*1 This Report and Recommendation is submitted to the Honorable Sherilyn Peace Garnett, United States District Judge, pursuant to 28 U.S.C. § 636 and General Order 05-07 of the United States District Court for the Central District of California.

I. Summary of Recommendation

Before the Court is the Expedited Petition filed by the Acting Secretary of Labor, U. S. Department of Labor (“DOL”). [Dkt. No. 1.] The DOL asks the Court to issue an order:

(1) enforcing six administrative subpoenas—four subpoenas duces tecum (the “Document Subpoenas”) served on Respondents L & Y Foods, Inc. (“L & Y Foods”), A1 Meat Solutions, Inc. (“A1 Meat Solutions”), Fu Qian Chen Lu (“Chen Lu”), and Cameron Zhong Lu (“Zhong Lu”) (collectively “Respondents”) and two subpoenas ad testificandum (the “Deposition Subpoenas”) served on Chen Lu and Zhong Lu pursuant to the Fair Labor Standards Act (collectively the “Subpoenas”);

(2) prohibiting Respondents from engaging in witness tampering and interfering with Petitioner's investigation; and

(3) finding that the statute of limitations is tolled until the DOL notifies the Court that Respondents have complied with the Subpoenas. [Id.] Respondents oppose the Petition. [Dkt. Nos. 14, 15.]

The Court has carefully reviewed and considered all of the pleadings, the argument by DOL counsel at the hearing,[1] the relevant legal authority, and the record in this case. For the reasons set forth below, the Court recommends (1) granting the Petition to enforce the Subpoenas; (2) granting in part the request for an order prohibiting interference with the DOL investigation; and (3) granting the DOL's request to toll the statute of limitations.

II. Background

The DOL Wage and Hour Division (“WHD”) enforces various employment laws, including the Fair Labor Standards Act, 29 U.S.C. § 201, et seq. (“FLSA”), which as pertinent here mandates payment of overtime, minimum wage and proper record keeping and protects minors from oppressive labor laws. The cutting and deboning of poultry is considered oppressive and hazardous labor for minors and is prohibited under the FLSA. See C.F.R. 570.61. The FLSA also contains a “hot goods” provision that prohibits the shipping or selling of goods produced in violation of these requirements. See 29 U.S.C. § 215(a)(1).

A. Execution of Civil Warrants and Alleged Retaliation Against Workers

The WHD is investigating whether Respondents, other entities owned and controlled by Respondents, and staffing companies owned by Bruce Lok have been in compliance with the FLSA. [Dkt. No. 1-7, Decl. of Philipda Modrakee ¶ 3.] On January 26, 2024, WHD executed warrants for inspection under the FLSA at two locations in Monterey Park of L & Y Foods, owned by Chen Lu, and one location in El Monte of A1 Meat Solutions, owned by Chen Lu's son, Zhong Lu. Chen Lu informed WHD that he is in charge of all three locations, and that Respondents hire poultry and meat cutters and packers, as well as floor supervisors, through staffing agencies owned by Bruce Shu Hau Lok (“Bruce Lok”). During the warrant execution WHD interviewed workers, reviewed documents, and found evidence of overtime wage violations. That same day, citing the overtime violations, WHD made an objection to the shipment of hot goods. Chen Lu then inquired whether firing all the workers and rehiring them as hourly employees would fix the problem. WHD warned Chen Lu against retaliating against the workforce, gave him an anti-retaliation fact sheet, and counseled him to speak to his attorney regarding any changes. [Dkt. No. 1-2, Decl. of Kimchi Bui ¶¶ 4-6.]

*2 On the evening of January 27, 2024, Respondents' counsel informed DOL counsel that Respondents were terminating the staffing agency at Respondents' three locations. The DOL responded by inquiring whether Respondents would immediately hire all workers and warning against retaliating against the workforce with any adverse changes that were unnecessary to comply with wage and hour law. [Dkt. No. 1-8, Decl. of Sonya Shao ¶ 5.]

In the subsequent days and weeks, workers reported to WHD about several changes at the three worksites. Specifically, floor supervisors told workers that because of the DOL, workers had to fill out multi-page applications if they wanted to continue working. The application states that the workers are now subject to a 90-day probationary period that can be extended before they are hired and during which they can be fired without notice. Supervisors also told employees that they are now “probationary employees” subject to new rules and can be fired at any time. Workers also reported that Respondents made several changes to the hourly rate and imposed a new minimum box requirement that is onerous, almost physically impossible for many workers to meet in eight hours, the new cap on daily work hours, and appears to be a wage reduction. Supervisors told workers if they cannot meet the new minimum box requirement, they would be terminated or moved to another position. [Dkt. No. 1-2, Bui Decl. ¶¶ 7-9.]

In addition, shortly after the WHD went to the worksite, workers reported to WHD investigators that supervisor Mariana Rivera has been taking employees into her office and demanding to know what they told WHD investigators. Since then, workers report that she has escalated her threatening behavior by calling workers derogatory names for talking to the WHD. Workers also report to WHD investigators that other supervisors and high-level employees have been telling workers that they “placed a noose over their own necks for talking about cash pay” to WHD. Workers also report that the overall effect has been to threaten the workers and make them fearful of losing their jobs. [Dkt. No. 1-2, Bui Decl. ¶¶ 7-12.]

As WHD began tracing the purchasers of Respondents' goods, Chen Lu told WHD that L & Y's top customers are “related to him.” WHD found that at least four additional customer companies are owned or controlled by Chen Lu or Chen Lu's spouse or their children, including Zhong Lu. These customer companies have received hot goods and are posed to further sell this contraband to unwitting customers. At the business addresses for these companies, however, WHD found other companies that disavowed any knowledge thereof and refused to answer phone calls. [Dkt. No. 1-2, Bui Decl. ¶¶ 13-17.]

