Court Opinion

ID: 2741359
Source: CourtListenerOpinion
Date Created: 2014-10-09 20:01:16.440515+00
Date Added: 2024-06-11T10:04:16.867868
License: Public Domain

FILED
                              NOT FOR PUBLICATION                                 OCT 09 2014

                                                                              MOLLY C. DWYER, CLERK
                      UNITED STATES COURT OF APPEALS                           U.S. COURT OF APPEALS

                              FOR THE NINTH CIRCUIT

 JAMES BRADY; SARAH CAVANAGH,                        No. 12-16384
 individually and on behalf of all others
 similarly situated,                                 D.C. No. 3:08-cv-00177-SI

               Plaintiffs - Appellants,
                                                     MEMORANDUM*
   v.

 DELOITTE & TOUCHE, a limited
 liability partnership,

               Defendant - Appellee.

                     Appeal from the United States District Court
                        for the Northern District of California
                     Susan Illston, Senior District Judge, Presiding

                      Argued and Submitted September 12, 2014
                              San Francisco, California

Before: BEA, IKUTA, and HURWITZ, Circuit Judges.

        This is a putative class action on behalf of unlicensed accountants against

Deloitte & Touche LLP, alleging various wage and hour violations under California

law. The district court originally certified the class, but, in light of this Court’s opinion

         *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
in Campbell v. PricewaterhouseCoopers, LLP, 642 F.3d 820 (9th Cir. 2011), granted

Deloitte’s subsequent motion to decertify. We have jurisdiction over the appeal from

the decertification order under 28 U.S.C. § 1292(e) and Federal Rule of Civil

Procedure 23(f), and affirm.

      1. We review a decertification order for abuse of discretion. Smith v. Univ. of

Wash., Law Sch., 233 F.3d 1188, 1192–93 (9th Cir. 2000). “We limit our review to

whether the district court correctly selected and applied Rule 23’s criteria.” Parra v.

Bashas’, Inc., 536 F.3d 975, 977 (9th Cir. 2008). An abuse of discretion occurs when

the district court “relies upon an improper factor, omits consideration of a factor

entitled to substantial weight, or mulls the correct mix of factors but makes a clear

error of judgment in assaying them.” Id. at 977–78 (citation omitted).

      2. The central issue in this case is whether unlicensed Deloitte accountants are

exempt from California wage and hour laws under either the Professional Exemption,

Cal. Code Regs. tit. 8, § 11040(1)(A)(3) (2001), or the Administrative Exemption, id.

§ 11040(1)(A)(2). To be exempt under either Exemption, an employee must

“customarily and regularly exercise[] discretion and independent judgment.” Id.

§ 11040(1)(A)(2)(b), (3)(c). The Administrative Exemption applies to employees who

are primarily engaged in work directly related to management policies or general

business operations. Id. § 11040(1)(A)(2)(a), (f).

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      3. In determining whether either of the two Exemptions applies, the district

court analyzes the work performed by the employees. See Marlo v. United Parcel

Serv., Inc., 639 F.3d 942, 946–48 (9th Cir. 2011); Campbell, 642 F.3d at 830, 832–33.

Deloitte proffered evidence that the level of discretion afforded to unlicensed

accountants varies dramatically from assignment to assignment. Deloitte also

submitted evidence that some unlicensed accountants are primarily assigned to work

involving management policies or general business operations. Certification under

Rule 23(b)(3) requires “that the questions of law or fact common to class members

predominate over any questions affecting only individual members.” Fed. R. Civ. P.

23(b)(3). Given the individual inquiries involved in determining the application of the

Professional and Administrative Exemptions in this case, the district court did not

abuse its discretion by determining that the common questions of law or fact

appellants identified did not predominate over these individual issues.

      AFFIRMED.

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