United States Court of Appeals

for the Fifth Circuit

No. 19-40553

Joshua Edwards, individually and on behalf of others similarly situated; 

Francisco Gutierrez; Humberto J. Morales; Ricky 

Martin; Ernesto Flores; Et Al., 

Plaintiffs—Appellants Cross-Appellees,

versus

4JLJ, L.L.C., doing business as J4 Oilfield Services; John 

Jalufka, 

Defendants—Appellees Cross-Appellants,

__________________________________________________

Rodrigo Tarango, Jr.

Plaintiff—Appellant Cross-Appellee,

versus

4JLJ, L.L.C., doing business as J4 Oilfield Services; John 

Jalufka,

Defendants—Appellees Cross-Appellants.

Appeals from the United States District Court 

for the Southern District of Texas 

USDC No. 2:15-CV-299

USDC No. 2:18-CV-78

United States Court of Appeals

Fifth Circuit

FILED

September 2, 2020

Lyle W. Cayce

Clerk

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Before Wiener, Graves, and Willett, Circuit Judges.

Don R. Willett, Circuit Judge:

4JLJ, LLC provides oil well pump and frack services. A group of its 

employees sued 4JLJ under the Fair Labor Standards Act, alleging that 4JLJ 

violated the FLSA’s overtime wage mandates. 4JLJ paid the Employees two 

different types of bonuses—a stage bonus and a performance bonus—and the 

Employees argued that both ought to have been included in the “regular 

rate” for the purposes of overtime calculation. The case was tried before a 

jury, which held for 4JLJ in all respects. After the verdict, the Employees 

filed two identical motions for judgment as a matter of law, which were both 

denied. The district court, however, did award sanctions to the Employees 

over a contentious discovery dispute. The Employees appeal the denial of 

their motionsfor judgment as a matter of law, and 4JLJ appeals the sanctions 

award. 

Our holdings are something of a mixed bag. We conclude that the

performance bonuses—but not the stage bonuses—should have been 

included in the regular rate as a matter of law. So we reverse and remand for 

the district court to consider all relief warranted. As for the sanctions award, 

the district court did not abuse its discretion, so we affirm.

I

4JLJ is a single-member LLC, wholly owned by Defendant John 

Jalufka. 4JLJ hired the Employees as frack and pump hands. On top of their 

base pay, 4JLJ paid the Employees two types of bonuses. Neither bonus was 

considered in the calculation of the Employees’ overtime wages—which lies 

at the heart of the Employees’ claims on appeal. The first bonus was a “stage 

bonus.” The fracking of a well occurs in identifiable stages, and 4JLJ offered 

a bonus for each stage completed. Stage bonuses were not memorialized in 

writing. 

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4JLJ also offered a quarterly “performance bonus,” which, unlike the 

stage bonus, was memorialized in a written contract given to the Employees 

upon hiring. In all capital letters and in a large typeface, the contract said: 

“THIS BONUS IS NOT TO BE EXPECTED, IT IS TO BE 

EARNED.” The contract went on to say: “IF YOU ARE HERE JUST 

TO GET A PAYCHECK, AND GET BY WITH AS LITTLE 

WORK AS POSSIBLE, DON’T EXPECT TO GET A 

PERFORMANCE BONUS.” The contract also provided the criteria by 

which the Employees would be evaluated for performance bonus 

consideration.1

The performance bonus was calculated using a pay scale applied to 

three classes of employees:

A Class: $1.00/hour

B Class: $0.75/hour

C Class: $0.50/hour

So if 4JLJ chose to give an employee a performance bonus, the bonus was 

calculated by adding an amount, shown above, to each hour the employee 

worked that quarter. 

The Employees filed a collective action complaint, alleging that 4JLJ2

violated the FLSA’s overtime wage mandates by failing to include these 

1 The contract listed positive factors that weighed in favor of bonus eligibility as 

well as negative factors that hurt one’s bonus prospects. 

2

John Jalufka was later joined as a defendant. But we refer to both defendants 

simply as 4JLJ throughout. 

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bonuses as compensation in the “regular rate”—which, under the FLSA, is 

used to calculate overtime wages.3

Before trial, the parties engaged in a bitter discovery brawl. The 

Employees made a production request for GPS data on work vehicles driven 

by the Employees,4and 4JLJ challenged this request. 4JLJ claimed that it 

didn’t have the data. A third-party provider, Fleetmatics, accumulated and 

stored the data. And, 4JLJ claimed, it wasn’t 4JLJ’s burden to retrieve the

data; the Employees should have gone to Fleetmatics directly.5

The Employees indicated that they would file a motion to compel but 

never followed through with the threat. Instead, seven months later, the 

Employees sent more production requests to 4JLJ—again asking for the 

same GPS data. 4JLJ again objected to the request as overly broad, 

burdensome, and not limited in time or scope. 4JLJ also stated that it had 

“none” of the data. 

Five days before the final pretrial conference, the Employees filed a 

brief with the court, complaining about 4JLJ’s failure to provide the 

requested GPS data. In that brief, the Employees “assumed that [the data] 

3 The Employees averred five bases for recovery: (1) 4JLJ failed to maintain 

adequate time records; (2) 4JLJ paid employees on a task basis, as opposed to per hour; (3) 

4JLJ underpaid employees relative to actual hours worked; (4) 4JLJ failed to pay overtime 

wages for work exceeding 40 hours in a week; and (5) 4JLJ failed to include bonuses in 

overtime wages. The Employees also contended that Jalufka was personally liable for the 

actions of 4JLJ. The Employees dropped the first four issues on appeal. Now, their 

remaining arguments are that 4JLJ should have included bonuses in overtime calculations 

and that Jalufka is personally liable. 

4 The GPS data subject to this discovery dispute has zero bearing on the 

substantive issues pursued on appeal (beyond its impact on sanctions). 