On January 31, 2024, DOL counsel notified Respondents' counsel of the DOL's concerns regarding retaliation, and Respondents' counsel stated that Respondents would do “everything in its power to ensure nothing of the sort occurs” and be “cooperative in sharing records.” [Dkt. No. 1-8, Shao Decl. ¶ 6.]

B. The Subpoenas

WHD contends that the documents required to be produced are relevant and material to its investigation of whether any person has violated or is about to violate the FLSA, and the witnesses have information relevant and material thereto. [Dkt. No. 1-3, Decl. of Ruben Rosalez ¶¶ 4-8; Dkt. No. 1-5, Decl. of Carrie Aguilar ¶¶ 4-5].

On January 26, 2024, WHD served the four Document Subpoenas to obtain records not at the worksites that day when the civil search warrants were executed. The first four categories call for documents identifying the business, corporate officers, physical location and organizational chart; in the subpoenas to L & Y Food and A1 Meat Solutions focus on those entities, while the first four categories in the subpoenas to Chen Lu and Zhong Lu focus on other entities in which they appear to have an ownership or controlling interest. The remaining categories in the four subpoenas are identical and call for the following categories of documents for the time period January 27, 2021 through the date of production:

[Dkt. No. 1-7, Modrakee Decl. ¶¶ 4-6.]

Respondents failed to provide any information in response to these subpoenas. [Id. at ¶ 7.] On February 5, 2024, Respondents' counsel emailed DOL counsel that Respondents would not comply with the subpoenas based on the warrant execution and Respondents' view that any further investigation would be overbroad and duplicative. [Dkt. No. 1-8, Shao Decl. ¶ 7.]

On February 9, 2024, DOL counsel sent another letter to Respondents' counsel regarding concerns of retaliation. [Id. at ¶ 9.] DOL counsel also offered to narrow the time frame and scope of several subpoena requests as a compromise to focus on urgent concerns regarding retaliation. DOL counsel further explained the time frame of the subpoenas are continuing and that documents such as employee lists and job applications and other information critical to investigating retaliation after January 26, 2024 could not have existed at the time of the warrant application. DOL counsel further explained how almost all of the subpoena requests were not duplicative of what was obtained in the warrant execution and indicated an informal interview of Chen Lu by the investigator may help resolve some of the other requests. [Id.; Dkt. No. 1-9.]

On February 13 and 23, 2024, the WHD issued the two Deposition Subpoenas to Chen Lu and Zhong Lu. These subpoenas seek testimony regarding L & Y Food, A1 Meat Solutions, and all other companies handling meat or poultry Chen Lu and Zhong Lu are owners, officers, or otherwise have control. [See Dkt. Nos. 1-4 at 39; 106 at 2.] On February 19 and 24, 2024, Respondents' counsel notified DOL counsel that Chen Lu and Zhong Lu would not comply with the Deposition Subpoenas. [Dkt. No. 108, Shao Decl. ¶¶ 12, 13.] Respondents' counsel also told DOL counsel that Respondents would not comply with any subpoenas and told DOL counsel to go to federal court. [Id. at ¶ 12.]

Respondents' refusal to respond to the Subpoenas is impeding WHD's ability to conduct a proper and timely investigation into possible violations of the FLSA and to notify customers who may have received hot goods from Respondents. [Dkt. Nos. 1-2, Bui Decl. ¶¶ 19, 20; 1-3, Rosalez Decl. ¶¶ 9-10.]

III. Legal Standard

District courts have authority to enforce Department of Labor subpoenas pursuant to 29 U.S.C. § 209. See 29 U.S.C. § 209. The Ninth Circuit has explained that “[t]he scope of [a court's] inquiry in an agency subpoena enforcement proceeding is narrow.” NLRB v. North Bay Plumbing, Inc., 102 F.3d 1005, 1007 (9th Cir. 1996) (citations omitted); see also United States v. Golden Valley Elec. Ass'n, 689 F.3d 1108, 1113 (9th Cir. 2012) (scope of judicial review in administrative subpoena enforcement proceeding is quite narrow). In such a proceeding, the Court considers three questions: “(1) whether Congress has granted the authority to investigate; (2) whether procedural requirements have been followed; and (3) whether the evidence is relevant and material to the investigation.” E.E.O.C. v. Children's Hosp. Med. Ctr. of N. Cal., 719 F.2d 1426, 1428 (9th Cir. 1983) (en banc); see Golden Valley Elec. Ass'n, 689 F.3d at 1113.

*4 If these three questions are answered in the affirmative, the subpoena must be enforced unless the opposing party shows that the subpoena is overbroad or unduly burdensome. N. Bay Plumbing, 102 F.3d at 1007; see Golden Valley Elec. Ass'n, 689 F.3d at 1113 (“Even if other criteria are satisfied, a Fourth Amendment reasonableness inquiry must also be satisfied”) (internal quotation marks omitted); Children's Hosp., 719 F.2d at 1428 (a “subpoena should be enforced unless the party being investigated proves the inquiry is unreasonable because it is overbroad or unduly burdensome”). “[T]he burden on a party seeking to dodge compliance with a subpoena is not a meager one[;] Such a party must come forward with facts suggesting that the subpoena is intended solely to serve purposes outside the purview of the jurisdiction of the issuing agency” or that “compliance would unduly disrupt and seriously hinder normal operations of the business.” N.L.R.B. v. Vista Del Sol Heath Servs., 40 F. Supp. 3d 1238, 1256 (C.D. Cal. 2014) (internal quotation marks omitted).

