Johnson v. Unified Government of Wyandotte County/Kansas City

F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
JUN 7 2004
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT
WILLIAM D. JOHNSON, DAVID N.
KEARNEY; MICHAEL A. KILL;
ALEXANDER G. KUMP; ROBERT L.
LANE, JR.; JOHN W. NASH; JASON
W. SUTTON; SOPHIA BARAJAS;
MICHAEL BOWMAN; JAMES
BRINKLEY; WILLIAM
CARPENTER; LARRY
CHRONISTER; GREGORY
COLLINS; GREGORY CONCHOLA;
CHAD COWHER; MICHAEL
HUGHES; KYNARD HYLTON;
THOMAS JOYCE; RICHARD
KEITH; PATRICK MCCALLOP;
WILLIAM MICHAEL; ANGELA
Nos. 01-3398, 02-3005 and 02-3014
MITCHELL; MICHAEL VEGA;
JACKIE WATERS; STEVE
WILLIAMS; TERRY ZEIGLER,
Plaintiffs - Appellants/Cross-
Appellees,
v.
THE UNIFIED GOVERNMENT OF
WYANDOTTE COUNTY/KANSAS
CITY, KANSAS and THE HOUSING
AUTHORITY OF KANSAS CITY,
KANSAS,
Defendants - Appellees/Cross-
Appellants.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE FOR THE DISTRICT OF KANSAS
(D.C. No. 99-CV-2407-JWL)
Steve A.J. Bukaty, (Luke B. Harkins with him on the briefs) Steve A.J. Bukaty,
Chartered, Overland Park, Kansas, for the Plaintiffs-Appellants/Cross-Appellees.
Gregory P. Goheen, (Daniel B. Denk, with him on the brief) McAnany, Van
Cleave & Phillips, P.A., Kansas City, Kansas, for Defendant-Appellee/Cross-
Appellant Unified Government of Wyandotte County/Kansas City, Kansas.
Thomas R. Buchanan, (Donald G. Scott with him on the brief) McDowell, Rice,
Smith & Gaar, Kansas City Missouri, for Defendant-Appellee/Cross-Appellant
The Housing Authority of Kansas City, Kansas.
Before O’BRIEN, HOLLOWAY and McWILLIAMS, Circuit Judges.
HOLLOWAY, Circuit Judge.
I
A
Plaintiffs/appellants are police officers employed by defendant/appellee
Unified Government of Wyandotte County/Kansas City, Kansas (an entity formed
by the merger of Kansas City, Kansas and Wyandotte County) who worked in
their off-duty hours as security guards for defendant-appellee, the Housing
Authority of Kansas City. The twenty-six plaintiffs brought this action (which
consolidated two separately filed lawsuits) seeking recovery for overtime
compensation under the Fair Labor Standards Act (FLSA or the Act). 1 They
contended that the Housing Authority and the Unified Government were joint
employers under the FLSA so that hours worked for both defendants during any
work week should have been combined for purposes of determining whether
plaintiffs were due overtime pay.
The case was tried to a jury and, as set out infra, almost all issues were
submitted for the jurors’ determination. The jury found for the defendants on all
issues. The district judge denied plaintiffs’ post-trial motion for judgment as a
matter of law or for a new trial. Johnson v. Unified Govt. of Wyandotte County,
180 F.Supp. 2d 1192 (D. Kan. 2001). 2 Plaintiffs now bring this appeal from the
final judgment. Each defendant filed a cross-appeal. The cross-appeals were not
briefed and are deemed to have been abandoned. See Bledsoe v. Garcia, 742 F.2d
1237, 1244 (10th Cir. 1984). Accordingly we dismiss the cross-appeals.
Plaintiffs invoked the district court’s jurisdiction under 29 U.S.C. § 216(b)
and 28 U.S.C. §§ 1331 & 1337. This court has appellate jurisdiction under 28
U.S.C. § 1291.
1
The Act is codified at 29 U.S.C. §§ 201 et seq.
2
The district judge issued thoroughly reasoned opinions denying certain
pre-trial motions in these cases as well. See Johnson, 127 F.Supp.2d 1181 (D.
Kan. 2000), and Barajas v. Unified Govt., 87 F.Supp.2d 1201 (D. Kan. 2000).
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B
The Housing Authority was created under state and federal statutes to
provide housing for low income tenants. The security patrols that have given rise
to the dispute underlying this litigation were funded under legislation passed by
Congress in 1988 to address the impact of illegal drugs in public housing. 3 The
Public Housing Drug Elimination Pilot Program, created under the authority of
this legislation, provided for grants to be used in public housing projects for,
among other things, the employment of security personnel. The Housing
Authority received a grant under this program which resulted in the use of the off-
duty police officers as security officers for the projects administered by the
Housing Authority.
