# In Re Fedex Ground Package System, Inc., Employment Practices Litigation

> District Court, N.D. Indiana · December 13, 2010 · 758 F. Supp. 2d 638

URL: https://www.frixlaw.com/law-library/cases/2478036

## Case

- **Full name:** In Re FEDEX GROUND PACKAGE SYSTEM, INC., EMPLOYMENT PRACTICES LITIGATION
- **Court:** District Court, N.D. Indiana
- **Decided:** December 13, 2010
- **Citations:** 758 F. Supp. 2d 638; 17 Wage & Hour Cas.2d (BNA) 129; 2010 U.S. Dist. LEXIS 134959; 2010 WL 5094230
- **Precedential status:** Published
- **Opinion:** Opinion by Miller
- **Judges:** Miller
- **Cited by:** 8 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/2478036

## How later opinions describe it (automated extraction)

- applying Florida law to those provisions, practices, and procedures

## Opinion text

*653
OPINION and ORDER
ROBERT L. MILLER, JR., District Judge.
The court today addresses all outstanding motions for summary judgment and disposes of all other pending cases in this FedEx Multidistrict Litigation docket. In August, this court granted FedEx’s motion for summary judgment in the Kansas case and ordered the parties to file five-page supplementary briefs for each of the outstanding class cases addressing why the outcome in those cases should be the same as or different from Kansas.
The court incorporates here the background and findings of fact contained in its Kansas decision and assumes the reader’s familiarity with the contents of that decision and other substantive decisions in this MDL litigation.
See generally
Op. and Ord., 734 F.Supp.2d 557 (N.D.Ind.2010) [Doc. No. 2097]
1
(“Kansas Decision
”).
2
*654
The court applies the summary judgment standard set forth in the
Kansas Decision,
734 F.Supp.2d at 583-584 .
When appropriate, the court will incorporate its reasoning from the Kansas decision. The reasoning for each of today’s dispositions is provided state by state in alphabetical order and, for ease of reference, an appendix at the end of this opinion and order summarizes today’s dispositions.
I. General Introduction
Before turning to the specifics of today’s decisions, the court addresses some common themes arising from the parties’ briefs in these FedEx MDL cases and offers some general comments that might help to understand these decisions.
A
These MDL Decisions Won’t Preclude Most Future Litigation Concerning Employment Status of FedEx Ground Drivers.
The plaintiff drivers in these FedEx MDL cases have entered into independent contractor agreements with FedEx Ground to provide package delivery services. Generally, the drivers seek determinations that they are employees under the various states’ laws and they seek reimbursement of business expenses and backpay for overtime and other wages. The nationwide character of this litigation makes it a truly unique set of cases, unlike anything that has appeared in the cases cited in the parties’ briefs.
Employment status questions typically arise when someone is physically harmed — either a third party or a worker. Courts developed the common law right to control test to determine whether an employer had reserved enough control over a worker to justify holding the employer liable for the worker’s tortious conduct towards a third party. Modern statutes have extended worker’s compensation protection to employees, sometimes using the common law right to control approach and sometimes broadly redefining the term “employee” to include a larger group of workers than the common law test would have included.
Today’s cases don’t involve physical harm to third parties or to the plaintiffs. Some of the states considered today have wage statutes that recognize the harm of illegal methods of paying wages to workers, such as not paying overtime, deducting business expenses from employees’ wages, and the like. Cases involving these wage statutes often involve state agencies seeking to penalize wayward employers and to vindicate workers’ statutorily created rights or the state’s statutory rights to collect employment taxes. Though it is less common, workers also may vindicate their rights in private causes of action by seeking to have a court declare that they are employees instead of independent contractors. In other states lacking these statutes — and in all the states in this MDL litigation — there remains these MDL plaintiffs’ generalized effort to be reclassified as employees so as to shift the balance of rights and duties in the working arrangement between themselves and FedEx: the plaintiff drivers then would have fewer duties and increased rights (but likely also decreased entrepreneurial opportunities with FedEx and decreased gross pay) and FedEx would face increased duties.
*655
Beyond the substantive character of these claims, the procedural uniqueness of these cases — an MDL proceeding consisting of class actions — is particularly noteworthy because this procedural posture has substantially limited the scope of evidence available to this court to decide the drivers’ generalized employment status question. Under the procedural posture of these cases, this court has considered evidence common to the drivers’ relationships with FedEx on a nationwide basis: the Operating Agreement and generally applicable Policies and Procedures. As a condition of class certification, the court excluded particularized evidence of actual control between FedEx and the drivers. This condition was appropriate to satisfy the commonality requirement for class certification, to satisfy the commonality and judicial economy considerations motivating the consolidation of these cases in an MDL court, and to address the very nature of these plaintiffs’ generalized claims.
The cases’ substantive nature and procedural posture might limit the preclusive effect of this court’s decisions in these cases. These decisions aren’t expected to preclude injured persons from seeking
respondeat superior
liability or worker’s compensation. Such personal injury cases would surely involve the review of much extrinsic and individualized evidence of a particular driver’s relationship with FedEx. Today’s decisions also don’t address what the outcomes of these cases might be if the classes were defined differently.
3
B. The Procedural Posture of These Cases Limits the Scope of Evidence Reviewed.
In their supplemental briefs, the drivers have complained at times that the court “refused” to consider extrinsic evidence of FedEx’s actual conduct towards them. The cases’ procedural posture limits the court to considering evidence truly common across the nation: the Operating Agreement and generally applicable Policies and Procedures. These cases might or might not come out differently under a different procedural posture allowing wider scope for review of extrinsic and particularized evidence, but that situation is not before the court today.
4
The drivers’ characterization of the court’s use of evidence, after the court indulged their strategy of coming before an MDL court as classes, isn’t well-taken. To disagree with the court’s rulings is fair (and is a matter better handled through a motion to reconsider or an appeal), but to say the court “refused” to do something when the court accepted the drivers’ own arguments on the matter isn’t accurate.
5
The parties have heaped numerous insults
*656
upon each other’s arguments and reasoning in their various briefs, and the court has patiently overlooked their excursions into the land of uncivil arguments, exaggerations, and mischaracterizations (and the court has avoided wasting time on listing citations to all the foul balls the parties pitched in their arguments); the court is less patient with mischaracterizations of its own efforts to rule fairly on the issues in this litigation.
The drivers have known at least since this court’s first order granting class certification that the scope of evidence would, under the approach taken by the drivers, be limited to the Operating Agreement and generally applicable Policies and Procedures.
See generally
Op. and Ord., Mar. 25, 2008, 273 F.R.D. 424 , 2008 WL 7764456 [Doc. No. 1119]. In July 2005, the drivers argued to the Judicial Panel on Multidistrict Litigation in Denver that their cases were appropriate for MDL centralization and that they could satisfactorily litigate their case based on common evidence. The drivers’ ensuing briefs seemed to indicate that they were perfectly comfortable with, and felt they could win their case based on, the use of common evidence. The court tried to remind the drivers that their cases would be decided on the basis of common evidence.
See, e.g.,
Op. and Ord., 662 F.Supp.2d 1069 , 1104 n. 5 (N.D.Ind.2009) [Doc. No. 1770] (“The court notes that the plaintiffs may have indicated a desire to introduce anecdotal evidence to support their claims in this action. If the plaintiffs intend to introduce anecdotal evidence of FedEx’s actual exercise of control to support their claims, they should inform the court immediately because this may require reevaluation of class certification.”); Ord., Apr. 22, 2008 [Doc. No. 1152].
As the court stated in the
Kansas Decision:
The court sets forth the facts from the perspective of what control FedEx has the right to exercise over its drivers and not necessarily what control FedEx actually exercises on a daily basis. While FedEx managers might exercise more control than what is retained in the Operating Agreement and commonly applicable policies and procedures, the class was certified on the basis of right to control, not actual exercise of control. The plaintiffs reiterated to this court during class certification that they could show right to control by reliance solely on the Operating Agreement and applicable policies and procedures and wouldn’t go beyond those documents to prove their case. In short, the issue for today’s purposes is what control FedEx had the right to exert pursuant to the parties’ contractual relationship.
* * *
FedEx might actually exercise more control than authorized, but as explained, the court is limited to determining whether FedEx retained the right to control. The court relies on the policies and procedures to the extent they show how FedEx implemented its authority as retained by the Operating Agreement.
Kansas Decision,
734 F.Supp.2d at 560, 589 .
C. Collateral Estoppel Issue
The California court of appeals affirmed the
Estrada
trial court’s decision finding FedEx Single Work Area (SWA) drivers to be employees.
Estrada v. FedEx Ground Package Sys., Inc.,
154 Cal. App.4th 1 , 64 Cal.Rptr.3d 327 (2007). The
Estrada
trial court held that the FedEx Multiple Work Area (MWA) plaintiff driver before it was an independent contractor, and that decision wasn’t appealed. SWA drivers own and operate a single delivery route for FedEx, while MWA drivers own
*657
and operate two or more delivery routes. On the evidence before it, the
Estrada
trial court found that the MWA driver was subject to the same “strict controls” as the SWA drivers and that the MWA driver and SWA drivers were all integral to FedEx’s business.
Estrada v. FedEx Ground,
No. BC 210130, at *17, 2004 WL 5631425 (Cal.Super.Ct. July 26, 2004) [Exh. B to Pltfs’ Req. for Judicial Notice, Apr. 24, 2008]. Although the
Estrada
trial court held SWA drivers to be employees, it held the MWA driver to be an independent contractor based on his opportunity for profit as a MWA driver. MWA drivers testified at trial “as to their enthusiasm for their entrepreneurial opportunities for making good money,” and the court noted that “a MWA has the opportunity to hire drivers and slowly but surely create a little financial empire under the aegis of FEG.”
Id.
at *18. The opportunity for profit, and not how much profit the MWA plaintiff made, was dispositive.
Id.
The plaintiff drivers have argued vigorously throughout this litigation that
Estrada’s
SWA finding should be given preclusive effect in all these MDL cases. This court has addressed the drivers’ argument and denied granting preclusive effect to the
Estrada
decision.
See generally
Op. and Ord., Apr. 21, 2010, 2010 WL 1652863 [Doc. No. 2029]. The court denied collateral estoppel because
Estrada
involved facts specific to the California class in that case. The facts before the
Estrada
court and those before this court are dissimilar insofar as the facts available to this court don’t go beyond the Operating Agreement and generally applicable Policies and Procedures.
