Carrie Ward v. Costco Wholesale Corporation , 552 F. App'x 631 ( 2014 )

FILED
NOT FOR PUBLICATION JAN 09 2014
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
CARRIE WARD, individually and on No. 11-56757
behalf of all others similarly situated,
D.C. No. 2:08-cv-02013-JHN-SS
Plaintiff - Appellant,
v. MEMORANDUM*
COSTCO WHOLESALE
CORPORATION,
Defendant - Appellee.
Appeal from the United States District Court
for the Central District of California
Jacqueline H. NGUYEN, District Judge, Presiding
Argued and Submitted August 30, 2013
Pasadena, California
Before: O’SCANNLAIN, TALLMAN, and BEA, Circuit Judges.
Plaintiffs brought suit against their former employer, Defendant Costco
Wholesale Corporation (“Costco”), under the federal Fair Labor Standards Act
(“FLSA”) and the California Labor Code, alleging that Costco had improperly
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
withheld wages from their final paychecks to repay the undisputed outstanding
balances due on their company-guaranteed credit cards. On appeal, Plaintiffs
claim that the district court erred in its judgment in favor of Costco after a bench
trial. Plaintiffs argue that the district court made a “clear error[] of law” “by
applying the credit-card deductions to employees’ accrued vacation and sick pay.”
We review a district court’s conclusions of law de novo. JustMed, Inc. v. Byce,
600 F.3d 1118, 1125 (9th Cir. 2010).
The district court did not err in concluding that Plaintiffs failed to prove that
Costco violated FLSA minimum wage and overtime provisions. The FLSA does
not require employers to pay all remaining vacation and sick pay to employees
upon termination. The sum of vacation and sick pay for each Plaintiff exceeded
the amount Costco deducted under the credit card agreement. It was undisputed
that the hourly wages exceeded the overtime and minimum wage requirements.
Hence, the district court correctly found that the credit card deductions did not
effect a violation of the overtime and minimum wage requirements.
Likewise, the district court did not err in concluding that Plaintiffs failed to
prove that Costco violated California Labor Code Sections 201 and 203. This
court “can affirm the district court on any grounds supported by the record.”
Tanaka v. Univ. of S. Cal., 252 F.3d 1059, 1062 (9th Cir. 2001) (quoting Weiser v.
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United States, 959 F.2d 146, 147 (9th Cir. 1992)). Therefore, we need not decide
whether the district court erred in ruling that Plaintiffs waived their California
Labor Code Section 227.3 claim regarding vacation pay because we conclude that
Plaintiffs’ California Labor Code claims are foreclosed by the California Supreme
Court’s ruling in Schachter v. Citigroup, Inc., 218 P.3d 262 (Cal. 2009). Prior to
issuance of a credit card, each Plaintiff signed an agreement authorizing Costco to
deduct the total remaining balance on his or her credit card from his or her final
paycheck upon separation of employment with Costco. “Having elected to receive
some of [their] compensation in the form of [credit card balances] , . . . [Plaintiffs]
cannot now assert that [they] should have been paid in cash that portion of [their]
compensation [that Plaintiffs] elected to receive [in the form of credit card
balances].” Id. at 270. Therefore, as in Schachter, we conclude that Costco did
“not run afoul of the Labor Code because no earned, unpaid wages remain
outstanding upon termination according to the terms of” Plaintiffs’ agreements
with Costco. Id. at 265.
For the same reasons, we also reject Plaintiffs’ challenge to the district
court’s denial of Plaintiffs’ post-judgment motions. Finally, because we affirm the
district court on the merits, we need not reach Plaintiffs’ claim regarding the
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district court’s denial of class certification pursuant to Federal Rule of Civil
Procedure 23.
AFFIRMED.
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