Cunningham v. Circle 8 Crane Services ( 2023 )

Case: 22-50170 Document: 00516688530 Page: 1 Date Filed: 03/24/2023
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
March 24, 2023
No. 22-50170
Lyle W. Cayce
Clerk
Samuel Cunningham,
Plaintiff—Appellant,
versus
Circle 8 Crane Services, L.L.C.,
Defendant—Appellee.
Appeal from the United States District Court
for the Western District of Texas
USDC No. 7:20-CV-106
Before Elrod, Haynes, and Willett, Circuit Judges.
Haynes, Circuit Judge:
Samuel Cunningham was employed as a crane mechanic by Circle 8
Crane Services, LLC—a business that owns and leases self-propelled,
hydraulic cranes to customers in several southwestern states. After Circle 8
terminated him, Cunningham sued claiming that Circle 8 failed to pay him
overtime compensation in violation of the Fair Labor Standards Act,
(“FLSA”) 29 U.S.C. § 207(a). Circle 8 moved for summary judgment,
arguing that Cunningham was exempt from the overtime compensation
requirements as a “mechanic” under the Motor Carrier Act (“MCA”). The
district court agreed, concluding that Cunningham was a “mechanic”
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No. 22-50170
because he engaged in activities of a character that directly affected the safety
of operation of the mobile cranes in interstate commerce and therefore
granted the motion for summary judgment. For the reasons set forth below,
we AFFIRM.
I. Facts
Circle 8 owns and leases self-propelled, hydraulic cranes to companies
for projects in oilfields. The cranes—which are permanently affixed to a
truck chassis and can legally travel on highways—are transported to
customer jobsites throughout the southern and southwestern United States,
including Texas, Oklahoma, Louisiana, and New Mexico. As a crane
mechanic, Cunningham traveled to these sites and other Circle 8 office
locations where the cranes were stored to perform repairs and maintenance
on the hydraulic, electrical, and pneumatic systems in the cranes. For
instance, he repaired the cranes’ brakes, lights, horns, windshield wipers,
transmissions, wheels, axles, tires, starters, and ignitions. On average,
Cunningham serviced approximately five to twenty cranes a week and would
travel out of state to service these cranes several times a month, if not several
times a week. He estimated that he worked, on average, eighty hours per
week.
Cunningham was employed in this position for approximately three
years—from April 2017 until March 2020. Initially, he was paid hourly and
received overtime compensation, but in March 2018, despite no change in
job responsibilities, Circle 8 converted him to a salaried position. In March
2020, Cunningham gave his two-week notice to Circle 8 that he would be
resigning. Three days later, Circle 8 terminated him.
Cunningham sued Circle 8 claiming that it failed to pay him overtime
compensation in violation of the FLSA, 29 U.S.C. § 207(a). Circle 8 moved
for summary judgment, arguing that Cunningham was exempt from the
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overtime compensation requirements under the MCA exemption as a
“mechanic.” The magistrate judge issued a report and recommendation
(“R&R”) finding there was a genuine dispute of material fact of whether
Cunningham performed work that directly affected the safe operation of
motor vehicles and recommended denying the motion. Circle 8 objected to
the magistrate judge’s R&R on the MCA exemption, and the district judge
sustained the objection, concluding that Cunningham’s work involved
“inspections that directly affected the mobile cranes’ safe operation” as well
as “repairs . . . [that] maintain[ed] physical conditions essential to the safety
of operation of the mobile cranes on highways.” As a result, the district court
granted Circle 8’s motion for summary judgment on the MCA exemption.
Cunningham timely appealed.
II. Jurisdiction and Standard of Review
We have jurisdiction to review the district court’s final judgment
under 28 U.S.C. § 1291. We review the district court’s “grant of summary
judgment de novo, viewing all evidence in the light most favorable to the
nonmoving party and drawing all reasonable inferences in that party’s
favor.” Kariuki v. Tarango, 709 F.3d 495, 501 (5th Cir. 2013) (quotation
omitted). Summary judgment is only appropriate when “the movant shows
that there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a).
“When the movant also carries the burden of proof at trial,” such as
here where Circle 8 asserts an affirmative defense, the “burden is even
higher; [it] must establish beyond peradventure all of the essential elements
of the claim or defense.” Guzman v. Allstate Assurance Co., 18 F.4th 157, 160
(5th Cir. 2021) (internal citation and quotation marks omitted) (emphasis in
original). “Only if the movant succeeds must the nonmovant designate
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specific facts showing that there is a genuine issue for trial.” Id. (internal
citation and quotation marks omitted).