See
Op. and Ord., Apr. 21, 2010, at 25-29 [Doc. No. 2029]. Also, the SWA class in
Estrada
was markedly different from the classes before this court because the MDL classes lump together SWA and MWA drivers. Thus, though the parties litigated a right to control issue in
Estrada,
the issue decided in
Estrada
isn’t identical to issue before this court.
The drivers never addressed how the collateral estoppel issue might differ for the California class as distinct from other states’ classes, even though California adds an economic realities twist to the common law right to control test and other states in this centralized docket don’t add such a twist. Also, in the interest of fairness, the court hasn’t precluded FedEx from litigating the right to control factor in today’s cases when the drivers haven’t addressed the potential preclusive effect of the
Estrada
trial court’s finding that a MWA driver was an independent contractor under the California test. Op. and Ord., Apr. 21, 2010, at 41. Indeed, the drivers have all but ignored the
Estrada
trial court’s MWA finding and have hardly addressed this court’s findings in the
Kansas Decision
relating to their entrepreneurial opportunities. It can’t work both ways: the drivers can’t argue persuasively that
Estrada
should have preclusive effect on the California class (and other states’ classes) while ignoring the
Estrada
trial court’s MWA finding. As in
Estrada,
this court has found the drivers’ entrepreneurial opportunities to be highly persuasive evidence indicating independent contractor status. Unlike
Estrada,
and because of the classes defined in these MDL cases, the court has no occasion to distinguish between SWA and MWA drivers. To repeat the Order denying the grant of preclusive effect to
Estrada,
the court doesn’t apply the finding of a right to control in
Estrada
to these cases, but rather analyzes the right to control again.
D. Intent Wasn’t Dispositive in the Kansas Decision.
In their supplemental briefs, the drivers characterize the
Kansas Decision
as placing dispositive weight on the clearly expressed intent in the Operating Agreement
*658
that an independent contractor relationship exist between themselves and FedEx. The court stated that this “factor weighs strongly in favor of independent contractor status.”
Kansas Decision,
734 F.Supp.2d at 589 . But among all the other factors, the intent factor weighed “strongly” because the intent expressed in the contracts was so clear, not because the intent factor had special status or carried dispositive weight. The court never said this factor was dispositive, and the court never believed this factor to be dispositive. The laws of every state considered in these cases generally require courts to look beyond contractual labels, and the court has done so by examining the Operating Agreement and generally applicable Policies and Procedures in their entirety, vis-avis the comprehensive list of factors that Kansas uses to determine employment status — the
Kansas Decision
would have been far shorter were it otherwise.
Most important in Kansas — and most important under the common law and Restatement tests generally — is the right to control, which typically is the weightiest factor. States often treat the right to discharge at will as the second most important factor. This court held that there was no reasonable inference that FedEx retained the right to control the methods and means of the drivers’ work on a class-wide basis.
See Kansas Decision,
734 F.Supp.2d at 589 . This finding came in light of the distinction between control of means and control of results. In most states, control of results doesn’t indicate employee status; control of means used to achieve contracted-for results does indicate employee status. Drawing the line between means and results is a challenging, highly contextual and fact-specific task. Bright-line rules prove elusive here. This court held that the controls reserved to FedEx were results-oriented: FedEx provides work to and pays contractor-drivers to provide the specific result of timely and safely delivered packages to FedEx customers.
See
Op. and Ord., 734 F.Supp.2d at 588, 589, 591, 592-593, 594, 594, 595, 600 . The totality of the circumstances and review of all the relevant facts and factors led to this results-oriented conclusion. Buttressing this conclusion, FedEx has no right to discharge drivers at will. FedEx can non-renew a contract or cancel a contract for breach, but these are unexceptional rights common to any contractee in an independent contractor relationship; notably, FedEx is contractually unable to discharge a driver at a whim and on the spot the way an employee in an at-will employment relationship could be discharged.
In addition to the right to control and right to discharge factors, the court found the drivers’ entrepreneurial opportunities to be highly probative of independent contractor status. Also, the plaintiff drivers are responsible for acquiring their own equipment, such as their own delivery trucks (and nothing suggests that the drivers aren’t paid accordingly to cover these expenses), though the equipment factor generally weighs less heavily in indicating independent contractor status. The court repeats here what it stated in the
Kansas Decision-.
Upon review of the evidence in the light most favorable to the plaintiffs, the only reasonable inference is that FedEx hasn’t retained the right to direct the manner in which drivers perform their work. FedEx supervises the drivers’ work and offers numerous suggestions and best practices for performance of assigned tasks, but the evidence doesn’t suggest that FedEx has the authority under the Operating Agreement to require compliance with its suggestions. Further, other factors strongly weigh in favor of independent contractor status; in particular, the parties intended to create an independent contractor arrange
*659
ment,
the drivers have the ability to hire helpers and replacement drivers, they are responsible for acquiring a vehicle and can use the vehicle for other commercial purposes, they can sell their routes to other qualified drivers, and FedEx doesn’t have the right to terminate contracts at-will.
Although some facts weigh in favor of employee status, after considering all the relevant factors, the court finds that the plaintiffs are independent contractors as a matter of [Kansas] law.
Kansas Decision,
734 F.Supp.2d at 559-560 (emphasis added).
The drivers’ supplemental briefs gave little importance to their entrepreneurial opportunities with FedEx. Generally, employees can’t sell their jobs, and they can’t hire other people to do their jobs for them. The drivers call these entrepreneurial opportunities a “sham,” but they haven’t shown the court on the common evidence that these opportunities are but a sham. After considering a wealth of extrinsic testimonial evidence, the trial court in
Estrada
held a Multiple Work Area driver (a driver who took advantage of the entrepreneurial opportunities available to him with FedEx by owning multiple delivery routes) to be an independent contractor. This court made its own findings using the common evidence available to it in the
Kansas Decision.
To characterize the
Kansas Decision
as finding a contractual label to be dispositive is to fundamentally misunderstand this court’s reasoning.
E. Kansas Law is Typical of the States’ Laius Reviewed Today.
The drivers’ supplemental briefs make a strong effort to distinguish Kansas law as being unique, while FedEx seizes on language from the
Kansas Decision
to say that what’s true in Kansas must be true elsewhere. These approaches have resulted in some jarringly inconsistent arguments between the summary judgment briefs and supplemental briefs, making it difficult for the court to accept the parties’ statements on what the law is. For example, in the Arkansas case, FedEx argued in its summary judgment response brief that Arkansas courts require each and every Restatement factor to favor either employee or independent contractor status for summary judgment to be appropriate. The drivers’ reply challenged this view of Arkansas law and persuasively distinguished the cases on which FedEx relied. In a move that reflects the parties’ parries in this litigation as a whole, the drivers’ post-Kansas supplemental brief now urges the very argument they previously condemned: that all Restatement factors must support independent contractor status in Arkansas for FedEx to win, and the drivers’ supplemental brief relies exclusively on the very cases the drivers had persuasively argued held dubious value for this docket.
Rather than helping the court to understand the law, some arguments have bordered on simple misrepresentations of the law. In any event, as today’s decisions will show, the court’s own review of the law of the various states has led to the conclusion that Kansas law is not strangely alien or
sui generis,
but rather is very typical of the states’ laws on determining employment status.
One of the drivers’ characterizations of the court’s understanding of Kansas law requires mention. The drivers try to distinguish the
Kansas Decision
by arguing that it carved out an exception in Kansas law: if an employer requires a worker to do a certain amount of work within customer-based time boundaries, that worker still can be considered an independent contractor if the employer (in this case, FedEx) is contractually bound to provide full days of work to the drivers. Without the employer’s exceptional contractual obli
*660
gation — so the drivers’ argument goes — • the worker would be considered an employee.
As today’s considerations of the various states’ laws should make clear, resolution of employment status at common law doesn’t allow for bright-line rules. Statutory redefinitions of the scope of employee status sometimes create clearer bright-line rules, unmistakably broadening the scope of who is an employee (often called “statutory employees”).
6
But at common law, the test is the right to control the means and methods of achieving results; control of the results doesn’t indicate employee status. Determining the line between means and methods, and results, is context specific and requires considering multiple factors and examining the totality of the circumstances of a given working relationship.
The
Kansas Decision
carved out no exceptions to Kansas law: this court isn’t in a position to declare what Kansas law is when Kansas itself hasn’t declared what its law is or what its law most likely would be. Rather, the
Kansas Decision,
and today’s decisions, take into consideration all the circumstances of the FedEx/driver working relationship and conclude that customer-based constraints on the drivers are results-oriented controls that don’t indicate employee status.
The drivers complain that FedEx makes them do so much work within so much time, which they say indicates control of means and methods. But the numerous cases across the states reviewed by the court indicate that “so much work within so much time” doesn’t, by itself, indicate employee status — subcontractors often agree to get a job done within a specified time. The
Kansas Decision
pointed out that FedEx is contractually bound to give drivers work. The parties agreed to something: FedEx would provide work, and the drivers would do that work. This type of agreement is common and unexceptional in all working relationships, whether of the employee or independent contractor variety, and is unexceptional to states’ laws differentiating between employee and independent contractor status. The court doesn’t agree that it created an exception in Kansas law, and the court doesn’t agree that Kansas law is alien and unique compared to the rest of the states’ laws relevant to today’s decisions.
F. FedEx’s Requests for Summary Judgment sua sponte.
In eleven of the states with pending summary judgment motions filed by the drivers,
7
FedEx didn’t file motions for summary judgment and instead argued in its summary judgment response briefs that the laws of those eleven states inflexibly required a trial on the employee vs. independent contractor question. The court held under Kansas law that the facts were susceptible to only one reasonable conclusion: on a class-wide basis, FedEx hasn’t retained the right to control the details of the drivers’ methods and means of doing their work.
Kansas Decision,
734 F.Supp.2d at 589 . FedEx now urges the court to apply this same conclusion to these eleven states and enter judgment
sua sponte
in its favor.
“[District courts are widely acknowledged to possess the power to enter summary judgments
sua sponte,
so long as the losing party was on notice that [it] had to come forward with all of [its] evidence.”
Celotex Corp. v. Catrett,
477 U.S. 317, 326 ,
*661
106 S.Ct. 2548 , 91 L.Ed.2d 265 (1986). Generally,
sua sponte
entry of judgment is a “hazardous procedure, ... warrants special caution and is often unnecessary,” but it is permissible.
