Court Opinion

ID: 4304024
Source: CourtListenerOpinion
Date Created: 2018-08-15 17:01:13.189234+00
Date Added: 2024-06-11T07:49:32.562414
License: Public Domain

FILED
                                                                     United States Court of Appeals
                      UNITED STATES COURT OF APPEALS                         Tenth Circuit

                             FOR THE TENTH CIRCUIT                          August 15, 2018
                         _________________________________
                                                                          Elisabeth A. Shumaker
                                                                              Clerk of Court
R. ALEXANDER ACOSTA, Secretary of
Labor, United States Department of Labor,

      Plaintiff - Appellee,

v.                                                          No. 17-4111
                                                  (D.C. No. 2:15-CV-00653-DAK)
FORECLOSURE CONNECTION, INC.;                                (D. Utah)
JASON WILLIAMS,

      Defendants - Appellants.
                      _________________________________

                             ORDER AND JUDGMENT*
                         _________________________________

Before TYMKOVICH, Chief Judge, LUCERO and HARTZ, Circuit Judges.
                 _________________________________

      Jason Williams and Foreclosure Connection, Inc. (“FCI”) appeal the district

court’s judgment in favor of the Secretary of Labor. Exercising jurisdiction under 28

U.S.C. § 1291, we affirm.

                                            I

      FCI is a Utah company that buys real estate, renovates homes, and rents or

resells properties. Williams is the manager and part owner of FCI. He is responsible

for hiring and firing decisions. Jack Erickson is FCI’s foreman. He assigns work to

construction workers at the company’s properties pursuant to Williams’ instructions.

      *
         This order and judgment is not binding precedent, except under the doctrines
of law of the case, res judicata, and collateral estoppel. It may be cited, however, for
its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
      Mychal Barber Sr. and his teenaged son, Mychal Scott Barber Jr., began doing

construction work for FCI in the summer of 2015. The Barbers became dissatisfied

with working conditions at FCI, and in particular, with the company’s failure to pay

overtime wages. On July 7, 2015, they submitted a complaint to the Wage and Hour

Division of the Department of Labor (“DOL”), alleging that FCI’s failure to pay

overtime wages violated the Fair Labor Standards Act (“FLSA”).

      The following morning, on July 8, Erickson told the Barbers not to report to

work because there was not enough work for them to do. Later that day, DOL

investigator Sheffield Keith met with Williams at FCI’s offices. Keith requested

certain records, including information on FCI’s employees. Williams responded that

FCI did not have any employees, and that all of its workers were independent

contractors. Later that night, the Barbers called Erickson, who told them they were

terminated. Erickson explained that Williams blamed the Barbers for reporting the

company to DOL.

      On July 15, an employee surreptitiously recorded a meeting Williams held

with his workers. Williams instructed the group to refuse to cooperate in DOL’s

investigation. He also circulated independent contractor agreements to the workers,

requested that they sign the agreements but leave them undated, and told them to

claim they could not remember when they signed. FCI submitted contractor

agreements to DOL, including an agreement for Barber Sr. with what appeared to be

a forged signature.

                                          2
      In September 2015, DOL filed a complaint alleging that FCI had obstructed its

investigation and retaliated against its employees, including the Barbers. Defendants

consented to the entry of a preliminary injunction barring any additional retaliation or

obstruction. Following a bench trial, the district court ruled in favor of DOL. It

imposed a permanent injunction, awarded $3,530.23 in back pay to Barber Jr. plus an

equal amount of liquidated damages, and awarded $80,992.55 in back pay to Barber

Sr. plus an equal amount of liquidated damages. Defendants timely appealed.

                                            II

      Following a bench trial, “we review the district court’s factual findings for

clear error and its legal conclusions de novo.” Keys Youth Servs., Inc. v. City of

Olathe, 248 F.3d 1267, 1274 (10th Cir. 2001). We will reverse under the clear error

standard only if the district court’s finding “is without factual support in the record or

if, after reviewing all the evidence, we are left with a definite and firm conviction

that a mistake has been made.” Id. (quotations omitted).

                                            A

      Defendants argue that DOL failed to demonstrate FCI was an enterprise

engaged in commerce. Under FLSA, employees are entitled to overtime pay if they

work more than forty hours per week and are “employed in an enterprise engaged in

commerce.” 29 U.S.C. § 207(a)(1). “‘Commerce’ means trade, commerce,

transportation, transmission, or communication among the several States or between

any State and any place outside thereof.” § 203(b).

                                            3
       However, the anti-retaliation provision of FLSA does not refer to an enterprise

engaged in commerce. It states that “it shall be unlawful for any person . . . to

discharge or in any other manner discriminate against any employee because such

employee has filed any complaint . . . related to [FLSA].” § 215(a)(3) (emphasis

added). A person is defined as “an individual, partnership, association, corporation,

business trust, legal representative, or any organized group of persons.” § 203(a).

       Several circuit courts have thus concluded that FLSA’s prohibition on

retaliation applies regardless of whether an employer qualifies as an enterprise

engaged in commerce. The Third Circuit held that although the portions of FLSA

“relating to wages and to hours do apply only to employers,” the “prohibitions

expressed in [§ 215] . . . are applicable to any person.” Bowe v. Judson C. Burns,

Inc., 137 F.2d 37, 38 (3d Cir. 1943) (quotation omitted). Commenting that FLSA “is

carefully drawn and every term is used as a term of art,” that court noted that the

wage and hour provisions consistently use “employer” but the anti-retaliation and

willful violation sections always use “person.” Id.; see also id. at 39 (“The

congressional intent is very plain and the pattern of the statute is perfect.”).