III. Discussion
Cunningham challenges the district court’s grant of summary
judgment under the MCA exemption on two grounds: (1) the Secretary of
Transportation did not have the power to establish the minimum
qualifications and maximum hours of service for him; and (2) he did not
engage in activities of a character directly affecting the safety of operation of
motor vehicles. 1 Although Cunningham alludes to fact issues, the reality is
that this case involves a dispute about the legal conclusion to be drawn from
the facts of his employment, which is a question of law, rather than a dispute
about what Cunningham did as an employee. We begin with an overview of
the statutory and regulatory framework that guides this ruling, then we turn
to the merits.
A. MCA Exemption
Generally, the FLSA requires an employer to pay overtime
compensation to any employee working more than forty hours in a workweek.
See 29 U.S.C. § 207(a)(1). “The overtime-pay rule is subject to several
enumerated exemptions, however.” White v. U.S. Corr., L.L.C., 996 F.3d
302, 307 (5th Cir. 2021); see 29 U.S.C. § 213. “[T]he employer bears the
burden” to establish a claimed exemption applies to the claimant, Dalheim v.
1
Cunningham argues that Circle 8 has the burden of showing he engaged in safety-
affecting work for each individual workweek that it claims the exemption applies. This is
not entirely accurate. Under 29 C.F.R. § 782.2(b)(3), “if the bona fide duties of the job
performed by the employee are in fact such that he is . . . called upon in the ordinary course
of his work to perform, either regularly or from time to time, safety-affecting activities,”
the employee falls “within the exemption in all workweeks when he is employed” in that
job. As set forth below in III.C., Cunningham was called upon in the ordinary course of his
job to perform, from time to time, safety-affecting activities.
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KDFW-TV, 918 F.2d 1220, 1224 (5th Cir. 1990), and we give a “fair reading”
to the exemptions, Carley v. Crest Pumping Techs., L.L.C., 890 F.3d 575, 579
(5th Cir. 2018).
Under the MCA exemption, the overtime compensation requirement
does not apply if “the Secretary of Transportation has [the] power to
establish qualifications and maximum hours of service” for the employee. 29
U.S.C. § 213(b)(1); see also White, 996 F.3d at 307. The Secretary of
Transportation has this power for employees who are employed by either
“motor carrier[s]” or “motor private carrier[s].” 49 U.S.C. § 31502(b)(1),
(b)(2). 2 Importantly, though, “[t]he Secretary of Transportation need only
possess the power to regulate the employees at issue; it need not actually
exercise that power for the [MCA] exemption to apply.” White, 996 F.3d at
307–08 (alteration in original) (emphasis added) (internal citation and
quotation marks omitted).
“The Department of Transportation has promulgated regulations
that interpret the statutory requirements of the MCA exemption.” Id. at 308
(citing 29 C.F.R. §§ 782.0–782.8). There are two regulations relevant to the
disposition of this case—29 C.F.R. §§ 782.2 and 782.6. The former, which
sets forth the general requirements for the MCA exemption, “states that the
applicability of the MCA exemption to a particular employee ‘depends both
on the class to which his employer belongs and on the class of work involved
in the employee’s job.’” White, 996 F.3d at 308 (quoting 29 C.F.R.
§ 782.2(a)). Thus, the Secretary of Transportation may establish
2
A “motor carrier” is defined as “a person providing motor vehicle transportation
for compensation.” 49 U.S.C. § 13102(14). By contrast, a “motor private carrier” is
defined as an individual who “transports property by motor vehicle” if “(A) the
transportation is as provided in section 13501 of this title; (B) the person is the owner,
lessee, or bailee of the property being transported; and (C) the property is being transported
for sale, lease, rent, or bailment or to further a commercial enterprise.” Id. § 13102(15).
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qualifications and maximum hours of service for employees of “motor
carrier[s]” and “motor private carrier[s]” who:
(1) [a]re employed by carriers whose transportation of
passengers or property by motor vehicle is subject to [the
Secretary of Transportation’s] jurisdiction under section 204
of the [MCA], [and]
(2) engage in activities of a character directly affecting the
safety of operation of motor vehicles in the transportation on
the public highways of passengers or property in interstate or
foreign commerce within the meaning of the [MCA].
Id. In short, for the MCA exemption to apply, the employer must prove that
the employee “meet[s] both of these requirements.” Id. at 308 (internal
citation and quotation marks omitted).
The latter regulation—§ 782.6(a), which is one of several that
delineate the specific classes of work involving “activities of a character
directly affecting the safety of operation of motor vehicles,” see
§ 782.2(b)(1)—sets forth the requirements for an employee to qualify as a
“mechanic” and therefore satisfy the second requirement of the MCA
exemption. See 29 C.F.R. § 782.6(a). To determine whether an employee
qualifies as a “mechanic,” “neither the name given to his position nor that
given to the work . . . he does is controlling. [W]hat is controlling is the
character of the activities involved in the performance of his job.” 29 C.F.R.
§ 782.2(b)(2).
