Court Opinion

ID: 3050055
Source: CourtListenerOpinion
Date Created: 2015-10-13 23:29:42.875506+00
Date Added: 2024-06-11T11:49:22.621576
License: Public Domain

FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

DAVID DENT,                              
               Plaintiff-Appellant,
                v.                             No. 05-15455
COX COMMUNICATIONS LAS VEGAS,                   D.C. No.
                                              CV-04-01197-RCJ
INC.; ROBERT HAYES; MC
COMMUNICATIONS, INC.; JOHN                       OPINION
WEHRMAN,
             Defendants-Appellees.
                                         
        Appeal from the United States District Court
                 for the District of Nevada
         Robert C. Jones, District Judge, Presiding

                   Argued and Submitted
        February 16, 2007—San Francisco, California

                   Filed September 10, 2007

     Before: Betty B. Fletcher and Richard R. Clifton,
    Circuit Judges, and Edward F. Shea,* District Judge.

                 Opinion by Judge B. Fletcher

  *The Honorable Edward F. Shea, United States District Judge for the
Eastern District of Washington, sitting by designation.

                               12109
          DENT v. COX COMMUNICATIONS LAS VEGAS     12111

                      COUNSEL

David Borgen (argued), Goldstein, Demchak, Baller, Borgen
& Dardarian, Oakland, California, and Leon Greenberg, Las
Vegas, Nevada, for the plaintiff-appellant.
12112        DENT v. COX COMMUNICATIONS LAS VEGAS
Rick D. Roskelley (argued) and S. Libby Henninger, Litter
Mendelson, P.C., Las Vegas, Nevada, for defendant-appellee
MC Communications, Inc.

William D. Deveney (argued), Elarbee, Thompson, Sapp &
Wilson, LLP, Atlanta, Georgia, and Carol Davis Zucker and
Chantel D. Carmouche, Kamer Zucker & Abbott, Las Vegas,
Nevada, for defendant-appellee Cox Communications Las
Vegas, Inc.

                             OPINION

B. FLETCHER, Circuit Judge:

   In March 2004 plaintiff-appellant David Dent accepted
overtime compensation that was owed to him by his former
employer, MC Communications, pursuant to a settlement
supervised by the Department of Labor (“DOL”) in accor-
dance with the Fair Labor Standards Act (“FLSA”), 29 U.S.C.
§ 216(c). Dent signed a WH-58 standard form “Receipt for
Payment of Lost or Denied Wages, Employment Benefits, or
Other Compensation,” which was prepared by the DOL and
certified by MC Communications, acknowledging receipt of
payment of unpaid wages “for the period beginning with the
workweek ending 5-04-02 through the workweek ending 10-
11-03.”

   On August 27, 2004 Dent commenced this suit claiming
unpaid overtime wages under the FLSA, 29 U.S.C. § 216(b),
as well as supplemental Nevada State Law statutory wage
payments. The defendants-appellees Cox Communications
Las Vegas, Inc. and MC Communications, Inc. (collectively,
“the defendants”1) moved to dismiss Dent’s FLSA claim on
the ground that it had been released, in full, by the March
  1
    John Wehrman and Robert Hayes also remain defendants in the instant
action. They did not enter appearances before this court.
              DENT v. COX COMMUNICATIONS LAS VEGAS                   12113
2004 settlement.2 The district court granted the motion to dis-
miss Dent’s FLSA claim and declined to exercise supplemen-
tal jurisdiction over Dent’s state law claims.3

   On appeal, Dent agrees that the March 2004 settlement
fully waived his right to pursue any claims for the period
specified on the WH-58—that is, from April 28, 2002 (i.e.,
the start of the workweek ending May 4, 2002) through Octo-
ber 11, 2003.4 He maintains, however, that the settlement does
not bar him from seeking compensation earned prior to that
period.