5

It later became clear that 4JLJ’s contractual agreement with Fleetmatics enabled 

4JLJ to access the data. But 4JLJ claims that it didn’t know this because it wasn’t 4JLJ’s 

practice to access or download data from Fleetmatics. 

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has since been lost, and thus spoliated by Defendants.” As the Employees 

had never filed a motion to compel, this was the first time the GPS issue 

came before the court. At the final pretrial hearing a few days later, 4JLJ told 

the court that it would do everything in its power to get the data. But 4JLJ

warned that it could take time. 

The search for this data caused massive delays, and in December 2017, 

two months later, the Employees filed a motion for sanctions. In their motion, 

they claimed that 4JLJ had earlier denied the existence of the contested data. 

And they continued to assert that important portions of the data had been 

lost or destroyed due to 4JLJ’s dilatory tactics. The district court imposed 

two sanctions on 4JLJ: (1) an adverse inference jury instruction and (2) a 

burden shifting sanction. After it became clear that no data was spoliated, the 

district court removed the adverse inference sanction but declined to vacate 

the burden shifting sanction. It also denied 4JLJ’s request to proceed with 

an interlocutory appeal to challenge the sanction. 

The case was tried before a jury for five days. After both sides rested, 

the Employees moved for a directed verdict, which the court denied. On 

February 26, 2019, the jury found in favor of 4JLJ on every issue. A flurry of 

motions and orders followed:

• On March 12, the Employees renewed their motion for 

judgment as a matter of law (or alternatively for a new trial). 

That same day, the Employees separately moved to recover 

attorney fees and expenses related to the discovery dispute. 

• On March 27, the district court entered a Final Judgment 

order in favor of 4JLJ, and it issued an order awarding 

monetary sanctions to the Employees. 

• On April 10, the Employees filed a second motion for 

judgment as a matter of law or for a new trial—

substantively identical to the first. And 4JLJ moved for 

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costs, as prevailing parties, under Federal Rule of Appellate 

Procedure 54(d). 

• On May 20, the court denied the Employees’ second 

request for judgment as a matter of law or a new trial. 

• On June 3, the district court issued an “Order on Request 

for Bill of Costs,” awarding 4JLJ only $14,920 of the 

$44,553 it requested. These orders finally disposed of all 

the parties’ claims. 

• On June 12, the Employees filed a notice of appeal.

• On June 24, 4JLJ filed a notice of cross-appeal, challenging 

the district court’s attorney-fee sanction and its allocation 

of Rule 54(d) costs.

II

Let’s start with jurisdiction. 4JLJ did not make a jurisdictional 

argument in its briefing. But at oral argument, 4JLJ contended that the 

Employees’ notice of appeal was late and that this tardy notice is a 

jurisdictional defect. Whether jurisdictional arguments are raised late (or not 

at all), “we must always be sure of our appellate jurisdiction.”

6 4JLJ is right 

that the Employees’ notice of appeal was late.7 But 4JLJ is wrong that this 

6 Castaneda v. Falcon, 166 F.3d 799, 801 (5th Cir. 1999). 

7 A party has 30 days to file a notice of appeal. FED. R. APP. P. 4(a)(1)(A). But 

that 30-day clock will restart upon the filing of a motion for judgment as a matter of law 

under Rule 50(b). FED. R. APP. P. 4(a)(4)(A). In that case, the 30-day time period to 

appeal starts “from the entry of the order disposing of the last such remaining motion.” 

FED. R. APP. P. 4(a)(4)(A). However, a “second Rule 50 JMOL motion will not toll the 

running of the Rule 4(a)(1) thirty-day time in which to file a notice of appeal unless such a 

second Rule 50 motion presents ‘at least one completely different ground for relief from 

the judgment.’” Lewallen v. City of Beaumont, 394 F. App’x 38, 41 (5th Cir. 2010) 

(unpublished) (emphasis in original) (quoting Nobby Lobby, Inc. v. City of Dallas, 970 F.2d 

82, 85 (5th Cir. 1992)). 

Here, the district court’s March 27 Final Judgment order did not specifically 

reference the Employees’ March 12 renewed motion for judgment as a matter of law. But 

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late filing spoils our jurisdiction. In Hamer v. Neighborhood Housing Services of 

Chicago, the Supreme Court made clear that “a provision governing the time 

to appeal in a civil action qualifies as jurisdictional only if Congress sets the 

time.”8If not prescribed by Congress, a time limit is simply a “mandatory 

claim-processing rule.”9 And these types of rules “may be waived or 

forfeited.”10 The Federal Rules of Appellate Procedure were promulgated by 

the Supreme Court, not by Congress.11 So the Employees’ failure to file a 

timely notice of appeal does not affect our appellate jurisdiction. And because 

when a district court “enters a final judgment, it has implicitly denied any outstanding 

motions, even if the court does not explicitly deny a particular motion.” Snider v. L-3 

Commc’ns Vertex Aerospace, L.L.C., 946 F.3d 660, 667 (5th Cir. 2019) (citing Tollett v. City 

of Kemah, 285 F.3d 357, 369 n.* (5th Cir. 2002)). The Employees’ second renewed motion 

for judgment as a matter of law on April 10 was substantively identical to the first—

presenting no new grounds for relief—so the second motion did not toll the running of Rule 

4(a)(1)’s thirty-day appeal period. See Lewallen, 394 F. App’x at 41. In the Employees’

second motion for judgment as a matter of law, the Employees included a “Procedural 

Note” that explained the reason for the second, identical filing; the Employees weren’t 

sure if their original renewed motion for judgment as a matter of law complied with Rules 

50(b) and 59 since the motion was filed before the district court’s Final Judgment order. 

