16

‐ 3302

‐ cv

Wang v. The Hearst Corporation

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

August Term, 2017

(Argued: September 11, 2017 Decided: December 8, 2017)

Docket No. 16

‐ 3302

‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ x

XUEDAN WANG, on behalf of herself and all others similarly situated,

MATTHEW JORDAN WAGSTER, ERIN E. SPENCER, on behalf of herself and

all others similarly situated, ALEXANDRA RAPPAPORT, SARAH WHEELS,

Plaintiffs

‐ Appellants

,

JESSICA ANN BEST, PAUL VANCE, COURTNEY HOLT, JANET E. GLAZIER,

REBECCA E. DIXON, ERIN D. SULLIVAN, CARLY ROCKWELL, DANA LYNN

VOGEL, ELIZABETH MANCINI, STEPHANIE LAUREN SKORKO, CAITLIN

LESZUK,

Plaintiffs

,

‐ v.

‐

The Hearst Corporation,

Defendant

‐ Appellee

.

‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ xBefore: JACOBS, CABRANES and WESLEY, Circuit Judges

.

Five participants in Hearst Corporation internship programs appeal from

the order of the United States District Court for the Southern District of New

York (Oetken, J .), dismissing on summary judgment their claims under the Fair

Labor Standards Act

, 29 U.S.C. §§ 201 et seq. Affirmed.

Rachel Bien (Juno Turner, on the brief ),

Outten & Golden LLP, New York, New

York, for Plaintiffs

‐ Appellants

.

Rachel Geman, Lieff Cabraser

Heimann & Bernstein, LLP, New York,

New York, for amici curaie American

Federation of State, County and Municipal

Employees; Communications Workers of

America, AFL

‐ CIO; Economic Policy

Institute; Intern Worker Alliance; National

Employment Lawyers Association;

National Employment Law Project; Service

Employees International Union; United

Food and Commercial Workers

International Union; Writers Guild of

America, East, AFL

‐ CIO; Professor Scott

Moss; Ross Perlin; and Professor David C.

Yamada, in support of

Plaintiffs

‐ Appellants

.

Eve Burton, Jonathan R. Donnellan,

Kristina E. Findikyan, Jennifer D. Bishop,

Hearst Corporation, New York, New York,

office, for Defendant

‐ Appellee

.

2DENNIS JACOBS, Circuit Judge :

Five participants in internship programs offered by defendant Hearst

Corporation (“Hearst”) sue for minimum wage under the Fair Labor Standards

Act (“FLSA”) and the New York Labor Law (“NYLL”). At issue is whether the

unpaid interns were “employees” of Hearst for the purposes of the FLSA under

Glatt v. Fox Searchlight Pictures, Inc.

, 811 F.3d 528 (2d Cir. 2016). We affirm the

judgment of the United States District Court for the Southern District of New

York, Wang v. Hearst Corp.

, 203 F. Supp. 3d 344 (S.D.N.Y. 2016), for the reasons

stated in Judge Oetken’s thorough opinion.

I

The question is whether Hearst furnishes bona fide for

‐ credit internships

or whether it exploits student

‐ interns to avoid hiring and compensating entry

‐

level employees. The factual record is voluminous and advances multiple

narratives, some of them contradictory; but the following essentials are

undisputed.

Hearst maintained dozens of internship programs with its various print

magazines. Each of five named appellants worked at one time as interns in one

of these programs. These internships were unpaid, carried no expectation of

eventual full

‐ time employment, and required intern candidates to receive prior

approval for college credit to participate. No intern alleges that Hearst promised

compensation or a future job.

The interns’ individual experiences varied, but there are groupings. Four

of the appellants–Alexandra Rappaport, Erin Spencer, Matthew Wagster, and

Sarah Wheels–were enrolled in college during their internships. Rappaport,

Spencer, and Wheels completed their internships during the summer between

academic years, and Wagster interned (with Esquire ) during his fall semester.

Lead plaintiff Xuedan Wang interned for one semester between her graduation

from college and the start of her graduate program in the Fashion Marketing

program at Parsons School of Design. Each intern received prior approval for

3college credit, although not all of them ultimately received credit from their

degree

‐ awarding institution: Wang had received permission for continuing

education credit but ultimately did not pursue it, Wagster was denied credit from

his institution because his internship was not applicable to his major, and Wheels

received credit from a local community college.

Each student had an academic or aspiring professional connection to

fashion. Wang and Spencer studied fashion in college, and Spencer’s internship

satisfied a graduation requirement (the Fieldwork course) for his major;

Rappaport and Wagster were majoring in the social sciences, but hoped to break

into the fashion industry; Wheels was an English major who interned in the

editorial department of Cosmopolitan to advance her writing career. All of them

testified or declared that they performed a range of tasks related to their

professional pursuits in the Hearst internship programs, and gained valuable

knowledge and skills. See, e.g.