   The issue before this court is thus whether the DOL-
supervised settlement, authorized by 29 U.S.C. § 216(c) and
reflected in the WH-58, released Dent’s claims under the
FLSA for wages earned prior to April 28, 2002. We hold that
it did not.

                                   ***

  This case arises under the FLSA, 29 U.S.C. §§ 201-19, as
well as Nevada state law. Jurisdiction in federal district court
was proper under 28 U.S.C. § 1331 and 28 U.S.C. § 1367.
  2
    Cox Communications also moved to dismiss Dent’s claims under
Nevada state law.
  3
    The defendants filed answers asserting various defenses, including fail-
ure to state a claim on which relief can be granted. They did not file their
motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) until
more than a month later, however. Because such a motion must be made
before the defendant’s responsive pleading, the defendants’ motion should
have been treated as a motion for judgment on the pleadings. See Fed. R.
Civ. P. 12(b), (c), (h)(2). Accordingly, we treat the district court’s dis-
missal of Dent’s claims as a grant of a motion for judgment on the plead-
ings. See MacDonald v. Grace Church Seattle, 457 F.3d 1079, 1081 (9th
Cir. 2006).
  4
    In light of this, Dent does not contest the dismissal of his complaint
with regard to causes of action accruing on or after the workweek ending
May 4, 2002.
12114       DENT v. COX COMMUNICATIONS LAS VEGAS
This court has jurisdiction under 28 U.S.C. § 1291 to review
the district court’s dismissal of the case, and we conduct that
review de novo. See MacDonald, 457 F.3d at 1081.

   In ruling on the defendants’ motion, the district court con-
sidered one document outside of the pleadings—Dent’s WH-
58. The parties agree that this document is authentic and
acknowledge that it is integral to Dent’s claim. In light of this,
it was proper for the district court to consider the form with-
out converting the defendants’ motion into one for summary
judgment. See, e.g., Parrino v. FHP, Inc., 146 F.3d 699, 706
& n.4 (9th Cir. 1998), superseded by statute on other grounds
as stated in Abrego Abrego v. The Dow Chem. Co., 443 F.3d
676, 681 (9th Cir. 2006).

   Like the district court, we must accept as true the allega-
tions in the plaintiff’s complaint, unless contradicted by the
WH-58. See MacDonald, 457 F.3d at 1081; Ott v. Home Sav.
& Loan Ass’n, 265 F.2d 643, 646 n.1, 647 (9th Cir. 1958).

                               ***

  The FLSA regulates, as a general matter, the minimum
wages paid to workers. See 29 U.S.C. §§ 206-207. Section 7
of the FLSA provides for overtime compensation: an
employee who works more than forty hours a week must be
paid at least one and one-half times his or her regular rate for
those additional hours. Id. § 207(a)(1).

   Section 16 of the FLSA, 29 U.S.C. § 216, addresses
courses of action available to remedy an employer’s violation
of the statute. Subsection 16(b) provides, in relevant part, for
a private cause of action to recover unpaid overtime compen-
sation and “an additional equal amount as liquidated dam-
ages.” 29 U.S.C. § 216(b). The same subsection also allows
a prevailing plaintiff to recover a reasonable attorney’s fee
and the costs of the action from the defendant. Id.
            DENT v. COX COMMUNICATIONS LAS VEGAS           12115
   [1] Subsection 16(c), 29 U.S.C. § 216(c)—the focus of this
case—authorizes the DOL to supervise what courts have
termed the “settlement” of FLSA claims. See, e.g., Walton v.
United Consumers Club, Inc., 786 F.2d 303, 305-06 (7th Cir.
1986); Lynn’s Food Stores, Inc. v. United States, 679 F.2d
1350, 1353 (11th Cir. 1982). The subsection provides:

    The Secretary [of Labor] is authorized to supervise
    the payment of the unpaid minimum wages or the
    unpaid overtime compensation owing to any
    employee or employees under section 206 or section
    207 of this title, and the agreement of any employee
    to accept such payment shall upon payment in full
    constitute a waiver by such employee of any right he
    may have under subsection (b) of this section to such
    unpaid minimum wages or unpaid overtime compen-
    sation and an additional equal amount as liquidated
    damages. . . . .