Seemingly out of an abundance of caution, the Employees filed a word-for-word identical 

renewed motion for judgment as a matter of law after the district court issued its Final 

Judgment order. This superfluous motion—because it was identical to the first—did 

nothing to change the Employees’ obligation to file a notice of appeal within 30 days of the 

court’s Final Judgment order. So their notice was late. Very late. 

8

138 S. Ct. 13, 17 (2017). 

9

Id.

10 Id.

11 Jackson v. Stinnett, 102 F.3d 132, 135 (5th Cir. 1996). 

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4JLJ did not properly raise the timeliness argument in its opening brief,12 the 

argument is forfeited.13 We have jurisdiction under 28 U.S.C. § 1291. 

III

Both parties have appealed. The Employees appeal the district court’s 

denial of their motion for judgment as a matter of law or a new trial.14 4JLJ

asks us to overturn the district court’s award of attorney fees and its 

allocation of costs. We address each issue in turn, starting with the 

Employees’ request for us to set aside the jury’s verdict.

A

First, the standard of review. We review the denial of a motion for 

judgment as a matter of law de novo, but “our standard of review with respect 

to a jury verdict is especially deferential.”15 The jury’s verdict must be 

upheld unless there is “no legally sufficient evidentiary basis for a reasonable 

12 4JLJ never mounted a jurisdictional argument in its opening brief. It merely 

hinted at a lack of clarity in our jurisdiction: “To the extent (which is unclear) [the 

Employees’] second, substantially repetitive motion for judgment or new trial tolled its 

deadline to appeal the Final Judgment, this court has jurisdiction over the principal appeal 

pursuant to 28 U.S.C. § 1291.” Brief for 4JLJ at 2–3, Edwards v. 4JLJ, No. 19-40553 (5th 

Cir. argued March 3, 2020). This isn’t an argument on timeliness. It’s a concession of 

ignorance. 

13 See DeVoss v. Sw. Airlines Co., 903 F.3d 487, 489 n.1 (5th Cir. 2018) (noting that 

failure to adequately brief an argument forfeits the claim on appeal); Cinel v. Connick, 15 

F.3d 1338, 1345 (5th Cir. 1994) (“A party who inadequately briefs an issue is considered to 

have abandoned the claim.”). 

14 In both of the Employees’ motions for judgment as a matter of law, they 

requested the alternative relief of a new trial. But we refer throughout, for the sake of 

simplicity, to the motions only as motions for judgment as a matter of law. 

15 SMI Owen Steel Co., Inc. v. Marsh USA, Inc., 520 F.3d 432, 437 (5th Cir. 2008) 

(quoting Flowers v. S. Reg’l Physician Servs., Inc., 247 F.3d 229, 235 (5th Cir. 2001)).

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jury to find for a party.”16 When entertaining a motion for judgment as a 

matter of law, the court “must review all of the evidence in the record, draw 

all reasonable inferences in favor of the nonmoving party, and may not make 

credibility determinations or weigh the evidence.”17 For the court to grant a 

motion for judgment as a matter of law, the “facts and inferences” must 

“point so strongly and overwhelmingly in favor of one party that the court 

concludes that reasonable jurors could not arrive at a contrary verdict.”18

Our standard of review for a motion for a new trial under Rule 59 is 

even more restrictive.19 We review a denied motion for a new trial for abuse 

of discretion.20 An abuse of discretion occurs when the district court’s ruling 

is based on “an erroneous view of the law or on a clearly erroneous 

assessment of the evidence.”21

16 Pineda v. United Parcel Serv., Inc. 360 F.3d 483, 486 (5th Cir. 2004) (quoting 

FED. R. CIV. P. 50(a)); id. (“[I]f reasonable persons could differ in their interpretations 

of the evidence, then the motion should be denied.” (quotation marks and citation 

omitted)).

17 Ellis v. Weasler Eng’g Inc., 258 F.3d 326, 337 (5th Cir. 2001). 

18 Bellows v. Amoco Oil Co., 118 F.3d 268, 273 (5th Cir. 1997).

19 Williams v. Manitowoc Cranes, LLC, 898 F.3d 607, 614 n.13 (5th Cir. 2018) (“It 

is more difficult to satisfy the standard for reversing the denial of a motion for a new trial 

than the standard for reversing the denial of judgment as a matter of law.”); Whitehead v. 

Food Max of Miss., Inc., 163 F.3d 265, 269 n.2 (5th Cir. 1998) (“As we have noted, the 

standard of review for appeals from denials of a new trial is far more narrow than that for 

denials of judgment as a matter of law. At first blush, this appears inconsistent, given that 

the remedy of a new trial is far less drastic for the nonmovant than suffering judgment as a 

matter of law. However, the reason for the more narrow standard for review of the denial 

of new trial motions springs from the lower standard applied by the district court to new 

trial motions—it is far less demanding than that for judgment as a matter of law.”). 

20 Munn v. Algee, 924 F.2d 568, 575 (5th Cir. 1991). 

21 Tollett, 285 F.3d at 363. 

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B

A jury was tasked with deciding who had the more convincing 

argument, 4JLJ or the Employees. Now the Employees want to take that job 

away from the jury and give it to us. We approach this request with caution.

The jury is “as central to the American conception of the consent of 

the governed as an elected legislature or the independent judiciary.”22 We 

inherited a reverence for juries from the English; Blackstone called the jury 

trial “‘the grand bulwark’ of English Liberties.”23 But in the years leading 

up to the American Revolution, “Americans grew to rely on the jury as a 

bulwark against British oppression, rejecting attempts to force American 

juries to find other Americans guilty of illegal British regulations.”24 Juries 

were so effective at curtailing British abuses that the British attempted to get 

rid of juries for disputes between the colonists and the British colonial 

government.25 Indeed, King George III’s efforts to strip colonists of their

22 Jennifer Walker Elrod, Is the Jury Still Out?: A Case for the Continued Viability of 

the American Jury, 44 TEX. TECH L. REV. 303, 303–04 (2012).

