Court Opinion

ID: 2642221
Source: CourtListenerOpinion
Date Created: 2013-11-14 18:23:46.196479+00
Date Added: 2024-06-11T09:01:13.703996
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

VICTOR RIVERA RIVERA; ERNESTO             No. 11-17365
SEBASTIAN CASTILLO RIOS; VICENTE
CORNEJO LUGO; JESUS GARCIA                  D.C. No.
MATA; LUIS ANGEL GARCIA MATA;            3:11-cv-00118-
GAUDENCIO GARCIA RIOS; SIMON                RCJ-VPC
GARCIA RIOS; VICENTE CORNEJO
CRUZ; EMILIO MONTOYA MORALES;
JORGE LUIS AGUILAR SOLANO;                  OPINION
DOMINGO RAMOS RIOS; ARTEMIO
RINCON CRUZ; SERGIO RIOS RAMOS;
PEDRO RIVERA CAMACHO; REGULO
RINCON CRUZ; AURELIANO MONTES
MONTES; MANUEL RIVERA RIVERA;
MARTIN FLORES BRAVO; VIRGILIO
MARQUEZ LARA; JOSE BALDERAS
GUERRERO; GERARDO RIOS RAMOS,
              Plaintiffs-Appellants,

                 v.

PERI & SONS FARMS, INC.,
              Defendant-Appellee.

     Appeal from the United States District Court
               for the District of Nevada
   Robert Clive Jones, Chief District Judge, Presiding
2             RIVERA V. PERI & SONS FARMS, INC.

                     Argued and Submitted
           June 14, 2013—San Francisco, California

                    Filed November 13, 2013

 Before: Diarmuid F. O’Scannlain and Milan D. Smith, Jr.,
  Circuit Judges, and James K. Singleton, Senior District
                         Judge.*

                 Opinion by Judge O’Scannlain

                           SUMMARY**

                             Labor Law

    The panel affirmed in part and reversed in part the district
court’s dismissal of claims of Mexican temporary
farmworkers under the Fair Labor Standards Act and relevant
state law.

    The panel reversed the district court’s dismissal of the
farmworkers’ FLSA claims to the extent that they accrued
within three years of filing suit, reversed its dismissal of their
breach of contract claims, affirmed its dismissal of their
claims under Nev. Rev. Stat. § 608.140, and reversed its
dismissal of their other state statutory and constitutional

    *
   The Honorable James K. Singleton, Senior District Judge for the U.S.
District Court for the District of Alaska, sitting by designation.
  **
     This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
            RIVERA V. PERI & SONS FARMS, INC.                3

claims to the extent that they accrued within two years of
filing.

    The defendant agricultural employer hired the
farmworkers through the H-2A program of the United States
Department of Labor. The panel held that in light of the
DOL’s regulatory interpretation, the employer was subject to
FLSA regulations requiring reimbursement of certain
expenses during each employee’s first week of work.
Deferring to the DOL’s interpretation, the panel held that
travel and immigration expenses incurred by the farmworkers
were covered by the FLSA regulations because these
expenses primarily benefitted the employer.

    The panel held that the farmworkers stated a claim for
breach of contract under Nevada law.

    As to claims under Nevada wage-and-hour laws that
largely duplicated the farmworkers’ claims under the FLSA
and their claims for breach of contract, the panel held that
Nevada law would follow federal law on claims under Nev.
Rev. Stat. §§ 608.250 and 608.260, as well as the Nevada
Constitution. The panel held that the farmworkers stated
claims under §§ 608.040 and 608.050 for failure to pay wages
due under their employment contracts. The panel affirmed
the dismissal of claims for attorneys’ fees under § 608.140 for
failure to allege a demand.

    The panel held that the district court was correct to
address statute of limitations issues because these affirmative
defenses were apparent on the face of the complaint. The
panel affirmed the dismissal of state constitutional claims to
the extent that they accrued more than two years before the
farmworkers filed suit. The panel held that because the
4           RIVERA V. PERI & SONS FARMS, INC.

farmworkers sufficiently alleged willfulness, the district court
erred in applying a two- rather than a three-year statute of
limitations to the FLSA claims.

    The panel affirmed in part, reversed in part, and remanded
for proceedings not inconsistent with its opinion.

