Court Opinion

ID: 9377327
Source: CourtListenerOpinion
Date Created: 2023-03-07 17:00:42.862135+00
Date Added: 2024-06-11T17:17:13.476652
License: Public Domain

FOR PUBLICATION

   UNITED STATES COURT OF APPEALS
        FOR THE NINTH CIRCUIT

UGOCHUKWU GOODLUCK                    Nos. 21-36024
NWAUZOR; FERNANDO                            22-35026
AGUIRRE-URBINA, individually and
on behalf of all those similarly      D.C. No. 3:17-cv-
situated,                                05769-RJB
                Plaintiffs-Appellees,
                                           ORDER
  v.                                   CERTIFYING
                                      QUESTIONS TO
THE GEO GROUP, INC., a Florida        WASHINGTON
corporation,                             SUPREME
                Defendant-Appellant.      COURT

STATE OF WASHINGTON,                    Nos.   21-36025
          Plaintiff-Appellee,                  22-35027

 v.                                     D.C. No. 3:17-cv-
                                           05806-RJB
THE GEO GROUP, INC.,
          Defendant-Appellant.

                  Filed March 7, 2023

 Before: Mary H. Murguia, Chief Judge, and William A.
      Fletcher and Mark J. Bennett, Circuit Judges.
2                NWAUZOR V. THE GEO GROUP, INC.

                          SUMMARY *

          Certification Order / Washington Law

    In a case in which federal civil immigration detainees—
who are held in the Northeast ICE Processing Center
(“NWIPC”), a private detention center in Tacoma,
Washington, operated by GEO Group—challenge GEO’s
practice of paying them less than the State’s minimum wage
to work at the detention center, the panel certified the
following questions to the Washington Supreme Court:
    1) In the circumstances of this case, are the
       detained workers at NWIPC employees
       within the meaning of Washington’s
       Minimum Wage Act (“MWA”)?
    2) If the answer to the first question is yes, does
       the MWA apply to work performed in
       comparable circumstances by civil detainees
       confined in a private detention facility
       operating under a contract with the State?
    3) If the answer to the first question is yes and
       the answer to the second question is no, and
       assuming that the damage award to the
       detained workers is sustained, is that damage
       award an adequate legal remedy that would
       foreclose equitable relief to the State in the
       form of an unjust enrichment award?

*
  This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
              NWAUZOR V. THE GEO GROUP, INC.              3

                       COUNSEL

Michael W. Kirk (argued), Charles J. Cooper, J. Joel Alicea,
Joseph O. Masterman, and Tiernan B. Kane, Cooper and
Kirk PLLC, Washington, D.C., for Defendant-Appellant.
Jennifer D. Bennett (argued) and Neil K. Sawhney, Gupta
Wessler PLLC, San Francisco, California; Gregory A. Beck,
Gupta Wessler PLLC, Washington, D.C.; Jamal N.
Whitehead, Adam J. Berger, Lindsay L. Halm, and Rebecca
J. Roe, Schroeter Goldmark & Bender, Seattle, Washington;
Robert Andrew Free, Law Office of R. Andrew Free,
Atlanta, Georgia; Meena Pallipamu, Meena Pallipamu
Immigration Law PLLC, Seattle, Washington; Devin T.
Theriot-Orr, Open Sky Law PLLC, Kent, Washington; for
Plaintiffs Appellees Ugochukwu Goodluck Nwauzor and
Fernando Aguirre-Urbina.
Marsha J. Chien (argued), Andrea Brenneke, and Lane
Polozola, Assistant Attorneys General; Robert W. Ferguson,
Attorney General of Washington State; Office of the
Washington State Attorney General; Seattle, Washington;
for Plaintiff-Appellee State of Washington.
Christopher J. Hajec and Gina M. D’Andrea, Immigration
Reform Law Institute, Washington, D.C., for Amicus Curiae
Immigration Reform Law Institute.
Catherine K. Ruckelshaus, National Employment Law
Project, New York, New York, for Amicus Curiae National
Employment Law Project Inc.
Kwi “Kat” Choi and Robin L. Goldfaden, Deputy Attorneys
General; Vilma R. Palma-Solana and Marisa Hernandez-
Stern, Supervising Deputy Attorneys General; Michael L.
Newman and Satoshi Yanai, Senior Assistant Attorneys
4             NWAUZOR V. THE GEO GROUP, INC.

