor-franchisee agreement constitutes
an employment agreement, any deductions for royalty fees,
advertising fees, finder's fees, accounting fees,
technology fees, complaint fees, services fees, non-reported
business fees, client sales tax, lease deductions, and
various other fees do not constitute “wages”
within the meaning of Conn. Gen. Stat. § 31-71e and
thus, Plaintiffs' claim under Conn. Gen. Stat. §
31-71e must be dismissed.
any initial and non-refundable franchise fee down payment
made or continuing to be paid by Plaintiffs or any of the
various other fees required from Plaintiffs may, if proven to
be a condition for Jani-King providing them with initial or
continuing employment, constitute an improper payment in
violation of § 31-73(b). As a result, Plaintiffs'
unjust enrichment claim survives and Jani-King's motion
to dismiss this claim is denied.
FACTUAL AND PROCEDURAL BACKGROUND
provides commercial cleaning services to its
customers. Am. Compl. ¶ 15. Jani-King
franchisees, two of whom are Mr. Mujo and Mr. Muharremi,
conduct these cleaning services. Id. To carry out
their business, Jani-King, under the terms of a franchise
agreement (“Agreement”), allegedly enters into
independent contractor relationships with individuals who
then perform janitorial work for Jani-King customers.
Id. Jani-King allegedly required all members of the
putative class to sign substantially similar agreements
before working for Jani-King. Id. ¶ 16.
the terms of these agreements, Jani-King allegedly required
Plaintiffs to pay an initial and non-refundable franchise fee
down payment, as a condition for Jani-King providing them
with the opportunity to perform cleaning services under
Jani-King's cleaning contracts between Jani-King and
their customers. Id. ¶ 17. Mr. Mujo and Mr.
Muharremi and a subset of the putative class members
allegedly paid the down payment to Jani-King as a lump sum at
the time of entering into the contract. Id. A second
subset of putative class members allegedly paid a portion of
the down payment at the time of entering into the contract
and paid or are paying the outstanding balance as monthly
deductions drawn from the compensation paid to them by
Freedom from Control and Direction Allegations
allege that they are not free from Jani-King's control
and direction with respect to Plaintiffs performance of
services, under the terms of the Agreement. Id.
¶ 20. Plaintiffs also maintain that Jani-King's
methods, procedures, and policies with which Jani-King
requires Plaintiff to comply “are numerous and detailed
and control the manner in which Plaintiffs and the putative
class members must perform their tasks.” Id.
example, the franchise agreement allegedly requires that
Plaintiffs complete a training program including an exam;
comply with the Jani-King Manual, which, among other things,
requires Plaintiffs to: abide by Jani-King's operating
systems, procedures, policies, methods, standards,
specifications, and requirements; wear a Jani-King uniform
and nametag; obtain a personal digital assistant or smart
phone to use when corresponding with Jani-King and its
customers; communicate with customers in a certain way and on
a schedule Jani-King determines; perform services consistent
with a cleaning schedule associated with the contract between
Jani-King and its customers; and allow Jani-King to perform
quality control inspections to ensure compliance with
Jan-King standards. Id. ¶ 20.
Agreement allegedly prohibits franchisees from engaging in or
having a financial interest in other cleaning services within
the territory covered by the Agreement. Id. Indeed,
the Agreement allegedly contain a non-compete clause that
prohibit Plaintiffs from engaging in any cleaning
service-related work during the term of the Agreement and for
two years after its termination. Id. ¶ 22.
also allegedly do not perform services outside of the usual
course of Jani-King's business or outside of all
Jani-King's places of business. Id. ¶ 21.
Indeed, Plaintiffs are allegedly “entirely
dependent” upon Jani-King for their work assignments,
and Plaintiffs do not and, under the terms of the Agreement,
cannot maintain their own clients or customers. Id.
also maintain that Jani-King deducts monthly various sums of
money from their wages, including royalty fees, advertising
fees, finder's fees, accounting fees, technology fees,
complaint fees, services fees, non-reported business fees,
client sales tax, lease deductions, and various other fees.