                         COUNSEL

José Jorge Behar, Chicago, Illinois, argued the cause and filed
the briefs for the plaintiffs-appellants. With him on the briefs
were Matthew J. Piers, Chicago, Illinois, and Mark R.
Thierman, Reno, Nevada.

Brad Johnston, Yerington, Nevada, argued the cause for the
defendant-appellee. Gregory A. Eurich, Denver, Colorado,
and Joseph Neguese, Denver, Colorado, filed the brief for the
defendant-appellee.

Diane A. Heim, Washington, D.C., argued the cause and filed
the brief for Amicus Curiae Secretary of Labor, in support of
the plaintiffs-appellants. With her on the briefs were M.
Patricia Smith, Washington, D.C., Jennifer S. Brand,
Washington, D.C., and Paul L. Frieden, Washington, D.C.

Monte B. Lake, Washington, D.C., filed the brief for Amicus
Curiae National Council of Agricultural Employers, in
support of the defendant-appellee.
              RIVERA V. PERI & SONS FARMS, INC.                          5

                              OPINION

O’SCANNLAIN, Circuit Judge:

    We are asked to decide claims of Mexican temporary
farmworkers under the Fair Labor Standards Act and relevant
state law.

                                     I

                                    A

    Peri & Sons is a Nevada corporation that produces,
harvests, and packages onions.1 The plaintiffs are Victor
Rivera Rivera and twenty-three other Mexican citizens (“the
farmworkers”) admitted to the United States to cultivate,
harvest, and process onions on Peri & Sons’ farm. Since
2004, Peri & Sons has hired such foreign workers through the
H-2A program of the United States Department of Labor
(DOL).

    American agricultural employers may hire aliens for
temporary labor under the H-2A program if the DOL certifies
that:

         (A) there are not sufficient workers who are
         able, willing, and qualified, and who will be
         available at the time and place needed, to

 1
   Because this case was dismissed upon a motion under Federal Rule of
Civil Procedure 12(b)(6), we assume the truth of factual allegations in the
operative complaint. See Caviness v. Horizon Cmty. Learning Ctr., Inc.,
590 F.3d 806, 812 (9th Cir. 2010); Marder v. Lopez, 450 F.3d 445, 448
(9th Cir. 2006).
6           RIVERA V. PERI & SONS FARMS, INC.

        perform the labor or services involved in the
        petition, and

        (B) the employment of the alien in such labor
        or services will not adversely affect the wages
        and working conditions of workers in the
        United States similarly employed.

8 U.S.C. § 1188(a)(1). Before submitting an Application for
Temporary Employment Certification, see 20 C.F.R.
§ 655.130, an “employer must submit a job order,” id.
§ 655.121(a)(1). Job orders must comply with various
requirements relating to the terms of employment. See, e.g.,
id. § 655.122.

    The farmworkers incurred expenses related to their
employment with Peri & Sons. Some had to pay a hiring or
recruitment fee of between $100 and $500 to Peri & Sons’
employees in order to be considered for employment. All had
to obtain H-2A visas from the United States Consulate in
Hermosillo, Sonora, Mexico. Each farmworker paid the
necessary fees and covered his own lodging costs in
Hermosillo. The farmworkers also paid a fee to obtain Form
I-94 from the United States Citizenship and Immigration
Services upon entering the country. These immigration and
travel expenses exceeded $400 for each plaintiff. In addition,
the farmworkers purchased protective gloves, which were
required for the performance of their jobs, at a cost of at least
$10 per week. They each also incurred expenses of at least
$100 in traveling from Peri & Sons’ farm in Nevada back to
their homes in Mexico.
            RIVERA V. PERI & SONS FARMS, INC.                7

    The farmworkers claim that these expenses were
primarily for Peri & Sons’ benefit but that the company did
not properly reimburse them.

                              B

    The farmworkers filed their original complaint on
February 16, 2011. The operative complaint for this appeal,
however, is the Second Amended Complaint (SAC), which
contained four counts. First, the SAC alleged that Peri &
Sons violated the Fair Labor Standards Act (FLSA),
29 U.S.C. § 201 et seq., partially because it failed to
reimburse each farmworker during his first week of
employment for travel and immigration expenses. Second, it
claimed that Peri & Sons breached its employment contracts
by violating the terms of the job orders submitted to the DOL.
Third, it alleged violations of Nevada wage-and-hour laws for
failure to pay the minimum wage and failure to pay wages
owed under employment contracts. Fourth, it asserted
violations of the minimum wage requirement in the Nevada
Constitution.

