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Potter v. International Business Machine Corp.

United States District Court, D. Oregon, Portland Division

March 14, 2018

JUDITH POTTER, an individual, Plaintiff,
v.
INTERNATIONAL BUSINESS MACHINE CORPORATION dba IBM, INC., a New York Corporation, SETERUS, INC., fka KYANITE FINANCIAL BUSINESS SERVICES, INC., a Delaware corporation, and MICHAEL PERRY, an individual, SHANNON STOCK, an individual, and AMANDA LOWE, an individual, Defendants.

          FINDINGS AND RECOMMENDATION

          JOHN V. ACOSTA, United States Magistrate Judge

         Introduction

         Plaintiff Judith Potter (“Potter”) filed this lawsuit in state court against her former employers alleging claims for minimum-wage violations, breach of contract, and retaliation. Defendants timely removed the lawsuit to this court asserting diversity jurisdiction and identifying defendant Amanda Lowe (“Lowe”) as a “sham defendant.” Presently before the court is Potter's motion to remand, and her request for attorney fees and costs related to her motion.

         The court finds Defendants failed to meet their heavy burden to establish Potter obviously failed to state a cause of action against Lowe according to the settled rules of the state. Accordingly, Lowe was not fraudulently joined, this court lacks diversity jurisdiction, and this lawsuit should be remanded to state court. However, Potter's request for attorney fees and costs should be denied.

         Background

         Defendant Seterus, Inc. (“Seterus”), is a fully-integrated mortgage loan servicing company and a wholly-owned subsidiary of defendant International Business Machine Corporation (“IBM”). (Lowe Decl., ECF No. 19, ¶¶ 2, 4.) From December 21, 2015, to June 8, 2017, Potter worked for Seterus as a bankruptcy asset specialist at a loan servicing center in Beaverton, Oregon. (Am Compl., ECF No. 1-1 (“Compl.”), ¶ 7; Lowe Decl. ¶ 4; Terbenche Decl. ECF No. 20, ¶ 4.) Initially, Potter was hired by a third party and assigned to IBM as a contractor. (Terbenche Decl. ¶ 4.) In October 2016, IBM hired Potter directly. (Terbenche Decl. ¶ 5; Ex. 1.)[1]

         While working at Seterus, Potter reported directly to Maggie Parrish (“Parrish”) and Megan Snyder (“Snyder”), both of whom worked in Seterus's Beaverton office and served as Potter's day- to-day managers. (Lowe Decl. ¶ 6.) Parrish and Snyder reported to defendant Shannon Stock (“Stock”), Assistant Vice President of the Bankruptcy group, who worked out of the Raleigh, North Carolina office and was only infrequently at the Beaverton office. (Lowe Decl. ¶¶ 6, 13.) Lowe was the Assistant Vice President of Operational Controls responsible for general operations of the foreclosure department as well as risk and compliance, and worked out of the Beaverton office. (Lowe Decl. ¶¶ 3, 4.) Both Stock and Lowe reported to defendant Michael Perry (“Perry”), Vice President of Default Management. (Lowe Decl. ¶ 6.)

         Potter alleges she was not allowed rest breaks or meal periods, [2] not paid overtime, and not paid timely, and IBM and Seterus did not properly report and pay taxes, all in violation of Oregon law. (Compl. ¶¶ 9, 10, 16, 17, 18, 19.) In late December 2016, Potter filed complaints with Perry alleging wage and hour violations, abusive behavior by Stock, and denial of benefits based on complaints about management abuse. (Compl. ¶ 11.) Potter alleges in early January 2017, “Defendants called Plaintiff into a meeting with Michael Perry on the phone and told her they had received her complaint.” (Compl. ¶ 12.) When nothing happened, Potter followed up with emails. (Compl. ¶ 12.) Potter learned Stock subsequently accused her of falsifying information by inflating settlements. (Compl. ¶ 12.) IBM terminated Potter on June 7 or 8, 2017. (Compl. ¶ 7; Lowe Decl. ¶ 12.) Potter alleges she was terminated, at least in part, because of her complaints. (Compl. ¶ 14.)

         Potter asserts claims against IBM and Seterus for minimum-wage violations under Or. Rev. Stat 653.025; overtime violations under Or. Rev. Stat.653.261; late wage payments under Or. Rev. Stat. 652.140; failure to provide an itemized wage statement under Or. Rev. Stat. 652.610; breach of contract; and whistleblower retaliation under Or. Rev. Stat. 659A.199. Potter's sole claim against Perry, Stock, and Lowe (the “Individual Defendants”) is for aider and abettor liability under Or. Rev. STAT.659A.030(1)(g).

         In support of her claim against Lowe, Potter alleges:

At all times material to this action, Defendant Amanda Lowe (herein referred to as “Lowe”) is a natural person residing in Oregon. Defendant [Lowe][3] was employed by Defendant IBM and Defendant Seterus and managed the Plaintiff subject to [her] terms of employment.
* * *
Defendant Lowe, an Assistant Vice President, holds a management role and was aware of the work conditions Plaintiff and other employee[s] were subject to. Defendant Lowe did not address the issues raised by Plaintiff. A lack of response and leadership on the part of Ms. Lowe allowed the wage and hour abuses to continue.
* * *
Amanda Lowe aided, abetted, incited, compelled and/or coerced the discrimination, retaliation, and harassment toward plaintiff relating to her reports of illegal wage theft, retaliation, and harassment, and her good ...

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