, J. App’x 148 (Rappaport gained knowledge

“vital” to a fashion career and accomplished her goal of receiving “a real

‐ life

experience”), id

. at 748

‐ 751 (Spencer had “a very valuable learning experience”),

id

. at 775

‐ 76 (Wang’s internship was a “rich and well

‐ rounded learning

experience” providing “unrivaled skills”).

At the same time, the interns share common complaints. They describe

many tasks in Hearst’s fashion closets as menial and repetitive. Several claim

that they did not receive close supervision or guidance and that the internships

offered little formal training

‐‐ in contrast to their academic experiences in school.

One common grievance was that the interns mastered most of their tasks within a

couple weeks, but did the same work for the duration of the internship.

In February 2012, lead plaintiff Xuedan Wang filed suit alleging that she

and a putative class of interns across Hearst’s magazine departments were

deprived of wages in violation of the FLSA and NYLL. Seven other interns opted

in after the district court granted the case collective certification. The district

court’s denial of plaintiffs’ motion for partial summary judgment was vacated in

this Court for reconsideration in light of Glatt v. Fox Searchlight Pictures, Inc.

, which was heard in tandem with Wang

. Wang v. Hearst Corp.

, 617 F. App’x 35

(2d Cir. 2015) (summary order).

4Hearst moved for summary judgment against the six remaining plaintiffs

under the Glatt test. The district court granted the motion, and five plaintiffs

filed a timely appeal. We review de novo a district court’s grant of summary

judgment. Mathirampuzha v. Potter

, 548 F.3d 70, 74 (2d Cir. 2008).

II

The FLSA defines “employee” by tautology: an “individual employed by

an employer.” 29 U.S.C. § 203(e)(1). The standard for “employee” is broad, but

the Supreme Court has long recognized that not every individual who performs a

service for an employer qualifies as an “employee” under the FLSA. See Walling

v. Portland Terminal Co.

, 330 U.S. 148, 149

‐ 53 (1947). “[E]mployee” status

depends upon the “economic reality” of the relationship between the putative

employer and employee. Glatt

, 811 F.3d at 534, 536.

Last year in Glatt

, we recognized the “primary beneficiary” test as the way

to distinguish employees from bona fide interns. Id

. at 536. To guide our

“flexible” analysis, we provided seven non

‐ exhaustive considerations specific to

the context of unpaid internships:

1. The extent to which the intern and the employer clearly understand that

there is no expectation of compensation. Any promise of compensation,

express or implied, suggests that the intern is an employee—and vice

versa;

2. The extent to which the internship provides training that would be

similar to that which would be given in an educational environment,

including the clinical and other hands

‐ on training provided by educational

institutions;

3. The extent to which the internship is tied to the intern ʹ s formal education

program by integrated coursework or the receipt of academic credit;

54. The extent to which the internship accommodates the intern ʹ s academic

commitments by corresponding to the academic calendar;

5. The extent to which the internship ʹ s duration is limited to the period in

which the internship provides the intern with beneficial learning;

6. The extent to which the intern ʹ s work complements, rather than

displaces, the work of paid employees while providing significant

educational benefits to the intern;

7. The extent to which the intern and the employer understand that the

internship is conducted without entitlement to a paid job at the conclusion

of the internship.

Id

. at 536

‐ 37.

The court applies these considerations by weighing and balancing the

totality of the circumstances. Id

. at 537; Barfield v. N.Y.C. Health & Hosps. Corp.

,

537 F.3d 132, 141

‐ 42 (2d Cir. 2008)(Employee status is a “flexible concept to be

determined on a case

‐ by

‐ case basis by review of the totality of the

circumstances.”). “No one factor is dispositive and every factor need not point in

the same direction for the court to conclude that the intern is not an employee.”

Glatt

, 811 F.3d at 537.

The totality of the circumstances should be considered in view of the

“purpose of a bona fide internship

... to integrate classroom learning with

practical skill development in a real

‐ world setting.” Id

. In a break from previous

tests, courts applying Glatt have acknowledged that the internship may provide a

direct benefit to the employer so long as the intern receives identifiable

educational or vocational benefits in return. See, e.g., Mark v. Gawker Media

LLC

, 2016 WL 1271064, at *8 (S.D.N.Y. Mar. 29, 2016).

Judge Oetken analyzed each Glatt factor and determined that all of them

except the sixth (displacement of paid employees) either favored Hearst to some

degree or were neutral. Wang

, 203 F. Supp. 3d at 354

‐ 55. In assessing the totality

6of the circumstances, the court concluded that the “Plaintiffs were interns rather

than employees as a matter of law.” Id

. at 355.