23 Id. at 314 (citing 4 WILLIAM BLACKSTONE, COMMENTARIES ON THE 

LAWS OF ENGLAND 342 (Univ. of Chi. Press 1979) (1769)). Blackstone also said that trial 

by jury is “the glory of the English law” and “the most transcendent privilege which any 

subject can enjoy or wish for, that he cannot be affected, either in his property, his liberty, 

or his person, but by the unanimous consent of twelve of his neighbors and equals.” 

Jennifer Walker Elrod, W(h)ither The Jury? The Diminishing Role of the Jury Trial in Our 

Legal System, 68 WASH. & LEE L. REV. 3, 7 (2011) (citing Mitchell v. Harmony, 54 U.S. 

115, 142-43 (1851) (quoting 4 WILLIAM BLACKSTONE, COMMENTARIES ON THE 

LAWS OF ENGLAND 227–29 (Oxford, Clarendon Pr. 1992) (1765))).

24 Elrod, Is the Jury Still Out?, supra note 22, at 315. 

25 Id.

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right to trial by jury was one of our chief grievances against the King and a 

catalyst for declaring our independence.26

Given how important juries were in resisting the abuses of the British 

colonial government, it’s no surprise that John Adams called trial by jury, 

along with representative democracy, “the heart and lungs of liberty.”27

Thomas Jefferson believed juries to be “the only anchor ever yet imagined 

by man, by which a government can be held to the principles of its

constitution.”28 In the ratification debates, the value of juries was the only 

thing Federalists and Anti-Federalists could agree on. According to 

Alexander Hamilton, “if there is any difference between them it consists in 

this, that the former regard it as a valuable safeguard to liberty; the later 

represent it as the very palladium of free government.”29 Juries are rightly 

reverenced in the American justice system because, as Chief Justice Taft 

said, juries give the people security that they, “being part of the judicial 

system of the country, can prevent its arbitrary use or abuse.”30 Those 

concerns are no less real now than they were in 1776. 

26 Id. One of the grievances against King George III listed in the Declaration of 

Independence was his habit of “depriving us, in many Cases, of the Benefits of Trial by 

Jury.” Id. (quoting The Declaration of Independence para. 20 (U.S. 1776)). 

27 Id. at 308, 331 (quoting Thomas J. Methvin, Alabama-The Arbitration State, 62

ALA. LAW. 48, 49 (2001) (“In 1774, John Adams stated: ‘Representative government and

trial by jury are the heart and lungs of liberty. Without them, we have no other fortification

against being ridden like horses, fleeced like sheep, worked like cattle, and fed and clothed

like swines and hounds.”)).

28 Id. at 308 (quoting Donald M. Middlebrooks, Reviving Thomas Jefferson’s Jury: 

Sparf and Hansen v. United States Reconsidered, 46 AM. J. LEGAL HIST. 353, 353 (2004)).

29 Elrod, W(h)ither the Jury?, supra note 23, at 8 n.28 (citing THE FEDERALIST 

NO. 83, at 521 (Alexander Hamilton) (G.P. Putnam’s Sons ed., 1888)).

30 Elrod, Is the Jury Still Out?, supra note 22, at 309 (citing Balzac v. People of Porto 

Rico, 258 U.S. 298, 310 (1922)).

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So we do not “tamper lightly” with jury verdicts.31 The law 

“commands judges, who are of all officials the least accountable to the 

people, not to invade the province of judgment by the people.”32 But, when 

necessary to protect the integrity of the courts and the rights of the people, 

federal courts can set aside jury verdicts when they have no evidentiary 

basis.33 That is the lens through which we must approach the Employees’ 

request for judgment as a matter of law. 

The Employees challenge two findings on appeal—two questions that 

have already been answered by a jury. The first is whether, under the FLSA, 

4JLJ ought to have included the Employees’ bonuses in the calculation of 

overtime pay. The second is whether Jalufka was an “employer” under the 

FLSA and thus liable alongside 4JLJ for any unpaid wages. 

1

We begin with the core issue on appeal—the nature of 4JLJ’s bonuses 

and whether they should have been factored into the overtime wage 

calculation.34 The FLSA was passed in 1938 in order to remedy labor 

31 EEOC v. Boh Brothers Const. Co., LLC, 731 F.3d 444, 452 (2013) (quoting Stacy 

v. Allied Stores Corp., 768 F.2d 402, 406 (D.C. Cir. 1985)). 

32 Id.

33 See Thompson v. Connick, 578 F.3d 293 (5th Cir. 2009) (Clement, J., concurring), 

rev’d on other grounds, 563 U.S. 51 (2011) (“But as Judge Wisdom counseled when 

overturning a jury verdict, ‘[i]n reviewing [a] . . . case when the plaintiff has been injured 

grievously, hard as our sympathies may pull us, our duty to maintain the integrity of 

substantive law pulls harder.’” (quoting Turner v. Atl. Coast Line R.R. Co., 292 F.2d 586, 

589 (5th Cir. 1961)).

34 The Employees first argue that 4JLJ forfeited its affirmative defense regarding 

bonus payments. The Employees contend that 4JLJ bears the burden of establishing that 

bonuses fall within an exemption, and that 4JLJ “failed to plead a statutory exclusion from 

the regular rate for discretionary bonuses pursuant to Section 7(e)(3).” Brief for the 

Employees, Edwards v. 4JLJ, No. 19-40553 (5th Cir. argued March 3, 2020). So, the 

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conditions that were “detrimental to the maintenance of the minimum 

standard of living necessary for health, efficiency, and general well-being of 

workers.”35 The statute requires employers to pay non-exempt employees 

who work more than 40 hours a week overtime of one and one-half times the 

employees’ “regular rate” of pay.36 The text “broadly defines ‘regular rate’ 

as the hourly rate actually paid the employee for ‘all remuneration for 

employment.’”