General; Rob Bonta, Attorney General of California;
California Department of Justice; Los Angeles, California;
for Amici Curiae the States of California, Connecticut,
Delaware, Hawaii, Illinois, Maine, Maryland, Michigan,
Minnesota, New Jersey, New Mexico, New York, Oregon,
Rhode Island, and Vermont and the District of Columbia.
Hannah Woerner, Columbia Legal Services, Olympia,
Washington; Jeremiah Miller, Fair Work Center, Seattle,
Washington; for Amici Curiae La Resistencia, Fair Work
Center, and Prof. Angelina Snodgrass Godoy.
Eunice Hyunhye Cho, American Civil Liberties Union,
National Prison Project, Washington, D.C.; Aditi Shah,
American Civil Liberties Union, National Prison Project,
New York, New York; for Amici Curiae the American Civil
Liberties Union (ACLU), the ACLU of Washington, and the
National Immigrant Justice Center.
Matt Adams, Aaron Korthuis, Leila Kang, and Michael Hur,
Northwest Immigrant Rights Project, Seattle, Washington,
for Amicus Curiae the Northwest Immigrant Rights Project.
               NWAUZOR V. THE GEO GROUP, INC.                 5

                           ORDER

    Plaintiffs-appellees are (1) a class of federal civil
immigration detainees held in a private detention center in
Tacoma, Washington, operated by defendant-appellant GEO
Group (“GEO”) pursuant to a contract with the federal
government, and (2) the State of Washington (“State”). The
detainees perform compensated essential work at GEO’s
detention center. The detained workers challenge GEO’s
practice of paying them less than the State’s minimum wage
to work at the detention center. GEO appeals from the
district court’s denial of GEO’s motion for judgment as a
matter of law; its award of damages to the class; and its
award of unjust enrichment to the State. We have
jurisdiction pursuant to 28 U.S.C. § 1291.
    The class’s damages claim under the State’s Minimum
Wage Act (“MWA”) turns on two important and unresolved
issues of Washington law. Stated briefly, those issues are:
(1) whether plaintiffs are, in the circumstances of this case,
“employees” under the MWA; and (2) whether the
government-institutions exemption of the MWA extends to
work performed by plaintiffs. The State’s unjust enrichment
claim depends on another important and unresolved issue of
Washington law: whether the class’s damages award on their
MWA claim is an adequate legal remedy that forecloses an
award to the State of equitable relief under the MWA in the
form of restitution.
    We respectfully ask the Washington Supreme Court to
exercise its discretion to decide the certified questions as set
forth below.
6              NWAUZOR V. THE GEO GROUP, INC.

                   I. Factual Background
    GEO is a private, for-profit corporation that operates
detention and correctional centers across the country. GEO
acquired the Northwest ICE Processing Center (“NWIPC”)
located in Tacoma, Washington, in 2005. GEO operates
NWIPC pursuant to a contract with Immigration and
Customs Enforcement (“ICE”) to provide “detention
management services.”
    NWIPC confines noncitizen civil detainees of the federal
government as they await determination of their immigration
status. Detainees are confined at NWIPC until ordered
deported (“removed”) or released. They are not confined
based on criminal convictions or pending criminal
proceedings, nor are they confined as a penalty for
immigration status violations. Some of the detainees are
lawful permanent residents with work authorizations.
   NWIPC has a capacity of up to 1,575 detainees. In 2015,
GEO entered into a ten-year contract with ICE to operate
NWIPC. Under the contract, GEO is to be paid a total of
$700,292,089.08, or approximately $70,000,000 per year.
Except for one aberrational year with a lower profit, GEO’s
annual profit at NWIPC between 2010 and 2018 ranged from
$18,600,000 to $23,500,000.
    GEO’s 2015 contract with ICE requires it to “perform in
accordance with specific statutory, regulatory, policy and
operational     constraints,   including     the ICE/DHS
Performance Based National Detention Standards
[(“PBNDS”)] as well as all applicable federal, state and local
laws.” The PBNDS incorporate “federal, state and local
labor laws and codes.” The contract specifies that if “a
conflict exist[s] between [federal, state, and local laws and
standards], the most stringent shall apply.”
               NWAUZOR V. THE GEO GROUP, INC.              7