III

A. Factors One and Seven

The appellants concede that factors one and seven (expectation of payment

and entitlement to a job

, respectively) favor Hearst. They argue, however, that

these factors bear little weight because FLSA rights cannot be waived. The

interns’ reading of these factors defies the clear mandate of Glatt

, which

explained that “[a]ny promise of compensation, express or implied, suggests that

the intern is an employee

‐‐ and vice versa .” 811 F.3d at 537 (emphasis added).

These factors are crucial to understanding the “economic reality” of the

internship relationship; where, as here, the programs were described specifically

as unpaid internships for students–and students applied to the internships with

that unambiguous understanding–the relationship is far less likely to take on an

abusive quality.

B. Factors Two and Five

The second factor (training) is at the heart of the dispute on appeal. The

interns argue forcefully that Judge Oetken misconstrued this factor by

broadening the ambit of “training” to include “practical skills.” See, e.g., Wang

,

203 F. Supp. 3d at 355. Wagster contends that the experience of having “s[a]t in

on marketing meetings” should have been discounted by his assignment to “take

meeting minutes.” Similarly, appellants argue that we should disregard

Spencer’s experience “learn[ing] about photo shoots” because she already knew

how to use a camera. The interns would thus limit the discussion of beneficial

training under the second factor to education that resembles university pedagogy

to the exclusion of tasks that apply specific skills to the professional environment.

Appellants’ interpretation ignores our instruction in Glatt that a key

element of the intern relationship is “the expectation of receiving educational or

7vocational benefits .” 811 F.3d at 536 (emphasis added); see also id. at 537 (“the

purpose of a bona

‐ fide internship is to integrate classroom learning with practical

skill development in a real

‐ world setting”). Glatt clearly contemplates that

training opportunities offered to the intern include “product[s] of experiences on

the job.” Id

. at 536; accord Gawker Media LLC

, 2016 WL 1271064, at *9

(“Plaintiffs take too narrow a view of [factor two], which includes the equivalent

of ‘clinical and other hands

‐ on training’”) (quoting Glatt

, 811 F.3d at 537). The

appellants’ tacit assumption is that professions, trades, and arts are or should be

just like school; but many useful internships are designed to correct that

impression.

The interns argue that the district court “ignored” evidence that Hearst’s

internships were a poor substitute for classroom learning. In fact, the court

accepted the complaints as true, and for that reason, concluded that the factor

weighed only “slightly” in favor of Hearst. At the same time, it recognized that

those complaints do not wholly offset the undisputed fact that the internships did

provide beneficial training. Accord Lucia Vlad

‐ Berindan v. NYC Metro. Transp.

Auth.

, 2016 WL 1317700, at *7 (S.D.N.Y. Apr. 1, 2016). For this reason, the

appellants also misread the closely related fifth Glatt factor (valuable duration) in

arguing that the interns were not receiving “beneficial learning” when they

performed repetitive or similar tasks they had already “learned.” As exemplified

by the meeting minutes and photoshoots, practical skill may entail practice, and

an intern gains familiarity with an industry by day to day professional

experience. See, e.g., J. App’x at 743

‐ 45 (accruing “good life skills” by repeating

administrative and organizational tasks such as “how to be more organized and

focused” in a professional environment); see also Gawker Media LLC

, 2016 WL

1271064, at *10 (independent work an repetitive tasks not “incompatible with the

account of vocational training and mentorship” identified elsewhere in the

record).

C. Factors Three and Four

The third and fourth Glatt factors relate to the integration of the internship

to the student

‐ intern’s academic program and academic calendar, respectively.

Both parties and the district court acknowledge that the interns’ experiences

8diverge with respect to these factors. In general, however, the internships were

arranged to fit the academic calendar and required academic credit as a

prerequisite.

Factor three (academic integration) clearly favors Hearst for all interns

except Wagster. For some interns, the connection is straightforward. Spencer’s

internship was a graduation requirement for his major. Wheels’ internship with

the editorial department of a magazine meshed with her academic major in

English and professional interest in writing. And while Rappaport’s internship

did not “integrat[e]” with “coursework” from her international relations major,

she discussed the internship with her college faculty, wrote a paper about it, and

received class credit for it: her college thus treated the internship as a course.

It is argued that “there was no connection between a formal education

program and Wang’s internship” in the fashion industry. Appellants’ Br. at 37

.

