Court Opinion

ID: 4639741
Source: CourtListenerOpinion
Date Created: 2020-12-04 20:00:46.152789+00
Date Added: 2024-06-11T07:58:59.999970
License: Public Domain

Case: 19-20567      Document: 00515660972           Page: 1     Date Filed: 12/04/2020

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

                                                                            FILED
                                                                     December 4, 2020
                                    No. 19-20567                       Lyle W. Cayce
                                                                            Clerk

   Casey Nelson; Maylene Velasco,

                                                              Plaintiffs—Appellants,

                                        versus

   Texas Sugars, Incorporated, doing business as Moments,

                                                               Defendant—Appellee.

                   Appeal from the United States District Court
                       for the Southern District of Texas
                             USDC No. 4:17-CV-2171

   Before Owen, Chief Judge, and King and Engelhardt, Circuit Judges.
   Per Curiam:*
          Exotic dancers sued the club where they perform, alleging violations
   of the Fair Labor Standards Act for failure to pay minimum and overtime
   wages. After trial, the jury returned a verdict in favor of the club, finding that
   the dancers were not employees within the meaning of the Fair Labor
   Standards Act. We AFFIRM.

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 19-20567        Document: 00515660972             Page: 2      Date Filed: 12/04/2020

                                        No. 19-20567

                                              I.
           Defendant-appellee Texas Sugars, Inc. owns and operates Moments
   (the “Club”), an adult cabaret in Pasadena, Texas, which features exotic
   dancers. Plaintiffs-appellants Casey Nelson and Maylene Velasco were exotic
   dancers at the Club (the “dancers”). The dancers filed suit in federal court,
   alleging that Texas Sugars misclassified them as independent contractors and
   failed to pay them minimum and overtime wages in violation of the Fair Labor
   Standards Act (the “FLSA”). The dancers’ suit proceeded to a jury trial,
   where the Club’s general manager and multiple dancers 1 testified.
   Specifically, the jury heard competing testimony on a range of relevant topics
   such as how the dancers were paid, the various aspects of the work
   arrangement that the dancers and the Club each controlled, the relative
   investments of the dancers and the Club, the skill and initiative involved in
   being a dancer, and the dancers’ typical tenure at the Club.
           Plainly put, after several days of testimony, the jury heard various
   narratives about the dancers’ work at the Club from which to determine
   whether the dancers were employees or independent contractors.
           After Texas Sugars concluded its case-in-chief, the dancers moved
   pursuant to Federal Rule of Civil Procedure 50 for a directed verdict as to
   liability on the basis that, under our economic realities test, the dancers are
   employees and not independent contractors. The district court denied the
   motion. The dancers also objected to the jury instructions regarding
   employee status, arguing that the question of employee status was not
   appropriate to submit to the jury and that the instructions misstated the law.
   The district court overruled the objections, opting instead to follow our

           1
            In addition to the two named dancers, six other dancers testified, three of whom
   were opt-in plaintiffs and another three of whom were not.

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                                          No. 19-20567

   pattern instructions verbatim. Once the jury returned a verdict in favor of
   Texas Sugars, the dancers moved for a new trial and renewed their motion
   for a directed verdict. The district court denied the motion for a new trial.2
   The dancers timely filed a notice of appeal.
                                                II.
           At bottom, this appeal is about whether the evidence adduced at trial
   supports the jury’s finding that the dancers were not employees of the Club.
   We conclude that the evidence supports exactly that.
               We review challenges to the denial of a Rule 50 motion de novo.
   Orozco v. Plackis, 757 F.3d 445, 448 (5th Cir. 2014). 3 And to be clear, where
   there has been a jury trial, a Rule 50 motion “is a challenge to the legal
   sufficiency of the evidence supporting the jury’s verdict.” Id. “A motion for
   judgment as a matter of law should be granted if there is no legally sufficient
   evidentiary basis for a reasonable jury to find for a party.” Id. In other words,
   “[a] post-judgment motion for judgment as a matter of law should only be
   granted when the facts and inferences point so strongly in favor of the movant
   that a rational jury could not reach a contrary verdict.” Pineda v. United Parcel
   Serv., Inc., 360 F.3d 483, 486 (5th Cir. 2004). To that end, we view the

