JOHN RICH III, Magistrate Judge
Defendant Rangeley Lake Resort Development Company, LLC ("Rangeley") moves pursuant to Federal Rule of Civil Procedure 21 to sever itself from the instant suit, arguing that it was misjoined as a defendant. See Defendant Rangeley Lake Resort Development Company, LLC's Motion To Sever Pursuant to Fed.R.Civ.P. 21 ("Motion") (Docket No. 71). For the reasons that follow, the Motion is denied.
"Because a motion to sever is not dispositive of an action, a magistrate judge may hear and determine the motion, subject to reconsideration by a district judge upon a showing that the magistrate judge's order is clearly erroneous or contrary to law." United States v. Bolden, No. CR08-0001, 2008 WL 4174914, at *1 n. 1 (N.D. Iowa Mar. 7, 2008).
I. Applicable Legal Standards
Federal Rule of Civil Procedure 21 provides, in relevant part: "On motion or on its own, the court may at any time, on just terms, add or drop a party." Fed.R.Civ.P. 21. "The rule does not define the grounds for misjoinder, but it is well-settled that parties are misjoined when the preconditions for permissive joinder in Rule 20(a) are not met." Beaulieu v. Concord Group Ins. Co., 208 F.R.D. 478, 479 (D.N.H. 2002). "To properly join two or more defendants in one action, the plaintiff must allege facts that show: (1) that the right to relief asserted against the defendants arises out of the same transaction, occurrence, or series of transactions or occurrences, and (2) that a question of law or fact in common to both defendants will arise in the action." Id.; see also Fed.R.Civ.P. 20(a)(2) (persons may be joined in one action as defendants if "any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences" and "any question of law or fact common to all defendants will arise in the action").
"When appropriate, the joinder rules result in beneficial economies of scale and judicial efficiency by resolving related issues in a single lawsuit." Beaulieu, 208 F.R.D. at 479. "Therefore, the preconditions for permissive joinder are construed liberally in order to promote the broadest scope of action consistent with fairness to the parties." Id. "However, the determination of whether parties have been misjoined lies within the sound discretion of the district court." Id.
"If the test for permissive joinder is not satisfied, a court, in its discretion, may sever the misjoined parties, so long as no substantial right will be prejudiced by the severance." Helm v. Alderwoods Group, Inc., No. C 08-01184 SI, 2010 WL 2219722, at *1 (N.D. Cal. May 28, 2010) (citation and internal quotation marks omitted). "Even if the permissive joinder requirements are met, the court may sever to avoid delay, jury confusion, or prejudice to the moving party." Id.
II. Factual Background
The instant action was initiated in state court on June 26, 2009, and removed by Rangeley to this court on August 12, 2009. See Docket Nos. 1-2. Following the resolution of a motion for remand, which ultimately was withdrawn, and two motions to dismiss, see Docket Nos. 5, 7, 14, 25, 30, 31, 48, 56, the discovery deadline was reset to April 1, 2011, see Docket No. 67. Discovery has only recently begun. See Defendant Festiva's Opposition to Defendant Rangeley's Motion To Sever ("Festiva's Opposition") (Docket No. 76) at 2, 4; Plaintiffs' Opposition to Defendant Rangeley's Motion To Sever ("Plaintiffs' Opposition") (Docket No. 78) at 1, 3.
A. Plaintiffs' Allegations
The plaintiffs, on behalf of themselves and others similarly situated, seek relief for the defendants' alleged violations of federal and Maine overtime-pay and minimum-wage laws. See Third Amended Complaint (Docket No. 84) ¶¶ 1-4. They propose to do so through the vehicles of a collective action pursuant to the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 216(b), and a class action pursuant to Federal Rule of Civil Procedure 23 targeting violations of Maine law. See id.
Following the filing of the instant motion, the plaintiffs sought and were granted permission to file a Third Amended Complaint naming as a third defendant Perry Williams, the managing partner of Rangeley. See Docket Nos. 75, 83. The Third Amended Complaint is in all other respects virtually identical to the Second Amended Complaint, the operative complaint at the time of the filing of the motion. Compare Third Amended Complaint with Second Amended Complaint (Docket No. 50). Accordingly, I refer to the Third Amended Complaint in setting forth the plaintiffs' allegations.
The "Collective Class" pursuant to the FLSA would consist of "[a]ll persons who are or have been employed by Defendants as a Sales Representative or some similar title, who were paid solely on a commission basis, at any time within three years prior to this action's filing date through the final disposition of this case." Id. ¶ 23. The "Maine Class" pursuant to Rule 23 would consist of "[a]ll employees of Defendants who were, are, or will be employed in the State of Maine as Sales Representatives or some similar title, who were paid solely on a commission basis, at any time within six years prior to this action's filing date through the final disposition of this case." Id. ¶ 30.
The plaintiffs allege, in relevant part, that:
1. They were or are employed by Rangeley and/or its successor, Festiva Development Group, LLC ("Festiva"), and Williams as sales representatives or some similar title. Id. ¶ 1.