    Under the contract, GEO must provide “nutritious,
adequately varied meals.” The facility must “be clean and
vermin/pest free.” GEO must “provide and distribute
suitable linens,” “launder and change linens,” and comply
with all applicable health and safety regulations and
standards. GEO must “provide safe and secure facilities.”
    The contract requires GEO to offer detained individuals
the opportunity to participate in a so-called Voluntary Work
Program (“VWP”). PBNDS 5.8 states that the VWP
provides detained individuals “opportunities to work and
earn money while confined, subject to the number of work
opportunities available and within the constraints of the
safety, security[,] and good order of the facility.” GEO has
offered detained individuals positions in this program since
2005. During the period relevant to this suit, approximately
200 to over 400 detained workers have participated each day
in the VWP at NWIPC.
     PBNDS 5.8 specifies that “[t]he normal scheduled
workday for a detainee employed full time is a maximum of
8 hours” and that “[d]etainees shall not be permitted to work
in excess of 8 hours daily, 40 hours weekly.” The standard
lists the possible reasons a detained worker can be “removed
from a work detail,” including “unsatisfactory
performance,” “disruptive behavior, threats to security,” and
“physical inability to perform the essential elements of the
job.”
    Section k of PBNDS 5.8 provides: “Detainees shall
receive monetary compensation for work completed in
accordance with the facility’s standard policy.       The
compensation is at least $1.00 (USD) per day.” During the
relevant period, ICE reimbursed GEO one dollar per day for
money paid to detained workers participating in the VWP
8              NWAUZOR V. THE GEO GROUP, INC.

program. There is nothing in GEO’s contract that prevents
GEO from paying above the reimbursement amount, either
voluntarily or if required to do so by state law. GEO has
never paid detained workers in VWP positions the State’s
hourly minimum wage.
    Under its contract with ICE, GEO has responsibility for
administrating the VWP, which included creating job
descriptions, setting work schedules, providing training, and
selecting workers. During the relevant period, NWIPC’s
“classification officer” was a GEO employee responsible for
managing detained workers and creating job assignments.
GEO employees had the authority to adjust the number of
detained workers and the type of job they performed. Under
the contract, ICE was not required to review or sign off on
GEO’s job descriptions, training requirements, or work
schedules, and it never did so. ICE played no role in work
assignments, training, or supervision, or in the day-to-day
management of the VWP. VWP workers performed work
that was essential to the day-to-day operations of NWIPC,
including meal preparation, janitorial services, and laundry
services. Detained workers were not permitted to work in
non-secure areas of the facility. GEO was responsible for
dealing with complaints and grievances concerning working
conditions.
    GEO usually paid detained workers one dollar per day,
the minimum prescribed in its contract with ICE. Sometimes
GEO paid up to five dollars per day to incentivize detained
workers to perform the most difficult work. GEO also
occasionally raised wages when detained individuals quit or
disease outbreaks at NWIPC caused shortages of available
workers, but never paid more than five dollars a day.
                NWAUZOR V. THE GEO GROUP, INC.                 9

    On September 20, 2017, the State sued GEO in Pierce
County Superior Court, alleging violations of the MWA and
seeking equitable remedies including unjust enrichment. On
September 26, 2017, detained workers filed a class action in
federal district court, alleging violations of the MWA and
seeking damages. On October 9, 2017, GEO removed the
State’s suit to the district court.
    The district court consolidated the two cases for the
purpose of determining liability. A jury trial was conducted
in October 2021. The jury returned a unanimous verdict for
the plaintiffs under the MWA in both cases. After the jury
returned its verdict, the court held a damages trial in the class
action and awarded $17.3 million in back pay. The court
held a separate trial on the State’s equitable claims. It
enjoined GEO from employing detained individuals without
paying Washington’s minimum wage, and it awarded the
State $5,950,340 based on unjust enrichment of GEO.
    GEO timely appealed.
               II. Explanation of Certification
    Washington law authorizes certification of a question
from a federal court when in the opinion of that court “it is
necessary to ascertain the local law of this state in order to
dispose of such proceeding and the local law has not been
clearly determined.” Wash. Rev. Code § 2.60.020.
                        A. Question 1
    In its appeal to us, GEO argues that the text of the MWA
and Washington case law interpreting the MWA exclude
from the MWA’s coverage the detained workers
participating in the VWP at NWIPC. Both the State and the
class members argue that the detained workers are
employees within the meaning of the MWA. See Wash.
10            NWAUZOR V. THE GEO GROUP, INC.