           2
              The district court did not explicitly deny the renewed motion for a directed
   verdict. But, although “[t]here are circumstances where a district judge might rationally
   deny the motion[] for directed verdict . . . but grant the motion for a new trial,” Urti v.
   Transp. Com. Corp., 479 F.2d 766, 769 (5th Cir. 1973), the inverse is not necessarily so. In
   this case, the arguments on both the motion for a new trial and the renewed motion for a
   directed verdict were such that after ruling on the motion for a new trial, the district court
   was left with nothing else to resolve. See FED. R. CIV. P. 50(b) (explaining that after the
   jury returns a verdict, “the movant may file a renewed motion for judgment as a matter of
   law and may include an alternative or joint request for a new trial”).
           3
             And though Texas Sugars posits that we should review this challenge for plain
   error, we disagree. The dancers preserved their challenge for appeal, and as discussed
   supra, their challenge nevertheless fails under our de novo review.

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                                     No. 19-20567

   evidence in the light most favorable to the verdict. Orozco, 757 F.3d at 448;
   Eberline v. Media Net, L.L.C., 636 F. App’x 225, 226 (5th Cir. 2016). Our
   review is especially deferential where there has been a jury verdict, and we
   do not engage in credibility determinations or reweigh the evidence. Orozco,
   757 F.3d at 448; Eberline, 636 F. App’x at 226.
          In FLSA cases for minimum wage and overtime compensation, a
   plaintiff must establish that she is an employee of the alleged employer. In
   determining whether a worker qualifies as an employee, we apply the
   economic realities test. Specifically, we “focus on whether, as a matter of
   economic reality, the worker is economically dependent upon the alleged
   employer or is instead in business for [her]self.” Hopkins v. Cornerstone Am.,
   545 F.3d 338, 343 (5th Cir. 2008). Five non-exhaustive factors guide our
   inquiry, and no one factor is determinative: “(1) the degree of control
   exercised by the alleged employer; (2) the extent of the relative investments
   of the worker and the alleged employer; (3) the degree to which the worker’s
   opportunity for profit or loss is determined by the alleged employer; (4) the
   skill and initiative required in performing the job; and (5) the permanency of
   the relationship.” Id.; see also Reich v. Circle C. Invs., Inc., 998 F.2d 324, 327
   (5th Cir. 1993).
          In this case, we consider whether the jury could properly determine,
   “as a matter of economic reality,” that the dancers failed to establish that
   they were employees. Reich, 998 F.2d at 327. We will only reject the jury’s
   verdict if the facts and inferences weigh so heavily in the dancers’ favor “that
   a rational jury could not reach a contrary verdict.” Id.; see also Eberline, 636
   F. App’x at 226 (discussing that our review of jury verdicts is especially
   deferential). For the reasons that follow, we find that there was sufficient
   evidence for the jury to conclude that the dancers were not employees.

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                                    No. 19-20567