    The district court dismissed the SAC with prejudice. It
rejected the farmworkers’ FLSA claims on the ground that
29 C.F.R. § 531.35 did not treat the relevant expenses as
kickbacks. The district court dismissed the breach of contract
claims because the farmworkers did not plead specific
violations of the contracts beyond reiterating the wage claims.
As to the state law statutory and constitutional claims, the
district court treated them as “redundant” and dismissed both
for the same reason it dismissed the FLSA claims. It also
applied a two-year statute of limitations to the wage claims,
both state and federal, holding that those having accrued
8           RIVERA V. PERI & SONS FARMS, INC.

before February 16, 2009 were barred. The farmworkers
timely appealed.

                              II

                              A

    Both the specific regulations governing the H-2A
program and the more general FLSA regulations promulgated
by the DOL control whether and when employers must
reimburse employees for inbound travel and immigration
expenses. The parties agree that Peri & Sons’ relationship
with the farmworkers is subject to the H-2A regulations but
dispute whether it is subject to the FLSA regulations.

    Regulations concerning the H-2A program require
employers to reimburse an employee who “completes 50
percent of the work contract period . . . for reasonable costs
incurred by the worker for transportation and daily
subsistence from the place from which the worker has come
to work for the employer . . . to the place of employment.”
20 C.F.R. § 655.122(h)(1). Peri & Sons argues that this
regulation only obligated it to reimburse its employees’ travel
expenses after the employees had completed half of their
work rather than during each employees’ first week.

    The FLSA, on the other hand, requires that employers
reimburse certain expenses during each employee’s first week
of work. See 29 C.F.R. § 531.36 (applying the rule to “any
such workweek”). The farmworkers argue that this FLSA
regulation required Peri & Sons to reimburse them for
immigration and travel expenses during the first week of
work. Peri & Sons argues that it is not subject to this FLSA
regulation because applying the FLSA regulation to H-2A
            RIVERA V. PERI & SONS FARMS, INC.               9

employees would, as a practical matter, make the H-2A
regulation superfluous. Peri & Sons also contends that
deducting travel costs would frequently reduce a worker’s
first week’s wages far below the minimum wage.

     We must evaluate such arguments in light of the DOL’s
regulatory interpretation. A DOL regulation has clarified
“that the FLSA applies independently of the H-2A
requirements and imposes obligations on employers regarding
payment of wages.” 20 C.F.R. § 655.122(h)(1); accord id.
§ 655.122(p)(1) (“[An] employer must make all deductions
from the worker’s paycheck required by law.”). Before
issuing its regulation, the DOL had rejected many of the
specific arguments raised here by Peri & Sons. See
Temporary Agricultural Employment of H-2A Aliens in the
United States, 75 Fed. Reg. 6884, 6915 (Feb. 12, 2010).
Under Chevron, U.S.A., Inc. v. NRDC, Inc., 467 U.S. 837,
843–44 (1984), we must defer to the DOL’s interpretation if:
(1) the statutory provision is ambiguous, and (2) the agency’s
interpretation is reasonable.

    The FLSA certainly does not unambiguously exempt H-
2A employers from its requirements and related regulations.
See 29 U.S.C. § 206 (requiring “[e]very employer” to pay the
minimum wage to covered employees); id. § 213 (providing
exemptions not relevant to Peri & Sons). Thus, the FLSA
either unambiguously applies the reimbursement requirement
to H-2A employers or contains an ambiguity on this point.
Assuming without deciding that the statute is ambiguous, the
DOL’s interpretation is reasonable. Because the DOL’s
interpretation neither makes it impossible to comply with
10           RIVERA V. PERI & SONS FARMS, INC.

both provisions nor creates surplusage,2 it is “a permissible
construction of the statute.” Chevron, 467 U.S. at 843.

                                  B

    Because Peri & Sons is subject to the FLSA
reimbursement regulations, we must next decide whether the
travel and immigration expenses incurred by the farmworkers
are covered by such regulations.