Rev. Code § 49.46.010(3); Anfinson v. FedEx Ground
Package Sys., Inc., 281 P.3d 289, 297 (Wash. 2012).
    Whether the MWA applies to the work performed by
members of the plaintiff class in the circumstances of this
case is a determinative threshold issue. If detained workers
at NWIPC are not employees within the meaning of the
MWA, they have no case. There is no direct and
unambiguous controlling precedent telling us whether the
MWA applies to essential work performed by civil detainees
in a detention facility operated by a private company under
a contract with the federal government when (1) the work
performed by the detainees allows the facility operator to
avoid hiring non-detainees to perform that same work, (2)
the company’s contract requires the operator to comply with
“state and local labor laws and codes,” and (3) the
company’s contract with the federal government allows the
operator to pay more than one dollar per day.
    Washington courts assess whether workers qualify as
employees under the MWA using the “economic-
dependence test.” Anfinson, 281 P.3d at 297–99. This test,
adopted from the federal Fair Labor Standards Act
(“FLSA”), asks “whether, as a matter of economic reality,
the worker is economically dependent upon the alleged
employer or is instead in business for himself.” Id. at 299
(citation omitted). The Washington Supreme Court first
adopted this test in the context of determining whether a
worker under the MWA was an “employee” or an
independent contractor. Id. at 292. Washington courts have
not addressed whether the economic-dependence test is
applicable in a custodial setting under the circumstances
presented in this case.
               NWAUZOR V. THE GEO GROUP, INC.               11

    The MWA excludes from coverage “[a]ny resident,
inmate, or patient of a state, county, or municipal
correctional, detention, treatment or rehabilitative
institution.” Wash. Rev. Code § 49.46.010(3)(k) (emphasis
added). The text of section k does not mention private
detention institutions.
    In its briefing to us, GEO argues that the MWA does not
apply to work performed by individuals confined in any
custodial institution. GEO cites Hill v. Department of Labor
& Industries, 253 P.3d 430 (Wash. Ct. App. 2011), and
Calhoun v. State, 193 P.3d 188 (Wash. Ct. App. 2008), in
support of its argument. Hill and Calhoun were decided
under section k, but the plaintiffs in both cases were confined
in public institutions. The institution in Hill was a state-run
prison. In Calhoun, the institution was a state civil
commitment facility.
    The Washington Supreme Court sometimes looks to the
FLSA in ascertaining the scope of the MWA. Anfinson, 281
P.3d at 298; but see Drinkwitz v. Alliant Techsystems, Inc.,
996 P.2d 582, 586 (Wash. 2000) (“[T]he MWA and FLSA
are not identical and we are not bound by such authority.”).
Even if the Washington Supreme Court in this case were to
look to the FLSA for assistance, the federal cases are in
conflict. The Fourth Circuit has held that Congress meant to
“protect” only “workers who operate within ‘the traditional
employment paradigm.’” Ndambi v. CoreCivic, Inc., 990
F.3d 369, 372 (4th Cir. 2021) (quoting Harker v. State Use
Indus., 990 F.2d 131, 133 (4th Cir. 1993)). In the Fourth
Circuit’s view, the FLSA can never cover detained workers.
Id. at 372–73. Our circuit disagrees, holding that the FLSA
does not “categorically exclude all labor of any [incarcerated
individual].” Hale v. Arizona, 993 F.2d 1387, 1392 (9th Cir.
1993) (en banc) (“Because Congress has specifically
12                NWAUZOR V. THE GEO GROUP, INC.