2. They performed tasks of selling timeshare interests to the general public and were paid exclusively on a commission basis. Id. During all relevant times, they were employed on the defendants' premises, and the defendants substantially controlled their hours and places of employment. Id.
3. During the Collective Class and Maine Class periods, the defendants failed to pay appropriate compensation, including overtime compensation and minimum wage, to each member of the Collective Class and the Maine Class as required by federal and state law. Id. ¶ 4.
4. Rangeley, a corporation of the State of Maine doing business in Portland, Maine, employed certain of the plaintiffs during all relevant times at the same location as that of Festiva. Id. ¶ 17. Festiva is a foreign corporation qualified to do business in the State of Maine and having a place of business in Portland, Maine. Id. ¶ 18. It employed certain of the plaintiffs, at all relevant times, at the same location as that of Rangeley. Id.
5. The defendants suffered and permitted the plaintiffs and the Collective Class to work without being paid minimum wage compensation and to work more than 40 hours a week without appropriate overtime compensation. Id. ¶ 24.
6. The defendants' unlawful conduct has been widespread, repeated, and consistent. Id. ¶ 25. The defendants have operated under a scheme to deprive these employees of appropriate minimum wage and overtime compensation by failing to compensate them properly for all hours worked. Id. ¶ 26. The defendants misclassified the plaintiffs and members of the Collective Class who had the job title of sales representative as "independent contractors" or "exempt" from federal overtime laws. Id. ¶ 27.
7. There are common questions of law and fact as to all members of the proposed Maine Class. Id. ¶ 35. These common questions include whether the defendants improperly classified the plaintiffs and members of the Maine Class who had the job title of sales representatives as independent contractors or exempt employees, and whether the defendants unlawfully failed to fully pay appropriate compensation, including minimum wage and overtime compensation, to members of the Maine Class in violation of Maine state wage laws. Id.
B. Rangeley's Evidence
In support of its Motion, Rangeley provides an affidavit of Perry Williams, the managing member of Rangeley, stating that:
1. Rangeley was formed in April 2000 for the purpose of selling timeshare units at Rangeley Lake in Maine. Affidavit of Perry Williams, in Support of Defendant Rangeley Lake Resort Development Company, LLC's Motion To Sever ("Williams Aff.") (Docket No. 71-1), attached to Motion, ¶ 3.
2. During the years of operation, Rangeley contracted with roughly 170 sales representatives to sell timeshare units. Id. ¶ 4.
3. Rangeley operated for roughly eight years, until the remaining timeshare intervals in Rangeley Lake Resort were sold to Festiva in 2008. Id. ¶ 5.
4. Rangeley no longer conducts its timeshare selling business. Id. ¶ 6.
5. After Rangeley sold its operations to Festiva, Festiva ran its own independent business selling timeshare intervals in the Festiva Adventure Club. Id. ¶ 7. The purchasers of timeshare intervals in that club receive membership that entitles them to intervals in time in Festiva's national network properties. Id.
6. At the time of the purchase, Festiva also maintained other sales offices around the country. Id. ¶ 8.
7. Rangeley and Festiva are entirely separate entities. Id. ¶ 9.
8. Neither Rangeley nor its members or officers has any ownership or other interest in Festiva. Id. ¶ 10. Likewise, neither Festiva nor any of its shareholders or officers has any ownership or other interest in Rangeley. Id.
9. Festiva and Rangeley used different independent contractor terms with their sales representatives. Id. ¶ 11.
10. Rangeley and Festiva had no agreement, correspondence, or communication regarding how to utilize or compensate sales representatives, and any similarities between the two companies in their use of them is purely coincidental. Id. ¶ 12.
11. Upon information and belief, of the 170 or so former sales representatives who worked for Rangeley, only two sought subsequent employment with Festiva. Id. ¶ 13. Upon information and belief, at no time did any sales representative used by Rangeley ever perform work concurrently for Festiva. Id. ¶ 14.
12. Festiva, unlike Rangeley, is still in operation, has multiple sales locations throughout the United States, and has used, and continues to use, hundreds of sales representatives. Id. ¶ 15.
C. Plaintiffs' Evidence
In support of their opposition to the Motion, the plaintiffs offer the declarations of Athena Keller and J. Ham Ying. See Declaration of Athena Keller in Support of Plaintiffs' Response to Defendant Rangeley's Motion To Sever ("Keller Decl.") (Docket No. 78-1), attached to Plaintiffs' Opposition; Declaration of J. Ham Ying in Support of Plaintiffs' Response to Defendant Rangeley's Motion To Sever ("Ying Decl.") (Docket No. 78-2), attached to Plaintiffs' Opposition.
Keller, a plaintiff in this action, was employed by Rangeley from approximately 2005 to approximately September or October 2008 and continued her employment with Festiva at the same Portland, Maine, location until approximately May 2009. Keller Decl. ¶¶ 1-2. Ying, also a plaintiff in this action, was employed by Rangeley from approximately 2002 to approximately September or October 2008. Ying Decl. ¶¶ 1-2. After Festiva purchased Rangeley, he continued his employment with Festiva at the same Portland, Maine, location for approximately one month. Id.