          First, given the fact that the dancers set their own schedule, worked
   for other clubs, chose their costume and routine, decided where to perform
   (onstage or offstage), kept all the money that they earned, and even chose
   how much to charge customers for dances, a reasonable jury could conclude
   that the Club did not exercise significant control over them. Indeed, we have
   previously found that a worker’s ability to adjust his or her own schedule,
   negotiate prices with customers, and keep whatever money was earned are
   all factors that a reasonable jury could conclude weigh against employee
   status and in favor of independent contractor status. Eberline, 636 F. App’x
   at 227–28.
          Second, as to the “relative investments” factor, because the dancers
   provided their own costumes and makeup, the jury could conclude that this
   factor, too, weighed against employee status or was neutral. Specifically,
   although the Club made significant investments in, inter alia, advertising,
   décor, food, and alcohol, the jury could have concluded that those
   investments were not essential for the dancers to perform their work and thus
   the relative investments of the Club and the dancers were not necessarily
   comparable. In other words, the dancers’ ability to perform and earn money
   did not depend on the Club’s décor or food and alcohol offerings. And we
   have previously found that a reasonable jury could conclude that this factor
   weighs against employee status where a worker provides his or her own tools
   and supplies. Eberline, 636 F. App’x at 228.
          Third, the jury could conclude that, although the Club determined
   certain aspects about the Club, the dancers assumed the risk of profit or loss
   by deciding how and when they chose to engage with customers, including
   when they worked, whether they performed onstage or offstage, and what
   choices they made regarding their costume and makeup. In other words, the
   dancers’ risk of profit or loss was determined (at least in part) by when they
   worked and how they chose to interact with and market themselves to

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                                       No. 19-20567

   customers. In fact, we have previously found that a reasonable jury could
   conclude that this factor weighs against employee status where the worker
   could set his or her own schedule and profit by how he or she chose to
   “market” himself or herself and which services he or she was willing to
   provide. Eberline, 636 F. App’x at 228.
             Fourth, the jury could conclude that, although no specific dancing skill
   was required, the dancers had to take initiative in terms of when they worked
   as well as their customer interactions. Again, we have found that a jury could
   conclude that this factor weighs against employee status where the worker
   controls his or her schedule and can profit based on the services offered to
   customers. Id. at 228–29.
             Fifth, even though some of the dancers worked at the Club for years,
   because the dancers had no set schedule and could pick their hours, the jury
   could have concluded that this arrangement was not a permanent one. We
   have previously found that arrangements that allow for movement from club
   to club and lack a set term weigh against employee status. See Reich, 998 F.2d
   at 328.
             Finally, we note that we have also sometimes looked to whether the
   worker’s services are integral to the business. Hobbs v. Petroplex Pipe &
   Constr., Inc., 946 F.3d 824, 836 (5th Cir. 2020). And though the dancers
   argue that this consideration weighs in their favor because, without the
   dancers, the Club would just be a bar, this fact does not change our analysis.
   Nor would a determination that the relative investments factor is neutral.
   This is so because no one factor is determinative. Hopkins, 545 F.3d at 343;
   Reich, 998 F.2d at 327; Brock v. Mr. W Fireworks, Inc., 814 F.2d 1042, 1043–
   44 (5th Cir. 1987); see also Eberline, 636 F. App’x at 229 (upholding jury
   verdict finding in favor of independent contractor status even where one of

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                                        No. 19-20567

   the factors favored employee status). To that end, the jury could reasonably
   conclude that, on balance, the factors did not favor employee status.
                                             III.
           The dancers also challenge the jury instructions. Specifically, on
   appeal, the dancers argue that the jury instructions misstated the law because
   they did not accurately capture the above-mentioned factors comprising our
   economic realities test. But the dancers are incorrect. Indeed, our pattern
   instructions, which the district court followed verbatim, undoubtedly capture
   these factors.
           We review challenges to jury instructions that were properly objected
   to for abuse of discretion. 4 Eastman Chem. Co. v. Plastipure, Inc., 775 F.3d
   230, 240 (5th Cir. 2014).
           Typically, we “afford the trial court great latitude in the framing and
   structure of jury instructions.” Eastman Chem. Co., 775 F.3d at 240. “In
   order to demonstrate reversible error, the party challenging the instruction
   must show that the charge creates substantial and ineradicable doubt whether
   the jury has been properly guided in its deliberations.” Id. In reviewing such
   challenges, we “consider whether the instruction, taken as a whole, ‘is a
   correct statement of the law and whether it clearly instructs jurors as to the
   principles of law applicable to the factual issues confronting them.’” United
   States v. Freeman, 434 F.3d 369, 377 (5th Cir. 2005). To object, a party “must
   do so on the record, stating distinctly the matter objected to and the grounds
   for the objection.” Fed. R. Civ. P. 51(c)(1).

