Court Opinion

ID: 4638325
Source: CourtListenerOpinion
Date Created: 2020-12-01 01:00:32.742692+00
Date Added: 2024-06-11T07:58:47.133265
License: Public Domain

Case: 20-10033     Document: 00515655252         Page: 1    Date Filed: 11/30/2020

           United States Court of Appeals
                for the Fifth Circuit                                  United States Court of Appeals
                                                                                Fifth Circuit

                                                                              FILED
                                                                      November 30, 2020
                                  No. 20-10033
                                                                            Lyle W. Cayce
                                                                                 Clerk

   Amber Biziko,

                                                             Plaintiff—Appellee,

                                      versus

   Steven Van Horne; Michelle Van Horne; A Habitat for
   Learning; Loving Individuals Generating Healing
   Today,

                                                       Defendants—Appellants.

                  Appeal from the United States District Court
                      for the Northern District of Texas
                           USDC No. 1:16-CV-111-C

   Before Clement, Ho, and Duncan, Circuit Judges.
   James C. Ho, Circuit Judge:
          A jury found Defendants liable for violations of overtime requirements
   under the Fair Labor Standards Act (FLSA). 29 U.S.C. § 201 et seq. On
   appeal, Defendants allege various errors by the district court. But every one
   of Defendants’ allegations of error was either unpreserved in the district
   court or inadequately briefed here, and therefore forfeited on appeal.
          We pause only to address one of those arguments—the claim that
   Defendants are not an “enterprise engaged in commerce” subject to the
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                                     No. 20-10033

   overtime requirements of the FLSA. Id. § 207(a)(1). In the district court,
   Defendants stipulated that they are “enterprises” subject to the FLSA—
   whereas on appeal, they deny that they are. Moreover, Defendants contend
   that this issue is “jurisdictional.” But they do not cite a single case relevant
   to whether the enterprise element under the FLSA is jurisdictional.
          This issue happens to be one of first impression in this circuit. We
   hold that the provision is not jurisdictional and therefore subject to forfeiture.
   In doing so, we follow the Supreme Court’s decision in Arbaugh v. Y&H
   Corp., 546 U.S. 500 (2006), which held that a similar requirement under Title
   VII is not jurisdictional—as well as the First Circuit’s decisions in Chao v.
   Hotel Oasis, Inc., 493 F.3d 26 (1st Cir. 2007), and Martinez v. Petrenko, 792
   F.3d 173 (1st Cir. 2015), which reached the same conclusion as to the
   enterprise element of the FLSA. We accordingly affirm.
                                           I.
          Michelle Van Horne is the executive director at A Habitat for
   Learning (AHFL), a private, non-profit childcare provider and school. Her
   husband, Steven Van Horne, is AHFL’s founder and currently serves as an
   administrator there.     Steven is also the founder of Loving Individuals
   Generating Healing Today (LIGHT), a charitable organization that provides
   services for low-income individuals who are struggling to make ends meet.
          Several years ago, Plaintiff Amber Biziko worked as a childcare
   provider and assistant director at AHFL. But for at least some of her time
   there, Biziko was apparently paid by both AHFL and LIGHT. According to
   Steven, this arrangement came about after Biziko asked him about the
   possibility of working overtime at AHFL. Rather than have AHFL pay Biziko
   overtime, Steven proposed having LIGHT provide Biziko a stipend, in
   exchange for Biziko “volunteering” some of her time at AHFL. Biziko went

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   on to perform the same duties for the same hourly rate, whether she was
   working for AHFL or simply “volunteering” there on behalf of LIGHT.
          Biziko later sued the Van Hornes, AHFL, and LIGHT, alleging that
   they had failed to properly calculate and pay overtime wages as required by
   the FLSA. 29 U.S.C. § 201 et seq.
          After a one-day trial, a jury returned a verdict for Biziko. Defendants
   now appeal, challenging several district court rulings as well as the final
   judgment.
                                         II.
          The FLSA generally guarantees overtime pay to “any . . . employee[]
   who in any workweek . . . is employed in an enterprise engaged in commerce
   or in the production of goods for commerce.” Id. § 207(a)(1). When we
   determine that an employer is subject to this provision of the FLSA, we
   typically state that the plaintiff has satisfied the Act’s “enterprise coverage”
   requirement. See, e.g., Martin v. Bedell, 955 F.2d 1029, 1032 (5th Cir. 1992).
          The Act defines the phrase “enterprise engaged in commerce or in
   the production of goods for commerce” to include, among other entities, an
   enterprise that has both (a) “employees handling, selling, or otherwise
   working on goods or materials that have been moved in or produced for
   commerce by any person,” and (b) an “annual gross volume of sales made or
   business done” that is “not less than $500,000.” 29 U.S.C. § 203(s)(1)(A).
          On appeal, Defendants contend that they do not satisfy either of these
   elements. But in the district court, they said just the opposite: In a joint
   pretrial order filed with the district court, Defendants stipulated that AHFL
   and LIGHT are “enterprise[s] engaged in commerce”—and specifically,
   that their employees “handled, sold or otherwise utilized goods and materials
   and handled equipment that had been moved in or produced for such

