Marcie Redgrave v. Doug Ducey ( 2020 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
MARCIE A. REDGRAVE, individually No. 18-17150
and on behalf of all others similarly
situated, D.C. No.
Plaintiff-Appellant, 2:18-cv-01247-
DLR
v.
DOUG DUCEY, Governor; THOMAS J. ORDER
BETLACH, in his official capacity as CERTIFYING
Director of the Arizona Health Care QUESTION TO
Cost Containment System; ARIZONA ARIZONA
DEPARTMENT OF ECONOMIC SUPREME
SECURITY; ARIZONA DIVISION OF COURT
DEVELOPMENTAL DISABILITIES,
Defendants-Appellees.
Appeal from the United States District Court
for the District of Arizona
Douglas L. Rayes, District Judge, Presiding
Argued and Submitted February 4, 2020
Phoenix, Arizona
Filed March 25, 2020
Before: Diarmuid F. O’Scannlain, Susan P. Graber,
and Eric D. Miller, Circuit Judges.
Order by Judge O’Scannlain
2 REDGRAVE V. DUCEY
SUMMARY *
Certification of Question to State Court
The panel certified the following question to the Arizona
Supreme Court:
Has Arizona consented to damages liability
for a State agency’s violation of the minimum
wage or overtime provisions of the federal
Fair Labor Standards Act, 29 U.S.C. §§ 206–
207?
COUNSEL
Kaitlyn Redfield-Ortiz (argued), Nicholas J. Enoch, and
Stanley Lubin, Lubin & Enoch P.C., Phoenix, Arizona, for
Plaintiff-Appellant.
Cory G. Walker (argued) and Mark Ogden, Littler
Mendelson P.C., Phoenix, Arizona, for Defendants-
Appellees.
*
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
REDGRAVE V. DUCEY 3
ORDER
O’SCANNLAIN, Circuit Judge:
Pursuant to Arizona Revised Statutes section 12-1861
and Supreme Court of Arizona Rule 27, we certify to the
Arizona Supreme Court the question of law set forth in Part
I of this order. The answer to this question may be
determinative of the cause pending before this court, and
there appears to be no controlling precedent in the decisions
of the Arizona Supreme Court or the Arizona Court of
Appeals.
I
The question to be answered is:
Has Arizona consented to damages
liability for a State agency’s violation of the
minimum wage or overtime provisions of the
federal Fair Labor Standards Act (“FLSA”),
29 U.S.C. §§ 206–207?
The Arizona Supreme Court may rephrase the question
as it deems necessary.
II
Counsel for Plaintiff–Appellant Marcie A. Redgrave are:
4 REDGRAVE V. DUCEY
Nicholas J. Enoch
Stanley Lubin
Kaitlyn A. Redfield-Ortiz
LUBIN & ENOCH, P.C.
349 North Fourth Avenue
Phoenix, AZ 85003
(602) 234-0008
Counsel for Defendants–Appellees Doug Ducey, in his
capacity as Governor of the State of Arizona; Thomas J.
Betlach, in his capacity as Director of the Arizona Health
Care Cost Containment System; the Arizona Department of
Economic Security; and the DES Division of Developmental
Disabilities are:
Mark Ogden
Cory G. Walker
Littler Mendelson, P.C.
2425 East Camelback Road, Suite 900
Phoenix, AZ 85016
(602) 474-3600
III
A
Marcie Redgrave works as an in-home caretaker for an
individual with cerebral palsy. That individual, P.L., is a
beneficiary of the Arizona Long-Term Care System
(“ALTCS”). ALTCS is a Medicaid program operated by the
Arizona Department of Economic Security’s Division of
Developmental Disabilities (“DDD”), which functions as a
managed care organization. Called an “independent
provider,” Redgrave is hired directly by DDD.
REDGRAVE V. DUCEY 5
Redgrave has served as P.L.’s attendant caretaker in
several states. She alleges that she is responsible for P.L.’s
round-the-clock needs: personal hygiene, preparing meals,
managing medical appointments, housecleaning, laundry,
and assistance in P.L.’s daily activities, such as visiting
friends, all allowing her little time off. In 2010, Redgrave
and P.L. moved to Arizona, where P.L. became a beneficiary
of ALTCS. According to Redgrave, she is paid $12.30 an
hour for sixteen hours a day, seven days a week. Before her
compensation was adjusted in 2016, she asserts that she was
paid for only eight hours a day, seven days a week.
Redgrave argues that she and other independent providers
work twenty-four hours a day and, at the very least, that the
DDD’s method for calculating compensation hours violates
federal regulations.