IV. Discussion

A. Congress Has Granted the DOL the Authority to Issue the Subpoenas

Pursuant to 29 U.S.C. § 211(a) “the Administrator or his designated representatives may investigate and gather data regarding the wages, hours and other conditions and practices of employment in any industry subject to this chapter, and may enter and inspect such places and such records ... as he may deem necessary or appropriate to determine whether any person has violated any provision of this chapter, or which may aid in the enforcement of the provisions of this chapter.” 29 U.S.C. § 211(a). Section 209 incorporates 15 U.S.C. § 49 – which authorizes the issuance of subpoenas to compel the production of documentary evidence related to any matter under investigation—into the “jurisdiction, powers, and duties of the Administrator, the Secretary of Labor, and the industry committees.” 29 U.S.C. § 209; 15 U.S.C. § 49; see also Okla. Press Publ'n Co. v. Walling, 327 U.S. 186, 198-200 (1946); Donovan v. Mehlenbacher, 652 F.2d 228, 230 (9th Cir. 1981) (“[T]he Department of Labor clearly has the power to issue subpoenas in the course of an investigation conducted under statutory authority, and to have those subpoenas enforced by federal courts.”).

Here, the Subpoenas were issued during an active investigation into whether Respondents violated provisions of the FLSA. [Dkt. Nos. 1-3, Rosalez Decl. ¶¶ 5-7; 1-5, Aguilar Decl. ¶ 5.] In their opposition, Respondents do not contend that WHD lacked authority under the FLSA to issue the Subpoenas. The Court finds Congress has granted Petitioner the statutory authority to issue the Subpoenas in connection with its FLSA investigation.

B. The DOL Has Satisfied Procedural Requirements

Procedural requirements are satisfied when an administrative subpoena is properly issued and served. See Acosta v. GT Drywall, Inc., 2017 WL 3262109, at *3 (C.D. Cal. June 26, 2017). A government official's affidavit is “sufficient to establish a prima facie showing that these requirements” are met. Id.; F.D.I.C. v. Garner, 126 F.3d 1138, 1142-43 (9th Cir. 1997).

Here, the Regional Administrator had the authority to issue the Subpoena on behalf of the Secretary of the Department of Labor pursuant to the Secretary's power to delegate authority. See Secretary's Order 5-2010, 75 FR 55352-03, 2010 WL 3514767, 5(C); see also Donovan v. Nat'l Bank of Alaska, 696 F.2d 678, 682 (9th Cir. 1983). Therefore, the Subpoena was properly issued by Ruben Rosalez, the Regional Administrator. [See Dkt. No. 1-3, Rosalez Decl. ¶¶ 4, 5.]

The DOL has also shown by affidavit that the Subpoenas were properly served. [See Dkt. No. 1-3, Rosalez Decl. ¶¶ 5, 7; Exhibits A-E]. The proofs of service establish that the Subpoenas were served on each of the Respondents. [Id.; Dkt. Nos. 1-4 at 10, 19, 28, 37, 40; 1-6 at 3.] Accordingly, the DOL has sufficiently proven the Subpoenas were properly served on Respondents. See Garner, 126 F.3d at 1142-43. Respondents do not dispute that the requisite procedural requirements were followed.

*5 Based on the foregoing, the Court finds the DOL satisfied all applicable procedural requirements in seeking to enforce the Subpoenas against Respondents.

C. The Documents and Information Sought in the Subpoenas Are Relevant and Material to the Investigation

To determine relevance, “the appropriate inquiry is whether the information sought might assist in determining whether any person is violating or has violated any provision of [the FLSA].” Donovan v. Nat'l Bank of Alaska, 696 F.2d 678, 684 (9th Cir. 1983). The DOL must show “only some reasonable basis for believing that the information will prove relevant.” NLRB v. Int'l Medication Sys., Inc., 640 F.2d 1110, 1114 n.3 (9th Cir. 1981) (citations omitted); see also Children's Hospital, 719 F.2d at 1429 (“When ... ‘[t]he evidence sought by the subpoena was not plainly incompetent or irrelevant to any lawful purpose,’ it should have been enforced.”) (quoting Endicott Johnson Corp. v. Perkins, 317 U.S. 501, 509 (1943)); E.E.O.C. v. Fed. Express. Corp., 558 F.3d 842, 854–55 (9th Cir. 2009) (relevance limitation is “not especially constraining”) (citation omitted). A district court defers to “the agency's appraisal of relevancy, which must be accepted so long as it is not obviously wrong.” N.L.R.B. v. Am. Med. Response, Inc., 438 F.3d 188, 193 (2d Cir. 2006); Garner, 126 F.3d at 1143 (citing the Second Circuit standard approvingly).

The DOL determined that the documents and testimony sought are relevant and material to WHD's investigation whether Respondents have violated the FLSA, including the anti-retaliation and “hot goods” provisions. The DOL has also determined that the subpoenaed documents and information are necessary to assist the WHD investigation into the conditions and practices that contribute to FLSA compliance in the poultry industry and may assist WHD in developing measures to improve compliance going forward. [Dkt. No. 1-3, Rosalez Decl. ¶¶ 5-8.] Respondents oppose the Petition on the grounds that the Subpoenas are overbroad and unduly burdensome (addressed below), but they do not argue that the documents and information sought by the Subpoenas are irrelevant or immaterial to the investigation.

The documents sought by the four requested subpoenas duces tecum are relevant and material to the DOL investigation into the conditions and practices that contribute to FLSA compliance in the poultry industry as well as potential FLSA violations, including retaliation and hot goods issues. These four subpoenas seek the following general categories of information: wages and the employment relationship (including job applications, communications, and contract with staffing agencies); child labor, and Respondents' corporate financial and customer information.