    The FLSA requires employers to pay at least the federal
minimum wage to each employee “engaged in commerce.”
29 U.S.C. § 206(a)(1). An employer has not satisfied the
minimum wage requirement unless the compensation is “free
and clear,” meaning the employee has not kicked back part of
the compensation to the employer. 29 C.F.R. § 531.35.
Thus, employers generally may not issue paychecks at the
minimum wage rate and then require employees to give some
of the money back. An employer may charge its employees
for the reasonable cost of providing them “board, lodging, or
other facilities” because such charges are not kickbacks,
meaning they can be included in the wage calculation.
29 U.S.C. § 203(m). Facilities “primarily for the benefit or
convenience of the employer” do not count as “other
facilities” and are not included in the wage calculation.
29 C.F.R. § 531.3(d)(1).

 2
   The FLSA regulations require reimbursement in the first week to the
extent that the expenses reduced an employee’s wages below the
minimum wage. The H-2A regulations require full reimbursement over
a longer period of time. The H-2A regulations, therefore, are not
superfluous because an employee paid more than the minimum wage
would receive some reimbursement in the first week and some
reimbursement later.
            RIVERA V. PERI & SONS FARMS, INC.                11

    To the extent deductions for items not qualifying as
“board, lodging, or other facilities”—such as items primarily
benefitting the employer—lower an employee’s wages below
the minimum wage, they are unlawful. Id. § 531.36(b).
Thus, the question before us is whether the expenses incurred
by the farmworkers primarily benefitted Peri & Sons or the
farmworkers.

                               1

    The farmworkers argue that they incurred travel and
immigration expenses, including fees associated with
recruitment, visas, and I-94 forms, for the benefit of Peri &
Sons. Peri & Sons, on the other hand, characterizes
immigration expenses as primarily for the benefit of the
employee.

    The FLSA regulations provide an illustrative list of
facilities that are “primarily for the benefit or convenience of
the employer”:

        (i) Tools of the trade and other materials and
        services incidental to carrying on the
        employer’s business; (ii) the cost of any
        construction by and for the employer; (iii) the
        cost of uniforms and of their laundering,
        where the nature of the business requires the
        employee to wear a uniform.

29 C.F.R. § 531.3(d)(2); see also id. § 531.32(c) (listing, as
a facility primarily for the benefit of the employer,
“transportation charges where such transportation is an
incident of and necessary to the employment (as in the case
of maintenance-of-way employees of a railroad)”). Meals,
12          RIVERA V. PERI & SONS FARMS, INC.

however, “are always regarded as primarily for the benefit
and convenience of the employee.” Id. § 531.32(c).

    The status of inbound travel and immigration expenses is
ambiguous under this regulatory standard. Travel and proper
immigration costs are essential for the H-2A employment
relationship to come to fruition. Presumably, both employers
and employees benefit from the employment relationship.
Employers can only hire H-2A workers after demonstrating
that they are unable to satisfy their labor needs with American
workers, see 20 C.F.R. § 655.161(b), so an employer’s
benefit is clear. Of course, foreign workers probably would
not travel to the United States for temporary employment if
employment of a similar quality were available closer to their
homes. The employees’ benefit is also clear. With such clear
benefits to both the farmworkers and Peri & Sons, the identity
of the primary beneficiary is ambiguous.

    When regulations are ambiguous, we are required to defer
to an agency’s reasonable interpretations of those regulations.
See Auer v. Robbins, 519 U.S. 452, 461 (1997) (“Because the
salary-basis test is a creature of the Secretary’s own
regulations, his interpretation of it is, under our jurisprudence,
controlling unless plainly erroneous or inconsistent with the
regulation.” (internal quotation marks omitted)). Deference,
however, is not appropriate if the agency’s “interpretation is
nothing more than a convenient litigating position or a post
hoc rationalization” for its actions rather than a “fair and
considered judgment on the matter in question.” Christopher
v. SmithKline Beecham Corp., 132 S. Ct. 2156, 2166 (2012)
(internal quotation marks and citations omitted). A change in
an agency’s interpretation does not present a “separate ground
for disregarding the [agency’s] present interpretation” unless
              RIVERA V. PERI & SONS FARMS, INC.                      13

the change leads to “unfair surprise.” Long Island Care at
Home, Ltd. v. Coke, 551 U.S. 158, 170–71 (2007).