B
In February 2018, Redgrave filed this putative collective
action “on behalf of herself and other similarly-situated
Independent Providers” in Maricopa County Superior Court
pursuant to 29 U.S.C. § 216(b), FLSA’s private right of
action for damages. She alleges that an independent
provider like herself meets the definition of an “employee”
of the DDD and that the DDD is a “third-party employer.”
See 29 U.S.C. § 203(e)(2); 29 C.F.R. § 552.109(c)
(excluding third-party employers from 29 U.S.C.
§ 213(b)(21)’s exemption of live-in domestic service
workers from FLSA’s overtime provision). As such, she
claims the protections of the FLSA’s minimum-wage
provision and its time-and-a-half overtime provision. See 29
U.S.C. § 206(a) (requiring employers to pay a minimum
wage for each hour worked); id. § 207(a)(1) (requiring
employers to pay employees “one and one-half times the
regular rate” for each hour worked in a week in excess of
6 REDGRAVE V. DUCEY
forty hours); 29 C.F.R. § 552.102(a) (defining hours worked
for a “live-in worker”). She seeks awards of unpaid
overtime, unpaid minimum wages, and liquidated damages,
plus interest. She also seeks a declaration that she and other
similarly situated individuals are entitled to be paid for all
the hours they work, including time-and-a-half for their
overtime hours.
Redgrave sued her alleged employer, DDD, along with
the Department of Economic Security (of which DDD is a
division), Thomas Betlach in his official capacity as Director
of the Arizona Health Care Cost Containment System, and
Doug Ducey in his official capacity as Governor of Arizona.
For our purposes, we refer to the four Defendants–Appellees
collectively as simply “the State.”
C
The State removed the case to federal court, asserted its
sovereign immunity from such claims, and moved to dismiss
the case. In the district court, Redgrave raised two
objections to the State’s purported sovereign immunity: first
that, by removing the case to federal court, the State waived
its sovereign immunity and, second, that Arizona has waived
its sovereign immunity from FLSA claims as a matter of law.
The district court rejected each supposed waiver of state
sovereign immunity.
On the question of whether Arizona waived its sovereign
immunity from FLSA claims as a matter of law, the district
court concluded that neither the Arizona Supreme Court’s
decision to abrogate state sovereign immunity in Stone v.
Arizona Highway Commission, 381 P.2d 107 (Ariz. 1963),
nor the Arizona State Legislature’s limitations on state
sovereign immunity established in the Actions Against
Public Entities or Public Employees Act (“Public Entities
REDGRAVE V. DUCEY 7
Act”), Ariz. Rev. Stat. §§ 12-820–12-826, amounted to a
waiver of immunity from claims under FLSA because each
dealt only with immunity from tort liability. Redgrave v.
Ducey, No. CV-18-01247-PHX-DLR, 2018 WL 4931722,
at *2 (D. Ariz. Oct. 11, 2018).
IV
A
Our court has determined that when a State removes a
case it invokes the jurisdiction of the federal district court
and thereby waives the sovereign immunity from suit it
would enjoy in state court. Walden v. Nevada, 945 F.3d
1088, 1092 n.1, 1094–95 (9th Cir. 2019). The State asserts
that its removal of this case did not effect a waiver of its
sovereign immunity from liability. Indeed, the several
circuits to share Walden’s conclusion all hold that removal
merely waives immunity from suit but not the defense of
immunity from liability. See, e.g., Trant v. Oklahoma,
754 F.3d 1158, 1172 (10th Cir. 2014); Stroud v. McIntosh,
722 F.3d 1294, 1302 (11th Cir. 2013); Lombardo v. Pa.
Dep’t of Pub. Welfare, 540 F.3d 190, 198 (3d Cir. 2008);
Meyers ex rel. Benzing v. Texas, 410 F.3d 236, 255 (5th Cir.
2005); see also Jessica Wagner, Note, Waiver by Removal?
An Analysis of State Sovereign Immunity, 102 Va. L. Rev.
549, 555–60 (2016) (describing the split of authority
between those circuits holding that removal does not waive
state sovereign immunity at all and those holding that
removal waives immunity from suit but not immunity from
liability). A state’s invocation of sovereign immunity from
liability would be an affirmative defense to a congressionally
created private right of action for damages, such as those
under FLSA. As the Supreme Court explained in Alden v.
Maine, 527 U.S. 706 (1999), because the states retain a
“residuary and inviolable sovereignty,” it is beyond the
8 REDGRAVE V. DUCEY
power of Congress to authorize private suits for monetary
damages against a state without that state’s consent to such
actions. Id. at 712, 715, 748–54. We have not decided and
in this Order do not decide whether removal to federal court
effects a waiver of such state sovereign immunity from
liability.