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   commerce” and that they “had an annual gross income of sales made or
   business done of not less than $500,000.00 for the years covering the basis
   of this lawsuit.”
           We agree with Biziko that Defendants cannot “admit and stipulate”
   to the enterprise element, and then change their position and attempt to deny
   that element on appeal. Defendants have accordingly forfeited—if not
   waived—any claim that they are not an enterprise under the FLSA. 1
           For their part, Defendants suggest that the enterprise coverage
   requirement is jurisdictional. In doing so, they provide no analysis or
   authority.    Nevertheless, federal courts have “an independent duty to
   examine the basis of [their] jurisdiction.” Feld Motor Sports, Inc. v. Traxxas,
   L.P., 861 F.3d 591, 595 (5th Cir. 2017). “[S]ubject-matter jurisdiction cannot
   be created by waiver or consent.” Howery v. Allstate Ins. Co., 243 F.3d 912,
   919 (5th Cir. 2001). And it is an issue of first impression in our court whether
   the enterprise coverage element of the FLSA is jurisdictional, as Defendants
   suggest.
           We find nothing in the text of the FLSA to indicate that the enterprise
   element is jurisdictional. And the lack of any such indication in the text of
   the FLSA is dispositive under Arbaugh.

           1
             Forfeiture and waiver are of course distinct concepts. “Whereas forfeiture is the
   failure to make the timely assertion of a right, waiver is the intentional relinquishment or
   abandonment of a known right.” United States v. Olano, 507 U.S. 725, 733 (1993)
   (quotations omitted). See also Puckett v. United States, 556 U.S. 129, 138 (2009) (same).
   But it may be that some of Defendants’ arguments—including their enterprise coverage
   arguments—are not just forfeited, but affirmatively waived. See SeaQuest Diving, LP v.
   S&J Diving, Inc., 579 F.3d 411, 425–26 (5th Cir. 2009) (“Before the bankruptcy court, S&J
   stipulated that there were no genuine issues of material fact, so this argument is waived.
   Assuming that the argument was merely forfeited, we find no plain error.”) (emphases
   added) (citation omitted). Regardless of whether Defendants waived or merely forfeited
   their arguments, they clearly have no right to raise them now.

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           In Arbaugh, the Supreme Court considered whether Title VII’s
   “definition of ‘employer’ to include only those having ‘fifteen or more
   employees’” was a requirement of “federal-court subject-matter
   jurisdiction” or “simply an element of a plaintiff’s claim for relief.” 546 U.S.
   at 503, 509 (quoting 42 U.S.C. § 2000e(b)). The Court concluded that Title
   VII’s employee requirement is nonjurisdictional. Id. at 516. In so doing, the
   Court noted that the “15-employee threshold appears” in a different section
   than Title VII’s jurisdictional provision and “does not speak in jurisdictional
   terms or refer in any way to the jurisdiction of the district courts.” Id. at 515
   (quoting Zipes v. Trans World Airlines, Inc., 455 U.S. 385, 394 (1982)).
           We reach the same conclusion as to the enterprise element of the
   FLSA.     To be sure, the FLSA does not have any single independent
   jurisdictional provision. But like Title VII’s “employer” element, the
   FLSA’s “enterprise” element contains no jurisdictional language, and is
   likewise found in the Act’s definition section. See, e.g., Minard v. ITC
   Deltacom Commc’ns, Inc., 447 F.3d 352, 356 (5th Cir. 2006) (“In light of the
   Supreme Court’s decision in Arbaugh, we conclude that the definition
   section of the [Family and Medical Leave Act], which defines 13 terms used
   in the statute, including the term ‘eligible employee,’ is a substantive
   ingredient of a plaintiff’s claim for relief, not a jurisdictional limitation.”).
           Moreover, this does not appear to be a close call. Arbaugh established
   a “readily administrable bright line” rule: “[W]hen Congress does not rank
   a statutory limitation on coverage as jurisdictional, courts should treat the
   restriction as nonjurisdictional in character.” 546 U.S. at 516. In other
   words, courts should not treat a statutory provision as jurisdictional unless
   “the Legislature clearly states that a threshold limitation on a statute’s scope
   shall count as jurisdictional.” Id. at 515 (emphasis added). The Supreme
   Court has subsequently referred to the interpretive rule in Arbaugh as a
   “clear-statement rule.” See, e.g., Hamer v. Neighborhood Hous. Servs. of Chi.,

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   138 S. Ct. 13, 20 n.9 (2017) (confirming that the “clear-statement rule” in
   Arbaugh applies in all cases “not involving the timebound transfer of
   adjudicatory authority from one Article III court to another”).
            Not surprisingly, then, the only circuit to have addressed this question
   under the FLSA since Arbaugh has likewise concluded that the enterprise
   element is not jurisdictional. Shortly after Arbaugh, the First Circuit held
   that the annual-sales component of enterprise coverage under the FLSA is
   non-jurisdictional. Chao, 493 F.3d at 33. It later assumed the same for the
   interstate commerce component. See Martinez, 792 F.3d at 175.
            We agree. “Given the ‘unfair[ness]’ and ‘waste of judicial resources’
   entailed in tying the [coverage] requirement to subject-matter jurisdiction,
   we think it [a] sound[] course to refrain from constricting [28 U.S.C.] § 1331
   or [the FLSA], and to leave the ball in Congress’ court.” Arbaugh, 546 U.S.
   at 515 (citations omitted). We hold that 29 U.S.C. § 203(s)(1)(A) is non-
   jurisdictional.    Defendants therefore forfeited any objection to FLSA
   enterprise coverage on appeal when they stipulated to it before the district
   court.
            Defendants’ remaining arguments are either meritless, forfeited, or
   both. We accordingly affirm.

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