Chao v. Hotel Oasis, Inc., No. 06-1021 affirms the judgment of the district court in a wage and hour dispute in an FLSA case. The hotel seems to have not only paid people below minimum wage, but maintained two sets of books. During pre-trial proceedings, the government and the defendant stipulated that 1) the hotel was currently in compliance; but 2) the hotel was subject to the FLSA because it’s annual dollar value was over $500,000. The stipulation wasn’t in writing or signed by the parties, but the District Court memorialized it in an order that wasn’t objected to. Then the hotel tried to back out of the stipulation, arguing that its lawyer didn’t have authority to enter into it, and later that it was mistakenly entered into. During a prolonged trial, the defendants again tried to argue that there simply wasn’t evidence that the hotel was that big. Also, the District Court precluded the defendant from introducing “Rule 1006" summaries of expert testimony regarding the hotel’s “annual dollar value” because, amongst other things, the underlying expert testimony was inadmissible, since the expert reports had not been disclosed. The District Court even says it gave the defendants a chance to show that the stipulation was wrong, but they didn’t do it, and told the parties that they could file a “joint proffer” of the “Rule 1006" summaries, so the First could have a complete record. The First holds that the order (memorializing the stipulation) became the “law of the case.” Also, the First (I think, properly) rejects and argument that the stipulation can’t confer subject matter jurisdiction on the court, because, the $500,000 threshold isn’t jurisdictional. But, strangely, it quotes Arbaugh v. Y & H Corp., 546 U.S. 500, 511 (2006), which the First has always used to screw people suing the government. See here, here, and here. At least, this time, it gets it right: Congress didn’t say the $500,000 limit was jurisdictional, therefore, it ain’t.
The District Court also entered an order holding the president personally liable as an employer under the FLSA. The First affirms this. It provides a review of its caselaw, and holds that since “He was the president of the corporation, and he had ultimate control over the business's day-to-day operations. In particular, it is undisputed that Lugo was the corporate officer principally in charge of directing employment practices, such as hiring and firing employees, requiring employees to attend meetings unpaid, and setting employees' wages and schedules” he has to pay.
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