exempted nine broad categories of workers from the
minimum wage provisions of the FLSA but not prisoners,
we are hard pressed to conclude that it nevertheless intended
for all [incarcerated individuals] to be excluded.” (internal
citations omitted)), abrogated on other grounds by Seminole
Tribe of Fla. v. Florida, 517 U.S. 44, 72–73 (1996).
                            B. Question 2
    If the MWA applies, in the circumstances of this case, to
work performed by civil detainees in a private detention
center operated under a contract with the federal
government, a second question arises: whether the MWA
applies to work performed, in comparable circumstances, by
civil detainees at a private detention facility operated under
a contract with the State. If § 49.46.010(3)(k) does not apply
to such work performed at a private detention facility
operated under a contract with the State, but does apply to
such work performed at private detention facilities operated
under a contract with the federal government, the federal-
law intergovernmental immunity doctrine may bar the
MWA’s application in the case before us. See, e.g., United
States v. City of Arcata, 629 F.3d 986, 991 (9th Cir. 2010);
North Dakota v. United States, 495 U.S. 423, 435 (1990).
    The State and members of the plaintiff class argue that
section k distinguishes between private and public
institutions, thereby avoiding intergovernmental immunity
concerns. GEO argues that Washington treats itself more
favorably than a federal contractor in comparable
circumstances, in violation of the intergovernmental
immunity doctrine and the Supremacy Clause. 1 In support

1
 Although not a party in this case, in August 2019 the United States filed
a statement of interest in the district court adopting GEO’s
                  NWAUZOR V. THE GEO GROUP, INC.                         13

of its argument, GEO points to guidance promulgated by the
Washington State Department of Labor and Industries. The
guidance concerns the MWA’s applicability to detainees in
a “state, county or municipal correctional, detention,
treatment or rehabilitative institution” who are “assigned by
facility officials to work on facility premises for a private
corporation at rates established and paid for by public
funds.” ES.A.1, Minimum Wage Act Applicability, last
revised December 29, 2020. This guidance states that such
detainees “are not employees of the private corporation and
would not be subject to the MWA.” Id. GEO argues that
this guidance shows that if the MWA applies to the VWP at
NWIPC, it impermissibly discriminates against the federal
government because it singles out the federal government for
differential and less favorable treatment.
    The application and effect of this guidance are unclear.
    First, it is not clear whether the guidance would treat the
detainees in this case differently from detainees working in
comparable circumstances in an private institution operating
under contract with the state. The detainees in the guidance
are held in a public institution, are employed by a private
contractor performing a task in that public institution, and
are paid at “rates established and paid for by public funds.”
The guidance may not apply to state detainees who are held
in circumstances comparable to those in the case before us.

intergovernmental immunity arguments. The United States argued “that
the intergovernmental immunity doctrine requires invalidation of
otherwise generally applicable state laws that treat states and those with
whom it deals better than the Federal Government and those with whom
it deals.” In a simultaneously filed order, we have invited the
Department of Justice to file an amicus brief articulating its current views
on GEO’s federal constitutional defenses.
14             NWAUZOR V. THE GEO GROUP, INC.

That is, the guidance may not apply to state detainees who
are held in an institution of a private contractor, who are
employed by that contractor at that institution, and who are
paid at rates determined by the contractor. And it may not
apply when the private contractor makes a substantial profit
by using detained workers to perform essential tasks in the
facility instead of using non-detained workers to whom it
would be obliged to pay minimum wage under the MWA.
    Second, even if the guidance were to apply in such a
fashion as to treat the federal government less favorably than
the State, the guidance is not a judicial interpretation of the
MWA.
                       C. Question 3
     The district court awarded equitable monetary relief to
the State, holding that GEO had been unjustly enriched by
its violations of the MWA. The Washington Supreme Court
has explained that equitable relief is unavailable when the
party seeking relief has an adequate remedy at law. Seattle
Pro. Eng’g Emps. Ass’n v. Boeing Co., 991 P.2d 1126, 1134
(Wash. 2000).
    GEO contends that the State is barred from seeking
unjust enrichment because there is an adequate remedy at
law. The State argues that the damages remedy under the
MWA does not provide an adequate remedy to the non-
detained community in the Tacoma area that has been
adversely affected by GEO’s reliance on its detained
workforce to perform essential work at NWIPC. The State
contends, and the district court agreed, that this essential
work would have been performed by non-detained labor
drawn from the community and paid according to the
requirements of the MWA if GEO had not used its detained
workforce to perform that work at rates far below those
               NWAUZOR V. THE GEO GROUP, INC.             15