We ask the Arizona Supreme Court to advise whether
Arizona possesses the defense of immunity from FLSA
liability in the first place. In other words, we ask whether
Arizona is among those states that consent to private suits
for damages for violations of FLSA’s overtime and
minimum-wage provisions or if it is among those states that
do not so consent. Cf. Meyers, 410 F.3d at 253 (“[C]ourts
must look to the law of the particular state in determining
whether it has established a separate immunity against
liability . . . .”).
B
The Public Entities Act identifies a range of
circumstances in which Arizona maintains its sovereign
immunity. See Ariz. Rev. Stat. §§ 12-820.01–.05. In
Redgrave’s view, Arizona has consented to private suits for
damages under FLSA because the Public Entities Act’s
absolute immunity provision fails to assert immunity from
FLSA claims. See id. § 12-820.01. Under section 12-
820.01(A), the state and its subdivisions:
shall not be liable for acts and omissions of
its employees constituting either of the
following:
1. The exercise of a judicial or
legislative function.
REDGRAVE V. DUCEY 9
2. The exercise of an administrative
function involving the determination
of fundamental governmental policy.
Id. By implication, the Public Entities Act may accept
liability for all other claims against the state and its
subdivisions. Redgrave argues that Arizona does not enjoy
sovereign immunity from her FLSA claims because the
setting of independent providers’ pay and hours is neither a
judicial function, nor a legislative function, nor a
determination of fundamental government policy. There
appears to be no controlling precedent specifying that
ALTCS’s compensation of independent providers is not a
fundamental government policy. Nor is it apparent to us
whether section 12-820.01 even governs the question of
Arizona’s immunity from FLSA claims.
1
In the view of the State’s counsel and the decision of the
district court, the Public Entities Act waives only Arizona’s
sovereign immunity from tort liability. The district court
read the 1963 Stone decision as having abrogated
“governmental immunity from tort liability” only. Stone,
381 P.2d at 109; see Redgrave, 2018 WL 4931722, at *2.
Under this view, the Public Entities Act, which was initially
proposed by the Governor’s Commission on Governmental
Tort Liability, created an exception to Stone’s abrogation
and selectively reasserted governmental tort immunity. See
Glazer v. State, 347 P.3d 1141, 1144 (Ariz. 2015); City of
Tucson v. Fahringer, 795 P.2d 819, 820 (Ariz. 1990) (calling
the Public Entities Act a “tort claims act”). Thus, the district
court concluded that Arizona retains its inherent right to
immunity from non-tort claims, including, of course, FLSA
claims. Redgrave, 2018 WL 4931722, at *2.
10 REDGRAVE V. DUCEY
Despite Stone’s focus on tort claims, the Public Entities
Act itself may occupy the field of Arizona’s law of sovereign
immunity. See Backus v. State, 203 P.3d 499, 502 (Ariz.
2009); City of Phoenix v. Fields, 201 P.3d 529, 532 (Ariz.
2009) (calling the Public Entities Act “a comprehensive
statutory scheme governing actions against public entities
and employees”). Indeed, many references to “tort liability”
were removed from the bill during the drafting process,
indicating a legislative purpose to define state sovereign
immunity more broadly. Compare Governor’s Comm’n on
Governmental Tort Liability, Ariz. Governmental Tort
Claims Act (Dec. 16, 1983), with 1984 Ariz. Sess. Laws
1091–94; cf. Russello v. United States, 464 U.S. 16, 23–24
(1983) (“Where Congress includes limiting language in an
earlier version of a bill but deletes it prior to enactment, it
may be presumed that the limitation was not intended.”).
However, the remaining reference to tort immunity—in the
residual “other immunities” provision—could be understood
to limit the Public Entities Act’s scope to tort claims. See
Ariz. Rev. Stat. § 12-820.05(A) (stating that the Public
Entities Act “shall not be construed to affect, alter or
otherwise modify any other rules of tort immunity regarding
public entities and public officers as developed at common
law and as established under the statutes and the constitution
of this state” (emphasis added)).