37 And the regular rate “must reflect all payments which the 

parties have agreed shall be received regularly during the workweek, 

exclusive of overtime payments.”38 So once the parties have decided on the 

amount and mode of payment, the regular rate becomes a simple 

mathematical formula.39

But it’s not always so simple to determine what kinds of payments 

should be included in the formula. Most remuneration must be included, but 

not all. Under § 207(e)(3), renumeration is not included in the regular rate if: 

both the fact that payment is to be made and the amount of the 

payment are determined at the sole discretion of the employer 

at or near the end of the period and not pursuant to any prior 

contract, agreement, or promise causing the employee to 

expect such payments regularly.

Employees argue, 4JLJ has forfeited this defense. But this argument is unavailing. 

Whether a bonus is discretionary—the central question on appeal—is not an exemption. 

Rather, as discussed infra, under § 207(e)(3), it’s a definitional element of the “regular rate 

of pay.” 

35 29 U.S.C. § 202. 

36 Gagnon v. United Technisource, Inc., 607 F.3d 1036, 1041 (5th Cir. 2010); 

§ 207(a)(1). 

37 Gagnon, 607 F.3d at 1041 (quoting § 207(e)). 

38 Id. (quoting Bay Ridge Operating Co. v. Aaron, 334 U.S. 446, 461 (1948)). 

39 Id.

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29 C.F.R. § 778.211 provides the following helpful hypothetical for 

considering whether this standard has been met: Suppose an employer 

promises his sales associates that he will give them a monthly bonus of one 

cent for each item they sell. But the bonus will only be given when the 

employer decides, in his discretion, that the financial condition of the 

company warrants such bonuses. According to § 778.211, the employer “has 

abandoned discretion with regard to the amount of the bonus though not with 

regard to the fact of each payment.”40 The upshot: For a bonus to be excepted 

from the regular rate under § 207(e), the employer must maintain discretion 

over whether to give the bonus and the amount given.

4JLJ did not include its bonuses in the regular rate. But the jury found 

that 4JLJ retained enough discretion over whether to pay bonuses and the 

amount to satisfy § 207(e)(3). The Employees say this was wrong as a matter 

of law. We review de novo, considering whether there was a “legally 

sufficient evidentiary basis for a reasonable jury to find” for 4JLJ.

41

But first, an important detour. In an FLSA dispute, plaintiffs bear the 

burden to prove all elements of their claims.42 If the employer, however, 

wants to show that an employee is exempt from an FLSA requirement, the 

employer has the burden of proof on that exemption.43 But we have never 

answered a question that proves decisive in this case: Who has the burden of 

proof on whether bonuses are discretionary and therefore excluded from the 

40 29 C.F.R. § 778.211 (emphasis added). 

41 Pineda, 360 F.3d at 486 (quoting FED. R. CIV. P. 50(a)); id. (“[I]f reasonable 

persons could differ in their interpretations of the evidence, then the motion should be 

denied.” (quotation marks omitted)).

42 Samson v. Apollo Resources, Inc., 242 F.3d 629, 636 (5th Cir. 2001). 

43 Id.

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regular rate under § 207(e)(3)? The answer turns on whether § 207(e)(3) is 

an exemption from the overtime provisions in § 207(a). 

Though we have never addressed this question head-on, we look to 

our other FLSA cases for guidance. In Samson v. Apollo, we faced the 

question of who has the burden of proving compliance with the requirements 

of the Fluctuating Workweek (FWW) method of calculating employee salary 

and overtime wages.44 We held that the FWW method was “one method of 

complying with the overtime requirements” of § 207(a)(1)—rather than an 

exemption to § 207(a)(1).45 Therefore, the employee bears the burden. 

In Carley v. Crest Pumping Technologies, we analyzed burdens 

surrounding the Motor Carrier Act (MCA) exemption.46 The MCA

exempts employees who are subject to Secretary of Transportation standards 

from FLSA overtime requirements.47 In Carley, no one disputed that the 

employer bore the burden to prove the MCA exemption applied. But the 

parties quarreled over who bore the burden of proving the weight of vehicles 

under the SAFETEA-LU Technical Corrections Act, which designates a 

class of employees to which the MCA exemption does not apply.48 The 

plaintiffs argued that the employer should bear the burden because the 

Corrections Act uses exclusionary language, analogous to the language used 

44 Id. at 631. 

45 Id. at 636.

46 890 F.3d 575, 576 (5th Cir. 2018). Carley was issued shortly after Encino 

Motorcars, LLC v. Navarro, where the Supreme Court rejected the principle embraced by 

many courts—including our own—that exemptions to the FLSA should be narrowly 

construed. 138 S. Ct. 1134 (2018). Carley recognized that, after Encino Motorcars, we were 

bound to give the FLSA a “fair reading,” rather than employ strict construction against 

employers’ claimed exemptions, as had long been our practice. See 890 F.3d at 579. 

47 Id. 

48 Id.

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in the exemptions listed in § 213.49 But we found it important that the 

Corrections Act was “not codified as an exemption” along with those listed 

under § 213.50 Rather, the Corrections Act was codified under § 207—a 

section that sets out FLSA standards that place the burden of proving lack 

of compliance on the employee.