specified in the MWA. Testimony at trial recounted that if
GEO had not relied on detained workers to perform essential
work at NWIPC, it would have been required to employ
eighty five additional non-detained workers.
    Washington’s case law on unjust enrichment does not
clearly answer the question whether the MWA damages
award to the class is an adequate remedy that bars an unjust
enrichment award to the State. An answer to this question is
necessary to the disposition of the State’s unjust enrichment
claim. There may be other questions relevant to the award
of unjust enrichment in this case that the Washington
Supreme Court may also choose to address.
                      D. Implications
    Certification of questions to the Washington Supreme
Court is particularly appropriate when questions of unsettled
state law have “significant policy implications.” Centurion
Props. III, LCC v. Chi. Title Ins. Co., 793 F.3d 1087, 1089
(9th Cir. 2015) (internal citation and quotation marks
omitted); see also Barlow v. Washington, 38 F.4th 62, 66–
67 (9th Cir. 2022) (considering the impact of certified
questions on state universities). We believe that the above-
discussed certified questions meet this standard. The
resolution of these questions is likely to have a significant
impact on how the federal government contracts with private
detention facilities in the State.
                  III. Certified Questions
    We respectfully certify the following three questions to
the Washington Supreme Court:
16             NWAUZOR V. THE GEO GROUP, INC.

       (1) In the circumstances of this case, are the
           detained workers at NWIPC employees
           within the meaning of Washington’s
           MWA?
       (2) If the answer to the first question is yes,
           does the MWA apply to work performed
           in comparable circumstances by civil
           detainees confined in a private detention
           facility operating under a contract with
           the State?
       (3) If the answer to the first question is yes
           and the answer to the second question is
           no, and assuming that the damage award
           to the detained workers is sustained, is
           that damage award an adequate legal
           remedy that would foreclose equitable
           relief to the State in the form of an unjust
           enrichment award?
    We do not intend the phrasing of our questions to restrict
the Washington Supreme Court’s deliberations.             We
recognize that the Washington Supreme Court may exercise
its discretion and reformulate the questions. Broad v.
Mannesmann Anlagenbau AG, 196 F.3d 1075, 1076 (9th Cir.
1999).
    The Clerk of Court is ordered to transmit to the
Washington Supreme Court, under official seal of the Ninth
Circuit, this order and request for certification along with all
relevant briefs and excerpts of record pursuant to Wash. Rev.
Code §§ 2.60.010 and 2.60.030 and Washington Rule of
Appellate Procedure 16.16.
               NWAUZOR V. THE GEO GROUP, INC.                17

    If the Washington Supreme Court accepts the certified
questions, we designate GEO as the party to file the first
brief pursuant to Washington Rule of Appellate Procedure
16.16(e)(1).
    Further proceedings in this court are stayed pending the
Washington Supreme Court’s decision whether to accept
review; and, if that Court accepts review, pending receipt of
answers to the certified questions. This appeal is withdrawn
from submission until further order. The Clerk is directed to
administratively close the docket. The panel will resume
control and jurisdiction upon the Washington Supreme
Court’s decision to not accept the certified questions or upon
receipt of answers to the certified questions.
    When the Washington Supreme Court decides whether
to accept the certified questions, or orders additional briefing
before deciding whether to accept the questions, the parties
are directed to promptly file a joint status report informing
us. If the Washington Supreme Court accepts the certified
question, the parties are directed to file further joint status
reports informing us when briefing has been completed and
a date set for oral argument and when the Washington
Supreme Court provides answers to the certified questions.

       /s/ Mary H. Murguia
       Chief Judge Mary H. Murguia
       U.S. Court of Appeals for the Ninth Circuit