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Case 2:13-Cv-00877-RSL Document 3 Filed 05/17/13 Page 1 of 8 Case 2:13-cv-00877-RSL Document 3 Filed 05/17/13 Page 1 of 8 1 Hon. Robert S. Lasnik 2 3 4 5 6 UNITED STATES DISTRICT COURT 7 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 8 SETH D. HARRIS, ACTING SECRETARY OF ) 9 LABOR, UNITED STATES DEPARTMENT ) OF LABOR, ) Case No. 2:13-cv-00877-RSL 10 ) Plaintiff, ) DECLARATION OF WAGE HOUR 11 ) INVESTIGATOR MING SPROULE IN v. ) SUPPORT OF PLAINTIFF'S MOTION 12 ) FOR A TEMPORARY RESTRAINING HUANG "JACKIE" JIE, an individual, ZHAO ) ORDER AND ORDER TO SHOW 13 "JENNY" ZENG HONG, an individual, PACIFIC ) CAUSE WHY A PRELIMINARY COAST FOODS, INC., a Washington corporation ) INJUNCTION SHALL NOT ISSUE 14 doing business as J & J MONGOLIAN GRILL, and J) & J COMFORT ZONE, INC. doing business as SPA) 15 THERAPY, ) ) 16 Defendants. ) ------------~~~~~---------- 17 I, MING SPROULE, declare as follows: 18 I. I am presently employed by the Wage and Hour Division of the United States 19 Department of Labor ("Wage and Hour") in Seattle, Washington, known as the "Seattle District Office." 20 2. I am a Wage Hour Investigator ("WHI"). I have been a WHI since September 1998. 21 3. As a WHI, I am responsible for investigating compliance with the laws enforced by 22 Wage and Hour, including compliance with the Fair Labor Standards Act ("FLSA"). 23 SPROULE DEC. -PAGE 1 U.S. DEPARTMENT OF LABOR Harris v. Huang, et al. - Case No. 2: 13-cv-00877 OFFICE OF THE SOLICITOR 24 300 Fifth Ave., Suite 1120 Seattle, W A 98104 (206) 757-6762 Fax: (206) 757-6761 Case 2:13-cv-00877-RSL Document 3 Filed 05/17/13 Page 2 of 8 1 4. As a WHI, I carry a caseload and accompany other WHis on their investigations. 2 5. I was assigned this case by my supervisor, Seattle District Office Assistant District 3 Director ("ADD") Tuan Huynh on January 25, 2012 to determine whether Mr. Huang "Jackie" Jie, Ms. 4 Zhao "Jenny" Zeng Hong, Pacific Coast Foods, Inc. and J & J Comfort Zone, Inc. (collectively 5 "Employers"') were in compliance with the FLSA. On February 23, 2012, I visited the establishment of 6 Pacific Coast Foods, Inc. and J & J Comfort Zone, Inc. and carried a letter requesting documents with 7 me. I met with and delivered the letter to Huang Jie during my meeting with him that same day. My 8 letter requested, among other things, all time and payroll records an employer is required to keep and 9 maintain, a list of employees, legal information about the Employers, and documentation of annual gross 10 sales. 11 6. I determined that Pacific Coast Foods, Inc. operates J & J Mongolian Grill, located in the 12 Bellis Fair Mall in Bellingham, Washington. J & J Comfort Zone, Inc. operates Spa Therapy out of a 13 salon and a separate kiosk in the Bellis Fair Mall in Bellingham, Washington. J & J Comfort Zone, Inc. 14 previously operated Spa Therapy out of a second location which was the Alderwood Mall in Lynnwood, 15 Washington. The Alderwood Mall Spa Therapy was closed on January 31, 2012. 16 7. Both Pacific Coast Foods, Inc. and J & J Comfort Zone, Inc. are owned and operated by 17 (Mr.) Huang "Jackie" Jie, and his wife (Ms.) Zhao "Jenny" Zeng Hong. Mr. Huang and Ms. Zhao 18 perform all management duties related to the running of these business, including hiring and firing 19 employees, setting pay rates, scheduling hours of work, calculating pay, paying employees, preparing 20 documentation for the accountant to prepare the payroll, ordering supplies, and supervising the daily 21 operations of these businesses. I determined that Pacific Coast Foods, Inc., J & J Comfort Zone, Inc., 22 Mr. Huang, and Ms. Zhao met the definition of an "employer" under §3(d) of the FLSA (29 U.S.C. 23 SPROULE DEC. -PAGE 2 U.S. DEPARTMENT OF LABOR Harris v. Huang, et at. - Case No. 2: 13-cv-00877 OFFICE OF THE SOLICITOR 24 300 Fifth Ave., Suite 1120 Seattle, W A 98104 (206) 757-6762 Fax: (206) 757-6761 Case 2:13-cv-00877-RSL Document 3 Filed 05/17/13 Page 3 of 8 §203(d)). 2 8. The individual Employers and most of their employees speak Mandarin. I speak 3 Mandarin. My contact with the Employers and with the employees was conducted in the Mandarin 4 language. 5 9. I visited the Employers' worksite, also referred to as an "Initial Conference," on February 6 23, 2012 and met with president and owner Huang "Jackie" Jie. I made Mr. Huang aware of the 7 importance of keeping records pursuant to the FLSA and advised him of the requirements of 29 C.F.R. 8 §516.2 I told him that he needed to record employees' start time, their end time, the days they worked, 9 the hours they worked, and the basis of their pay, whether hourly or otherwise. I took handwritten notes 10 of the Employers' position, my questions and requests, and the Employers' responses. I also have an 11 independent recollection of this meeting. I obtained only a handful of documents during this meeting. 