Nelson Uddin, on behalf of himself and other similarly situated, Plaintiff, v. XPP (2026)

NYSCEF document numbers 1-10 were read and considered in deciding this motion.

Relief Requested

The defendants move pursuant to CPLR 3211(a)(7) to dismiss the class claims of the complaint.

Background

The plaintiff alleges that he worked for the defendants as a delivery driver from April 2025 through February 2026, generally working five days per week for approximately 45 hours, and during the holiday season up to 54 hours weekly. He alleges that the defendants regularly failed to pay him at the proper overtime rate, suppressed or "shaved" his recorded hours, failed to pay him for all hours worked, and issued paystubs that did not accurately reflect his hours. He further alleges that he received bonus payments that were unlawfully excluded from the calculation of his regular and overtime rate, resulting in systematically underpaid overtime. The plaintiff alleges that, throughout his employment, he had no managerial duties and exercised no supervisory authority.

The plaintiff, on behalf of himself and others similarly situated, commenced this action alleging (1) overtime violations under the Fair Labor Standards Act (hereinafter FLSA); (2) overtime violations under the Labor Law; (3) wage notice violations under Labor Law § 195(1); (4) wage statement violations under Labor Law § 195(3); and (5) "gap time" and time shaving violations under Labor Law §§ 191, 193, and 663. The plaintiff alleges that the defendants maintained uniform wage practices—including failure to pay overtime, inaccurate paystubs, and unlawful rounding—that affected all class members in the same manner. The plaintiff seeks unpaid wages, overtime premiums, spread of hours pay, statutory penalties, liquidated damages under both federal and state law, interest, attorneys' fees, and class certification.

Motion Sequences 001

The defendants move pursuant to CPLR 3211(a)(7) to dismiss the class claims of complaint. In a memorandum of law, counsel for the defendants argues that all class claims must be dismissed pursuant to CPLR 3211(a)(7) because the complaint seeks liquidated damages and statutory penalties that constitute "penalties" under CPLR 901(b), which prohibits class actions seeking such relief unless specifically authorized by statute. Counsel cites several New York cases holding that liquidated damages under the Labor Law are penalties not recoverable on a class wide basis and contend that the plaintiff's prayer for liquidated damages, wage notice penalties, and wage statement penalties renders class treatment legally unavailable. Counsel contends that, since the defect appears on the face of the complaint and the damages sought violate CPLR 901(b), dismissal of all class allegations is mandated at the pleading stage.

In an attorney affirmation in opposition, counsel for the plaintiff argues that the motion is premature and that the defendants' contentions concerning liquidated damages under CPLR 901(b) pertain to a remedy, not pleading sufficiency, and therefore must be addressed, if at all, at the class certification stage and not the pleading stage. The plaintiff cites Court of Appeals authority holding that named plaintiffs may waive liquidated damages later in the litigation to avoid any CPLR 901(b) barrier and that such potential waiver preserves class viability at the pleading stage. Counsel further asserts that class wide compensatory damages remain fully recoverable regardless of any penalty based limitations, and that wage and hour class actions are routinely certified in New York. Counsel contends that, since the complaint states legally cognizable claims and any damages related issues are premature, the motion must be denied in its entirety.

In an attorney affirmation in reply, counsel for the defendants argues that the plaintiff has conceded that Labor Law liquidated damages and statutory penalties are prohibited in class actions under CPLR 901(b), yet has failed to waive those remedies in the complaint or in his opposition papers. Counsel asserts that the mere possibility of a future waiver is legally insufficient and that dismissal is required because the complaint expressly seeks class wide penalties which are barred by statute. Counsel also contends that the motion is not premature and that courts routinely dismiss class allegations at the pleading stage when CPLR 901(b) prohibits the remedies sought.

Discussion

On a motion to dismiss pursuant to CPLR 3211(a)(7), the Court must accept the facts alleged in the complaint as true and afford the plaintiff the benefit of every favorable inference (see Leon v Martinez, 84 NY2d 83, 87 [1994]). A complaint will survive dismissal so long as the facts alleged fit within any cognizable legal theory (see id. at 87-88). "CPLR 901(b) provides that, '[u]nless a statute creating or imposing a penalty, or a minimum measure of recovery specifically authorizes the recovery thereof in a class action, an action to recover a penalty, or minimum measure of recovery created or imposed by statute may not be maintained as a class action' " (Maylou v Mittal, 251 AD3d 939, 941 [2d Dept 2026], quoting CPLR 901[b]). In the context of wage-and-hour claims, liquidated damages recoverable pursuant to the Labor Law have been treated as nonmandatory statutory penalties for purposes of CPLR 901(b) (see e.g. Brown v Mahdessian, 206 AD3d 511, 511 [1st Dept 2022]). Courts have recognized that a plaintiff may waive nonmandatory statutory penalties and proceed with a class action seeking recovery on the underlying wage claims, thereby avoiding CPLR 901(b)'s bar on class-wide recovery of statutory penalties (see Borden v 400 E. 55th St. Assoc., L.P., 24 NY3d 382, 389-390 [2014]; County of Nassau v Expedia, Inc., 120 AD3d 1181, 1182 [2d Dept 2014]; see also Brown v Mahdessian, 206 AD3d at 512).

Here, dismissal of the class claims of the complaint is not warranted. Although the complaint seeks liquidated damages and statutory penalties that may ultimately be unavailable on a class-wide basis under CPLR 901(b), the defendants do not challenge the legal sufficiency of the plaintiff's underlying wage-and-hour claims. Moreover, the possibility that certain remedies may be barred absent a waiver does not render the complaint legally deficient at the pleading stage, particularly where New York courts have recognized that a plaintiff may waive nonmandatory statutory penalties and proceed on behalf of a class as to the underlying claims (see Borden v 400 E. 55th St. Assoc., L.P., 24 NY3d at 389-390; Brown v Mahdessian, 206 AD3d at 512; County of Nassau v Expedia, Inc., 120 AD3d at 1182). At this juncture, accepting the allegations of the complaint as true and affording the plaintiff the benefit of every favorable inference, the Court cannot conclude that class treatment is unavailable as a matter of law. Accordingly, the defendants' motion pursuant to CPLR 3211(a)(7) to dismiss the class claims of the complaint must be denied.

Conclusion

Based on the foregoing, it is hereby

ORDERED that the defendants' motion pursuant to CPLR 3211(a)(7) to dismiss the class claims of the complaint is DENIED; and it is further,

ORDERED that, pursuant to the provisions of 22 NYCRR 202.19 and 22 NYCRR 202.23, a preliminary conference will be scheduled in this matter within 30 days after the date of this decision and order.

The parties' remaining contentions have been considered and do not warrant discussion.

Any request for relief not expressly granted herein is DENIED.

This constitutes the decision and order of the Court.

Dated: November 5, 2026

E N T E R:

Mineola, New York

HON. SARIKA KAPOOR, A.J.S.C.

Sarika Kapoor, J.