51

Unlike the enumerated exemptions listed in § 213, § 207 “defin[es] 

when FLSA mandates overtime pay.”52 Considering this placement in § 207, 

the Correction Act’s “statutory structure indicates that [it] is not meant to 

be read in the same way as exclusionary language within a FLSA

49 Id. at 580.

50 Id.

51 Id.

52 Id. (emphasis added). But see Vela v. City of Houston, 276 F.3d 659, 664 (5th Cir. 

2001); Foremost Dairies, Inc. v. Wirtz, 381 F.2d 653 (5th Cir. 1967). In Vela, we addressed 

the question of who bears the burden of proof on the “§ 207(k) exemption,” which exempts 

employees of a public agency engaged in “fire protection activities” from the general 

overtime rule of § 207(a)(1). 276 F.3d at 664. Likewise, in Foremost Dairies, we held that 

§ 7(e) of the FLSA (now § 207(f)), is an exemption on which the employer has the burden 

of proof. 381 F.2d at 656 n.4. Section 7(e), known as the “Belo provision,” provides an 

exception to § 207(a)(1)’s 40-hour maximum workweek requirement, where the employee 

is engaged in “irregular hours of work.” Id. at 655. 

Vela and Foremost Dairies show that placement in § 207 isn’t definitive proof that 

the provision in question isn’t an exemption. But both cases helpfully show what such an 

exemption might look like outside the enumerated list in § 213. In Vela, the city sought to 

show that—under to § 207(k)—unless plaintiffs worked over 53 hours a week, they were 

exempt from the general overtime compensation requirements of § 207(a)(1). The city’s 

argument was that § 207(a)(1) simply did not apply to that class of employee—those 

engaged in fire protection activities. Likewise, in Foremost Dairies, the employer sought to 

show that its employees were exempt from the FLSA’s 40-hour-workweek requirement 

because, under § 7(e), the employees were engaged in irregular hours of work. 

In contrast, 4JLJ hasn’t argued that its employees are exempt from the 

requirements of § 207(a). Rather, 4JLJ contends that it has complied with § 207(a)(1)’s 

overtime requirements under § 207(e)(3)’s definition of “regular rate.” 

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exemption.”53 The Corrections Act is not an exemption from § 207(a); 

instead, “it codifies conditions under which § 207(a) requires overtime pay 

notwithstanding the MCA exemption.” In keeping with the logic of Samson, 

we found that the burden of proof should be on plaintiffs because 

“compliance with the Corrections Act is of a piece with compliance with 

§ 207(a), rather than a way to exempt oneself from § 207(a).”

54

So our key question: Is § 207(e)(3) “of a piece with compliance with 

§ 207(a),”55 or is it more like the exemptions listed in § 213—a mechanism 

for exempting oneself from compliance with § 207(a)? 

Section 207(e) does not exempt employers from compliance with 

§ 207(a); it provides instruction for compliance with § 207(a)(1), where 

“regular rate” is used without definition. Section 207(e) provides that 

definition, which is crucial for employers if they are to understand what must 

be included in the regular rate—in order to comply with § 207(a). It was the 

Employees’ burden to show that they “performed work for which [they 

were] not properly compensated.”56 And to do so, they must show that 4JLJ

ought to have included the renumeration in question in the regular rate. 

Because § 207(e)(3) is merely a definitional element of the regular rate—and 

therefore merely a definitional element of the Employees’ claim—it was their 

burden to show that bonuses were not discretionary according to the statute’s 

terms.57

53 Carley, 890 F.3d at 580.

54 Id.

55 See id.

56 Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687 (1946), overruled on other 

grounds by Integrity Staffing Sols., Inc. v. Busk, 574 U.S. 27, 31 (2014). 

57 But see Newman v. Advanced Tech, 749 F.3d 33, 36 (1st Cir. 2014) (noting that the 

provisions at § 207(e)(1)-(8)“are to be interpreted narrowly against the employer, and the 

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Now, with § 207(e)(3) in mind, we discuss 4JLJ’s stage bonuses. The 

Employees argue that stage bonuses were nondiscretionary as a matter of law 

because: (1) 4JLJ did not retain discretion as to whether the bonuses would 

be paid; (2) the amount of the stage bonus was determined prior to the work 

being performed; (3) 4JLJ did not retain discretion as to the payment until 

near the end of the pay period; and (4) the bonus was paid according to a prior 

agreement. 

But the Employees struggle to locate support for any of these 

assertions in the record. And reviewing a motion for judgment as a matter of 

law, we can only overturn the district court’s denial based on evidence that 

was actually before the jury.58 The Employees do point to testimony that 

some employees sometimes received stage bonuses—first $75 per stage and 

later $100. But the Employees show us no evidence in the record that 

elucidates how employees came to expect stage bonuses, who determined the 

amount, when the amount was determined, whether all employees typically 

received such bonuses, or whether the amount ever varied. 

It was the Employees’ burden to show that bonuses were nondiscretionary. And given the paucity of evidence before the jury, there is 

nothing that “point[s] so strongly and overwhelmingly in favor” of a finding 

that stage bonuses were nondiscretionary that “reasonable jurors could not 

employer bears the burden of showing that an exception applies” (quoting O’Brian v. Town 

of Agawam, 350 F.3d 279, 294 (1st Cir. 2003))); Madison v. Resources for Human Dev., Inc., 

233 F.3d 175, 187 (3d Cir. 2000) (“The burden is on the employer to establish that the 

remuneration in question falls under an exemption.”).

58 Ellis, 258 F.3d at 337; see also Apache Deepwater, L.L.C. v. W&T Offshore, Inc., 

930 F.3d 647, 652-653 (5th Cir.), cert. denied sub nom. W & T Offshore, Inc. v. Apache 

Deepwater, L.L.C., 140 S. Ct. 649 (2019) (“A party is only entitled to judgment as a matter 

of law on an issue where no reasonable jury would have had a legally sufficient evidentiary 

basis to find otherwise.”).

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arrive at a contrary verdict.”59 The Employees simply didn’t present enough 

evidence at trial to conclusively show a lack of discretion in 4JLJ’s allocation 

of stage bonuses—at least not enough evidence to warrant judgment as a 

matter of law. Here, we decline to disturb the jury’s reasoned judgment on 

such a flimsy record. 