Moreover, the DOL had proffered evidence of retaliation. It is well established that unchecked retaliation subverts the purpose of the FLSA. See Kasten v. Saint-Gobain Performance Plastics Corp, 563 U.S. 1, 11 (2011) (the FLSA “relies for enforcement not upon ‘continuing detailed deferral supervision or inspection of payrolls,’ but upon ‘information and complaints received from employees seeking to vindicate rights claimed to have been denied.’ ”) Evidence regarding Respondents' corporate financial information, other companies, and customers is also relevant. The opaque nature of the companies controlled by Chen Lu, Zhong Lu, and their relatives, combined with Respondents' refusal to answer any questions, appear to be an attempt to obscure the ownership and hide from liability. The DOL properly notes that it is textbook investigatory procedure to request information from related entities to confirm that workers are not being shared among entities or paid “off the books” of the main entity's payroll. See Acosta v. Shingal, 2018 WL 1358973, at *6 (N.D. Cal. Mar. 16, 2018) (ordering production of corporate financial documents, general ledgers, bank records and tax returns).

*6 The Subpoenas also seek information regarding customers, including customers owned or controlled by Respondents so that DOL can timely identify and notify downstream recipients of hot goods and fulfill the FLSA mandate to prevent hot goods from continuing in interstate commerce. See Citicorp Indus. Credit, Inc. v. Brock, 483 U.S. 27, 36-37 (1987) (“While improving working conditions was undoubtedly one of Congress' concerns, it was certainly not the only aim of the FLSA. In addition to [that goal], the Act's declaration of policy, contained in § 2(a), reflects Congress' desire to eliminate the competitive advantage enjoyed by goods produced under substandard conditions. This Court has consistently recognized this broad regulatory purpose. “The motive and purpose of the present regulation are plainly ... that interstate commerce should not be made the instrument of competition in the distribution of goods produced under substandard labor conditions, which competition is injurious to the commerce.”) (citations omitted).[2] Respondents are required to answer questions and produce documents regarding other companies that they own and/or control.

Accordingly, the Court concludes that the documents and information sought by the Subpoenas are relevant and material.

D. The Subpoenas Are Not Unreasonably Broad or Unduly Burdensome

The burden of proving that an administrative subpoena is unduly burdensome or unreasonably broad is not easily met. Fed. Hous. Fin. Agency v. SFR Invs. Pool 1, LLC, 2018 WL 1524440, at *7, n.7 (D. Nev. Mar. 27, 2018) (collecting cases). “ ‘[I]f the investigation is legitimate, the subpoena is not needlessly broad, and the records sought are relevant to the inquiry,’ the subpoena should be enforced.” Vista Del Sol Heath Servs., 40 F. Supp. 3d at 1256 (quoting Int'l Medication Sys., 640 F.2d at 1114). To demonstrate that an administrative subpoena imposes an undue burden, “a subpoenaed party must provide specific evidence showing that compliance ‘threatens to unduly disrupt or seriously hinder normal operations of a business.’ [ ] Merely referencing the agency's extensive requests or asserting that compliance would be costly is not enough.” Id. (internal citation omitted). As such, “[c]onclusory or speculative statements of harm, inconvenience, or expense are plainly insufficient.” Cf. Nationstar Mortg., LLC v. Flamingo Trails No. 7 Landscape Maint. Ass'n, 316 F.R.D. 327, 334 (D. Nev. 2016). Further, if the party seeking to quash the subpoena does not “come forward with facts suggesting that the subpoena is intended to solely serve purposes outside the purview of the jurisdiction of the issuing agency,” the court should “act summarily” and enforce the subpoena. Vista Del Sol Heath Servs., 40 F. Supp. 3d at 1256. Moreover, “[t]he court's inquiry into the underlying circumstances is a limited one.” United States v. Kearns, U.S. Dist. LEXIS 63312, at *2–*3 (S.D. W. Va. June 14, 2011); see Elwell v. Bade, 2020 WL 3263656, at *9–10 (S.D. Ind. June 16, 2020) (overruling respondent's objection that the FAA's “investigation is motivated by an improper purpose” and explaining that the agency does not have the duty to disclose agency work product regarding the details of the investigation due to the deliberative process privilege).

*7 Respondents contend that the information sought in the Subpoenas is duplicative of the previously executed search warrant, is overbroad and unduly burdensome, and is not supported by competent, admissible evidence. [Dkt. No. 14 at 8.] Specifically, Respondents contend that the DOL has already searched for and had access to every document requested in the document subpoenas, and that the DOL has never specified any specific documents, or categories of documents, that it did not obtain in the execution of its search warrants. Respondents explain that without this information, it is not possible for Respondents to make a document production without duplicating documents already in the DOL's possession.

This argument is unavailing. As the DOL explains in its Reply, the scope of the Subpoenas includes documents created after the January 26, 2024 execution of the warrants – specifically, documents pertaining to Respondents' alleged retaliation against workers, and documents evidencing its current compliance with the FLSA. The Court agrees with the DOL that documents created after the search could not have been seized in the warrants. Moreover, Respondents fail to identify which categories of documents listed in the Subpoenas they allege were seized, in their entirety, during the search warrant execution. Cf. Acosta v. Fusilli at Miller Place, Inc., 2018 WL 4635735, at * 6 (E.D. N.Y. May 7, 2018) (specifying categories of documents sought in the administrative subpoenas that respondents alleged were already in the DOL's possession). In Acosta, the court examined each category proffered by the respondents as duplicative and addressed the specific objections as to each category. Id. Here, Respondents assert broadly that the “government has already searched for and had access to every single document requested in the subpoenas” [Dkt. No. 14 at 8], which, as stated above, is demonstrably untrue.