29 U.S.C. § 216(c).

   [2] Section 255 of Title 29 of the United States Code sup-
plies the statute of limitations for actions to enforce any cause
of action for compensation due under the FLSA: an action
must be commenced “within two years after the cause of
action accrued,” unless the cause of action arises “out of a
willful violation.” 29 U.S.C. § 255(a). In the case of a willful
violation, the limitations period is extended to three years. Id.;
see McLaughlin v. Richland Shoe Co., 486 U.S. 128, 132-33
(1988). A new cause of action accrues at each payday imme-
diately following the work period for which compensation is
owed. See, e.g., O’Donnell v. Vencor Inc., 466 F.3d 1104,
1113 (9th Cir. 2006) (addressing the statute of limitations
under 29 U.S.C. § 255). Dent’s complaint alleges willful vio-
lations of the FLSA, so we must assume that a three-year stat-
ute of limitations—dating back to August 27, 2001—applies.

                               ***
12116         DENT v. COX COMMUNICATIONS LAS VEGAS
  The WH-58 prepared by the DOL and executed by Dent
and his former employer states:

      I, David Dent, hereby acknowledge receipt of pay-
      ment in full from MC Communications . . . for the
      period beginning with the workweek ending 5-04-02
      through the workweek ending 10-11-03 of unpaid
      wages, employment benefits, or other compensation
      due me . . . under . . . The Fair Labor Standards Act.

The WH-58, which is the DOL’s June 1998 version of the
form, also offers the following notice:

      Your acceptance of back wages due under the Fair
      Labor Standards Act means that you have given up
      any right you may have to bring suit for such back
      wages under Section 16(b) of that Act. Section 16(b)
      provides that an employee may bring suit on his/her
      own behalf for unpaid minimum wages and/or over-
      time compensation and an equal amount as liqui-
      dated damages, plus attorney’s fees and court costs.
      Generally, a 2-year statute of limitations applies to
      the recovery of back wages. Do not sign this receipt
      unless you have actually received payment of the
      back wages due.

                                    ***

   Dent argues that, in light of the language of the WH-58, he
did not waive his right to sue under 29 U.S.C. § 216(b) for
causes of action which accrued before April 28, 2002.5 The
defendants counter that Dent attributes undue significance to
the dates memorialized on his WH-58. They contend that the
form shows that Dent accepted payment for the back wages
  5
   More specifically, in light of the three year statute of limitations for
willful violations, Dent maintains that he is entitled to bring claims for the
period from August 27, 2001 through April 27, 2002.
            DENT v. COX COMMUNICATIONS LAS VEGAS           12117
that the Secretary determined to be owed to him, and that—
under the terms of 29 U.S.C. § 216(c)—this waived and
released any right he had to bring suit against them under the
FLSA. As summed up by the brief of Cox Communications,
the defendants’ position is that “no matter what time period
the Secretary used in calculating the settlement amount,”
§ 216(c) requires that the settlement addressed all unpaid
wages owed to Dent and extinguished all future claims.

   [3] We do not find, however, that the plain meaning of 29
U.S.C. § 216(c) unambiguously compels such a conclusion.
See United States v. Daas, 198 F.3d 1167, 1174 (9th Cir.
1999) (explaining that courts must look first to the plain
meaning of a statute to ascertain congressional intent, and not-
ing that discerning the plain meaning requires consideration
of the entire statutory scheme). The statutory language of the
FLSA does not reject the possibility of a settlement payment
and resulting waiver that are tied to a specified time period.
The statute can be read as establishing the Secretary of
Labor’s authority, without limiting his discretion to use that
authority to resolve fully a set of claims as defined by a par-
ticular time period.