Jones v. Union Pacific R.R. Co.,
302 F.3d 735, 740 (7th Cir.2002). Federal Rule of Civil Procedure 56(f)(1), which became effective December 1, 2010, specifically authorizes granting summary judgment for a nonmovant — what the Rule calls “Judgment Independent of the Motion” — after notice and a reasonable time to respond. The drivers’ supplemental briefs make clear that they knew FedEx would seek such judgments. The drivers didn’t ask for additional briefing; instead, they explained their disagreement with FedEx’s view of the law and argued that judgment in favor of FedEx wouldn’t be appropriate. Thus, the court concludes the drivers have had a reasonable opportunity for response.
FedEx argues that judicial economy would best be served by entering what is now called judgment independent of the motion in its favor in these eleven states. The parties have fully litigated these MDL cases within their procedural posture. The evidence before the court — the Operating Agreement and generally applicable Policies and Procedures — isn’t in dispute, and the drivers didn’t take the position that this evidence contains ambiguous terms. The drivers’ presentation of facts is common and repeated across the board in these cases, and their arguments about how the court should view the facts don’t materially change from one state to the next.
FedEx’s about-face on the appropriateness of summary judgment in these cases seizes attention, but this court’s duty is to decide these cases as the states’ highest courts (or, in the absence of guidance from the highest courts, as the appellate courts) would decide them.
E.g., Home Valu, Inc. v. Pep Boys,
213 F.3d 960, 963 (7th Cir.2000). As set forth in the decisions in this opinion, the court has reviewed the laws of these eleven states and finds that resolution of the employment status question without a trial is appropriate in these states when the facts are undisputed and lend themselves to but one inference. The court hesitates to grant FedEx a windfall, but because the drivers had full opportunity to present their position, judicial economy is best served by granting judgment to FedEx in these states if the states’ laws favor FedEx as did Kansas law. Also, insofar as it is most fair to give parties an answer to a question when the question is ripe and has been pending for quite some time, fairness to the parties is best served by answering now the general question presented in these MDL cases.
II. Disposition of FedEx MDL Cases
A. Alabama
(1) 8:06-cv-428, Floyd
The
Floyd
drivers allege violations of the Alabama Deceptive Trade Practices Act and fraud; they seek an accounting, rescission, declaratory judgment, and injunctive relief. The drivers didn’t move to certify the ADTPA and fraud claims, but they don’t indicate that their claims turn on anything other than a determination of their employment status under Alabama law.
See
Memo, in Support of Mot. to Certify Class (Alabama), Apr. 2, 2007, at 1 [Doc. No. 583]. Only the drivers filed a motion for summary judgment. For the reasons stated below, the court denies the drivers’ motion and grants judgment independent of the motion to FedEx. Because the Alabama claims stand or fall on the common question of whether FedEx Ground misclassified its drivers as independent contractors, judgment will be entered for FedEx on all claims in this Alabama (Floyd) case.
*662
As noted, FedEx didn’t move for summary judgment against the Alabama class. In its supplemental brief, FedEx asks the court to enter judgment
sua sponte
(now called judgment independent of the motion) in its favor. As set forth in the general introduction to today’s decisions, the court takes this request seriously because summary judgment is appropriate under Alabama law, the drivers’ employment status can be examined today without prejudice to the plaintiffs, and answering now the question of the plaintiff drivers’ employment status under Alabama law will conserve judicial resources.
FedEx’s summary judgment response brief argued that summary judgment on the employment status question is “practically unavailable” in Alabama. Yet Alabama courts have been perfectly willing to enter judgment on employment status without a trial when the facts are undisputed.
See, e.g., Dickinson v. City of Huntsville,
822 So.2d 411, 416 (Ala.2001) (affirming summary judgment finding independent contractor status where no substantial evidence was presented to show employee status);
In re Curry v. Interstate Express, Inc.,
607 So.2d 230, 233 (Ala.1992) (reversing lower court and finding worker to be employee);
Atchison v. Boone Newspapers, Inc.,
981 So.2d 427, 434 (Ala.Civ.App.2007) (affirming summary judgment finding worker to be independent contractor);
see also Lankford v. Gulf Lumber Co., Inc.,
597 So.2d 1340, 1344 (Ala.1992) (“[Wjhether a defendant reserved the right of control is generally a question of fact to be decided by the jury
if the evidence is in dispute
....” (emphasis added)).
In Alabama “for one to be an employee, the other party must retain the right to direct the manner in which the business shall be done, as well as the result to be accomplished or, in other words, not only what shall be done, but how it shall be done.”
Atchison v. Boone Newspapers,
981 So.2d at 431 (citations omitted). Alabama courts “look[] to the reserved right of control rather than the actual exercise of control.”
Id. (quoting Turnipseed v. McCafferty,
521 So.2d 31, 32 (Ala.Civ.App.1987));
see also In re Curry v. Interstate Express,
607 So.2d at 232 (“In the last analysis, it is the reserved right of control rather than its actual exercise that provides the answer.”). If the right of control extends no further than directing what is ultimately to be accomplished, employee status isn’t indicated.
See Lankford v. Gulf Lumber Co.,
597 So.2d at 1343 (finding right to supervise loggers was merely to ensure contracted-for results and didn’t indicate employee status);
Williams v. Tennessee River Pulp and Paper Co.,
442 So.2d 20, 21-22 (Ala.1983) (finding the only reasonable inference from work site inspections was that company was supervising conformity with contract requirements, which didn’t indicate employee status);
Atchison v. Boone Newspapers,
981 So.2d at 431 ;
Liberty Mut. Ins. Co. v. D & G Trucking, Inc.,
966 So.2d 266, 268 (Ala.Civ.App.2006).
Alabama courts consider four factors to decide whether an employer has retained the right to control the manner of contract performance: (1) direct evidence of the right or exercise of control; (2) the method of payment used; (3) whether the alleged principal had the right to terminate employment; and (4) the right to control another’s time.
Dickinson v. City of Huntsville,
822 So.2d 411, 416 (Ala. 2001);
see also Williams v. Tennessee River Pulp & Paper Co.,
442 So.2d at 21 (“[T]he crucial factor is the right of Tennessee Paper to control the manner of Mauldin’s performance.”). Alabama courts sometimes consider the furnishing of equipment instead of the right to control
*663
another’s time.
Atchison v. Boone Newspapers,
981 So.2d at 432 .
The
Floyd
plaintiffs argue that if a company “controlled what loads [the driver] picked up and where he picked them up,” then Alabama views such control as establishing an employee relationship. Pltfs’ Supp. Brief (Alabama), Sept. 24, 2010, at 2 [Doc. No. 2161]
(quoting In re Curry v. Interstate Express,
607 So.2d at 233 , and
citing Liberty Mut. Ins. v. D & G Trucking,
966 So.2d at 269 (“Trucking personnel decide which driver to dispatch ... [and] [o]nce that driver has accepted a load, he or she is not permitted by D & G Trucking to run a personal errand that might involve significant travel beyond the pickup and delivery.”)). The presence of “some controls,” the drivers argue, is direct evidence of the right to control. Pltfs’ Supp. Brief, at 2-3
(quoting Liberty Mut. Ins. v. D & G Trucking,
966 So.2d at 270 ).
The drivers are right that at some point, “some control” amounts to enough control to indicate an employee relationship. But not here.
In re Curry
and
Liberty Mutual
are distinguishable from the case before the court today.
8
The
In re Curry
court didn’t find a right to control simply because “Interstate controlled what loads [Curry] picked up and where he picked them up, as well as the place of delivery of the cargo.”
In re Curry v. Interstate Express,
607 So.2d at 233 . Interstate ordered Mr. Curry to transport his load of dog food even after Mr. Curry expressed his concern that the load wasn’t properly secured, which led to Mr. Curry’s injury.
Id.
Reasonably, in light of the order to transport a load known to be improperly secured, Interstate should be responsible to Mr. Curry for worker’s compensation.
Liberty Mutual
involved a worker’s compensation insurance premium dispute where a company reclassified drivers as independent contractors without making significant changes to the company’s actual relationship with the drivers.
Liberty Mut. Ins. v. D & G Trucking,
966 So.2d at 269-270 . Besides the reclassification, D & G Trucking continued to control drivers as it had before and continued to own the trucks the drivers drove. In both cases, the defendants’ orders concerning the identity of loads and timing of pick up and delivery were not, by themselves, dis-positive facts: those facts were surrounded by a larger context favoring employee status. Neither case involved facts that overlap in a compelling way with the facts before this court. Also, Alabama doesn’t treat any single fact as dispositive; employment status is a fact-intensive inquiry.
See Hooker Constr., Inc. v. Walker,
825 So.2d 838, 843-844 (Ala.Civ.App.2001) (“[T]he retention of control necessary to establish employee status is determined on a case-by-case basis. No one fact by itself can create an employer-employee relationship .... When taken as a whole, the evidence supports the trial court’s finding.” (citation omitted)).
The court incorporates here its reasoning in the
Kansas Decision.
As previously held, FedEx’s controls are results-oriented, and FedEx’s supervision exists to ensure contracted-for results. Such controls don’t indicate employee status in Alabama. “After reviewing the common undisputed
*664
evidence offered by the parties, the only reasonable inference that can be drawn is that FedEx hasn’t retained the right to control the details of the contractors’ work methods on a class-wide basis.”
Kansas Decision,
734 F.Supp.2d at 589 .
As in the
Kansas Decision,
Alabama drivers don’t negotiate their pay: FedEx controls their pay. Some Alabama courts view control of pay as weighing in favor of employee status.
See In re Curry v. Interstate Express,
607 So.2d at 233 (finding Interstate controlled payment where Interstate determined percentage driver received). Other courts don’t view it this way, but rather are satisfied that payment without deducting taxes and with provision of 1099 Forms weighs in favor of independent contractor status.
See Atchison v. Boone Newspapers,
981 So.2d at 430, 432 . Also, as in the
Kansas Decision,
FedEx doesn’t have the right to terminate Alabama drivers at will, and FedEx doesn’t have the right to control Alabama drivers’ time insofar as contractors can hire assistants and replacement drivers and can develop profitable package delivery businesses in contract with FedEx. Finally, Alabama drivers are fully responsible for obtaining their own equipment — even though FedEx makes fulfilling this responsibility easier through its Business Support Package, the drivers have the ultimate responsibility of obtaining equipment with or without FedEx’s help.
See Keebler v. Glenwood Woodyard, Inc.,
628 So.2d 566, 568-569 (Ala.1993) (noting that enabling contractor to work by providing equipment and insurance wasn’t the same as controlling the manner in which he worked). For these reasons, and the reasons stated in the
Kansas Decision,
the
Floyd
drivers are independent contractors under Alabama law.