           4
            Here, again, Texas Sugars urges us to review this challenge for plain error. But
   because the dancers preserved this challenge for appeal, we decline to do so. Further, as
   discussed supra, this challenge nevertheless fails under abuse of discretion.

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                                          No. 19-20567

           Further, we have previously held that a “district court [does] not
   abuse its discretion by using a pattern jury instruction that correctly state[s]
   the law.” United States v. Toure, 965 F.3d 393, 403 (5th Cir. 2020); United
   States v. Sheridan, 838 F.3d 671, 673 (5th Cir. 2016) (“It is well-settled,
   however, that a district court does not err by giving a charge that tracks this
   Circuit’s pattern jury instructions and that is a correct statement of the
   law.”) (citations omitted); see also United States v. Redd, 355 F.3d 866, 874
   (5th Cir. 2003) (discussing that “on a point such as instructions to juries
   there should be no difference in procedure between civil and criminal
   cases”).
           In this case, the district court simply used our pattern instructions
   without any deviation. And these pattern instructions specifically pertain to
   the question of employee status in the FLSA context. See Fifth Circuit
   Pattern Jury Instruction (Civil Case) 11.26.
           To be sure, when read as a whole, the instructions are not
   misstatements of the law but accurately capture the employee-status inquiry.
   Specifically, the jury was directed to consider who controlled the dancers’
   work, how the dancers were paid, the risk or opportunity the dancers had for
   profit or loss, who supplied the necessary equipment, how the services were
   rendered, and how the parties understood their relationship. 5 All these
   considerations are relevant to the economic realities test that we apply to this

           5
             To that end, the dancers’ argument that the district court abused its discretion in
   failing to give an instruction on three economic realities factors—permanency of the
   relationship, skill and initiative, and whether the dancers are an integral part of the Club’s
   business—is unavailing. First, we emphasize that no one factor is determinative. Hopkins,
   545 F.3d at 343. Second, these factors are necessarily included in our pattern instructions.
   For example, even though the instructions do not use the words “relative investments” or
   “permanency,” the jury was instructed to consider them because the jury was directed to
   consider how the services are rendered and the ability to transfer services.

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                                           No. 19-20567

   question. 6 Compare Pattern Jury Instruction 11.26 with Reich, 998 F.2d at 327
   (outlining our five, non-exhaustive factors that we use to guide the employee
   status inquiry). And, under the economic realities test, the considered factors
   are non-exhaustive. Reich, 998 F.2d at 327 (explaining that the “factors are
   merely aids in determining the underlying questions”); Brock, 814 F.2d at
   1043–44 (discussing that “the factors are not exhaustive”); see also Parrish v.
   Premier Directional Drilling, L.P., 917 F.3d 369, 379 (5th Cir. 2019).
           We note that, just because the dancers contend that a certain factor
   should have favored employee status, does not necessarily mean that the
   factor was framed incorrectly or even that the jury found to the contrary on a
   specific factor. Based on the jury’s verdict, there is no way to know how the
   jury actually weighed any one factor, and we emphasize that no one factor is
   determinative. Hopkins, 545 F.3d at 343; Reich, 998 F.2d at 327; Brock, 814
   F.2d at 1043–44.
           Therefore, the district court did not abuse its discretion in adhering to
   our pattern instructions and overruling the dancers’ objections to the jury
   instructions.
                                                IV.
           For the foregoing reasons, we AFFIRM.

           6
              And though the dancers also argue that the specific pattern instruction, which
   directs the jury to consider the parties’ intent, allows the jury to consider a factor outside
   of the five commonly considered factors, we emphasize that those factors are non-
   exhaustive, Brock, 814 F.2d at 1043–44, and our pattern instructions are careful to remind
   the jury that no one factor is determinative, see Fifth Circuit Pattern Jury Instruction (Civil
   Case) 11.26 (instructing the jury that “no single factor determines the outcome”).

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