In contending that the Subpoenas are improperly cumulative of items seized pursuant to the warrants, Respondents cite Rules 26 and 45 of the Federal Rules of Civil Procedure, which govern discovery in civil cases. However, those rules do not apply to the instant Petition. The Subpoenas were issued as part of an ongoing DOL administrative investigation – not in discovery in a civil case. Rules 26 and 45 thus do not apply. See E.E.O.C. v. Deer Valley Unified School Dist., 968 F.2d 904, 906 (9th Cir. 1992) (agency's investigatory subpoena power “is based on specific statutory authority, not on the general discovery protections of the Federal Rules of Civil Procedure”); Fed. R. Civ. P. 45 (Advisory Committee Notes, 1937 Adoption) (Rule 45 “does not apply to the enforcement of subpoenas issued by administrative officers and commissions pursuant to statutory authority. The enforcement of such subpoenas by the district courts is regulated by appropriate statutes.”) As the Ninth Circuit explained in Deer Valley Unified School Dist.:

Id. Here, to demonstrate that the Subpoenas are unduly burdensome or unreasonably broad, Respondents must meet the heavy burden discussed above.

*8 Respondents attempt to meet that burden by arguing that the time period for the subpoenaed documents is overbroad. The Document Subpoenas limit the time period to “January 27, 2021 to the date of production.” [Dkt. No. 1-4 at 3, 12, 21, 30.] The Document Subpoenas clarify that their scope includes “[d]ocuments created prior to January 27, 2021, which have been used or relied on since January 27, 2021 or which describe legal duties which remain in effect after January 27, 2021 (such as policies and contracts”. [Id. at 4, 13, 23, 32.] The DOL explains that this instruction is to ensure that a company with, for example, a longstanding pay regime currently in effect does not refuse to produce records related thereto on the ground that the records were created before the Subpoenas' start date. The WHD investigation is legitimate and the records sought are relevant. Respondents have not shown that the time period January 27, 2021 to the present, along with the clarifying instruction, is needlessly broad in light of the reasonable explanation offered by the DOL for the clarifying instruction as well as the DOL's offer to prioritize and narrow the requests in the document Subpoenas. [Dkt. Nos. 1-8; 1-9.] In response to that offer, rather than address the specific concerns, Respondents' counsel hung up the phone on DOL counsel and sent an email refusing to try to resolve the matter. [Dkt. Nos. 1-8, Shao Decl. ¶ 12; 1-9 at 10-11.] Respondents' broad assertion that the clarifying instruction effectively sweeps in all of their business records is insufficient to meet the high burden required to show that the document Subpoenas are overbroad and to support their wholesale refusal to respond to the Subpoenas.

Respondents also contend that the document Subpoenas are overbroad on logistical grounds, that is, the records are “voluminous and cannot practically be moved from one place to another without extraordinary undue hardship” and “[i]t would be completely infeasible to physically transport those business records” to the DOL office. [Dkt. No. 14-1, Declaration of Fu Qian Chen Lu ¶ 13.] The DOL responds that these conclusory statements fail to set forth the specific facts required to refuse compliance on the grounds of overbreadth. The Court agrees. The declarations submitted by Respondents do not address whether any of the records are in digital format and do not explain why digital production in response to the DOL's offer to receive records digitally via WHD's online document portal or email would threaten to unduly disrupt or seriously hinder normal business operations. Respondents also fail to address the DOL's offer to “send an investigator to the worksite to scan [all applications for work relating to poultry and meat cutting, packing, and processing] or pick them up.” [Dkt. No. 1-9. Shao Decl. Ex. A.] Respondents further fail to address the DOL's offers to prioritize the production of narrowed categories of documents to expedite WHD's investigation before production of the full set of records requested. [Id.] In short, Respondents fail to offer the requisite specific evidence of the alleged burden, failed to respond to DOL's offers to reduce any such burden, and failed to show that the alleged burdens are undue in light of the size of their business and the scope of the WHD investigation.

As to the two deposition Subpoenas, Respondents provide no information justifying their refusal to comply. To minimize any burden in Chen Lu or Zhong Lu having to travel to the WHD offices, the DOL offered to send an investigator to Respondents' office to conduct interviews. [Id.]

Respondents do not dispute that the FLSA authorizes WHD to compel the attendance of witnesses to provide information under oath. See 29 U.S.C. §§ 209, 211. Respondents offer to provide attorney-written answers to questions submitted by WHD in lieu of live testimony. Respondents offer no authority to support their position that this proposal is adequate to respond to the Deposition Subpoenas. The DOL contends that Respondents' position is tantamount to refusal to comply with the Deposition Subpoenas. The Court agrees. Respondents offer no evidence to meet their burden of establishing that the Deposition Subpoenas are unreasonably broad or unduly burdensome. Moreover, the evidence contradicts Respondents' claim that they were never informed about what information the DOL requires from oral testimony that DOL had not already obtained in the search warrants. [Dkt. No. 14 at 9.] The subpoenas stated that the witness is “to testify to matters relating to all companies handling meat or poultry where you are an owner or otherwise have control, including but not limited to” L & Y Food, Inc. and A1 Meat Solutions, Inc. (Chen Lu Subpoena) and A1 Meat Solutions, Inc. and L & T Meat Company (Zhong Lu Subpoena). [See Dkt. Nos. 1-4 at 30, 1-6 at 2.] Additionally, in a February 9, 2024 letter to Respondents' counsel, DOL counsel specified the information that it sought to address in an interview with Chen Lu the following week. [See Dkt. No. 1-9 at 4.]