(2) 3:07-cv-191, Gentle
Bruce and Stephanie Gentle present the same claims as the
Floyd
drivers — violations of the Alabama Deceptive Trade Practices Act and fraud — and seek an accounting, rescission, declaratory judgment, and injunctive relief. The Gentles haven’t filed a motion for summary judgment, but today’s decision in
Floyd
applies to Bruce Gentle’s claims because he is a member of the Alabama class. The court has no information on whether Stephanie Gentle is a member of the Alabama class; if she isn’t, the transferor court will decide how much weight to give to today’s procedurally distinct decision in
Floyd
when deciding her case. The court will suggest remand of the Gentles’ case to its transferor court for further disposition.
The court instructs the parties to file a joint proposed pretrial order with this court within twenty-one days of entry of this order. In addition to summarizing the history of this case, including significant orders and their docket numbers (including, but not limited to, evidentiary, class certification, and dispositive orders), the parties should provide a detailed description of the claims that remain outstanding, without arguing the merits of those claims, and should outline for the court and the transferor court how they anticipate resolving those claims.
B. Arizona (3:07-cv-272, Gibson)
The
Gibson
drivers allege violations of Arizona’s wage withholding statute, Ariz. Rev. Stat. Ann. § 23-352 , and seek rescission, declaratory relief, and injunctive relief. All claims are class certified; only the drivers filed a summary judgment motion. For the reasons stated below, the court denies the plaintiffs’ motion and grants judgment independent of the motion to FedEx. Because the Arizona claims stand or fall on the common question of whether FedEx Ground misclassified its drivers as independent contractors, judgment will be entered in FedEx’s favor on all claims in
Gibson.
*665
As noted, FedEx didn’t file a motion for summary judgment against the Arizona class. In its supplemental brief, FedEx asks the court to enter judgment
sua sponte
(now called judgment independent of the motion) in its favor. As set forth in the general introduction to today’s decisions, the court takes this request seriously because summary judgment is appropriate under Arizona law, the drivers’ employment status can be examined today without prejudice to the plaintiffs, and answering now the question of the plaintiff drivers’ employment status under Arizona law will conserve judicial resources.
FedEx insisted in its summary judgment response brief that Arizona law requires a trial on the employment status question. As in other states, summary judgment is appropriate in Arizona where the material facts are undisputed and only one inference can be drawn from those facts.
Santiago v. Phoenix Newspapers, Inc.,
164 Ariz. 505 , 794 P.2d 138, 141 (1990). The
Kansas Decision
held that “[ajfter reviewing the common undisputed evidence offered by the parties, the only reasonable inference that can be drawn is that FedEx hasn’t retained the right to control the details of the contractors’ work methods on a class-wide basis.”
Kansas Decision,
734 F.Supp.2d at 589 . For purposes of this case, Arizona law doesn’t materially differ from Kansas law.
The parties agree that Arizona’s common law test for employment status provides the definition of “employee” under Arizona’s wage withholding statute. “The right to control or supervise the method of reaching a specific result determines whether an individual is an employee or an independent contractor.”
Home Ins. Co. v. Industrial Comm’n,
123 Ariz. 348 , 599 P.2d 801, 803 (1979);
see also Hunt Bldg. Corp. v. Industrial Comm’n,
148 Ariz. 102 , 713 P.2d 303, 306 (1986) (same);
Hughes v. Industrial Comm’n,
113 Ariz. 517 , 558 P.2d 11, 12-13 (1976) (“[W]e must look to the right to control the method of reaching a desired result reposed in the employer. It is not the exercise of the power to supervise and control, but rather its existence which is to be considered.”).
Arizona doesn’t follow a single formula for its right to control test. Some courts have looked to the multi-factor Restatement test for employment status, discussed in the
Kansas Decision. See, e.g., Santiago v. Phoenix Newspapers,
794 P.2d at 141
(citing
Restatement (Second) of Agency § 220). Other courts have examined the right to control in light of other factors that also were discussed in the
Kansas Decision. See, e.g., id.
at 145 n. 6 (noting IRS list of twenty factors: instructions; training; integration; services rendered personally; hiring, supervising and paying assistants; continuing relationship; set hours of work; full time required; doing work on business premises; order of sequence set; reporting; payment by time, not job; payment of traveling expenses; furnishing of tools; investment; realization of profit or loss; working for more than one firm at a time; making service available to public; right to discharge; right to terminate without liability);
Home Ins. Co. v. Industrial Comm’n,
599 P.2d at 803 (“These indicia ... include: duration of the employment; the method of payment; who furnishes necessary equipment; the right to hire and fire; who bears responsibility for workmen’s compensation insurance; the extent to which the employer may exercise control over the details of the work, and whether the work was performed in the usual and regular course of the employer’s business.”);
Dial-A-Messenger, Inc. v. Arizona Dep’t of Econ. Sec.,
133 Ariz. 47 , 648 P.2d 1053, 1057-1059 (Ariz.Ct.App.1982) (discussing multiple factors: authority over an individ
*666
ual’s assistants; compliance with instructions; oral or written reports; personal performance; establishment of work sequence; right to discharge; set hours of work; training; amount of time; expense reimbursement; availability to the public; compensation on job basis; realization of profit or loss; significant investment). The common denominator is that the test is the alleged employer’s reserved right to control. Arizona courts consider the totality of the circumstances when evaluating the indicia of control, and no single factor is itself conclusive.
Santiago v. Phoenix Newspapers,
794 P.2d at 143 ;
Hunt Bldg. Corp. v. Industrial Comm’n,
713 P.2d at 306 ;
Home Ins. Co. v. Industrial Comm’n,
599 P.2d at 803 (“To determine the right to control, courts look to the totality of the facts and circumstances of each case, examining various indicia of control.... In undertaking an analysis none of the indicia is, in itself, conclusive.”).
The drivers’ supplemental brief highlights and relies on the use in some Arizona decisions of the disjunctive
“or”
to argue that a right to supervise eontractedfor results indicates an employee relationship in Arizona. See
Home Ins. Co. v. Industrial Comm’n,
599 P.2d at 803 (noting employment status turns on “[t]he right to control
or
supervise the method of reaching a specific result” (emphasis added)). The language cited by the drivers doesn’t support their argument. The phrase doesn’t say that the right to supervise a result indicates employee status; the phrase says the right to supervise the method of reaching a specific result indicates employee status. This test is no different from other states using the right to control test, and it differentiates between results-oriented supervision of contracted-for rights and supervision and control of means and methods used to achieve those results.
If the drivers were correct, Arizona law would be radically different from Kansas law and Arizona cases would reflect their argument. But Arizona cases don’t interpret the “or” language as the drivers suggest. For example, the
Home Insurance
court, which used the disjunctive “or”, held that a hiring party could reasonably expect the worker’s compensation claimant to follow established departure and arrival times, and that he not deviate from well-recognized delivery routes, without creating an employment relationship.
Home Ins. Co. v. Industrial Comm’n,
599 P.2d at 804 ;
see also Hunt Bldg. Corp. v. Industrial Comm’n,
713 P.2d at 306-307 (noting that applying Arizona’s right to control test “require[s] sufficient control over the method of reaching a desired result as opposed to merely controlling the end result of the work.”);
Central Mgmt. Co. v. Industrial Comm’n,
162 Ariz. 187 , 781 P.2d 1374, 1376-1377 (Ariz.Ct.App.1989) (“If the right of control of details goes no further than is necessary to ensure a satisfactory end result, it does not establish employment.” (citation omitted)).
The drivers also argue that the intent factor is “noticeably absent” from Arizona decisions. Arizona cases hardly mention intent at all. But, as discussed in the general introduction to today’s decisions, even though the intent factor weighs clearly in favor of an independent contractor relationship in states that weigh this factor, this factor wasn’t dispositive in the
Kansas Decision
and its absence from consideration under Arizona law doesn’t change today’s outcome.
The court has held that FedEx’s retained controls are results-oriented and there is no reasonable inference that FedEx has retained the right to control the methods and means of the plaintiff drivers’ work on a class-wide basis.
Kansas Decision,
734 F.Supp.2d at 589 . The
Kansas
*667
Decision
discussed nearly all the factors cited by Arizona courts, and the court incorporates that decision here. One factor not discussed in Kansas is the drivers’ availability to the public. The drivers are free to work for whomever else they wish, and, as discussed in the
Kansas Decision,
this freedom is far from illusory when the drivers take advantage of the entrepreneurial opportunities available to them. Their trucks, when covered with the FedEx logo, aren’t available to the public for service. Yet plumbers working at a job site aren’t available to the rest of the public when working a contract, so there’s nothing special in itself about a contractor or a van being tied up with a particular job. The availability factor could indicate employee status under numerous factual contexts, but in light of the drivers’ entrepreneurial opportunities, this factor doesn’t change the balance found by the court in its
Kansas Decision.
For the reasons stated here and in the
Kansas Decision,
the
Gibson
drivers are independent contractors under Arizona law.
C. Arkansas (3:06-cv-209, Harris)
The
Harris
drivers allege violations of Arkansas’ Wage and Hour Law, breach of contract, misrepresentation, unjust enrichment, conversion, quantum meruit, and violations of the Fair Labor Standards Act; they seek declaratory judgment and injunctive relief. The drivers didn’t seek class certification on the breach of contract, misrepresentation, or FLSA claims, but they represented that “[a]t the heart of the Arkansas claims is the common ‘overarching issue’ of whether FXG improperly labels these drivers as independent contractors.” Memo, in Support of Mot. to Certify Class (Arkansas), Apr. 23, 2007, at 1 [Doc. No. 603]. Only the plaintiffs moved for summary judgment. For the reasons stated below, the court denies the drivers’ summary judgment motion and grants judgment independent of the motion to FedEx on the state law claims only. To the extent the drivers’ claims depend upon Arkansas state law, the court decides their claims today because they turn on the central question of the drivers’ employment status under Arkansas law. The FLSA claim hasn’t been briefed and requires further development with individualized evidence.
See
Op. and Ord., 662 F.Supp.2d at 1080-1083 [Doc. No. 1770]. The court will suggest remand of the FLSA-related claims for further disposition.