    The DOL has expressly addressed the status of inbound
travel expenses. Section 655.122(p) explains that an H-2A
employer who is “subject to the FLSA may not make
deductions that would violate the FLSA.” 20 C.F.R.
§ 655.122(p)(1). In a section interpreting § 655.122(p) and
the FLSA regulations, a regulatory preamble provides that
“an H-2A employer covered by the FLSA is responsible for
paying inbound transportation costs in the first workweek of
employment to the extent that shifting such costs to
employees (either directly or indirectly) would effectively
bring their wages below the FLSA minimum wage.” 75 Fed.
Reg. at 6915.

    With regard to immigration and recruitment expenses,3
the preamble incorporated by reference the analysis from a
previous field assistance bulletin. Id. (“Because of the similar
statutory requirements and similar structure of the H-2A and
H-2B programs, the same FLSA analysis applies to the H-2A
program as was set forth in the Field Assistance Bulletin
[2009-2 (Aug. 21, 2009)].”). That analysis stated: “[T]ravel
and immigration-related costs necessary for workers hired
under the H-2B program are for the primary benefit of their
employers, and the employers therefore must reimburse the
employees for those costs in the first workweek if the costs
reduce the employees’ wages below the minimum wage.”
U.S. Dep’t of Labor Wage and Hour Div., Field Assistance
Bulletin 2009-2, 9 (Aug. 21, 2009), available at

   3
     This analysis does not apply to passport fees. See 20 C.F.R.
§ 655.135(j). The farmworkers, however, have voluntarily dismissed their
claim for reimbursement of passport fees.
14            RIVERA V. PERI & SONS FARMS, INC.

http://www.dol.gov/whd/FieldBulletins/FieldAssistanceBul
letin2009_2.pdf. It also stated that “under both the visa
program regulations and the FLSA, we believe that
employers are responsible for paying the fees of any
recruiters they retain to recruit foreign workers and provide
access to the job opportunity.” Id. at 12.

                                   2

     In the face of regulatory ambiguity, the DOL’s
determination that inbound travel and immigration expenses
primarily benefit H-2A employers was reasonable. There is
no reason to think that the DOL’s determination was not a
product of its considered judgment. Although the DOL
briefly changed its interpretation at one point in 2008, there
is no indication that the change caused any unfair surprise for
Peri & Sons.4         Therefore, we defer to the DOL’s
interpretation. The district court erred in ruling that Peri &
Sons was not required to reimburse its employees during the
first week of work for inbound travel and immigration
expenses to the extent that such expenses lowered their
compensation below the minimum wage.

                                   III

    The farmworkers also argue that, under the common law
of Nevada, Peri & Sons breached their employment contracts
by failing to adhere to the terms of the job order. The

 4
   The withdrawal of the brief-lived 2008 interpretation expressly stated
that the 2008 “interpretation may not be relied upon as a statement of
agency policy.” Withdrawal of Interpretation of the Fair Labor Standards
Act Concerning Relocation Expenses Incurred by H-2A and H-2B
Workers, 74 Fed. Reg. 13,261, 13,262 (Mar. 26, 2009).
            RIVERA V. PERI & SONS FARMS, INC.                15

purported breaches of contract stemmed from not only the
FLSA violations discussed above but also the refusal to
reimburse the farmworkers for the cost of their outbound
travel and for the cost of gloves necessary to perform the job.
The district court dismissed this claim on the ground that the
SAC did not plead the breach with sufficient specificity.

    The Federal Rules of Civil Procedure require federal
plaintiffs to include “a short and plain statement of the claim
showing that the pleader is entitled to relief.” Fed. R. Civ. P.
8(a)(2). Rule 8(a) “generally requires only a plausible ‘short
and plain’ statement of the plaintiff’s claim, not an exposition
of his legal argument.” Skinner v. Switzer, 131 S. Ct. 1289,
1296 (2011). Such a statement must give the defendant “fair
notice of the basis for [the plaintiffs’] claims.” Swierkiewicz
v. Sorema N.A., 534 U.S. 506, 514 (2002).