Performance bonuses, however, are another story. In contrast to stage 

bonuses, the Employees produced a written agreement at trial that governed 

performance bonuses. The agreement contains: (1) a list of criteria for 

determining whether a performance bonus would be awarded; and (2) a pay 

scale that stipulates precisely how much is to be given. As a reminder, for a 

bonus to be excluded from the regular-rate calculation, the employer must 

retain discretion over the fact of payment and the amount. 

It was reasonable for the jury to conclude that 4JLJ retained discretion 

over whether to give performance bonuses. On top of witness testimony that 

indicted 4JLJ exercised discretion over whether to give bonuses generally, 

the jury had the performance bonus agreement itself to consider, which 

makes clear that bonuses are “NOT TO BE EXPECTED.” The 

agreement also states that performance bonuses are for those who 

“consistently perform on a higher level”; it’s for those who are “top 

performer[s].” Section 207(e) doesn’t say that the existence of an agreement 

alone nullifies employer discretion in regard to remuneration; the statute 

pinpoints an agreement that causes employees to expect those bonuses. Given 

the testimony offered by the Employees’ own witnesses, along with Jalufka’s 

testimony and the written agreement, it was perfectly reasonable for the jury 

to conclude that the Employees would not expect the regular payment of 

performance bonuses. 

59 Bellows, 118 F.3d at 273 (cleaned up).

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But § 207(e) also demands that employers retain discretion over the 

amount of payment, not just whether payment is given.60 The performance 

bonus agreement provides a concrete pay scale. That scale shows exactly 

what employees will be paid if they receive a bonus. And 4JLJ points to no 

evidence that contradicts this predetermined pay scale. For instance, not a 

single employee testified that he received a performance bonus that deviated 

from the contracted-for amount. Based on the performance bonus 

agreement, and the complete absence of any evidence contradicting the 

universal applicability of the agreement, a reasonable jury could not have 

concluded that 4JLJ maintained discretion over the amount of performance 

bonuses. Thus, the performance bonuses were nondiscretionary under the 

FLSA, and 4JLJ ought to have included them in the regular rate. The 

Employees were entitled to judgment as a matter of law regarding 

performance bonuses.61

2

We next consider whether Jalufka was an “employer” under the 

FLSA and thus liable alongside 4JLJ for the unpaid wages. The jury found 

that Jalufka wasn’t an employer. We agree. 

60 29 U.S.C. § 207(e)(3). 

61 We do not address the Employees’ alternatively requested relief of a new trial. 

That’s because “[i]t is more difficult to satisfy the standard for reversing the denial of a 

motion for a new trial than the standard for reversing the denial of judgment as a matter of 

law.” Williams, 898 F.3d at 614 n.13. So if we would affirm a denied motion for judgment 

as a matter of law, we would affirm denial of the same motion for a new trial. Miller v. Travis 

County, 953 F.3d 817, 821 (5th Cir. 2020) (finding the evidence under the “more exacting 

standard” for judgment as a matter of law to satisfy the standard for a new trial). For this 

reason, we affirm the district court’s denial of a motion for a new trial over the issue of 

stage bonuses. And because we reverse the district court’s denial of judgment as a matter 

of law regarding performance bonuses, the requested relief of a new trial over this issue is 

moot. 

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To determine whether an individual or an entity is an employer under 

the FLSA, we use the “economic reality” test.62 That test asks us to 

consider “whether the alleged employer: (1) possessed the power to hire and 

fire the employees, (2) supervised and controlled employee work schedules 

or conditions of employment, (3) determined the rate and method of 

payment, and (4) maintained employment records.”63

The Employees make much of the fact that Jalufka is the sole owner 

of 4JLJ, so he was the sole beneficiary of the “unpaid overtime premiums.”64

But they cite no case supporting this as a relevant factor. And under the 

standard economic reality factors, 4JLJ offered ample evidence. The record 

demonstrates that Jalufka did not make day-to-day hiring or firing decisions, 

that he did not set pay rates, and that he did not maintain employment files. 

There was testimony that Jalufka was not the type of owner who “controls 

everything” or is “involved in day-to-day operations and decisions”; rather, 

his managers made those decisions. Meanwhile, Jalufka was usually “out in 

the yard working with the rest of the guys.” Testimony from several 

individuals—including the Employees’ own witnesses—supported a finding 

that Jalufka was not an “employer” for the purposes of personal liability 

under the FLSA. 

C

Finally, 4JLJ cross-appealed, arguing that the district court’s award 

of attorney fees and its Rule 54(d) cost allocation were both an abuse of 

discretion. 4JLJ frames the district court’s attorney-fee award and its Rule 

62 Gray v. Powers, 673 F.3d 352, 354. (5th Cir. 2012). 

63 Id. at 355 (quotation marks omitted). 

64 Brief for the Employees at 33, Edwards v. 4JLJ, No. 19-40553 (5th Cir. argued 

March 3, 2020).

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54(d) cost allocation as “second and third tier sanctions.”65 This is because, 

before trial, the district court shifted the burden of proof—from the 

Employees to 4JLJ —on an element of the Employees’ claim. Both parties 

agree that this burden shifting sanction is not at issue. But the first sanction 

plays a role in 4JLJ’s theory on appeal because, 4JLJ argues, the burden

shifting sanction was the first of multiple tiers of sanctions. The second tier 

was the attorney fee award to the Employees. And the third tier was the 

reduction in Rule 54 costs that the district court awarded to 4JLJ as the 

prevailing party.66 These sanctions, 4JLJ argues, were duplicative. 