To take advantage of the grant monies made available under this
legislation, the City of Kansas City, Kansas (before its merger with Wyandotte
County created the Unified Government) and the Housing Authority entered into a
“memorandum of understanding” for the employment of off-duty officers of the
former as security officers for the latter. Under this agreement, the city agreed to
provide two marked police cars and radio and dispatch backup to be used by the
off-duty officers when serving as security patrols for the Housing Authority. II
Aplt. App. 270-72. Officers had to complete an application to the Police
3
See 42 U.S.C. §§ 11901 et seq.
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Department and receive permission for any off-duty work, including that with the
Housing Authority. Id. at 61, 109. Officers were limited to 20 off-duty hours of
employment per week, with no more than four hours per day on any day when the
officer was on duty with the Police Department. All off-duty employment was at
the option of the individual officer; in other words, this was strictly a voluntary
program.
Additional facts are noted in connection with the legal analysis which
follows.
II
To establish their entitlement to overtime compensation the plaintiffs had to
convince the court and the jury that they were employees of the Housing
Authority, as opposed to independent contractors; 4 that the Housing Authority and
the Unified Government should be regarded as joint employers; 5 and that they had
worked more than 43 hours in any week for which they sought recovery. 6 Even if
the plaintiffs had prevailed on each of those three issues, the law provides an
4
See Baker v. Flint Engineering & Const. Co., 137 F.3d 1436, 1440 (10th
Cir. 1998).
5
See 29 C.F.R. § 791.2.
6
The 43 hour per week standard, rather than the usual 40 hour per week
standard, applies to law enforcement personnel. See 29 U.S.C. § 207(k); 29
C.F.R. § 533.230(c). Other elements of the claim are of no concern to us in this
appeal. The division of duties between judge and jury is discussed infra.
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affirmative defense called the “special detail exception,” which was invoked by
these defendants. See Johnson, 180 F.Supp.2d at 1197-1200. The parties agreed
to submit all of these issues to the jury, which decided all of them in favor of the
defendants. 7 As the district judge pointed out, plaintiffs had to prevail on each of
these issues to recover. Id. at 1194, n.1.
Consequently, plaintiff have, of necessity, raised each of these issues on
appeal. But it is not necessary for us to decide each issue, and prudence counsels
against doing so. Because we conclude that sufficient evidence supported the jury
findings that the plaintiffs were not employees of the Housing Authority, but were
instead functioning as independent contractors when they patrolled as security
guards, we will not decide the other issues mentioned above.
We review the denial of a motion for judgment as a matter of law based on
the ground of insufficiency of the evidence de novo, using the same legal standard
as the district court.
A party is entitled to judgment as a matter of law only if the
“evidence points but one way and is susceptible to no reasonable
inferences supporting the party opposing the motion.” In reviewing
the record, we “will not weigh evidence, judge witness credibility, or
challenge the factual conclusions of the jury.” Judgment as a matter
of law is appropriate if there is no legally sufficient evidentiary basis
7
The trial judge was well aware of authority such as Dole v. Snell, 875 F.2d
802, 805 (10th Cir. 1989), discussed infra, that the ultimate question on these
issues is one of law. But “the court and the parties struggled with the proper
allocation of the court’s functions and the jury’s functions” in applying the
principle. 180 F.Supp.2d at 1202.
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for a claim under the controlling law. We consider the evidence, and
any inferences drawn therefrom, in favor of the non-moving party.
Brown v. Gray, 227 F.3d 1278, 1285 (10th Cir. 2000) (internal citations omitted)
(quoting Deters v. Equifax Credit Info. Servs., Inc. 202 F.3d 1262, 1268 (10th Cir.
2000)).
As a rule, the ultimate question is one of law, with the fact finder’s
underlying determinations reviewed only for clear error. Dole v. Snell, 875 F.2d
802, 805 (10th Cir. 1989). Here, however, we are presented with something of an
anomaly. Apparently because the district court and the parties found this rule to
be vexingly difficult to apply in the practical setting of a jury trial, the parties
agreed to submit this issue to the jury (along with other similar “ultimate”
questions that need not concern us here). See Johnson, 180 F.Supp.2d at 1202.
Consequently, we review the denial of the post-trial motion for judgment as a
matter of law only for the sufficiency of the evidence to support the jury’s
decision. Had the trial court made the ruling as one of law, our review would
have been de novo on the ultimate question. But for us now to make a de novo
determination whether the plaintiffs should be regarded as employees of the
Housing Authority under the FLSA would be counter to the doctrine of invited
error. See Eateries, Inc. v. J.R. Simplot Co., 346 F.3d 1225, 1229 (10th Cir.