Arizona courts have from time to time applied the Public
Entities Act’s provisions to non-tort claims. E.g., Fields,
201 P.3d at 531, 534 (applying the Public Entities Act’s
requirement under section 12-821.01(A) that a person with
claims against a public entity make a settlement demand
within 180 days—not an immunity provision—to class
claims for constructive fraud, breach of contract, and failure
REDGRAVE V. DUCEY 11
to pay wages); 1 Kromko v. Ariz. Bd. of Regents, 146 P.3d
1016, 1022, 1024 (Ariz. Ct. App. 2006), vacated on other
grounds, 165 P.3d 168 (Ariz. 2007) (holding that, under
section 12-820.01(A), the legislature but not the Board of
Regents was immune from lawsuit alleging that tuition hikes
violated the Arizona Constitution); Pima County v. State,
850 P.2d 115, 118 (Ariz. Ct. App. 1992) (concluding that the
state auditor general did not enjoy legislative immunity from
Pima County’s challenge to its calculation of the county’s
statutorily required contribution to a health care fund).
However, it is not apparent from these cases whether the
state defendants raised the issue of the Public Entities Act’s
application to non-tort claims.
2
Another possibility is that the Public Entities Act effects
a waiver of Arizona’s state sovereign immunity from both
tort claims and non-tort claims but that such a waiver is
limited to claims arising out of state law—in other words that
Arizona specifically retains its immunity from federal law
claims like those in this case. Such a reading is supported
by the Public Entities Act’s enacted statement of purpose, in
which the Legislature declared it “to be the public policy of
this state that public entities are liable for the acts or
omissions of public employees in accordance with the
statutes and common law of this state.” 1984 Ariz. Sess.
Laws 1091–92 (emphasis added). Insofar as the scope of the
Public Entities Act’s provisions is ambiguous, the enacted
statement of purpose may suggest that the Act does not
govern immunity from federal claims. Cf. Antonin Scalia &
1
Fields might be especially relevant because the grounds of an
Arizona law claim of failure to pay wages are similar to those of the
FLSA claims in this case. 201 P.3d at 531.
12 REDGRAVE V. DUCEY
Bryan A. Garner, Reading Law 218 (2012) (“[T]he prologue
does set forth the assumed facts and the purposes that the
majority of the enacting legislature . . . had in mind, and
these can shed light on the meaning of the operative
provisions that follow.”).
3
Finally, we are unsure whether to read the Public Entities
Act by applying the usual rule of construction that a
sovereign does not subject itself to liability unless it does so
explicitly. “[A] waiver of the Government’s sovereign
immunity will be strictly construed, in terms of its scope, in
favor of the sovereign.” Lane v. Peña, 518 U.S. 187, 192
(1996); see also Amy Coney Barrett, Substantive Canons
and Faithful Agency, 90 B.U. L. Rev. 109, 146–50 (2010)
(describing the long history of the canon requiring a clear
statement before interpreting a law to override sovereign
immunity). Yet the Arizona Supreme Court may have
flipped the traditional rule—at least in dicta. According to
the Court, “governmental liability is the rule in Arizona and
immunity is the exception . . . [w]e therefore construe
immunity provisions narrowly.” Doe ex rel. Doe v. State,
24 P.3d 1269, 1271 (Ariz. 2001). It is not apparent, however,
whether the canon is only reversed as to tort claims (if at all).
See, e.g., Fahringer, 795 P.2d at 820 (stating the rule as
“when a government entity or employee is a defendant in a
tort action, ‘the rule is liability and immunity is the
exception’” (quoting Stone, 381 P.2d at 112)).
V
It appears to this court that there is no controlling
precedent of the Arizona Supreme Court or the Arizona
Court of Appeals with regard to the State’s assertion of its
sovereign immunity from a private suit for damages under
REDGRAVE V. DUCEY 13
FLSA. We thus request that the Arizona Supreme Court
accept and decide the certified question.
In light of our decision to certify the question set forth
above, submission of this case is withdrawn, and all
proceedings are stayed pending the Arizona Supreme
Court’s decision whether it will accept review and, if so,
receipt of the answer to the certified question. The Clerk is
directed to administratively close this docket pending further
order. The parties shall notify the Clerk of this court within
one week after the Arizona Supreme Court accepts or rejects
the certified question, and again within one week after the
Arizona Supreme Court renders its opinion if accepted. The
panel will resume control and jurisdiction upon receipt of an
answer to the certified question or upon the Arizona
Supreme Court’s decision to decline to answer the certified
question.
The Clerk of this court shall file an original and six
copies of this order with the clerk of the Arizona Supreme
Court. Upon request of the Arizona Supreme Court and as
the Arizona Supreme Court deems necessary, the Clerk of
this court shall transmit the original or copies of portions of
the record.
IT IS SO ORDERED.
/s/ Diarmuid F. O’Scannlain
Diarmuid F. O’Scannlain,
Circuit Judge