*9 In short, Respondents offer no valid basis for their refusal to comply with the Deposition Subpoenas.

Respondents also object to the Document Subpoenas as requesting sensitive proprietary business or commercial information that belongs to Respondents, their clients and their customers. Specifically, Respondents object to the requests for all monthly financial statements, profit and loss statements, statements of cash flows and balance sheets, complete general ledger, business account bank statements, contracts, invoices and work orders sent to or received from clients for services and any related work, and copies of all canceled checks, and documents reflecting all purchase and/or sale of chicken, pork, beef, and/or beef products. In support of these objections, Respondents cite Fed. R. Civ. P. 45 and the need for a protective order to ensure that the DOL does not misuse or improperly disclose this information to third parties. As discussed above, Rule 45 does not apply here.

The DOL responds that courts have repeatedly enforced administrative subpoenas for tax records, general ledgers, and proprietary information. See Acosta v. Shingal, 2018 WL 1358973, at *2 (N.D. Cal. Mar. 16, 2018) (rejecting objections to producing tax returns in response to administrative subpoena are “inconsistent with the wide scope of records available to the [DOL] under the FLSA); See 29 U.S.C. § 211(a) (referencing records “necessary or appropriate” to determine whether a violation occurred, as well as those records that “may aid in the enforcement of the provisions”); Nature Image, Inc. v. U.S. Dept. of Labor, 2019 WL 4316514, at *2, 3 (C.D. Cal. June 19, 2019) (granting DOL petition to enforce administrative subpoenas for loan/credit applications that would include the petitioners' confidential, personal financial information, tax returns and personal asset information). The court stated that the petitioners' “minimal privacy interests in whatever personal financial documents they chose to submit to Bank to obtain loans or credit for corporate entities would be outweighed by the DOL's interest in enforcing the FLSA by reviewing [petitioner]'s banking records to get a complete picture of corporate financial transactions that may shed light on payroll practices.” Id. See also Solis v Forever 21, Inc., 2013 WL 1319769, at *7 (C.D. Cal. Mar. 7, 2013) (rejecting request for protective order to limit disclosure of “confidential trade secrets” called for by DOL subpoenas; “[a]side from blanket assertions that the [DOL] intends to disclose its trade secrets, [respondent] provides no specific detail regarding which subpoenaed items constitute trade secrets or why there is a risk the [DOL] will publicly disclose them.”). Further, in Solis, the Court stated that the petitioner “can rely on the protections provided by Department of Labor regulations promulgated under the Freedom of Information Act (“FOIA') to avoid public disclosure of confidential information.” Id. at *7.

The DOL has shown that financial and alleged proprietary information called for in the Document Subpoenas is relevant and material to its investigation and that its requests are supported by caselaw. Respondents cite no authority to support their argument that the DOL is not entitled to obtain this information through administrative subpoena in an investigation into alleged FLSA violations. Moreover, Respondents can rely on the protections provided by the Department of Labor regulations.[3] Thus, even if the Document Subpoenas seek confidential trade secret information, Respondents will have an opportunity to challenge the public disclosure of this information under FOIA. Respondents have not demonstrated that these protective mechanisms are insufficient to maintain the confidentiality of its proprietary information.

E. DOL Request for an Injunction

*10 As set forth above, the DOL alleges that Respondents have engaged in retaliatory acts and intimidating statements. Consequently, the DOL seeks an order that Respondents, their agents, and their attorneys are enjoined from intimidating or retaliating in any way against any current or former employees or any other witness either for their participation, perceived participation, or potential participation in this investigation or any related litigation. Arguing that courts frequently recognize such retaliatory tactics serve to intimidate the workforce and chill workers from participating in DOL investigations, the DOL cites cases in which it moved for a preliminary injunction to enjoin the employer from violating the anti-retaliation provisions of the FLSA. See Scalia v. Unforgettable Coatings, Inc., 455 F.Supp.3d 987, 993-94 (D. Nev. Apr. 23, 2020) (granting preliminary injunction); Perez v. Fatima/Zahra, Inc., 2014 WL 2154092, at *4 (N.D. Cal. 2014) (granting application for temporary restraining order and order to show cause and setting preliminary injunction hearing).[4]

In this investigation, the DOL filed a motion for a temporary restraining order, which was granted. See Su v. L & Y Food, et al., Case No. 2:24-cv-02606-ODW (BFMx), Docket No. 13.[5] The relief requested by the DOL in that motion did not, however, seek to enjoin the conduct that is the subject of the request before the Court here. In the instant motion, the DOL does not argue that it has met the legal standard for issuance of a preliminary injunction. See 29 U.S.C. § 217 (district court have jurisdiction to restrain violations of 29 U.S.C. § 215);[6] Winter v. Natural Res. Def. Council, 555 U.S. 7, 20 (2008) (“A plaintiff seeking a preliminary injunction must establish that he is likely to succeed on the merits, that is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.”).

