Northern California Record

Sunday, November 17, 2019

9th Circuit remands case involving federal and state employment law

By Angela Underwood | Feb 15, 2018

Law money 08

SAN FRANCISCO — The U.S. Court of Appeals for the 9th Circuit has vacated a district court ruling based on demographic provisions and remanded it to the lower court.

Judges Richard A. Paez, Marsha S. Berzon, and Morgan Christen vacated and remanded a district court’s dismissal of plaintiff-appellant Brian Newton’s complaint against defendant-appellee Parker Drilling Management Services that argues state wage and hour laws govern employees who drill on the Outer Continental Shelf (OCS) platforms.

Newton was employed between January 2013 to January 2015 as a painter for Parker on Santa Barbara Channel, located 3 miles offshore on the OCS seabed, according to background information in the Feb. 9 ruling. Newton was not authorized to leave the platform when he worked 12-hour, 14-day shifts with mandated standby, yet was only paid for 12 hours, the ruling said.

Though required by California Law to provide Newton 30-minute meal breaks every five hours, Parker Drilling did not allow him to pause, he alleged according to the ruling. After leaving in February 2015, Newton filed a seven-count putative class action. The first amended complaint argued “minimum wage violations; failure to pay overtime and doubletime; pay stub violations; failure to pay timely final wages; failure to provide lawful meal periods; civil penalties under the Private Attorney General Act of 2004 (PAGA); and unfair competition,” according to the ruling.

However, Parker Drilling countered, arguing based on the Outer Continental Shelf Lands Act (OCSLA) and the Fair Labor Standards Act (FLSA), Newton could not claim wage and hour objections. The district court concurred, noting that based on the Labor Department, “Newton could not invoke California wage and hour laws as surrogate federal law,” according to the appeal.

In discussion, authoring judge Christen cited Valladolid v. Pac. Operations Offshore 2010 to explain that “subject to certain exceptions and conditions, the OCSLA declares that the Constitution and laws of the United States extend to the outer Continental Shelf,” according to the appeal.

After citing several cases, including Rodrigue v. Aetna Casualty & Surety Co. 1969, a wrongful-death case that cited the High Seas Act in defense, “The Supreme Court concluded from its analysis of the text that “federal law is ‘exclusive’ in its regulation of [the OCS], and that state law is adopted only as surrogate federal law,” Christen wrote, adding that based on the highest court’s rulings of similar cases involving OCSLA jurisprudence, the ninth circuit need address three questions.

The initial inquiry of “the threshold question is whether the situs of the controversy is the OCS,” and “Second, if the situs is the OCS, we then ask whether there is any federal law applicable to the dispute." 

The court continued, “Third, if there is federal law applicable to the dispute, then we ‘must consider the content of both potentially applicable federal and state law’ and ask whether any applicable state law is inconsistent with federal law."

In discussing the three questions, Christen noted the importance of semantics and stated the importance of the text and legislative history of OSCLA, citing Simmons v. Himmelreich, writing, “[W]e generally presume [that] Congress says what it means and means what it says."

Taking language examination one step further to understand the full meaning of “inconsistent,” Judge Christen cited EcologicalRightsFoundation v. Pacific Gas & Electricity Co., noting in that case, “[W]e concluded that laws are inconsistent if they are mutually ‘incompatible, incongruous, [or] inharmonious,’” Judge Christen writes in the appeal.

After defining whether inconsistency applied in Newton’s case, Christen said the ultimate question that would determine whether the case be remanded would be to decide whether California’s minimum wage and overtime laws are in fact “inconsistent” with the regulations of the FLSA.

“The FLSA’s savings clause expressly provides that states are free to adopt more protective standards for minimum wages or maximum hours in a work week,” Christen wrote, adding “the application of California minimum wage and overtime laws as federal law on the OCS serves the purpose of the OCSLA.”

 Christen concluded the 40-page appeal noting that the district court blundered when it denied Newton’s claims and remanded the matter back to court since “California’s minimum wage and maximum hours worked provisions are ‘applicable and not inconsistent.’”

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U.S. Court of Appeals for the Ninth Circuit