12 Mr. Huang watched me as I scanned the posted employee schedules at the restaurant. At that time, Mr. 13 Huang was not aware that I obtained copies of individual therapists' daily sales and tips journal from the 14 Spa Therapy kiosk. I later provided these copies to Mr. Huang. I came into contact with the employer's 15 payroll accountant Diana Long but I cannot recall if she called me or I called her first. 16 10. Ms. Long made some documents available to me but not the documents each employer is 17 required to keep pursuant to the FLSA. There was no accurate recording of the days of the week or the 18 hours per day which employees worked. There was no accurate recording of the basis of employees' 19 pay. The payroll summaries I was provided with showed a salary to employees who are not exempt 20 from the FLSA (a salary basis is only appropriate for bona fide administrative, executive or professional 21 employees). 22 11. The Employers meet the requirements for enterprise coverage and separately, for 23 SPROULE DEC. -PAGE 3 U .S . DEPARTMENT OF LABOR Harris v. Huang, et al. - Case No. 2: 13-cv-00877 OFFICE OF THE SOLICITOR 24 300 Fifth Ave., Suite 1120 Seattle, W A 98104 (206) 757-6762 Fax: (206) 757-6761 Case 2:13-cv-00877-RSL Document 3 Filed 05/17/13 Page 4 of 8 1 individual coverage under the FLSA. 2 12. Following my initial meeting with Mr. Huang and my explanation of the records required 3 to be kept to comply with the FLSA, Mr. Huang provided me with documents he claimed were accurate 4 records of hours worked by employees. The documents were obvious fabrications, unsupported by 5 verifiable payroll records and inconsistent on their face. 6 13. My investigation covered the period from January 1, 2010 to December 3I, 2012. 7 14. I determined that Huang "Jackie" Jie, and Zhao "Jenny" Zeng Hong, and Pacific Coast 8 Foods, Inc. dba J & J Mongolian Grill (collectively for this paragraph "Pacific Coast Foods") employed 9 between three and five full-time and part-time employees per day including cooks, kitchen helpers, 10 servers, and cashiers. Pacific Coast Foods was required to be open for business during all mall hours 11 which were from 10:00 a.m. to 9:00p.m. Mondays through Saturday, and II :00 a.m. to 6:00p.m. on 12 Sundays. Employees began work at 9:30a.m. and worked until 15 to 30 minutes after closing. 13 Employees typically had one day off each week. All employees were paid a monthly salary, not by the 14 hour. Employees' wages ranged in pay from $1,600 to $2,600 per month. Employees were paid 15 partially in cash, partially by check, some completely in cash. Deductions were only taken on a portion 16 of the compensation paid by check. Employees ate three meals throughout their work day and took I7 between five and fifteen minutes for each meal. Pacific Coast Foods failed to keep payroll records as 18 required by 29 C.F.R. §516.2. Pacific Coast Foods failed to provide me with a list of employee names 19 and contact information for all of their employees. I determined that Pacific Coast Foods sought to limit 20 my ability to contact current and former employees. 21 15. During the investigative period, there were three separate locations of businesses run by 22 Huang "Jackie" Jie, Zhao "Jenny" Zeng Hong, and J & J Comfort Zone, Inc. dba Spa Therapy 23 SPROULE DEC. -PAGE 4 U.S. DEPARTMENT OF LABOR Harris v. Huang, et al. - Case No.2: 13-cv-00877 OFFICE OF THE SOLICITOR 24 300 Fifth Ave., Suite 1120 Seattle, W A 98104 (206) 757-6762 Fax: (206) 757-6761 Case 2:13-cv-00877-RSL Document 3 Filed 05/17/13 Page 5 of 8 (collectively for this paragraph "Comfort Zone"). Two locations were in Bellis Fair Mall and there was 2 one Alderwood Mall location. Comfort Zone operated as Oriental Massage, Inc. for the period from 3 November 5, 2009 to July 22, 2010. The corporation Oriental Massage, Inc. was dissolved on 4 November 5, 2010. I determined that Comfort Zone employed between twelve and fourteen employees 5 per day. The business was seasonal, with summer being the high season where up to fourteen 6 employees may be employed. Comfort Zone was required to be open for business during all mall hours 7 which were from 10:00 a.m.
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