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Ralton v. Collecto, Inc.

United States District Court, D. Massachusetts

February 27, 2015

COLLECTO, INC., d/b/a EOS-CCA, Defendant.


DENISE J. CASPER, District Judge.

I. Introduction

Plaintiff Christine Ralton ("Ralton") filed this lawsuit against Defendant Collecto, Inc., d/b/a EOS-CCA ("Collecto") alleging a violation of the McNamara O'Hara Service Contract Act ("SCA"), 41 U.S.C. §§ 6701 et seq. D. 4 ¶ 20. Ralton also alleges a "wage claim" for "[t]he failure of Collecto to pay Ralton the required prevailing wages" in violation of "Massachusetts State law." Id . ¶ 27. Collecto has moved to dismiss. D. 5. For the reasons stated below, the Court ALLOWS the motion.

II. Standard of Review

In considering a motion to dismiss under Fed.R.Civ.P. 12(b)(6), the Court must determine if the facts alleged "plausibly narrate a claim for relief." Schatz v. Republican State Leadership Comm., 669 F.3d 50, 55 (1st Cir. 2012) (citing Ocasio-Hernández v. Fortuño-Burset, 640 F.3d 1, 12 (1st Cir. 2011). The Court accepts "the truth of all well-pleaded facts and draw[s] all reasonable inferences therefrom in the pleader's favor." Grajales v. P.R. Ports Auth., 682 F.3d 40, 44 (1st Cir. 2012). The Court must "determine whether the factual allegations are sufficient to support the reasonable inference that the defendant is liable for the misconduct alleged." García-Catalán v. United States, 734 F.3d 100, 103 (1st Cir. 2013) (internal quotations and citations omitted). "[T]he plaintiff need not demonstrate [she] is likely to prevail" at this stage, only that her claims are "facially plausible." Id. at 102-3 (citations omitted). Although the Court's inquiry does not demand "a high degree of factual specificity, " id. at 103 (internal quotation and citation omitted), the complaint "must contain more than a rote recital of the elements of a cause of action." Id . (quoting Rodríguez-Reyes v. Molina-Rodríguez, 711 F.3d 49, 53 (1st Cir. 2013)).

III. Factual Background

Unless otherwise indicated, the following facts are as alleged in the complaint, D. 4, and are taken as true for the purposes of considering this motion.

In November 2004, the U.S. Department of Education ("DOE") awarded Collecto a federal student aid collection contract. D. 4 ¶ 3. The DOE awarded a second contract to Collecto in the summer of 2009. Id . ¶¶ 18, 19. In March 2005, Ralton began working at Collecto under the first contract as a "Loan Recovery Specialist." Id . ¶ 4. In July 2008, Ralton was transferred to a different department, and her job classification under the contract changed to "general clerk II." Id . ¶ 15. Ralton ended her position on the contract in March 2011, but continued working at Collecto in the Compliance Department. Id . ¶ 26.

The Department of Labor established prevailing wage rates and fringe benefits for debt collection services, as required by the SCA. Id . ¶¶ 6, 20. Collecto's contract with the DOE incorporated these wage determinations. Id . ¶ 24. In October 2009, Ralton discovered that from March 2005 to October 2009, she was paid less than the prevailing wage and benefits for both of her job classifications under the contract. Id . ¶¶ 20, 23. Ralton's wages continued to fall short of the prevailing wage rate through March 2011. Id . ¶ 25.

IV. Procedural History

Ralton instituted this action in Plymouth Superior Court on July 1, 2014. D. 4. Collecto removed this action to federal court, D. 1, and subsequently moved to dismiss, D. 5. The Court heard the parties on the pending motion and took this matter under advisement. D. 17.

V. Discussion

A. Ralton Does Not Have a Private Right of Action under the SCA

Ralton alleges a violation of the SCA, which "was approved by Congress to provide labor standards for the protection of employees of contractors furnishing services to or performing maintenance service for the United States Government." Sopeña v. Colejon Corp., 920 F.Supp. 259, 265 (D.P.R. 1996). With certain exceptions, the SCA "requires the inclusion of specific provisions establishing minimum wage and fringe benefit levels in every contract entered into by the United States." Miscellaneous Serv. Workers, Drivers & Helpers, Teamsters Local No. 427 v. Philco-Ford Corp., WDL Div., 661 F.2d 776, 778 (9th Cir. 1981). Collecto contends, however, that Ralton's SCA claim must be dismissed as a matter of law because "the SCA does not provide employees with a private right of action against their employers for the failure to pay prevailing wages." D. 6 at 1. While the First Circuit has not addressed this issue directly, the Court is persuaded by other courts that have considered the question and concluded that the SCA does not provide an express or implied private right of action. See e.g., Sopeña, 920 F.Supp. at 265 (noting that the SCA "does not create a private cause of action"); Danielsen v. Burnside-Ott Aviation Training Ctr., Inc., 941 F.2d 1220, 1227-29 (D.C. Cir. 1991) (concluding that "it is plain that the SCA creates no private remedy"); Philco-Ford, 661 F.2d at 779 (noting that "[t]he Act does not specifically grant a private right of action, and nothing in its language or history compels [the court] to believe that such a right may be implied" rather "a plain reading of the statute ...

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