B. Secretary of Transportation’s Authority
Against this backdrop, we address Cunningham’s first argument. He
contends the district court erred in granting summary judgment because
there is no dispute that Cunningham’s qualifications and hours of service
were not actually regulated by the Secretary of Transportation, nor did Circle
8 maintain any records vis-à-vis Cunningham establishing compliance with
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the Motor Carrier Act. According to Cunningham, this shows that the
Secretary of Transportation did not have the power to establish his minimum
qualifications and maximum hours of service. This argument both
misunderstands the law and misses the point.
As noted above, the Secretary of Transportation “need not actually
exercise [its] power for the [MCA] exemption to apply.” Id. at 307–08
(second alteration in original) (quotation omitted). Thus, the fact that Circle
8 has no records vis-à-vis Cunningham establishing compliance with the
MCA or that Cunningham’s qualifications and hours of service were not
actually regulated by the Secretary of Transportation is of no moment. The
Secretary need only have the power to regulate, which, in turn, depends on
whether the two MCA exemption requirements set forth above are satisfied.
We conclude that the Secretary clearly has the power to regulate, as relevant
here, “mechanics”—see 29 C.F.R. §§ 782.2(b)(1), 782.6(a)—so we reject his
first challenge. The question, then, is whether Cunningham’s employment
met the two MCA exemption requirements (or whether there is a genuine
dispute of material fact about either or both requirements). We will discuss
this next.
C. Cunningham’s Employment
As discussed above, there are two requirements for the MCA
exemption to apply. As to the first requirement, “employment by a carrier
subject to the Secretary of Transportation’s jurisdiction,” Cunningham
waived this issue by failing to raise it on appeal and argue it below, United
States v. Griffith, 522 F.3d 607, 610 (5th Cir. 2008) (explaining that failure to
raise an issue on appeal constitutes waiver of that argument), United States v.
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Bigler, 817 F.2d 1139, 1140 (5th Cir. 1987) (explaining the court will not
consider issues that were not raised before the trial court). 3
Turning to Cunningham’s second argument, he contends the district
court erred when it concluded that he qualified as a “mechanic” within the
meaning of § 782.2(a) and therefore satisfied the second requirement of the
MCA exemption—“engage[ment] in activities of a character directly
affecting the safety of operation of motor vehicles.” 29 C.F.R. § 782.2(a).
More precisely, Cunningham argues he is not a “mechanic” because the bulk
of the work he performed on the self-propelled cranes was to the crane itself,
not the truck chassis, and his work on the crane did not directly affect how
safely the vehicle could operate on highways. Staying with Cunningham’s
logic, which refuses to treat the self-propelled crane as an undifferentiated
whole, we agree with the district court that he qualified as a “mechanic”
because his repairs to the truck chassis directly affected the safety of
operation of the motor vehicle.
A “mechanic” is an employee “whose duty it is to keep motor
vehicles operated in interstate [] commerce by his employer in a good and
safe working condition.” 29 C.F.R. § 782.6(a). Mechanics engage in
activities of a character that directly affects the safety of operation of motor
vehicles when they “prevent the vehicles from becoming potential hazards
to highway safety and thus aid in the prevention of accidents.” Id. For
instance, mechanics perform work of this character when “they actually do
[the] inspection, adjustment, repair or maintenance work on the motor
vehicles themselves,” and the work “correct[s] or prevent[s] . . . defects
3
Even if Cunningham did not waive this issue on appeal, there is little question that
Circle 8 engaged in interstate commerce within the meaning of the MCA exemption as it
leased self-propelled cranes throughout the southern and southwestern United States,
including Texas, Oklahoma, Louisiana, and New Mexico.
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which have a direct causal connection with the safe operation of the unit as a
whole.” Id. Thus, activities like “[t]he inspection, repair, adjustment, and
maintenance . . . of steering apparatus, lights, brakes, horns, windshield
wipers, wheels and axles, . . . transmissions, . . . [and] starters and ignition”
are of a character that directly affects the safety of operation of motor
vehicles. Id.There is little dispute over the work Cunningham performed. He
performed precisely the type of activities that § 782.6(a) contemplates as
directly affecting the safety of operation of motor vehicles on the truck
chassis itself. For instance, he admitted that he performed repairs to the
brakes, lights, horns, windshield wipers, transmissions, wheels and axles, and
starters and ignitions in the self-propelled cranes. Even drawing every
reasonable inference in his favor, the record demonstrates that at least some
of these components—such as the wheels and axles, transmissions, and
starter and ignition—were affixed to or part of the truck chassis. As such,
the district court correctly concluded that Cunningham qualified as a
“mechanic” under § 782.6(a) and engaged in activities of a character that
directly affected the safety of operation of the self-propelled cranes.
IV. Conclusion
In sum, the district court correctly concluded Cunningham was
exempt from the FLSA overtime compensation requirements under the
MCA exemption. Accordingly, we AFFIRM.
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