    Under Nevada law, “the plaintiff in a breach of contract
action [must] show (1) the existence of a valid contract, (2) a
breach by the defendant, and (3) damage as a result of the
breach.” Saini v. Int’l Game Tech., 434 F. Supp. 2d 913,
919–20 (D. Nev. 2006) (citing Richardson v. Jones, 1 Nev.
405, 408 (1865)). The farmworkers’ complaint explained the
contracts and damages at issue. It asserted that the
underlying contracts were the job “orders described in
Paragraphs 12 to 14 of this Complaint.” Such is a plausible
claim because “[i]n the absence of a separate, written work
contract entered into between the employer and the worker,
the required terms of the job order and the certified
Application for Temporary Employment Certification will be
the work contract.” 20 C.F.R. § 655.122(q). The SAC also
claimed that the farmworkers had “substantial injuries in the
form of lost wages.”
16            RIVERA V. PERI & SONS FARMS, INC.

    The SAC alleged breaches by Peri & Sons. Employment
contracts between H-2A employers and employees must “[a]t
a minimum . . . contain all of the provisions required by this
section.” Id. § 655.122(q). Such mandatory terms include
provisions prohibiting H-2A employers from “mak[ing]
deductions that would violate the FLSA,” id. § 655.122(p),
and requiring H-2A employers to “provide or pay for the
worker’s transportation and daily subsistence from the place
of employment to the place from which the worker . . .
departed to work for the employer,” id. § 655.122(h)(2). In
light of these terms of the contract, the factual allegations
incorporated into the breach of contract claim plausibly state
a claim.

    The district court erred in concluding that the
farmworkers had not pled their breach of contract claims with
sufficient specificity. Such allegations were sufficient to give
Peri & Sons fair notice and to make the farmworkers’ breach
of contract claims plausible.5

                                   IV

   The farmworkers asserted claims under Nevada wage-
and-hour laws that are largely duplicative of their claims
under the FLSA and their claims for breach of contract.

 5
   Contrary to Peri & Sons’ assertion, the farmworkers did not waive their
recruiting fees argument by failing to raise it below. The Plaintiffs’
Memorandum of Points and Authorities in Opposition to Defendant’s
Motion to Dismiss alleged that some of the farmworkers had been
required to pay recruiting fees and argued that reimbursement of such fees
was required by law.
            RIVERA V. PERI & SONS FARMS, INC.              17

                              A

    In claims under Nevada Revised Statutes §§ 608.250 and
608.260, as well as the Nevada Constitution, the farmworkers
allege that Peri & Sons failed to pay the Nevada minimum
wage under the same kickback theory on which they relied
for their FLSA claims. The district court dismissed these
claims on the same grounds that it dismissed the FLSA
claims, reasoning that the Nevada Supreme Court would
follow federal precedent on this issue. We agree with the
district court that the Nevada Supreme Court would probably
interpret Nevada law to follow federal law on this issue. Cf.
Nev. Rev. Stat. § 608.250 (directing the Labor Commissioner
to set the minimum wage “in accordance with federal law”);
Nev. Admin. Code § 608.160(2)(a) (prohibiting an employer
from “deduct[ing] any amount from the wages due an
employee unless . . . [t]he employer has a reasonable basis to
believe that the employee is responsible for the amount being
deducted”).

    Peri & Sons claims that the Nevada courts would not
interpret state law to follow federal law on this issue. The
cases on which Peri & Sons relies, however, merely indicate
that the Nevada courts do not interpret state law in
accordance with federal law when the relevant statutes
contain materially different language. In Boucher v. Shaw,
196 P.3d 959, 963 n.27 (Nev. 2008), the Nevada Supreme
Court refused to adopt a test used in the federal courts to
determine whether an individual is an “employer.” The court
so ruled because the Nevada statute defining “employer” did
not include any language indicating that officers of corporate
employers were included. See id. The relevant federal
statute, on the other hand, defined “employer” to include “any
18          RIVERA V. PERI & SONS FARMS, INC.

person acting directly or indirectly in the interest of an
employer in relation to an employee.” 29 U.S.C. § 203(d).