FedEx didn’t file a summary judgment motion with respect to the Arkansas class. In its supplemental brief, FedEx asks the court to enter judgment
sua sponte
(now called judgment independent of the motion) in its favor. As set forth in the general introduction to today’s decisions, the court takes this request seriously because summary judgment is appropriate under Arkansas law, the drivers’ employment status can be examined today without prejudice to the plaintiffs, and answering now the question of the plaintiff drivers’ employment status under Arkansas law will conserve judicial resources. Summary judgment is appropriate in Arkansas when the facts are undisputed and only one inference can reasonably be drawn from them.
Howard v. Dallas Morning News, Inc.,
324 Ark. 91 , 918 S.W.2d 178, 185 (1996);
see also Dickens v. Farm Bureau Mut. Ins. Co. of Arkansas,
315 Ark. 514 , 868 S.W.2d 476 (1994) (affirming summary judgment finding independent contractor status).
Arkansas follows the multi-factor Restatement test for employment status discussed in the
Kansas Decision. See
Restatement (Second) of Agency § 220. The right to control is the most important factor, and the right to control, not actual control, determines the relationship. Because a fact intensive inquiry is required, each case must be decided on its own facts,
*668
under the totality of the circumstances.
See ConAgra Foods, Inc. v. Draper,
372 Ark. 361 , 276 S.W.3d 244, 249 (2008);
Arkansas Transit Homes, Inc. v. Aetna Life
&
Casualty,
341 Ark. 317 , 16 S.W.3d 545, 547-548 (2000);
Howard v. Dallas Morning News,
918 S.W.2d at 182-183 .
Arkansas follows the distinction between controlling results and controlling methods and means used to obtain those results:
It is not enough that the employer has merely a general right to order the work stopped or resumed, to inspect its progress or to receive reports, to make suggestions or recommendations which need not necessarily be followed, or to prescribe alterations and deviations. Such a general right is usually reserved to employers, but does not mean that the contractor is controlled as to his methods of work, or as to operative detail. Thei’e must be a retention of a right of supervision that the contractor is not entirely free to do the work his own way.
ConAgra Foods v. Draper,
276 S.W.3d at 250
(quoting Williams v. Nucor-Yamato Steel Co.,
318 Ark. 452 , 886 S.W.2d 586, 587 (1994) (alterations omitted)).
[I]n contracts for the performance of work, the inclusion of such phrases as, “work is to be done in accordance with instructions,” “under direction and supervision,” and the like does not relate to the method or manner in which work is to be done, and does not govern the details of the physical means by which the work is to be performed, or change the status of independent contractor to that of master and servant.
ConAgra Foods v. Draper,
276 S.W.3d at 250 (discussing
Moore v. Phillips,
197 Ark. 131 , 120 S.W.2d 722 (1938)).
Arkansas courts construe employee status more broadly in situations involving
respondeat superior
liability or worker’s compensation. Among all the states’ cases this court has examined, Arkansas courts have given special emphasis to the rule that although one entrusts work to an independent contractor, one may yet be liable for harm the contractor causes to others to the extent one has retained control of any part of the contractor’s work— even though the contractor still is generally considered an independent contractor and not an employee.
Elkins v. Arkla, Inc.,
312 Ark. 280 , 849 S.W.2d 489, 490 (1993)
(citing
Restatement (Second) of Torts § 414). As the Arkansas Supreme Court put it, “[W]hen one is sought to be held responsible for the tortious act of another under the principle of
respondeat superior,
the question of responsibility will not depend entirely upon the existence of some actual contractual relationship of master and servant. It is sometimes allowable to prove the relation of master and servant by the fact that one performs service for another.”
ConAgra Foods v. Draper,
276 S.W.3d at 249, 250 (discussing Restatement (Second) of Torts § 414);
Howard v. Dallas Morning News,
918 S.W.2d at 184 ;
but see Blankenship v. Overholt,
301 Ark. 476 , 786 S.W.2d 814, 816 (1990) (finding no liability even where employer provided numerous specifications to contractor). Still, personal injury caused by an independent contractor doesn’t automatically result in liability for the employer; when no factor supports a finding of employee status, no
respondeat superior
liability will attach.
See Williams v. Nucor-Yamato Steel Co.,
886 S.W.2d at 587 (stating that where there’s no exercise of actual control or retained right of control, there’s no liability for a company toward the injured employee of independent contractor). Yet Arkansas appears to give wider scope to employer liability in
respondeat superior
cases involving independent contractors, which has caused this court to read Arkansas
respon
*669
deat superior
cases with caution because today’s case involves no personal injury issues.
Additionally, Arkansas policy is to liberally construe the scope of employee status in worker’s compensation cases.
See, e.g., Franklin v. Arkansas Kraft, Inc.,
12 Ark. App. 66 , 670 S.W.2d 815, 816 (1984) (“It is well settled that the determination whether, at the time of injury, a person was an employee or an independent contractor, is a factual one, and the Commission is required to follow a liberal approach, resolving doubts in favor of employment status for the [injured] worker.” (citation omitted));
see also Irvan v. Bounds,
205 Ark. 752 , 170 S.W.2d 674, 675 (1943) (same). But this isn’t a worker’s compensation case, either.
The drivers rely on three key cases to argue that they are employees under Arkansas law,
9
but those cases are distinguishable because they involve issues of
respondeat superior
and worker’s compensation.
See ConAgra Foods, Inc. v. Draper,
372 Ark. 361 , 276 S.W.3d 244 (2008)
(respondeat superior,
personal injury);
Arkansas Transit Homes, Inc. v. Aetna Life & Casualty,
341 Ark. 317 , 16 S.W.3d 545 (2000) (worker’s compensation);
Howard v. Dallas Morning News, Inc.,
324 Ark. 91 , 918 S.W.2d 178 (1996)
(respondeat superior,
personal injury). The physical harm context sufficiently colored the decisionmaking of those courts to cast doubt on the cases’ controlling value for today’s decision. As noted, the
ConAgra Foods
court stated
respondeat superior
liability sometimes is appropriate merely because one person performs service for another. Independent contractors, by definition, perform services for others, so the general question of employment status can’t be colored by a policy that imposes liability when physical injury occurs, because no physical harm is part of the case before the court today.
In the
Kansas Decision,
the court held FedEx’s controls to be results-oriented controls, not controls over methods and means. Further, the court held that only one reasonable inference was available from the undisputed facts: although FedEx has reserved the right to control the contracted-for results, on the evidence available under this case’s procedural posture, FedEx hasn’t retained the right to control the details of the contractors’ work methods on a class-wide basis.
See Kansas Decision,
734 F.Supp.2d at 589 . The court addressed the Restatement factors in its
Kansas Decision,
and the reasoning from that decision is incorporated here. The court concludes that the
Harris
drivers are independent contractors under Arkansas law.
The court instructs the parties to file a joint proposed pretrial order with this court within twenty-one days of entry of this order. In addition to summarizing the history of this case, including significant orders and their docket numbers (including, but not limited to, evidentiary, class certification, and dispositive orders), the parties should provide a detailed description of the FLSA-related claims that remain outstanding, without arguing the merits of those claims, and should outline for the court and the transferor court how they anticipate resolving those claims.
*670
D. California
(1) 3:05-cv-528, Alexander
The
Alexander
drivers allege violations of the Family and Medical Leave Act; violations of various California wage-related statutes, including failure to reimburse, failure to pay overtime, late payment of wages, failure to provide meal and break periods, and illegal deductions from wages; unlawful coercion; fraud; unfair business practices; and wrongful termination. They seek an accounting, civil penalties, declaratory relief, and injunctive relief. The court granted certification for the state law claims, but denied certification for the FMLA claims because the federal claims require individualized evidence for predominant issues.
See
Op. and Or., Mar. 25, 2008, 273 F.R.D. at 458-59 , 2008 WL 7764456, at *30-31 [Doc. No. 1119]. The parties filed cross-motions for summary judgment. For the reasons stated below, the court grants summary judgment to FedEx and denies the plaintiffs’ motion for summary judgment. The holding that the plaintiffs are independent contractors under California state law resolves the state law claims. The parties haven’t briefed the FMLA-related claims, and those claims require further development. The court will suggest remand of the
Alexander
case for further disposition of the FMLA-related claims.
The parties agree that because the relevant statutes in question don’t define “employee,” the applicable employment status test is set forth in
S.G. Borello & Sons, Inc. v. Department of Indus. Relations,
48 Cal.3d 341 , 256 Cal.Rptr. 543 , 769 P.2d 399 (1989).
See Estrada v. FedEx Ground Package Sys.,
154 Cal. App.4th 1 , 64 Cal.Rptr.3d 327, 335 (2007). The principal test of employment status is “whether the person to whom service is rendered has the right to control the manner and means of accomplishing the result desired. If control may be exercised only as to the result of the work and not the means by which it is accomplished, an independent contractor relationship is established.”
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 548 , 769 P.2d 399
(citing Tieberg v. Unemployment Ins. Appeals Bd., 2
Cal.3d 943, 88 Cal.Rptr. 175, 177 , 471 P.2d 975 (1970)). The right to discharge at will, without cause, is strong evidence of the existence of employee status.
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 548 , 769 P.2d 399
(citing Tieberg v. Unemployment Ins. Appeals Bd.,
88 Cal.Rptr. at 179 , 471 P.2d 975 ). Other factors to be considered are the remaining factors from the Restatement (Second) of Agency § 220.
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 548 , 769 P.2d 399
(citing Tieberg v. Unemployment Ins. Appeals Bd.,
88 Cal.Rptr. at 179 -180 & n. 4, 471 P.2d 975 ). Individual factors aren’t applied mechanically as separate tests; they are intertwined and their weight often depends on particular combinations and the circumstances and facts of each case.
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 548 , 769 P.2d 399 .
S.G. Borello & Sons
pushed this traditional right to control test in the direction of an “economic realities” test, without eliminating the applicability of the right to control test and the Restatement factors. This way of approaching the common law factors differs materially from other states considered in today’s decisions.
S.G. Borello & Sons
was a worker’s compensation case and heavily emphasized the history and remedial and social purposes of California’s Worker’s Compensation Act: (1) to ensure that the cost of industrial injuries will be part of the cost of goods rather than a burden on society; (2) to guarantee prompt, limited compensation for an employee’s work injuries, regardless of fault,
*671
as an inevitable cost of production; (3) to spur increased industrial safety; and (4) to insulate the employer from tort liability for an employee’s injuries.
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 550 , 769 P.2d 399 . Traditional common law analysis didn’t meet these concerns:
The common law and statutory purposes of the distinction between “employees” and “independent contractors” are substantially different. While the common law tests were developed to define an employer’s liability for injuries caused
by
his employee, the basic inquiry in compensation law involves which injuries
to
the employee should be insured against by the employer.