1

We start with attorney fees. District courts “wield their various 

sanction powers at their broad discretion.”67 We review a district court’s 

decision to impose sanctions for abuse of discretion.68 A district court abuses 

its discretion when its ruling “is based on an erroneous view of the law or on 

a clearly erroneous assessment of the evidence.”69

Here, the district court didn’t abuse its discretion in fashioning

sanctions for 4JLJ’s delays. The court invoked Rules 26 and 37 in its sanction 

order. 4JLJ contends that neither rule authorized the district court’s 

sanctions. Although we doubt whether the court’s sanction order would be 

65 Brief for 4JLJ at 54, Edwards v. 4JLJ, No. 19-40553 (5th Cir. argued March 3, 

2020). 

66 The court awarded 4JLJ only $14,920.98 of the requested $44,533.04.

67 Olivarez v. GEO Grp., Inc., 844 F.3d 200, 203 (5th Cir. 2016) (quoting Topalian 

v. Ehrman, 3 F.3d 931, 934 (5th Cir. 1993)).

68 U.S. v. 49,000 Currency, 330 F.3d 371, 376 (5th Cir. 2003) (citing Smith v. Smith, 

145 F.3d 335, 344 (5th Cir. 1998)).

69 Tollett, 285 F.3d at 363.

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warranted under Rule 37 alone (given that no spoliation occurred),

70 it was 

still within the district court’s inherent and Rule 26 powers to sanction 4JLJ

for evasive discovery practices.71 And the district court did not base its 

sanctions ruling on a clearly erroneous assessment of the evidence. There is 

support in the record for the district court’s conclusion that 4JLJ’s delays 

were willful and imposed unnecessary costs on the Employees. 4JLJ

intimated that it could not access the Fleetmatics data when it could, in one 

instance responding to a discovery request by stating “we wouldn’t have 

anything anyway.” Given our strong reluctance “to substitute our judgment 

for that of the trial court, when it comes to enforcement of acceptable 

standards of litigation conduct,”72 we decline to upset the district court’s 

decision to sanction this sort of behavior.

4JLJ also argues that the sanctions were punitive rather than 

compensatory and therefore unwarranted under Goodyear Tire & Rubber Co. 

v. Haeger.

73 We disagree. A sanction is compensatory if it is “calibrated to the 

damages caused by the bad-faith acts on which it is based.”74 And “a fee is so 

calibrated if it covers the legal bills that the litigation abuse occasioned.”75

The district court’s sanctions fit the bill. The expenses and attorney fees 

were calibrated to the damages caused by 4JLJ’s failure to timely produce 

the Fleetmatics data. The sanctions remedied, among other things, the 

Employees’ “numerous expenses, delay costs, and the burden of attorney 

70 See FED. R. CIV. P. 37(e).

71 See FED. R. CIV. P. 26(g); Goodyear Tire & Rubber Co. v. Haeger, 137 S. Ct. 

1178, 1186 (2017).

72 Topalian, 3 F.3d at 935 (internal citation omitted). 

73 See 137 S. Ct. at 1186. 

74 Id. (internal quotation marks, bracketing, and citation omitted).

75 Id.

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time and attention to motions, [and] status conferences,” all of which 

resulted from 4JLJ’s delays. The district court’s measurement may not have 

been perfect, but it need not be. The “essential goal in shifting fees is to do 

rough justice, not to achieve auditing perfection.”76 Here, we decline to 

second-guess the district court’s sense of rough justice; the attorney fees 

award was not an abuse of discretion. 

2

We next address what 4JLJ labels the third-tier sanction—the district 

court’s Rule 54 cost allocation. Despite a “strong presumption that the 

prevailing party will be awarded costs,” we will only reverse a district court’s

decision regarding costs for an abuse of discretion.77 Our review is narrow 

because district courts have wide discretion under Rule 54 to decide whether, 

and to what extent, to reduce these costs.78 It may reduce or deny costs for 

many reasons,79 although it must articulate its reasons for doing so.80

Here, the district court articulated its reasons in its order on the bill of 

costs. In the district court’s view, reducing costs was necessary “to ensure 

that its sanctions [were] effective and not unduly offset by [4JLJ’s] costs.” 

And the court based its decision on facts in the record suggesting that 4JLJ

had engaged in evasive discovery practices. 

4JLJ argues that—like the attorney-fees sanction—the court’s 

decision to reduce Rule 54 costs was punitive because it was layered atop 

76 Haeger, 137 S. Ct. at 1187 (internal quotation marks and citation omitted).

77 Pacheco v. Mineta, 448 F.3d 783, 793 (5th Cir. 2006).

78 Migis v. Pearle Vision, Inc., 135 F.3d 1041, 1049 (5th Cir. 1998).

79 See Pacheco, 448 F.3d at 794 (listing “misconduct by the prevailing party” as a 

reason for withholding costs from the prevailing party).

80 Id.

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prior sanctions. We reject this argument. By denying 4JLJ some of the costs 

it would have otherwise been entitled to, the district court sought to ensure 

that the costs would not offset the attorney fees and expenses the court 

awarded to the Employees. In light of its “superior understanding of the 

litigation,”81 we find no basis to question the district court’s decision to 

reduce these costs.

In sum, 4JLJ’s arguments on cross-appeal are unavailing. The district 

court did not abuse its discretion in awarding attorney fees to the Employees 

or in awarding Rule 54 costs. 

CONCLUSION

We are reluctant to second-guess the decision of a jury, but we will

when the law requires it. Judgment as a matter of law in favor of the 

Employees was warranted regarding performance bonuses but not stage 

bonuses. So we REVERSE the district court’s denial of judgment as a 

matter of law and REMAND for the court to consider what relief is owed to 

the Employees consistent with this opinion. Also, we AFFIRM the district 

court as to Jalufka’s status as an employer under the FLSA. Finally, we 

AFFIRM the court’s award of attorney fees and its bill of costs allocation.

81 Haeger, 137 S. Ct. at 1187.

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