      In Dancer v. Golden Coin, Ltd., 176 P.3d 271, 274 (Nev.
2008), the court interpreted Nevada law to exclude tips from
the calculation of an employee’s minimum wage even though
federal law permitted the inclusion of tips. Again, the state
and federal statutes used significantly different language.
Compare 29 U.S.C. § 203(m)(2) (including tips in the
definition of wages), with Nev. Rev. Stat. § 608.160(1)(b)
(making it unlawful to count “any tips or gratuities bestowed
upon the employees” in a calculation of the minimum wage).
In this case, on the other hand, the relevant state law is not
textually inconsistent with federal law. Compare 29 U.S.C.
§ 206(a) (“Every employer shall pay to each of his employees
. . . wages at the following rates . . . .”), with Nev. Rev. Stat.
§ 608.250(1) (“[T]he Labor Commissioner shall, in
accordance with federal law, establish by regulation the
minimum wage which may be paid to employees in private
employment within the State.”).

    Because we disagree with the district court’s
interpretation of federal law, its dismissal of these state law
claims cannot stand.

                                B

    In claims under Nevada Revised Statutes §§ 608.040 and
608.050, the farmworkers allege that Peri & Sons failed to
pay wages due under their employment contracts. The
success of these claims depends upon the success of the
contract claims discussed above. Because we conclude that
the farmworkers adequately pled their claims for breach of
contract, we also conclude that the district court should not
               RIVERA V. PERI & SONS FARMS, INC.                           19

have dismissed their state law causes of action for wages due
under those contracts.

    The district court, however, dismissed the farmworkers’
claims under § 608.140 for a different reason. Section
608.140 only permits a plaintiff to recover attorneys’ fees
when the plaintiff establishes “that a demand has been made,
in writing, at least 5 days before suit was brought, for a sum
not to exceed the amount” recovered. Nev. Rev. Stat.
§ 608.140. Because the farmworkers failed to allege that they
had made such a demand, the district court dismissed their
claim under § 608.140. The farmworkers did not include any
argument about making a demand in their opening brief. As
a result, they waived their right to challenge the district
court’s ruling on this issue. See Leer v. Murphy, 844 F.2d
628, 634 (9th Cir. 1988); Miller v. Fairchild Indus., Inc.,
797 F.2d 727, 738 (9th Cir. 1986). The district court properly
dismissed the farmworkers’ § 608.140 claim.

                                      V

    The district court dismissed all of the farmworkers’ wage-
and-hour claims to the extent that they accrued before
February 16, 2009, applying a two-year statute of limitations.6
The farmworkers first argue that the district court should not
have addressed statute of limitations issues on a motion to
dismiss because plaintiffs are not required to counter
affirmative defenses in their complaints. They also assert that

 6
   The farmworkers interpret the district court’s order as applying a two-
year statute of limitations to their breach of contract claims as well. It is
not entirely clear whether the district court did so, but to the extent it did,
it was in error. Nevada law provides a six-year statute of limitations for
breach of contract claims. Nev. Rev. Stat. § 11.190(1)(b).
20            RIVERA V. PERI & SONS FARMS, INC.

their state constitutional claims are subject to a four-year
statute of limitations, and that their FLSA claims are subject
to a three-year statute of limitations. 7 Peri & Sons contends
that it was proper for the district court to consider statutes of
limitations issues, that the farmworkers waived arguments
about longer periods of limitations, and that we, even if we
choose to consider such arguments, should reject them.

                                    A

     The farmworkers are correct to note that plaintiffs
ordinarily need not “plead on the subject of an anticipated
affirmative defense.” United States v. McGee, 993 F.2d 184,
187 (9th Cir. 1993). When an affirmative defense is obvious
on the face of a complaint, however, a defendant can raise
that defense in a motion to dismiss. See Cedars-Sinai Med.
Ctr. v. Shalala, 177 F.3d 1126, 1128–29 (9th Cir. 1999)
(citing 5B Charles Alan Wright & Arthur R. Miller, Federal
Practice and Procedure: Civil § 1357 (3d ed. 1998) (“A
complaint showing that the governing statute of limitations
has run on the plaintiff’s claim for relief is the most common
situation in which the affirmative defense appears on the face
of the pleading and provides a basis for a motion to dismiss
under Rule 12(b)(6) . . . .”)). In this case, the statute of
limitations issues are apparent on the face of the complaint.
The district court, therefore, was correct to address them.

