Summary
declining to apply judicial estoppel where the plaintiff filed a declaration stating he did not disclose his lawsuit to the bankruptcy court because he did not know that he was required to do so
Summary of this case from Freitas v. Mccabe, Hamilton & Renny Co.Opinion
No. 08-56319 D.C. No. 2:07-cv-00101-MMM-E No. 08-56384
06-07-2012
DAVID HEFFELFINGER, on behalf of himself, the general public and all other similarly situated; ANDREW HINDS, on behalf of himself, the general public, and all others similarly situated; RODNEY DWYRE, on behalf of himself, the general public, and all others similarly situated, Plaintiffs - Appellants, v. ELECTRONIC DATA SYSTEMS CORPORATION, a Delaware corporation, Defendant - Appellee. DAVID HEFFELFINGER, on behalf of himself, the general public and all other similarly situated; ANDREW HINDS, on behalf of himself, the general public, and all others similarly situated; RODNEY DWYRE, on behalf of himself, the general public, and all others similarly situated, Plaintiffs - Cross/Appellees, v. ELECTRONIC DATA SYSTEMS CORPORATION, a Delaware corporation, Defendant - Cross/Appellant.
NOT FOR PUBLICATION
MEMORANDUM
This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.
Appeal from the United States District Court
for the Central District of California
Margaret M. Morrow, District Judge, Presiding
Argued and Submitted August 1, 2011
Pasadena, California
Before: REINHARDT and BERZON, Circuit Judges, and PANNER, Senior District Judge.
The Honorable Owen M. Panner, Senior District Judge for the U.S. District Court for Oregon, Portland, sitting by designation.
Plaintiffs David Heffelfinger, Andrew Hinds, and Rodney Dwyre contend that they and other IT worker class members are not administratively exempt, Cal. Code Regs. tit. 8, § 11040(1)(A)(2), from California wage law requiring that Defendant EDS pay them overtime compensation, see Cal. Lab. Code § 510. We affirm the district court's grant of summary judgment to EDS as to Heffelfinger and Hinds, reverse as to Dwyre, and remand for further proceedings.
I. The Administrative Exemption
We note, initially, that we do not rely on the 2004 FLSA regulations to interpret California's administrative exemption. The exemption expressly incorporates FLSA regulations effective as of 2001, see Cal. Code Regs. tit. 8, § 11040(1)(A)(2)(f), and California's Industrial Welfare Commission ("IWC") has clarified, with respect to Wage Order 4-2001, that "'only those federal regulations specifically cited in its wage orders, and in effect at the time of promulgation of these wage orders, . . . apply in defining exempt duties under California law.'" Harris v. Superior Court, 53 Cal. 4th 170, 180 (2011) (final emphasis added) (quoting IWC, Statement as to the Basis (2001)).
All citations to the FLSA regulations in this memorandum disposition are to the 2001 version.
--------
a. David Heffelfinger
Heffelfinger primarily performed work "directly related to management policies or general business operations," Cal. Code Regs. tit. 8, § 11040(1)(A)(2)(a)(I), of one of EDS's customers. His main role, installing, maintaining, and managing a personnel records management database for the Department of Defense ("DOD"), qualifies as "'servicing' a business," 29 C.F.R. § 541.205(b), and was therefore "qualitatively administrative," Harris v. Superior Court, 53 Cal. 4th 170, 181 (2011).
Additionally, Heffelfinger's duties entailed "execut[ing] or carr[ying] . . . out," 29 C.F.R. § 541.205(c), DOD database policies by "developing and enforcing data base standards and procedures," "leading or participating in logical and physical data base design," and "reviewing system and programming designs to ensure efficient use of data base resources," among other responsibilities of a similar level of importance. He also "affect[ed] policy," id., by "monitoring data base performance statistics and recommending improvements, advising systems engineers and updating management on data base concepts and techniques, and researching new data base technologies." The majority of Heffelfinger's work was therefore "quantitatively" administrative, Harris, 53 Cal. 4th at 181, as well.
In addition, Heffelfinger "customarily and regularly exercise[d] discretion and independent judgment," Cal. Code Regs. tit. 8, § 11040(1)(A)(2)(b), regarding "matters of significance," 29 C.F.R. § 541.207(a). As a Team Lead, he distributed assignments among team members, monitored projects, and resolved disputes. Like the administratively exempt plaintiff in Combs v. Skyriver Comms., Inc., he also had the authority to recommend courses of action for achieving client specifications. See 159 Cal. App. 4th 1242, 1265-66 (2008). Heffelfinger "suggested solutions to accomplish technical specifications received from the DOD," "presented logical representations of network design which the DOD took under advisement," and provided advice on the feasibility of running different applications. That his suggestions were routinely subject to final client approval does not undermine the exempt nature of Heffelinger's role in designing and implementing database solutions based on DOD directives. See 29 C.F.R. § 541.207(e)(1).