   Where the statutory language is ambiguous, we turn to the
legislative history for evidence of congressional intent. See id.
While the legislative history of § 216(c) does not address
directly the question presented here, it sheds light on Con-
gress’s purpose in adopting the subsection. Subsection 216(c)
was added in 1949 to facilitate the voluntary resolution of
claims for back wages, while still providing protection for
workers through DOL supervision.

   To further the FLSA’s objective of protecting certain popu-
lations of workers from substandard wages and oppressive
conditions, the Supreme Court in the mid-1940s rejected
plaintiffs’ attempts to waive claims to liquidated damages
under the FLSA in private settlements. See, e.g., D.A. Schulte,
Inc. v. Gangi, 328 U.S. 108, 116 (1946). It was understood by
12118        DENT v. COX COMMUNICATIONS LAS VEGAS
Congress that these holdings led to a decline in voluntary res-
titution by employers. See S. Rep. No. 81-640 (1949), as
reprinted in 1949 U.S.C.C.A.N. 2241, 2249 (citing as a major
cause for the decline in voluntary restitution between 1945
and 1948 the lack of assurance that an employer who agreed
to pay back wages owed to an employee would not later also
be held liable for damages and attorney’s fees under
§ 216(b)).

   Congress therefore sought “to assure employers who pay
back wages in full under the supervision of the Wage and
Hour Division that they need not worry about the possibility
of suits for liquidated damages and attorney’s fees.” Id. Sub-
section (c) was designed to offer a choice to an employee who
had been improperly denied wages under the FLSA: he or she
might “choose between action by the Administrator under the
new subsection (c) for simply the amount which is owed to
him and his own individual right of action under subsection
(b) for both back wages and liquidated damages together with
a reasonable attorney’s fee.” Id.6

   [4] While the Senate report described an action under
§ 216(c) as one for “the amount which is owed,” the context
makes clear that the report—and Congress more generally—
sought to distinguish between an agreement for back wages
under § 216(c) and the pursuit of additional damages and fees
by bringing suit under § 216(b). There is no indication that
Congress opposed DOL-supervised agreements regarding
wages owed for a discrete time period, so long as all further
claims—namely, liquidated damages, attorney’s fees or costs
—based on that period would be waived. Such an approach
does not undermine Congress’s interest in assuring the
employer that all claims from that period had been addressed
conclusively, and that the agreement would not be subject to
  6
   For further discussion of this legislative history, see Walton, 786 F.2d
at 305; Sneed v. Sneed’s Shipbuilding, Inc., 545 F.2d 537, 539 (5th Cir.
1977).
             DENT v. COX COMMUNICATIONS LAS VEGAS                   12119
second-guessing by the courts.7 Cf. Biggs v. Wilson, 1 F.3d
1537, 1539 (9th Cir. 1993) (noting that “in construing the
FLSA, we must be mindful of the directive that it is to be lib-
erally construed to apply to the furthest reaches consistent
with Congressional direction”) (citing Mitchell v. Lublin,
McGaughy & Assoc., 358 U.S. 207, 211 (1959)).

   In sum, we disagree with the district court’s determination
that, under the terms of 29 U.S.C. § 216(c), Dent’s DOL
supervised settlement necessarily waived his claims under the
FLSA for the period between August 27, 2001 and April 27,
2002.

   Furthermore, Dent’s WH-58 only provided adequate notice
for the waiver of rights associated with the time period speci-
fied on the form—from April 28, 2002 (i.e., the start of the
workweek ending May 4, 2002) and October 11, 2003.