  7
    The farmworkers have not challenged the district court’s application
of a two-year statute of limitations to their claims under Nevada statutes.
Accordingly, we do not disturb the district court’s ruling on that issue.
            RIVERA V. PERI & SONS FARMS, INC.                21

                               B

    With regard to their state constitutional claims, the
farmworkers assert that the district court erred in failing to
apply a catch-all four-year statute of limitations. See Nev.
Rev. Stat. § 11.190(2)(c) (requiring “[a]n action upon a . . .
liability not founded upon an instrument in writing” to be
brought within four years). Peri & Sons argues that the
farmworkers cannot present this argument for the first time
on appeal. In response, the farmworkers suggest that they did
not have an opportunity to raise the argument below because
the district court acted sua sponte in applying a two-year
statute of limitations to their state constitutional claims.

    The district court, however, did not act sua sponte on this
issue. Peri & Sons clearly argued to the district court that the
two-year statute of limitations applies to the farmworkers’
state constitutional claims. Instead of arguing in favor of a
four-year statute of limitations, the farmworkers merely
contended that the issue should not be resolved on a motion
to dismiss, a contention we have already rejected. The
farmworkers’ failure to raise the argument below constitutes
a waiver. See Costanich v. Dep’t of Soc. & Health Servs.,
627 F.3d 1101, 1110 (9th Cir. 2010). The district court
properly dismissed the state constitutional claims to the
extent they accrued more than two years before the
farmworkers filed suit.

                               C

    With regard to the FLSA claims, the SAC clearly alleged
that Peri & Sons’ violations were “deliberate, intentional, and
willful.” The farmworkers argue that this allegation was
sufficient to implicate the three-year statute of limitations in
22          RIVERA V. PERI & SONS FARMS, INC.

29 U.S.C. § 255(a) for “a cause of action arising out of a
willful violation.” Peri & Sons contends that the farmworkers
waived this argument by failing to raise it before the district
court. See Costanich, 627 F.3d at 1110. The farmworkers,
however, argued before the district court that they
“adequately alleged that Defendant’s FLSA violations were
willful” and cited a Supreme Court case discussing the three-
year statute of limitations for willful violations. See
McLaughlin v. Richland Shoe Co., 486 U.S. 128, 135 (1988)
(“Ordinary violations of the FLSA are subject to the general
2-year statute of limitations. To obtain the benefit of the
3-year exception, the Secretary must prove that the
employer’s conduct was willful . . . .”).

    While the farmworkers’ argument could have been
clearer, it ought to be read in light of the contention by Peri
& Sons to which they were responding. In front of the
district court, Peri & Sons acknowledged that willful
violations were subject to a three-year statute of limitations
but argued that there was no “factual basis” for finding the
purported violations to be willful. Given the apparent source
of the disagreement between the parties on the statute of
limitations question, it was reasonable for the farmworkers to
focus on the contested issue rather than the conceded one in
their submission to the district court. On these facts, the
farmworkers’ submission was sufficient to raise the issue
before the district court. It was not waived.

    On appeal, Peri & Sons continues to argue that there is no
factual basis for applying the three-year statute of limitations
because any violation could not have been willful when the
federal courts have disagreed with each other over the legality
of such actions. The opinion on which Peri & Sons relies,
Gaxiola v. Williams Seafood of Arapahoe, Inc., 776 F. Supp.
             RIVERA V. PERI & SONS FARMS, INC.                  23

2d 117, 128 (E.D.N.C. 2011), however, arose on summary
judgment, not a motion to dismiss. Id. at 120. At the
pleading stage, a plaintiff need not allege willfulness with
specificity. See Fed. R. Civ. P. 9(b) (“Malice, intent,
knowledge, and other conditions of a person’s mind may be
alleged generally.”). We conclude that the farmworkers
sufficiently alleged willfulness and that the district court
erred in applying a two-year statute of limitations at this
stage.

                                VI

    For the foregoing reasons, we reverse the district court’s
dismissal of the farmworkers’ FLSA claims to the extent that
they accrued within three years of filing, reverse its dismissal
of their breach of contract claims, affirm its dismissal of their
claims under § 608.140, and reverse its dismissal of their
other state statutory and constitutional claims to the extent
that they accrued within two years of filing.8 We remand for
proceedings not inconsistent with this opinion.

  AFFIRMED IN PART, REVERSED IN PART, AND
REMANDED

   8
     Because of their success on this appeal, we award costs to the
plaintiffs-appellants.