       Similarly, in Meek v. United States, 136 F.2d 679 (6th Cir. 1943), the Sixth

Circuit upheld the criminal conviction under FLSA of a defendant who claimed he

was no longer an employer at the time an employee was fired. Id. at 679. The court

held that “the differentiation between the prohibitions in other sections of the Act

directed to the ‘employer,’ and those here directed to ‘any person,’ is significant of

the intent of the Congress. The language is clear and conforms to the pattern of the

                                            4
Act.” Id. at 680. And in Wirtz v. Ross Packaging Co., 367 F.2d 549 (5th Cir. 1966),

the Fifth Circuit held that “the clear and unambiguous language” of FLSA, which

contains the terms “any employee” and “any person” in its anti-retaliation provision,

does not require that either party “be engaged in activities covered by the Act’s wage

and hour provisions in order for the strictures against discriminatory discharge to be

invoked.” Id. at 550-51.

       More recent decisions are in accord. In Sapperstein v. Hager, 188 F.3d 852

(7th Cir. 1999), the court held that a retaliation claim could go forward even though

the employer did not qualify as an enterprise. Id. at 856. The court explained that,

even if an employee’s complaint turned out not to be a violation of FLSA, the anti-

retaliation provision does not require an actual violation to be proved. Id. at 856-57.

It provided the following policy rationale for this rule:

       Determining whether there is an actual violation can mislead even an
       experienced district court, and a sensible employee who knew he had to
       be right to enjoy whistleblower protection would think twice about
       reporting conduct which might turn out to be lawful. Congress instead
       wanted to encourage reporting of suspected violations by extending
       protection to employees who filed complaints, instituted proceedings, or
       indeed, testified in such proceedings, as long as these concerned the
       minimum wage or maximum hour laws.

Id. at 857.

       Finally, in Arias v. Raimondo, 860 F.3d 1185 (9th Cir. 2017), the Ninth

Circuit explained that the wage and hour sections of FLSA sensibly apply only to

employers because only employers control wages. Id. at 1189. The court contrasted

FLSA’s anti-retaliation provision, which Congress enacted “to enable workers to

                                            5
avail themselves of their statutory rights in court by invoking the legal process

designed by Congress to protect them.” Id. at 1190. That purpose would not be

served by limiting liability to employers. Because “the difference in reach between

FLSA’s substantive economic provisions and its anti-retaliation provision is

unmistakable . . . , Congress clearly means to extend section 215(a)(3)’s reach

beyond actual employers.” Id. at 1191-92.

         We are persuaded by the foregoing authorities and hold that the anti-retaliation

provisions of FLSA apply to any person regardless of whether that person is an

enterprise engaged in commerce.1 Accordingly, we reject defendants’ first claim of

error.

                                             B

         Defendants also contend that the district court clearly erred in finding a causal

connection between the Barbers’ protected activity and their terminations. They

point to the district court’s reference to July 7 as “the last day before the Barbers

were fired,” in arguing that the Barbers were terminated on the morning of July 8,

before Williams was aware that DOL had been contacted. “As we have explained, an

employer’s action against an employee cannot be because of that employee’s

         1
         Although defendants cite the Commerce Clause, U.S. Const., art. I, § 8, cl. 3,
they do not advance any substantive constitutional argument on this issue, instead
dedicating their opening brief to statutory analysis. We therefore do not address any
constitutional argument regarding the scope of FLSA’s application to the events at
issue in this case. See United States v. Gordon, 710 F.3d 1124, 1150 (10th Cir. 2013)
(arguments are waived if they “are presented in a perfunctory and conclusory
fashion” because “we are rightly hesitant to definitively opine on . . . legally
significant issues when they have received . . . cursory treatment”).
                                             6
protected opposition unless the employer knows the employee engaged in protected

opposition.” Zokari v. Gates, 561 F.3d 1076, 1081 (10th Cir. 2009) (quotation,

brackets, and emphasis omitted).

       However, Barber Jr. testified that there were two interactions with Erickson on

July 8. In the morning, Erickson told them not to come in that day because there was

no work. They called back “later that night” to find out if they should report the

following day and Erickson “said that [the Barbers] weren’t working anymore” and

that the Barbers “were terminated.” We thus interpret the district court’s statement

as finding the termination occurred on July 8, after Keith met with Williams.

       Defendants also argue that DOL failed to establish pretext. They point to a

recorded call in which Erickson states that the Barbers were fired for making a report

to city inspectors. But a plaintiff may prove FLSA retaliation “either through the use

of direct evidence or by showing that [the employer’s] proffered non-retaliatory

reasons for terminating him were pretextual.” Conner v. Schnuck Markets, Inc.,

121 F.3d 1390, 1396 (10th Cir. 1997). The record contains direct evidence that the

Barbers were fired because of their complaints to DOL: Barber Jr. testified that

Erickson told him that Williams blamed them for the report during the phone call in

which they were terminated. In any event, the district court could permissibly infer

pretext because of the inconsistent reasons provided for the terminations. See

Richmond v. ONEOK, Inc., 120 F.3d 205, 209 (10th Cir. 1997).2

       2
        Defendants did not challenge the DOL’s authority to seek back pay and
liquidated damages for retaliation in their briefing to this court or in the district court.
                                             7
                                         III

      AFFIRMED.

                                          Entered for the Court

                                          Carlos F. Lucero
                                          Circuit Judge

See 29 U.S.C. §§ 216, 217. Accordingly, any such challenges are waived. See
United States v. Porter, 405 F.3d 1136, 1141-42 (10th Cir. 2005) (“We do not
consider issues not presented to the district court, and they are deemed waived.”);
Coleman v. B-G Maint. Mgmt. of Colo., Inc., 108 F.3d 1199, 1205 (10th Cir. 1997)
(“Issues not raised in the opening brief are deemed abandoned or waived.”).
                                          8