As there are no genuine issues of material fact with regard to any of these matters, we affirm the grant of summary judgment to EDS as to whether Heffelfinger was exempt as an administrative employee.
b. Andrew Hinds
Hinds is not judicially estopped at this juncture from pursuing his claims simply because he failed to disclose this lawsuit in his bankruptcy proceedings. Judicial estoppel does not apply if Hinds's nondisclosure was based on "inadvertence or mistake." Helfand v. Gerson, 105 F.3d 530, 536 (9th Cir. 1997). Hinds's declaration creates a genuine issue as to whether his nondisclosure was inadvertent; as Hinds asserted, "I did not disclose [this lawsuit] to the bankruptcy court or trustee because I had no idea that I should."
Like Heffelfinger, Hinds serviced the DOD by maintaining and managing the DOC's personnel records management database and therefore performed "qualitatively administrative" work, Harris, 53 Cal. 4th at 181; see 29 C.F.R. § 541.205(a). Hinds's duties were also "quantitatively" administrative, id., as substantiated by the plaintiffs' concession that "Hinds was responsible for very high-level problem-solving and for implementing specialized tools with respect to the Oracle data base." The plaintiffs moreover agree that "[i]n general, Hinds provided solutions to the DOD's technical issues, which included leading and coordinating operational support and implementation activities for the DOD's database administration." (emphasis added)
Furthermore, Hinds "customarily and regularly exercise[d] discretion and independent judgment," Cal. Code Regs. tit. 8, § 11040(1)(A)(2)(b), in a "real and substantial" way, 29 C.F.R. § 541.207(d)(1). He was responsible for keeping the DOD's personnel records management database "up and running," and also served as "point man" with respect the DOD's common access card system." In addition, Hinds analyzed production problems, participated in "subsystem design" and "major system upgrades," and worked "[u]nder minimal direction . . . to provide programming and technical leadership in support of customer needs." Based on these undisputed facts, no reasonable juror could conclude that Hinds did not regularly exercise independent judgment and discretion "with respect to matters of significance," id. § 541.207(a).
c. Rodney Dwyre
In contrast, there is a triable issue as to whether Dwyre, a Systems Engineer and Information Analyst, qualifies for the administrative exemption. Dwyre's "duties primarily consisted of computer programming of business applications" for the California Department of Health Services ("DHS")," another EDS customer. Although "computer programmers" and "systems analysts" can be administratively exempt if they perform duties such as "the planning, scheduling, and coordination of activities which are required to develop systems for processing data to obtain solutions to complex business, scientific, or engineering problems," id. § 541.205(c)(7), the specific kinds of duties enumerated in subsection (a)(2) of the computer software field exemption, see Cal. Lab. Code § 515.5(a)(2), do not in themselves constitute "qualitatively," Harris, 53 Cal. 4th at 181, administrative work within the meaning of the administrative exemption.
As a technical Team Lead, Dwyre spent part of his time assigning and coordinating work, determining schedules, reviewing assignments, and running team meetings. Although duties like these fall within the definition of administratively exempt work, Dwyre asserted that he spent "nowhere near 50% of [his] time" on such activities." Instead, Dwyre's declared that his "job was to create or modify" computer programs to meet DHS's business requirements. The record readily supports an inference that Dwyre was primarily engaged in "[t]he design, development, documentation, analysis, creation, testing, or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications" and/or the "[t]he application of systems analysis techniques and procedures, including consulting with users, to determine . . . software . . . or system functional specifications." Id. § 515.5(a)(2)(A)-(B). Based on the record, a reasonable juror could find that Dwyre was not primarily engaged in "qualitatively" administrative work, Harris, 53 Cal. 4th at 181.
II. Class Certification
____ The district court did not abuse its discretion in certifying the IT Workers as a class. See Marlo v. United Parcel Service, Inc., 639 F.3d 942, 946 (9th Cir. 2011). The class members shared a common question of law: whether the IT Workers' duties constituted "work directly related to management policies or general business operations," Cal. Code Regs. tit. 8, § 11040(1)(A)(2)(a)(I), of EDS or its customers. Because this question predominated at the time over any need for individualized inquiry into class members' responsibilities, the district court did not err in certifying the class. See Fed. R. Civ. P. 23(b)(3).
As the district court acknowledged, however, "EDS has raised serious issues regarding the fact that information technology workers' job responsibilities vary." Even class members who shared the same job code had different duties. Upon remand, the district court retains broad discretion to address problems with the certified class, including the authority to decertify the class, in light of our holding on appeal or for other reasons. See United Steel, Paper & Forestry, Rubbery, Mfg. Energy, Allied Indus. & Serv. Workers Int'l Union, AFL-CIO, CLC v. ConocoPhillips, 593 F.3d 802, 809-10 (9th Cir. 2010).
***
We therefore AFFIRM IN PART and REVERSE IN PART the grant of summary judgment for EDS. We REMAND to the district court for further proceedings consistent with this disposition, including consideration of EDS's motion for class decertification and, if appropriate, consideration of whether Dwyre falls within the computer software field exemption.
Each party shall bear its own costs on appeal. Heffelfinger v. Electronic Data Systems Corporation, No. 08-56319 PANNER, J., concurring in part and dissenting in part:
I agree with the majority as to Heffelfinger and Hinds. Because I see no significant distinction between Dwyre and the other two plaintiffs, I dissent as to Dwyer. The case presents a complicated issue and I think the trial judge got it right.