  [5] To establish a valid waiver, 29 U.S.C. § 216(c) plainly
requires that the employee agree to accept the amount ten-
dered by the employer, and that the employee receive pay-
ment in full of that amount. See, e.g., Sneed, 545 F.2d at 539-
40 (noting, also, that the Secretary of Labor’s supervision of
   7
     The defendants cite repeatedly to the DOL’s amicus brief in Niland v.
Delta Recycling Corp., 377 F.3d 1244 (11th Cir. 2004). In that case, all
parties acknowledged that the plaintiff Niland had agreed to accept com-
pensation for overtime worked prior to February 8, 2002. The only ques-
tion was whether the DOL had provided adequate supervision. The DOL
sought to convince the court that Niland should not be allowed to revisit
the agreed-upon settlement. See Brief for the Secretary of Labor as
Amicus Curiae in Support of Defendant-Appellee Delta Recycling Corp.
Supporting Affirmance of the District Court, Niland v. Delta Recycling
Corp., 377 F.3d 1244 (11th Cir. 2004) (No. 03-14553). The Eleventh Cir-
cuit ultimately held that the DOL had supervised the settlement ade-
quately. Niland, 377 F.3d at 1247-48. Unlike Dent, Niland did not argue
that he was entitled to seek wages for a time period outside of that which
his § 216(c) settlement was explicitly intended to cover. The certainty and
finality that the DOL advocated for in its amicus brief is not compromised
by our decision here.
12120        DENT v. COX COMMUNICATIONS LAS VEGAS
the settlement is required). As the Seventh Circuit explained
in Walton, 786 F.2d at 305-07, “agreement” is more than the
acceptance of funds, as it must exist “independent of payment.”8
Where notice is lacking, meaningful agreement—and thus
valid waiver—cannot be found. In the DOL’s amicus brief in
Niland, which is cited by the defendants, the government
observed that “an employee does not waive his right under
section 16(c) to bring a section 16(b) action unless he or she
agrees to do so after being fully informed of the conse-
quences.” Brief for the Secretary of Labor at 23, Niland, 377
F.3d 1244 (11th Cir. 2004) (No. 03-14553). Typically an
employee manifests assent by signing a receipt (either the
standard WH-58 or another form authorized by the DOL),
which puts the employee on notice of the resulting waiver.
See Niland, 377 F.3d at 1248 (describing the WH-58 as the
form used by the DOL to inform employees of § 216(c)’s
waiver); Sneed, 545 F.2d at 538 & n.3, 539-40; see also 29
C.F.R. § 516.2(b).

   [6] The WH-58 signed by Dent explained that “acceptance
of back wages due under the Fair Labor Standards Act means
that you have given up any right you may have to bring suit
for such back wages under Section 16(b) of that Act.” Dent
was, of course, accepting back wages owed to him, but argu-
ably not all of the wages due. The form informed Dent that
the back wages he agreed to accept were “for the period
beginning with the workweek ending 5-04-02 through the
workweek ending 10-11-03.” In this context, the form’s state-
ment that he was giving up the right to sue for “such back
wages” reads most naturally as indicating that Dent was waiv-
  8
   Notably, while the filing of a suit by the Secretary of Labor under 29
U.S.C. § 216(c) (permitting actions to recover unpaid minimum wages or
overtime compensation and liquidated damages by the Secretary) or § 217
(permitting injunctions) automatically terminates an employee’s right to
sue, the Secretary’s approval of a payment amount does not. See id.
§ 216(b)-(c). It is a distinguishing feature that the employee’s assent is
required before the right to sue is waived under § 216(c)’s provision for
supervised settlements.
            DENT v. COX COMMUNICATIONS LAS VEGAS           12121
ing the right to bring suit under Section 16(b), 29 U.S.C.
§ 216(b), for the specified period. Moreover, the form advised
Dent only of the general two year statute of limitations; it did
not give specific notice that a three year statute of limitations
might apply.

   [7] For the foregoing reasons, we conclude that Dent’s
claims were released only with regard to the time period spec-
ified on his WH-58. We therefore affirm the district court’s
dismissal of Dent’s causes of actions under the FLSA accru-
ing on or after the workweek ending May 4, 2002, and reverse
the district court’s dismissal of Dent’s causes of actions under
the FLSA accruing on or between August 27, 2001 and April
27, 2002.

  AFFIRMED IN PART; REVERSED IN PART