Id. ¶ 23.
example, in September 2016, Mr. Muharemmi allegedly earned a
net revenue of $4, 508.72. Id. ¶ 24. From this
amount, Jani-King allegedly deducted: (1) a royalty fee of
$425.75; (2) an accounting fee of $127.72; (3) a technology
fee of $106.44; (4) a finder's fee of $162.42; (5)
franchisee supplies costs in the amount of $49.98; (6) an
advertising fee of $63.86; (7) a lease cost in the amount of
$27.21; (8) a business protection plan (“BPP”)
deduction of $276.73; (9) a “BPP” administrative
fee of $7.00; (10) client sales tax in the amount of $251.30;
and (11) charge backs in the amount of $1, 261.50.
Id. In total, Jani-King allegedly deducted $2,
761.90 from Mr. Muharremi's compensation, leaving him
with $1, 746.80 in gross income for the month Id.
July 2015, Mr. Mujo allegedly earned $1, 403.83 in revenue.
Id. ¶ 25. From that amount, Jani-King allegedly
deducted: (1) a royalty fee in the amount of $132.00; (2) an
accounting fee of $66.00; (3) a finder's fee in the
amount of $714; (4) an advertising fee of $13.20; (5) a
business protection plan deduction of $77.35; (6) a business
protection administration fee of $7; and (7) client sales tax
in the amount of $83.83. Id. In total, Jani-King
allegedly deducted $1, 093.38 from Mr. Mujo's
compensation, leaving him with $310.45 gross income.
allegedly has made these deductions without obtaining a
knowing and intelligent authorization for those deductions on
a form approved by the Commission of the Department of Labor,
as allegedly required under Section 31-71e of the Connecticut
General Statutes. Id. ¶ 26. Plaintiffs maintain
that the Agreement does not constitute written authorization,
as required under Connecticut law, because, at the time of
execution, Jani-King represented to Plaintiffs that they were
not Jani-King's employees and Jani-King was not their
employer within the meaning of the Connecticut Minimum Wage
Act (“Minimum Wage Act”). Id. Plaintiffs
alleged that these deductions were solely for Jani-King's
benefit and did not confer a benefit on Plaintiffs.
allege that the putative class members are similarly situated
“individuals in Connecticut who, pursuant to a contract
with Jani-King, have performed cleaning services for
Jani-King at any time during the two years immediately
preceding this lawsuit and continuing until final judgment of
the case.” Id. ¶ 29. The putative class
is allegedly so numerous that joinder of all parties is
impracticable, given that more than fifty individuals in
Connecticut meet the class definition. Id. ¶
allege that there are common questions of law and fact,
including whether: (1) Jani-King has improperly categorized
Plaintiffs as independent contractors; (2) the wage
deductions under the Agreement were lawful; (3) the down
payment and wage deductions Jani-King required violate
Section 31-73 of the Minimum Wage Act; and (4) whether
Jani-King was thereby unjustly enriched. Id.
claims are allegedly typical of the class in that the claims
are identical and arise from the same course of conduct and
practice. Id. ¶ 34. Mr. Mujo and Mr. Muharremi
allege that they will fairly and adequately protect the
interests of the class and that common questions of law and
fact predominate over questions affecting only individual
members. Id. ¶ 35-36. Plaintiffs allege that,
because Plaintiffs will prove their claims by a common body
of evidence, a class action is superior to other available
methods for the fair and efficient adjudication of this
matter. Id. ¶ 36.
filed this lawsuit on December 5, 2016, and, on February 9,
2017, filed an Amended Complaint alleging two counts: (1)
Jani-King has violated the Minimum Wage Act; and (2)
Jani-King has been unjustly enriched. ECF Nos. 1, 41.
seek: (1) injunctive relief; (2) compensatory damages under
the Minimum Wage Act; (3) penalty damages under Section 31-72
of the Connecticut General Statutes; (4) attorney's fees
as appropriate under Section 31-72 of the Connecticut General
Statutes; (5) common law punitive damages; (6) disgorgement;
(7) and interest and costs. Id. at 14. The Court has
jurisdiction under 28 U.S.C. § 1332. Defendants move to
dismiss the Amended Complaint for failure to state a claim
under Federal Rule of Civil Procedure 12(b)(6). Mot. to
Dismiss. ECF No. 45.