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 549 , 769 P.2d 399 (citations and quotations omitted). In the face of employee-protective legislation, a worker’s status must be resolved “with deference to the purposes of the protective legislation” and “[t]he nature of the work, and the overall arrangement between the parties, must be examined to determine whether they come within the ‘history and fundamental purposes’ of the statute.”
Id.
at 550, 769 P.2d 399 (citations omitted).
To assist with this analysis,
S.G. Borello & Sons
mentioned a six-factor test other jurisdictions use in the worker’s compensation context, while maintaining that the test was basically a re-hashing of the Restatement test:
Besides the ‘right to control the work,’ the factors include (1) the alleged employee’s opportunity for profit or loss depending on his managerial skill; (2) the alleged employee’s investment in equipment or materials required for his task, or his employment of helpers; (3) whether the service rendered requires a special skill; (4) the degree of permanence of the working relationship; and (5) whether the service rendered is an integral part of the alleged employer’s business.
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 551 , 769 P.2d 399 (citations omitted). Each situation must still be evaluated on its own facts, and the dispositive circumstances may vary from case to case.
Id.
The
S.G. Borello & Sons
court applied a “right to control overall process” test that it believed met the policy objectives behind California’s Worker’s Compensation Act. The workers in
S.G. Borello & Sons
were cucumber harvesters who worked for short periods of time and were paid half the gross proceeds of the cucumbers harvested. The harvesters alone were responsible for deciding the best method of hoeing, weeding, irrigating, and harvesting the cucumbers to maximize their payments, so the grower didn’t reserve a right to control the details of the harvesters’ work.
Id.
at 551-552, 769 P.2d 399 ;
see also Rinaldi v. Workers’ Comp. Appeals Bd.,
227 Cal. App.3d 756 , 278 Cal.Rptr. 105, 109 (1991) (noting lack of traditional control over cucumber harvesters in
Borello).
But the
Borello
court turned to what later courts have described as the “economic realities” of the situation to take into account that the grower was in the business of producing and selling agricultural crops, and despite ceding control to the harvesters over a piecemeal aspect of the operation, the grower maintained “pervasive control over the operation as a whole.”
S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 552 , 769 P.2d 399 . The grower controlled all meaningful aspects of the business relationship — price, crop cultivation, fertilization, insect prevention, payment, and the right to deal with buyers. The grower thus maintained all “necessary” control over the work, and the lack of control of the details was attributable to
*672
the simplicity of the work, not to a relinquishment of control.
Id.
at 552, 769 P.2d 399 . In sum, the
S.G. Borello & Sons
court’s analysis found that S.G. Borello & Sons had a right to control the overall process, the harvesters were a regular and integral part of S.G. Borello & Sons’ business operation, the harvesters’ work was permanent insofar as they returned season after season for work, the harvesters didn’t hold themselves out as businesses, the harvesters made no investment other than personal service and hand tools, the harvesters had no opportunity for profit or loss, and the harvesters’ terms of service were non-negotiable.
Id.
at 552-553, 769 P.2d 399 .
Post-Borello
courts have held the coupling of the right to control the overall process with the integral nature of a person’s work in a business to indicate employee status.
See Air Couriers Int’l v. Employment Dev. Dep’t,
150 Cal.App.4th 923 , 59 Cal.Rptr.3d 37 (2007) (affirming finding of employee status for employment tax purposes where courier retained all necessary control over the overall delivery operation, the work was simple, the workers weren’t engaged in a separate profession or operating an independent business, and the delivery work was an integral aspect of the courier’s business);
JKH Enters., Inc. v. Department of Indus. Relations,
142 Cal.App.4th 1046 , 48 Cal.Rptr.3d 563, 579 (2006) (finding drivers in courier business to be employees because JKH retained all necessary control over the operation as a whole, drivers’ work wasn’t highly skilled, and drivers’ function was integral to courier business, even though JKH didn’t exercise control over the details of the work and JKH was more concerned with the results of the work than the means of its accomplishment);
Rinaldi v. Workers’ Comp. Appeals Bd.,
227 Cal. App.3d 756 , 278 Cal.Rptr. 105, 109 (1991) (finding almond grower to be employer of injured worker because, although the grower lacked control in the traditional sense, he retained all necessary control over the Almond growing operation as a whole, harvesting almonds didn’t require much skill, and the harvesters’ work was integral to the grower’s operation). But no case before this court, except for the trial court’s decision in
Estrada v. FedEx Ground,
No. BC 210130, 2004 WL 5631425 (Cal.Super.Ct. July 26, 2004) [Exh. B to Pltfs’ Req. for Judicial Notice, Apr. 24, 2008], indicates what might happen if the
S.G. Borello & Sons
workers had entrepreneurial opportunities such that their work could be conducted from the auspices of a separately operating business. Each case must be analyzed under its own facts and circumstances. Nothing indicates a rule of law that an employer’s right to control the overall operation together with integration into an employer’s business necessarily requires a finding of employee status regardless of the other factors to be considered.
Cases after
S.G. Borello & Sons
haven’t uniformly applied the “right to control overall operations” approach highlighted here. Some have focused on the traditional right to control methods and means test used by other states considered in today’s decisions.
See Antelope Valley Press v. Poizner,
162 Cal.App.4th 839 , 75 Cal.Rptr.3d 887, 899-900 (2008) (using manners and means approach to evaluate the right to control);
Estrada v. FedEx Ground Package Sys., Inc.,
154 Cal. App.4th 1 , 64 Cal.Rptr.3d 327, 335 (2007) (“The essence of the [right to control] test is the ‘control of details’ — that is, whether the principal has the right to control the manner and means by which the worker accomplishes the work.”). As in
S.G. Borello & Sons, Antelope Valley Press
was a worker’s compensation case where that court, in harmony with
S.G. Borello & Sons’s
policy analysis, expressed concern about newspaper carriers’ inability to distribute the risk and cost of injury as an
*673
expense of doing business because no evidence showed the carriers had other sources of business income.
Antelope Valley Press v. Poizner,
75 Cal.Rptr.3d at 900 . The
Estrada
court zeroed in on extensive extrinsic evidence of the right to control FedEx Single Work Area drivers’ methods and means of doing their work.
Estrada v. FedEx Ground Package Sys.,
64 Cal.Rptr.3d at 331-337 .
The drivers haven’t argued the policies and purposes behind the California wage statutes in question. In a case similar to the one before this court, in which FedEx drivers sought reimbursement for work-related expenses, the
Estrada
appellate court didn’t discuss the wage statutes’ policies and purposes. Today’s case doesn’t involve concerns that injured employees should have their costs of on-the-job injuries covered, employers should cover those costs, employers should have their liability for these costs capped, and consumers of specific products of that work should ultimately bear the costs and not the public at large.
See S.G. Borello & Sons v. Department of Indus. Relations,
256 Cal.Rptr. at 551 , 769 P.2d 399 ;
Rinaldi v. Workers’ Comp. Appeals Bd.,
278 Cal.Rptr. at 111 (expressing concern that to come to a different conclusion “would virtually guarantee that in all such cases the costs of injuries would be borne by society at large through the Uninsured Employer’s Fund”). Rather, the concerns behind the statutes here at issue seem to be protecting employees from being deprived of their due wages and preventing employers from using contractual arrangements as a subterfuge to avoid paying due wages to employees.
Cf. Narayan v. EGL, Inc.,
616 F.3d 895, 897 (9th Cir.2010) (stating, in the context of overtime, improper deductions, and business expenses claims, that “statutes enacted to confer special benefits on workers are designed to defeat rather than implement contractual arrangements” (quotation omitted)). To the extent today’s plaintiff drivers agreed to bear certain expenses of their work and be paid by FedEx in a way that accounts for these expenses, the court doesn’t believe that special policy considerations (which the drivers didn’t bring before the court) should color today’s decision. Rather, the court applies the
S.G. Borello & Sons
common law test using both types of right to control found in California cases as a method of determining whether the contractual arrangement before the court is a subterfuge to avoid statutory duties imposed on employers or is a valid contractual arrangement between an employer and independent contractors.
The drivers state early in their supplemental brief that “[i]n California, local delivery drivers like the FXG drivers here are employees as a . matter of law.” The drivers’ citations give this argument force, but the argument also forgets the
Estrada
trial court’s finding that the MWA plaintiff was an independent contractor. The cases cited by the drivers contain findings that drivers were integral to the employer’s business, but don’t indicate that the workers had entrepreneurial opportunities or opportunities for profit, and so are readily distinguishable from the
Alexander
drivers’ case for this reason (and for other reasons the court needn’t discuss here, such as deferential standard of review).
See Messenger Courier Assoc. of the Ams. v. California Unemp’t Ins. Appeals Bd.,
175 Cal.App.4th 1074 , 96 Cal.Rptr.3d 797, 802 (2009);
Antelope Valley Press v. Poizner,
162 Cal.App.4th 839 , 75 Cal.Rptr.3d 887, 900 (2008);
Air Couriers Int’l v. Employment Dev. Dep’t,
150 Cal.App.4th 923 , 59 Cal.Rptr.3d 37, 46-48 (2007);
JKH Enters. v. Department of Indus. Relations,
142 Cal.App.4th 1046 , 48 Cal.Rptr.3d 563, 577 (2006).
Under the right to control details approach, this court has held that there is no
*674
reasonable inference that FedEx has retained the right to control the plaintiff drivers’ methods and means of conducting their work on a class-wide basis.
Kansas Decision,
734 F.Supp.2d at 589 . The court also addressed and weighed all the Restatement factors in its
Kansas Decision
and incorporates here its reasoning in that decision. Although the
S.G. Borello & Sons
court’s economic realities approach would give greater emphasis to the finding that the plaintiff drivers’ work is integral to FedEx’s business, that approach also would give greater emphasis to the plaintiff drivers’ class-wide entrepreneurial opportunities, which this court has held to be highly indicative of independent contractor status. California law, though different from Kansas law in its focus on economic realities, doesn’t produce an outcome materially different from that under Kansas law. For the reasons stated here and in the
Kansas Decision,
the
Alexander
drivers are independent contractors under the right to control details approach.
The right to control details holding doesn’t automatically apply under California’s “right to control overall process” approach. FedEx clearly has the right to control the overall process of its package delivery business. As in
S.G. Borello & Sons,
the drivers perform a service that is an essential part of FedEx’s overall business. FedEx controls the overall process by controlling pricing and by implementing many results-oriented controls to ensure proper package delivery, as was discussed the
Kansas Decision.