Neither Keller nor Ying actively sought employment with Festiva after the sale or was told to reapply for his or her job. Keller Decl. ¶ 3; Ying Decl. ¶ 3. Rather, upon information and belief, they began automatically working for Festiva. Id. Both were classified as independent contractors by Rangeley. Id. Keller and Ying believe that other sales representatives employed by Rangeley also began working automatically for Festiva without reapplying for their positions. Id. ¶ 4.
of the subservient estate.
Granted, there is no evidence that such pasturage use is now intended or that a future owner has such use in mind, but that lack of evidence is irrelevant; this example is employed solely to demonstrate that the prohibition against gates does increase the burden on the subservient estate. If the lack of evidence of that potential intended use is important, it would likewise be important that there is no evidence of the existence or nonexistence of gates on the roadway
at the time the easement was created. Such evidence of either situation is not relevant to a determination of the rights granted under the easement. What is important is what the easement says.
In this day of the automobile, when one need not leave their car to purchase food to eat or obtain money from our banks (and by some news accounts, even to be married), we tend to think that it is necessary for us to do everything from our automobiles. I maintain, however, that it is not unreasonable to exit from an automobile and open a gate. Doing everything from the confines of our cars falls among the luxuries of our society.
The Moores rely on (and the majority cites) Gerstner v. Wilhelm, 584 S.W.2d 955, 957 (Tex.Civ.App.-Austin 1979, writ dism'd), for the proposition that the trial court had the authority to enjoin Ferrara from putting gates across the easement as it enters and exits his property. However, in contrast to the easement the Moores claim here, the easement in Gerstner called for "the free and uninterrupted use, liberty and easement of passing in and along a certain passageway or road across the said premises . . . and being 40 feet in width and to use such passageway or road at all times in common with the Grantee — " Id. This case is distinguishable from Gerstner in two respects: (1) in this case, there was no such expansive or delineated grant of rights in the easement as in Gerstner, and (2) unlike this case, Gerstner dealt with an ambiguous grant of easement. In Gerstner, the trial judge provided an instruction to the jury (not quoted in the opinion) as to the meaning of "free and uninterrupted." The opinion in Gerstner does recite that, "Because of the language of the easement and the factual circumstances surrounding the grant, the court properly entered judgment that Gerstner remove the fences and gates." Id. at 959 (emphasis added). Since the issue of the easement was submitted to the jury in the Gerstner case to make factual determinations, it must have been deemed to have been an ambiguous grant because juries have no role in ruling on issues of law. In the circumstance in which there is an ambiguity, any such ambiguity is to be resolved against the grantor. Dwyer, 374 S.W.2d at 665. Further, where an instrument is capable of two reasonable constructions, it will be strictly construed against the author. Harris, 517 S.W.2d at 364. Here, the Moores stand in the shoes of Hayes, et al., the drafter of the easement.
One should point out that in the case at bar here, neither side alleges that any ambiguity exists in the grant of the easement. Under contract law (which, as pointed out above, applies as to easements), if ambiguity of the instrument is not pled, then its construction is solely a question of law and not of fact; questions of law are reviewed de novo. Eastman Software, Inc. v. Tex. Commerce Bank, Nat'l Ass'n, 28 S.W.3d 79, 84 (Tex.App.-Texarkana 2000, pet. denied).
Because the grant is in general terms, the grantees' dominant estate is entitled only to rights sufficient to effect the purpose of the easement. See Coleman v. Forister, 514 S.W.2d 899, 903 (Tex. 1974). As to implication of easement rights not specifically granted by the instrument creating the easement, a court can "imply only those rights reasonably necessary to the fair enjoyment of the easement with as little burden as possible to the servient owner." Lakeside Launches, Inc. v. Austin Yacht Club, Inc., 750 S.W.2d 868, 871 (Tex.App.-Austin 1988, writ denied) (citing Coleman, 514 S.W.2d at 903). "Nothing passes by implication as incidental to a grant of an easement except what is reasonably necessary to its fair enjoyment." Kearney Son v. Fancher, 401 S.W.2d 897, 903 (Tex.Civ.App.-Fort Worth 1966, writ ref'd n.r.e.).
The Moores brought this suit and it was their burden to provide evidence to support each portion of their claim. Although they fully established their right to an easement, they failed to provide evidence that fully-accessible gates could not be erected across it. To imply that the easement which the Moores own dictates that there be a prohibition against gates (to which the Moores would have full access) erected across it is to violate the constraint against imposing a greater burden than is reasonably necessary to effect the ingress and egress purposes of the easement.
The easement here does not specifically grant the dominant estate the right to an easement "free and uninterrupted" by gates. The grant provides only for ingress and egress to the dominant estate. To find a grant of unrestricted passage, therefore, it would be necessary to read terms into the four corners of the document which do not exist (i.e., the right to drive a car the length of the easement without having to get out and open a gate); this cannot be done under the circumstances of this case. See id.; Marcus Cable Assocs., 90 S.W.3d at 700; Koelsch, 132 S.W.3d at 498.
Accordingly, I believe the trial court erred in enjoining Ferrara from erecting gates on the easement so long as the owner of the Moores' tract were given access rights through those gates.