The DOL seeks the above-referenced order pursuant to the Court's inherent authority to enforce the Subpoenas, which the DOL contends encompasses the authority to ensure that Respondents cease impeding the investigation. In support of this argument, the DOL cites cases affirming a district court's inherent authority to impose sanctions, see Chambers v. NASCO, Inc., 501 U.S. 32, 43 (1991) (holding that district court properly invoked its inherent power in assessing attorney fees and expenses as a sanction for a party's bad-faith conduct), Link v. Wabash R. Co., 370 U.S. 626, 633 (1962) (holding that district court has inherent power to dismiss an action for failure to prosecute), and one case in which the district court enjoined a party from communicating with witnesses outside the presence of counsel. See Bauer v. Hill, 2023 WL 6373857, at *1 (C.D. Cal. Aug. 4, 2023) (ordering defendant to refrain from communicating with witnesses outside the presence of counsel). Courts may impose sanctions under their inherent authority for “willful disobedience of a court order or when the losing party has acted in bad faith, vexatiously, wantonly, or for oppressive reasons.” Fink v. Gomez, 239 F.3d 989, 991 (9th Cir. 2001) (quoting Roadway Express, Inc. v. Piper, 447 U.S. 752, 766 (1980)) (cleaned up); Bauer, 2023 WL 6373857, at *4. “[S]anctions are available if the court specifically finds bad faith or conduct tantamount to bad faith. Sanctions are available for a variety of types of willful actions, including recklessness when combined with an additional factor such as frivolousness, harassment, or an improper purpose.” Fink, 239 F.3d at 994. “Before awarding sanctions under its inherent powers, however, the court must make an explicit finding that [a party's] conduct ‘constituted or was tantamount to bad faith.’ ” Primus Auto. Fin. Servs., Inc. v. Batarse, 115 F.3d 644, 648 (9th Cir. 1997) (citation omitted).

*11 In Bauer, based on “disturbing allegations of witness tampering,” the court ordered the defendant “to refrain from any contact with any party or witness in this case without her attorney present” in accordance with the court's specific directions. 2023 WL 6373857, at *1, 4. In that case the plaintiff moved for terminating sanctions on the ground that the defendant's communications with four witnesses amounted to witness tampering as defined in 18 U.S.C. § 1512.[7] Although there is no private cause of action for a § 1512 violation, conduct falling within the statute's ambit may be sanctionable pursuant to the court's inherent power. Id. (citations omitted). Applying the clear and convincing standard, the court analyzed the language and context of the communications and concluded that although they did not meet the § 1512 definition of witness tampering, they were sanctionable. Id. at *7.

The order in Bauer is narrower than that sought by the DOL here. It barred communications by a single defendant with witnesses in the case outside the presence of counsel. The order sought by the DOL here is broader than that in Bauer in several respects, including that it would cover “Respondents, their agents, and their attorneys.” It is also based on a less robust evidentiary showing than that in Bauer. The DOL requests that the Court relax application of the rules of evidence given the summary nature of this proceedings and the need to protect the identity at this stage of the litigation of workers who have confidentially provided information regarding Respondents' retaliatory conduct. In support of that request, the DOL cites Harris v. Acme Universal, Inc., 2014 WL 3907107, at *4 (D. Guam Aug. 11, 2014), in which it moved for a preliminary injunction pursuant to F.R.C.P. 65 and 29 U.S.C. § 215(a)(3) to enjoin the employer from retaliating against employees.[8] The Harris court accepted the WHD declarations setting forth employee statements, explaining that district courts may consider hearsay in deciding whether to issue a preliminary injunction. Id. at *6. Moreover, statements offered against an opposing party that were “made by the party's agent or employee on a matter within the scope of that relationship and while it existed” are not hearsay. See Fed. R. Evid. 801(d)(2)(D).

Here, the Bui Declaration states that shortly after WHD went to the worksites, supervisor Mariana Rivera brought employees into her office and demanded to know what they told WHD investigators, and Rivera subsequently called workers “names like dog, perro, and a derogatory term for indigenous, indio, for talking to the WHD, making statements like, ‘It's these dogs' fault we are in this problem.’ ” [Dkt. No. 1-2, Bui Decl. ¶ 10.] Bui also declares that workers report that several other supervisors and higher-level employees have been telling workers they “placed a noose over their own necks for talking about cash pay” to WHD. [Id. at ¶ 11.] Respondents do not deny these allegations, but they do object to the evidence on grounds of hearsay, foundation, and lack of personal knowledge. [See Dkt. No. 15 at 5.] Respondents do not cite any authority that the rules of evidence apply to the instant motion, or that the Court cannot consider hearsay in determining whether to exercise its inherent authority to impose sanctions.

*12 These alleged efforts by Respondents' supervisorial employees to deter workers from communicating with WHD are disturbing and warrant a prohibiting order, though not as broad as that requested by DOL. The Court recommends that Respondents, supervisor Marianna Rivera, and other employees of Respondents who have authority to supervise workers at L & Y Foods and A1 Meat Solutions be ordered not to intimidate, threaten, or retaliate against the workers for participating in the DOL investigation of Respondents.

F. The Statute of Limitations is Equitably Tolled

The DOL requests that the statute of limitations be tolled from February 5, 2024, which was the original deadline to respond to the Subpoenas, until 30 days after the date that the DOL informs the Court the Respondents produced the subpoenaed documents and witnesses. [Dkt. No. 1-1 at 21.] Respondents' opposition does not address this argument.

The statute of limitations for any action under the FLSA is two years, but willful violations may increase the statute of limitations to three years. See 29 U.S.C. § 255. The Ninth Circuit has recognized the FLSA limitations period is subject to the doctrine of equitable tolling. See Partlow v. Jewish Orphans' Home of S. Cal., Inc., 645 F.2d 757, 760 (9th Cir. 1981), overruled on other grounds by Hoffman-La Roche, Inc. v. Sperling, 493 U.S. 165 (1989). “Equitable tolling applies when the plaintiff is prevented from asserting a claim by wrongful conduct on the part of the defendant, or when extraordinary circumstances beyond the plaintiff's control made it impossible to file a claim on time.” Stoll v. Runyon, 165 F.3d 1238, 1242 (9th Cir. 1999) (citation omitted).

