Steinbach

We are faced with a question of first impression: does suecessorship liability exist under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq.l We conclude that it does, but not on the facts of this case.

I

Appellants are a group of twelve former employees of Hubbard Ambulance Services, Inc., run by defendants Steven and Sheila Hubbard. Hubbard provided non-emergency ambulance services. It also allegedly violated the FLSA by failing to pay its employees in accordance with the FLSA’s minimum wage and overtime provisions. Whether it in fact, did so is not at issue in this appeal.

In 1987, Hubbard and the individual Hubbard defendants filed bankruptcy petitions. Hubbard continued to provide ambulance services. The employees first filed suit in June 1991. Later that summer, Care Ambulance entered into negotiations with Hubbard over the possible sale of Hubbard’s assets to Care. Drndng a September meeting, two Care vice presidents were informed of the pending FLSA suit, as well as Hubbard’s opinion that it was meritless.

Negotiations continued. Because the parties believed any sale would require the approval of the bankruptcy court, they could not reach an outright sale…