Yet, the right to control, though a primary consideration, isn’t dispositive; what is dispositive here is the drivers’ class-wide ability to own and operate distinct businesses, own multiple routes, and profit accordingly. The court agrees with, and finds persuasive, the As
trada
trial court’s distinction between SWA and MWA drivers.
10
The court has weighed all the other relevant factors in the
Kansas Decision
and incorporates that decision here insofar as it addresses relevant factors other than the right to control details. The
Alexander
drivers are independent contractors under the right to control overall process approach.
The court instructs the parties to file a joint proposed pretrial order with this court within twenty-one days of entry of this order. In addition to summarizing the history of this case, including significant orders and their docket numbers (including, but not limited to, evidentiary, class certification, and dispositive orders), the parties should provide a detailed description of the FMLA-related claims that remain outstanding, without arguing the merits of those claims, and should outline for the court and the transferor court how they anticipate resolving those claims.
(2) 3:06-cv-429, Pedrazzi
Jeremiah Pedrazzi, a sole plaintiff and a member of the California
Alexander
class, alleges illegal kickbacks, unfair business practices, violations of California’s wage statutes and related statutes, breach of contract, retaliation, hostile work environment, employment discrimination based on disability, infliction of emotional distress, and wrongful termination in violation of public policy. FedEx moved for summary judgment, incorporating its
Alexander
arguments and also arguing that employment status under California’s antidiscrimination statutes is governed by the standard set forth in
S.G. Borello & Sons, Inc. v. Department of Indus. Relations,
256 Cal.Rptr. 543 , 769 P.2d 399 . Mr. Pedrazzi responded, agreeing that
S.G. Borello & Sons
controls his antidis
*675
crimination claims. For the reasons just stated in
Alexander,
the court grants in part FedEx’s request for summary judgment on Mr. Pedrazzi’s wage-related and breach of contract claims,
11
which are identical to the claims made in
Alexander,
and the court will suggest remand of Mr. Pedrazzi’s case to its transferor court for further disposition on his discrimination-related claims.
Although the parties agree that
S.G. Borello & Sons
applies to Mr. Pedrazzi’s disability discrimination claims, the court notes that
S.G. Borello & Sons
applies the common law employment status test in light of the remedial purposes of the California statute in question.
See Alexander
decision,
supra
at 670-75. The parties haven’t briefed the policy purposes behind California’s antidiscrimination statutes and how those purposes affect the common law analysis set forth in
S.G. Borello & Sons.
As discussed in Alexander, taking these policy purposes into account is essential under
S.G. Borello & Sons.
If, as Mr. Pedrazzi alleges in his complaint, FedEx terminated his contract because of his disabilities, the court can’t say without briefing on the issue that today’s
Alexander
holding should apply to Mr. Pedrazzi in the potentially different context of the remedial purposes of California’s antidiscrimination laws. Mr. Pedrazzi’s claims of intentional and negligent infliction of emotional distress, retaliation, hostile work environment, and wrongful termination in violation of public policy might be tied to a separate determination of Mr. Pedrazzi’s employment status under California’s anti-discrimination statutes. Additionally, Mr. Pedrazzi’s discrimination-related claims aren’t class claims, so further discovery of particularized evidence seems likely to be appropriate for the resolution of those claims.
The court instructs the parties to file a joint proposed pretrial order with this court within twenty-one days of entry of this order. In addition to summarizing the history of this case, including significant orders and their docket numbers (including, but not limited to, evidentiary, class certification, and dispositive orders), the parties should provide a detailed description of the discrimination-related claims that remain outstanding, without arguing the merits of those claims, and should outline for the court and the transferor court how they anticipate resolving those claims.
(3) 3:08-cv-52, Huerta
Ricardo Huerta, a member of the California
Alexander
class, brings several claims of breach of contract, fraud, misrepresentation, and violations of California’s wage (and related) statutes. FedEx filed a motion for summary judgment incorporating its
Alexander
arguments, and Mr. Huerta’s response also incorporates the
Alexander
arguments. Because Mr. Huerta is a member of the
Alexander
class, today’s decision in
Alexander
is binding on him; he is an independent contractor. For the reasons stated in
Alexander,
the court grants summary judgment to FedEx. Unlike most breach of contract claims in these MDL cases, a number of Mr. Huerta’s breach of contract claims appear to be premised on his position as an independent contractor and so appear to require further disposition. The court will suggest remand of Mr. Huerta’s case to the transferor court for further disposition.
*676
The court instructs the parties to file a joint proposed pretrial order with this court within twenty-one days of entry of this order. In addition to summarizing the history of this case, including significant orders and their docket numbers (including, but not limited to, evidentiary, class certification, and dispositive orders), the parties should provide a detailed description of the claims that remain outstanding, without arguing the merits of those claims, and should outline for the court and the transferor court how they anticipate resolving those claims.
E. Florida
(1) 3:05-cv-664 Carlson
The
Carlson
drivers claim violations of Florida’s Deceptive and Unfair Trade Practices Act, negligently supplied false information, breach of contract, and fraud; they seek rescission and declaratory judgment. The drivers indicated that all their claims would turn on the predominant, common issue of whether they
are
employees or independent contractors under Florida law.
See
Memo, in Support of Mot. to Certify Class (Florida), April 2, 2007, at 1 [Doc. No. 584]. The parties have filed cross-motions for summary judgment. For the reasons stated below, the court grants summary judgment to FedEx and denies the
Carlson
drivers’ summary judgment motion. Because the Florida claims stand or fall on the common question of whether FedEx Ground misclassified its drivers as independent contractors, judgment will be entered for FedEx on all claims in this Florida (Carlson) case.
The contents of the Operating Agreement and generally applicable Policies and Procedures are undisputed, so the determination of employment status “depends upon the legal relationship that the undisputed facts engender.”
Hilldrup Transfer & Storage of New Smyrna Beach, Inc. v. Department of Labor and Emp’t Sec., Div. of Emp’t,
447 So.2d 414, 415 (Fla.Dist.Ct.App.1984)
(citing Cantor v. Cochran,
184 So.2d 173, 174 (Fla.1966));
see also Harper v. Toler, 884
So.2d 1124, 1130 (Fla.Dist.Ct. App.2004) (“Thus, if the only reasonable view of the evidence compels the conclusion that an employment relationship did not exist, a court may determine the issue as a matter of law.”).
Florida courts have stated Florida’s common law employment status test in various ways over the last few decades. Some have turned to a very traditional four-factor test (see today’s Alabama decision,
supra
at 662-96), with right to control being the weightiest factor.
See Saudi Arabian Airlines Corp. v. Dunn,
438 So.2d 116 (Fla.Dist.Ct.App.1983). Others have concluded that the test involves weighing seven of the Restatement factors.
See Carroll v. Kencher, Inc.,
491 So.2d 1311, 1312 (Fla.Dist.Ct.App.1986). Still others have held that the main test is simply whether the purported employer has direction and control over the purported employee.
See Verchick v. Hecht Invs., Ltd.,
924 So.2d 944, 946 (Fla.Dist.Ct.App.2006).
The Florida Supreme Court, however, has turned to the full list of factors set forth in the Restatement (Second) of Agency, § 220(2).
See Cantor v. Cochran,
184 So.2d at 174 . One particular appellate court nicely summed up the law in a way fully consistent with other Florida appellate decisions and the Florida Supreme Court’s decision in
Cantor v. Cochran:
The “extent of control” referred to in Restatement section 220(2)(a) has been recognized as the most important factor in determining whether a person is an independent contractor or an employee. Of course, employees and independent contractors both are subject to some control by the person or entity hiring them. The extent of control exercised
*677
over the details of the work turns on whether the control is focused on simply the “result to be obtained” or extends to the “means to be employed.” A control directed toward
means
is necessarily more extensive than a control directed toward
results.
Thus, the mere control of results points to an independent contractor relationship; the control of means points to an employment relationship. Furthermore, the relevant issue is the extent of control which, by the agreement, the master
may
exercise over the details of the work. Thus, [i]t is the right of control, not actual control or actual interference with the work, which is significant in distinguishing between an independent contractor and [an employee].
Harper v. Toler,
884 So.2d at 1131 (citations and quotations omitted; emphasis and alterations in the original);
see also Keith v. News & Sun Sentinel Co.,
667 So.2d 167, 172 (Fla.1995) (noting that intent and right to control factors must be given special weight among the Restatement factors so as to avoid inconsistent results when applying them).
Florida courts consistently point out that no bright-line rule exists for applying these principles, and each case must be determined on its own facts and in light of the totality of the circumstances.
Keith v. News & Sun Sentinel Co.,
667 So.2d at 170 (holding that presumption of newspaper delivery person’s status as independent contractor doesn’t exist because “the facts peculiar to each case govern the decision”);
Magarian v. Southern Fruit Distribs.,
146 Fla. 773 , 1 So.2d 858, 861 (1941) (“[E]ach case must stand on its own facts and, therefore, no useful purpose may be served by citing particular cases involving different factual conditions.”). Nonetheless, the parties’ arguments search for bright-line rules.
FedEx urges the court to place dispositive weight on the intent expressed in the Operating Agreement that an independent contractor relationship should exist, an intent buttressed by provisions in the Agreement prohibiting FedEx from exercising control over drivers’ means and methods of conducting their work. As in the
Kansas Decision,
the intent factor weighs “strongly” in FedEx’s favor because of the clarity of the stated intent in the contracts, not because of its relative weight vis-a-vis other factors, particularly the right to control. Some Florida courts have given the intent factor special significance, second only, perhaps, to the right to control.
See Keith v. News & Sun Sentinel Co.,
667 So.2d at 171 (“Hence, courts should initially look to the agreement between the parties, if there is one, and honor that agreement, unless other provisions of the agreement, or the parties’ actual practice, demonstrate that it is not a valid indicator of status.”). But be that as it may, Florida courts also have issued the usual caution against accepting form over substance, so today’s decision doesn’t rely on giving the intent factor dispositive weight.