2003). The plaintiffs cannot agree to submit the question to the jury and still
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enjoy the benefit of the de novo standard of review that we would have applied to
the district judge’s determination of the ultimate issue in the absence of that
stipulation.
As applied to the plaintiffs in this case and their relationship to the
defendants, the FLSA generally defines an employee as “any individual employed
by a . . . political subdivision of a State . . . .” 29 U.S.C. § 203(e)(1), (e)(2)(C).
The terms “employ” and “employer” are given similarly broad but vague
definitions. 8 The “striking breadth” of these definitions “stretches the meaning of
‘employee’ to cover some parties who might not qualify as such under a strict
application of traditional agency principles.” Nationwide Mut. Ins. Co. v.
Darden, 503 U.S. 318, 326 (1992) (quoted in Baker v. Flint Engineering & Const.
Co., 137 F.3d 1436, 1440 (10th Cir. 1998)).
Accordingly, in determining whether the plaintiffs were employees of the
Housing Authority, our analysis “is not limited by traditional common law
concepts” but focuses on the economic realities, “and the focal point is ‘whether
the individual is economically dependent on the business to which he renders
service . . . or is, as a matter of economic fact, in business for himself.’” Dole v.
8
“Employer” is defined as “any person acting directly or indirectly in the
interest of an employer in relation to an employee . . . .” 29 U.S.C. § 203(d). The
verb “employ” is defined to mean “suffer or permit to work.” 29 U.S.C. § 203(g).
See Baker v. Flint Engineering & Const. Co., 137 F.3d 1436, 1440 (10th Cir.
1998).
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Snell, 875 F.2d 802, 804 (10th Cir. 1989) (quoting Doty v. Elias, 733 F.2d 720,
722-23 (10th Cir. 1984)). In Doty, we listed five factors (derived from United
States v. Silk, 331 U.S. 704, 716 (1947)) which are generally considered in
applying this test:
(1) the degree of control exerted by the alleged employer over the
worker; (2) the worker’s opportunity for profit or loss; (3) the
worker’s investment in the business; (4) the permanence of the
working relationship; and (5) the degree of skill required to perform
the work.
733 F.2d at 723. “An additional commonly considered factor is the extent to
which the work is an integral part of the alleged employer’s business.” Dole v.
Snell, 875 F.2d at 805. None of the factors is to be considered dispositive; the
test is instead based on the totality of the circumstances. Id. The instruction to
the jury on this issue included each of the factors mentioned above and was
submitted without objection. Supp. App. 17-19.
The record includes substantial evidence indicating that the Housing
Authority exercised very little control over the plaintiffs as they conducted the
security patrols. The security guards could come and go as they pleased within
the times from 4 p.m. to 2 a.m. Id. at 102, 113. Starting times were flexible,
depending on the individual’s needs. Id. at 54-55, 75. If needed, an officer could
go home after having worked only two hours. Id. at 93-94. When on duty as a
police officer, an individual had to get permission for breaks, but this was not so
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when the individual was working as a security guard for the Authority. Id. at
142-43. A police officer while on duty had to have permission to leave her
assigned district. In contrast, the Authority had properties in different divisions
and districts, and the security guards did not need permission to move from one
project to another in a different district. Id. Plaintiffs had little supervision while
on security duty for the Authority. Id. at 85. From this evidence, the jury could
reasonably have concluded that the degree of control exercised by the Housing
Authority was minimal and that this factor clearly weighed in favor of regarding
the plaintiffs as independent contractors rather than employees of the Authority.
Did the plaintiffs have the opportunity for profit or loss? The plaintiffs
could not have lost money from their efforts for the Housing Authority.
Certainly, then, their circumstances differed from those of some independent
contractors. However, the flexibility that was afforded them in determining the
number of hours that they worked made their circumstances rather different from
those of most employees as well. The jury could have viewed this factor as not
favoring either side.
As to the degree of skill involved in the actual labors, the officers who
served as security guards had been trained by the police department and did not
need further training. Supp. App. at 62-63; 97-98. As to whether the work was
integral to the Housing Authority’s business, the evidence was that the Authority
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had functioned for years before and after the program without the security patrols.
Without the complete record, we cannot conduct the thorough review that is
usual in a sufficiency of the evidence challenge, and obviously we have not
addressed each of the pertinent factors identified above. Nevertheless, having
identified sufficient evidence on several of the factors, we cannot say that the
jury’s decision on the independent contractor issue was without support in the
evidence. We are therefore bound by that decision.