The DOL states that district courts have equitably tolled statutes of limitations when an employer interferes with a WHD investigation, including by failing to respond to an administrative subpoena. See Walsh v. Adventures Int'l, LLC, 2022 WL 4280276, at * 2 (D. Nev. Sept. 15, 2022) ( finding that if FLSA statute of limitations is not tolled, the WHD will be harmed by the running of the limitations period while its investigation is stalled by the respondent's non-compliance); Perez v. Abbas, 2015 WL 2250436, at *11 (N.D. Cal. May 13, 2015) (tolling FLSA limitation period when the employer instructed employees not to provide any information to the DOL in its investigation of the employer); Harris v. Subcontracting Concepts, LLC, 2013 WL 951336 (N.D.N.Y. Mar. 11, 2013), aff'd, 656 Fed. Appx. 25 (2d Cir. 2014) (denying employer's motion for reconsideration of order enforcing subpoena and tolling FLSA statute of limitations).

Here, on March 30, 2024, the DOL filed a Complaint alleging oppressive child labor, hot goods, and interference with the DOL's hot goods investigation. See Su v. L & Y Food, Inc., et al., Case No 2:24-cv-02606-SPG-PD, Docket No. 1. Arguably, the filing of the Complaint moots the request for equitable tolling. However, based on the requests in the Subpoenas and the DOL's arguments in the instant matter, it appears that the scope of the DOL investigation is broader than the causes of action in the Complaint and that Respondents' refusal to comply with the Subpoenas has stalled or impeded that investigation. Accordingly, the Court recommends that the FLSA statute of limitations be equitably tolled.

V. Recommendation

For the foregoing reasons, the Court recommends that the District Judge enter the following order:

1. Respondents, supervisor Marianna Rivera, and other employees of Respondents who have authority to supervise workers at L & Y Foods and A1 Meat Solutions shall not intimidate, threaten, or retaliate against current or former employees of Respondents for participating in the DOL investigation of Respondents under the FLSA.

*13 2. Respondents shall comply with 29 CFR § 516.7, including by providing the Acting Secretary with access to all of their time and payroll records as well as all associated piece records, on an ongoing basis, within 72 hours of the Acting Secretary's request. See also Subpoena Request Nos. 6 - 10.

3. Within 72 hours of this Order, for the subpoenas duces tecum to Respondents, Respondents shall produce all documents responsive to the following requests for the subject period of January 27, 2021 to date of production, see Subpoena Instruction I, as requested unless otherwise explicitly indicated herein:

a) Subpoena Request No. 5 for all companies under Respondents Fu Qian Chen Lu and/or Zhong Lu's ownership or control or for which records are under their possession, custody, or control which have business relating to the purchase and/or sale of chicken, beef, or other food products;

b) Subpoena Request Nos. 6 – 9 starting January 26, 2024 to date of production;

c) Request No. 10;

d) Request Nos. 11 – 12;

e) Request No. 15 for all companies under Respondents Fu Qian Chen Lu and/or Zhong Lu's ownership or control or for which records are under their possession, custody, or control which have business relating to the purchase and/or sale of chicken, beef, or other food products;

f) Request No. 16, limited to bank names and account numbers for corporate Respondents L & Y Food, Inc. and A1 Meat Solutions, Inc.;

g) Request No. 17, documents sufficient to show all clients served by all companies under Respondents Fu Qian Chen Lu and/or Zhong Lu's ownership or control or for which records are under their possession, custody, or control which have business relating to the purchase and/or sale of chicken, beef, or other food products;

h) Request No. 19, contracts, invoices, and work orders with all contractors providing chicken processing services like Bruce Lok's companies, for all companies under Respondents Fu Qian Chen Lu and/or Zhong Lu's ownership or control or for which records are under their possession, custody, or control which have business relating to processing of chicken, beef, or other food products;

i) Request No. 26, limited to invoices, purchase orders, shipping invoices, accounts payable and receivable for

i. The period of January 26, 2024 to production for Respondents L & Y Food, Inc. and A1 Meat Solutions. Inc. only,

ii. For the entire period requested for all other companies under Respondents Fu Qian Chen Lu and/or Zhong Lu's ownership or control or for which records are under their possession, custody, or control which have business relating to the purchase and/or sale of chicken, beef, or other food products;

j) Request Nos. 20, 29 (communications with workers relating to instructions for work, compensation, discipline, hiring, and firing) from January 14, 2024 to production;

k) Request No. 30, limited to the time period of January 26, 2024 to present; does not limit Request No. 10 in any way;

l) Request No. 31, documents relevant to evaluating Respondents' attempts to comply with the FLSA.

5. If needed, Petitioner may petition the Court to order production of additional requests contained in the subpoenas duces tecum to Respondents, in addition to the requests identified in ¶ 4.

6. Respondents may produce responsive information through electronic means, such as email to the Wage and Hour Division, modrakee.philipda@dol.gov and bui.kimchi@dol.gov.

*14 7. For the Administrative Subpoenas Ad Testificandum to Respondents Fu Qian Chen Lu and Zhong Lu, they shall each individually appear at 312 N. Spring Street, Room 720, Los Angeles, CA 90012-4701 for an individual administrative deposition starting within 7 business days of the Order (or on another date agreeable to the Acting Secretary), and answer all questions asked.

8. The statute of limitations shall be equitably tolled from February 5, 2024 until 30 days after the date that the Petitioner informs the Court that Respondents have produced the subpoenaed documents and witnesses.

NOTICE

Reports and Recommendations are not appealable to the Court of Appeals but are subject to the right of any party to file Objections as provided in the Local Rules Governing Duties of Magistrate Judges, and review by the District Judge whose initials appear in the docket number. No Notice of Appeal pursuant to the Federal Rules of Appellate Procedure should be filed until entry of the Judgment of the District Court.