But Wang interned between the completion of her undergraduate degree in

fashion and the start of her graduate degree, also in fashion. She intentionally

deferred her start date for graduate school and took a full time internship at a

Hearst magazine to gain professional experience. A jury is not necessary to infer

from these undisputed facts that Wang’s internship “is tied to [her] formal

education.” Glatt

, 811 F.3d at 537. That Wang did not receive credit does not

undermine the connection between her formal education program and her

internship; she did not receive credit because she did not pursue it. As a matter

of law, the (undisputed) fact that the program required a student to earn

approval from an accredited university for the “receipt of academic credit”

generally is more telling than whether credit was actually awarded in that

individual’s case. 1

1 Wagster’s circumstances differ because he was denied credit specifically

“due to a reevaluation of the educational value of the internship,” indicating a

frayed connection between his internship and formal academic program.

Appellee’s Br. at 28; see J. App’x at 399. Pre

‐ approval for credits paired with

subsequent withholding of those credits on a substantial basis would make the

third factor at least neutral as to Wagster, if it does not outright favor him.

9For the majority of the interns here, the undisputed evidence also favors

Hearst with respect to the fourth factor (academic calendar). Rappaport, Spencer,

and Wheels interned during their college summer breaks in accordance with the

school calendar. Wang had deferred her studies to intern between school years,

and Wagster was not an active student during his internship. Hearst did not fail

to accommodate their academic schedules when they had no schedules to

accommodate.

D. Factor Six

The sixth factor (displacement) considers the extent to which an intern’s

work complements the work of paid employees or displaces it. An intern’s work

is complementary if it requires some level of oversight or involvement by an

employee, who may still bear primary responsibility. The district court

considered that the sixth factor favored the interns because the interns completed

some work regularly performed by paid employees.

This factor alone is not dispositive. An intern may perform

complementary tasks and in doing so confer tangible benefits on supervisors.

The Glatt factors intentionally omitted a criteria that had been advanced by the

Department of Labor that the alleged employer derive no immediate advantage

from the activities of the intern. Glatt

, 811 F.3d at 534. It is no longer a problem

that an intern was useful or productive. See also Gawker Media

, 2016 WL

1271064, at *12

‐ 13.

IV

The facts of this case permit inferences that support Hearst with respect to

certain Glatt factors, and inferences that support particular interns with respect to

other factors. The interns and amici urge that such mixed inferences foreclose a

ruling on summary judgment. 2 We disagree, for the reasons explained by the

2 Many of our FLSA tests that are fact

‐ sensitive and require the judge to

assign weight are routinely disposed of on summary judgment. See Hart v.

Rick’s Cabaret Intern., Inc.

, 60 F. Supp. 3d 447, 456

‐ 57 n. 5 & 6 (S.D.N.Y. 2014);

10district court, which weighed all factors under the totality of the circumstances,

and concluded that the interns are not “employees” for the purposes of the FLSA.

As the interns observe, these cases do involve a “fact specific” and case

‐ by

‐

case analysis. But “the mere existence of some alleged factual dispute between

the parties will not defeat an otherwise properly supported motion for summary

judgment; the requirement is that there be no genuine issue of material fact.”

Anderson v. Liberty Lobby, Inc.

, 477 U.S. 242, 248 (1986)(emphasis omitted); see,

e.g., Gawker Media LLC

, 2016 WL 1271064, at *9 (“There are no genuine issues of

material fact–that is, issues that could change the Court’s calculus if resolved in

favor of [the intern] at trial.”). Status as an “employee” for the purposes of the

FLSA is a matter of law, and under our summary judgment standard, a district

court can strike a balance on the totality of the circumstances to rule for one side

or the other. See Glatt

, 811 F.3d at 537 (“every factor need not point in the same

direction for the court to conclude that the intern is not an employee”)(emphasis

added); Brock v. Superior Care, Inc.

, 840 F.2d 1054, 1058

‐ 59 (2d Cir. 1988).

There are contested issues that bear on the quality of each intern’s

experience. The crucial point is that a district court may rule on summary

judgment if it can weigh the Glatt factors on the basis of facts that are not in

dispute. As the district court recognized, the internships “involved varying

amounts of rote work and could have been more ideally structured to maximize

their educational potential,” but concluded that these critiques did not give rise

to a material factual dispute. Wang

, 203 F. Supp. 2d at 355; accord Lucia Vlad

‐

Berindan

, 2016 WL 1317700, at *7

‐ 8 (approving a motion to dismiss

recommendation with two factors in intern’s favor “outweighed” by other five);

Meyer v. U.S. Tennis Ass’n

, 607 F. App’x 121 (2d Cir. 2015)(summary order

reflecting settled law). The amici contend that summary judgment is inapposite

in all unpaid intern cases that turn on competing factors. Such a rule would

foreclose weighing of undisputed facts in this commonplace fashion.

11Gawker Media LLC

, 2016 WL 1271064, *11 (granting summary judgment while

acknowledging that “contrary evidence” existed in the record and the sixth factor

favored the intern).

CONCLUSION

The judgment is affirmed.

12