III
Plaintiffs contend that the jury instructions and verdict form used by the
district court were unfairly prejudicial to them because of the sheer volume of
work the jury would have been required to perform in order to find in favor of
plaintiffs. We review decisions as to both jury instructions and special verdict
forms under the abuse of discretion standard. Webb v. ABF Freight System, Inc.,
155 F.3d 1230, 1249 (10th Cir. 1998).
Plaintiffs assert that due to the verdict form used, a verdict in their favor
would have required the jurors “to literally copy down hundreds of lines of
damages amounts, taken from exhibits created by Plaintiffs’ damages expert.”
Appellants’ Brief at 13. Plaintiffs also contend that Instruction 24, an instruction
on damages referred to in the verdict form, was confusing, apparently for the
same reason. In addressing the contention in ruling on plaintiffs’ objection to
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Instruction 24 at trial, the district judge said:
This jury[,] I do not believe[,] is going to be stampeded on some
decision based upon what is the easiest thing for them to do. I
believe they have been very attentive, very tuned in to this case. I
don’t believe the actual math they will have to do if they get to the
damages calculations is all that awesome a task for them because the
plaintiffs’ exhibits are so clearly laid out to correlate with that
formula and with the verdict form that, as much as I wish we could
do it a different way, I believe that for all the reasons I stated earlier
it’s appropriate to leave it that way.
II Aplt. App. 630.
We think it clear that the district judge’s reasoning applies to the verdict
form as well as to Instruction 24, even though the latter was the point the judge
was specifically addressing in these remarks. We have no basis for disagreeing
with the trial judge’s assessment of the diligence of the jurors, and this alone
suggests that the plaintiffs’ argument has little force. Furthermore, plaintiffs’
brief asserts that their damages exhibits and special interrogatories they had
proposed would have greatly simplified the jury’s task. But we cannot make the
suggested comparison because plaintiffs have not provided citations to the record
to enable us to find the trial exhibits and proposed special interrogatories (which
do not appear to be included in their appendix).
Plaintiffs say that the essence of their complaint is that the instruction and
verdict form were contrary to the “burden shifting rule on damages in FLSA
cases” discussed in Hearnsberger v. Gillespie, 435 F.2d 926 (8th Cir. 1970). We
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presume that plaintiffs’ reference is to that portion of the Eighth Circuit’s opinion
in which the court quoted and followed Anderson v. Mt. Clemens Pottery Co., 328
U.S. 680, 686-88 (1946), where the Supreme Court had held that, if the
employer’s records are inaccurate or inadequate, the plaintiff employee
has carried out his burden if he proves that he has in fact performed
work for which he was improperly compensated and if he produces
sufficient evidence to show the amount and extent of that work as a
matter of just and reasonable inference. The burden then shifts to the
employer to come forward with evidence of the precise amount of
work performed or with evidence to negative the reasonableness of
the inference to be drawn from the employee’s evidence. If the
employer fails to produce such evidence, the court may then award
damages to the employee, even though the result be only
approximate.
Hearnsberger, 435 F.2d at 931-32 (quoting Anderson, 328 U.S. at 687-88)).
Plaintiffs contend that they were “entitled to a reasonable inference of
accuracy of their damages evidence, and Defendants bore the burden of
establishing the exactness of the comparatively minuscule amounts of
overpayments to be deducted from the totals” on plaintiffs’ damages exhibits.
Appellants’ Brief at 15. Once again, our review is severely hampered by the fact
that plaintiffs have not provided citations to enable us to find their damages
exhibits, if those exhibits are included in the appendix. But we see no defect in
the trial judge’s rulings and instructions. Instruction 24 clearly told the jurors
that the defendants bore the burden of proving the amounts of any “premium pay”
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that could be subtracted in performing the calculations. 9
Even if we assume that the plaintiffs had proffered a set of instructions and
a verdict form that would have been far easier for the jurors to use, that would
still not convince us that the trial judge abused his discretion in not using the
simplest procedure available.
Plaintiffs raise another issue which we have not addressed – whether the
trial judge erred in deciding as a matter of law that plaintiffs had failed to adduce
evidence to support their contention that the defendants had willfully violated the
Act. Because we uphold the jury verdict that there was no violation, plaintiffs
could not show prejudice even if we were to conclude that there was evidence
from which the jurors could have found willful violations.
Accordingly the cross-appeals, Nos. 02-3005 and 02-3014, are
DISMISSED, and the judgment of the district court in No. 01-3398 is
AFFIRMED.
9
Defendants suggest that plaintiffs cannot show that they suffered any
prejudice from the verdict form because the jury awarded no damages. That
contention quite obviously misses the mark because plaintiffs argue,
unpersuasively we conclude, that the very complexity of the task of calculating
damages influenced the jury to decide all issues in favor of the defendants.
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