See, e.g., Adams v. Department of Labor & Emp’t Sec., Div. of Unemp’t Comp.,
458 So.2d 1161, 1162 (Fla.Dist.Ct.App.1984)
(citing Cantor v. Cochran,
184 So.2d at 174 (Fla.1966)).
The drivers rely heavily on
Justice v. Belford Trucking Co., Inc.,
272 So.2d 131 (Fla.1972), in which a worker’s compensation claimant filled out an employment application with Belford Trucking and signed a contract that expressly stated the intent to create an independent contractor relationship. The claimant was to lease a trailer from Belford Trucking for five years for exclusive use in the service of Belford Trucking. The claimant made pickups and deliveries at the command of Belford and was told he risked termination if he refused a trip. Sometimes, Belford
*678
Trucking would lease the claimant over to other carriers without his input. Belford Trucking took worker’s compensation premiums out of the claimant’s paychecks, paid him a percentage of his freight, and issued W-2’s showing taxes withheld.
Id.
at 132-134 .
The drivers argue that
Justice
is directly analogous to their situation, but the facts are readily distinguishable. FedEx drivers are ultimately responsible for obtaining their own equipment, which they can use for their own purposes so long as FedEx logos are removed; FedEx doesn’t lease the contractor-drivers over to other carriers; and FedEx drivers are paid as independent contractors, i.e., no taxes are withheld and 1099 Forms are issued.
Justice
is instructive, but it doesn’t compel a trial or judgment for the plaintiffs here: each case must be assessed on its own facts.
Keith v. News & Sun Sentinel Co.,
667 So.2d at 170 ;
Magarian v. Southern Fruit Distribs.,
1 So.2d at 861 .
The court has held that “the only reasonable inference that can be drawn is that FedEx hasn’t retained the right to control the details of the contractors’ work methods on a class-wide basis.”
Kansas Decision,
734 F.Supp.2d at 589 . Whether the court looks only to the right to control, or to all the Restatement factors or some number of factors in-between, the result is the same. The relevant factors are all addressed in the
Kansas Decision,
which is incorporated here. The
Carlson
drivers are independent contractors under Florida law.
(2) 3:09-cv-356, Ward,
Scott Ward and Juan Gomez allege age discrimination and tortious interference with their businesses; they seek declaratory relief finding that they are employees and not independent contractors.
Mr. Gomez might be a member of the Florida class; Mr. Ward might not be a member of the class.
See
Sealed Document, June 16, 2009 [Doc. Nos. 1758-18
&
1758-19]. Their complaint doesn’t specify their class status. If they are class members, today’s decision in
Carlson
binds them and they are independent contractors. If they aren’t class members, the transferor court will decide how much weight to give to today’s proeedurally distinct decision in
Carlson
when deciding their case. The tortious interference claim appears
to be
premised on their position as independent contractors. Because these remaining claims wouldn’t benefit from continued inclusion in this docket, the court will suggest remand of their case to its transferor court for further disposition.
The court instructs the parties to file a joint proposed pretrial order with this court within twenty-one days of entry of this order. In addition to summarizing the history of this case, including significant orders and their docket numbers (including, but not limited to, evidentiary, class certification, and dispositive orders), the parties should provide a detailed description of the claims that remain outstanding (including an indication of whether they are members of the
Carlson
class), without arguing the merits of those claims, and should outline for the court and the transferor court how they anticipate resolving those claims.
F. Georgia (3:05-cv-411, White)
The
White
drivers allege unjust enrichment; they seek rescission, a constructive trust and other equitable relief, and injunctive and declaratory relief. All the drivers’ claims are class certified and stand or fall on the determination of the drivers’ employment status under Georgia law. The parties filed cross-motions for summary judgment. For the reasons stated below, the court grants summary judgment to FedEx and denies the
White
drivers’ summary judgment motion. Judg
*679
ment will be entered for FedEx on all the
White
claims.
The drivers rely on
Atkins v. MRP Park Lake, L.P.,
301 Ga.App. 275 , 687 S.E.2d 215, 220 (2009), to suggest that if the facts are disputed, Georgia law requires a trial on the question of employment status. The
Atkins
court found summary judgment improper because the parties had no written contract, and disputed evidence showed that the employer exercised control.
Id.
at 220. The matter before this court centers around the right to control retained in a written contract. The contract’s contents and the applicable policies and procedures aren’t in dispute; rather, the dispute relates to the law’s application to the undisputed facts.
As the drivers argued in their summary judgment motion, and as the court set forth in the class certification order, Georgia’s “chief test [of employment status] lies in whether the contract gives, or the employer assumes, the right to control the time, manner, and method of executing the work as distinguished from the right merely to require certain definite results in conformity to the contract.”
Ross v. Ninety-Two West, Ltd.,
201 Ga. App. 887 , 412 S.E.2d 876, 881 (1991); Op. and Ord., 662 F.Supp.2d at 1083 -1087 (citing cases) [Doc. No. 1770];
see also RBF Holding Co. v. Williamson,
260 Ga. 526 , 397 S.E.2d 440, 441 (1990);
Larmon v. CCR Enters.,
285 Ga.App. 594, 595 , 647 S.E.2d 306 (2007);
Cotton States Mut. Ins. Co. v. Kinzalow,
280 Ga.App. 397 , 634 S.E.2d 172, 175 (2006). Some Georgia cases have turned to the factors recited in the Restatement (Second) of Agency § 220(2), though those cases seem to be a small minority.
See Murphy v. Blue Bird Body Co.,
207 Ga.App. 853 , 429 S.E.2d 530, 532 (1993) (applying Restatement factors to employment status issue). Georgia courts recognize that a contracting company, such as FedEx, is “entitled to take steps to ensure compliance with its contract and to monitor the results obtained thereunder,” and that “the exercise of [its] right to protect and control its trade name and good will does not equate to managing the daily operations of [the drivers’] business.”
Cotton States Ins. v. Kinzalow,
634 S.E.2d at 176 ;
see also McLaine v. McLeod,
291 Ga.App. 335 , 661 S.E.2d 695 , 700 n. 5 (2008) (gathering cases where supervision to ensure contracted-for result didn’t result in employee status).
Georgia law holds somewhat uniquely that a rebuttable presumption of independent contractor status arises when a contract for services explicitly designates a worker as an independent contractor. This presumption disappears if the contract “provides that [the worker] shall be subject to any rules or policies of the employer which may be adopted in the future.”
Ross v. Ninety-Two West, Ltd.,
412 S.E.2d at 881 ;
see also Cotton States Ins. v. Kinzalow,
634 S.E.2d at 175 . The Operating Agreement in question obligates drivers to keep their personal appearance “consistent with reasonable standards of good order as maintained by competitors and promulgated from time to time by FedEx Ground.” OA, § 1.12 [Doc. No. 1237-2], The Agreement also obligates drivers to purchase or lease communications equipment, such as scanners, that comply “with specifications promulgated from time to time by FedEx Ground.” OA, § 1.13. These provisions allow FedEx to issue further rules in the future and raise a cautionary flag against presuming independent contractor status, but they don’t, by themselves, indicate employee status.
The drivers cite a few cases to suggest that, at minimum, a trial is needed. In
Jordan v. Townsend,
128 Ga.App. 583 , 197 S.E.2d 482 (1973), the appellate court reversed a grant of summary judg
*680
ment because the contract at issue created a material issue of fact regarding whether the corporation retained the right to control a tractor-trailer contractor’s employee. The
Jordan
case is distinguishable because that contract expressly allowed the corporation to provide without restriction written specifications, which weren’t expressly articulated in the contract, to timber harvesters in the future.
See id.
at 483 (“There were no restrictions on what ‘reasonable rules’ might be adopted by Union Camp or what the rules might consist of.”). But, as noted in the
Kansas Decision,
the FedEx Operating Agreement places express limits on FedEx’s authority to direct the means and methods of FedEx Ground drivers’ work (and the question of whether FedEx actually breached those limits isn’t before the court).
The drivers also rely on the inapposite case of
Brown v. Who’s Three, Inc.,
217 Ga.App. 131 , 457 S.E.2d 186 (1995), which involved the question of whether an apprentice facial esthetician was an employee or independent contractor in a personal injury matter. The
Brown
court discussed at length Georgia statutory and public policy placing
respondeat superior
liability on apprentices’ supervisors. As a matter of policy, the esthetician couldn’t be considered an independent contractor so the
Brown
court didn’t examine the traditional common law test as to whether she was or wasn’t a contractor: it ruled simply, “[t]he statute precludes, by public policy, the status of independent contractor for an apprentice.”
Id.
at 191 .
Finally, the court in
Mark Six Realty Assocs., Inc. v. Drake,
219 Ga.App. 57 , 463 S.E.2d 917 (1995), held that a real estate salesperson was, atypically, an employee rather than an independent contractor, in a situation in which the agent sold a house containing numerous structural defects. Mark Six assigned the agent to work on the subdivision in question, required her to follow certain negotiating procedures and use standard forms, subjected her to quarterly performance reviews, and exercised other similar controls.
Id.
at 919-920. The case differs for two reasons. First, the case’s procedural posture was the appeal of a trial court’s denial of a motion for judgment notwithstanding the verdict after a jury found for Drake. Under that posture, the procedural rules weighed heavily in favor of the plaintiff: “The standard of review is whether any evidence supports the jury’s verdict, and we must construe the evidence in the light most favorable to the party who prevailed before the jury.”
Id.
at 919. Nothing indicates what the trial court thought of the case at summary judgment, or whether such a motion had been filed. Because “some” evidence existed that Mark Six retained the right to exercise, and did exercise, control over the time, manner, and method of the agent’s performance of her duties, the trial court didn’t err in denying the JNOV motion.
Id.
at 920. Second, the contract required the agent in question to work solely and exclusively for Mark Six during specified hours.
Id.
at 920. This MDL case involves much more freedom to apply the law to the undisputed facts and involves drivers who can have complete freedom in their schedules by hiring assistants or by otherwise taking advantage of the entrepreneurial opportunities allowed to them.
The court incorporates the
Kansas Decision
and its conclusion that there is no reasonable inference that FedEx has retained the right to control the plaintiffs’ work methods on a class-wide basis.
Kansas Decision,
734 F.Supp.2d at 589 . To the extent Georgia law would recognize a broader examination of the employment status question using the Restatement test, the court again incorporates here the reasoning of the
Kansas Decision.
The
White
drivers are independent contractors under Georgia law.
*681
G. Indiana (3:05-cv-390, Riewe)
The
Riewe
drivers claim illegal deductions from wages, in violation of Indiana Code §§ 22-2-6 and 22-2-4-4, and fraud. They seek rescission and declaratory and injunctive relief. Though the drivers didn’t seek to certify the fraud claim, they don’t indicate that their claims turn on anything other than a determination of their employment status under Indiana law.
See
Memo, in Support of Mot. to Certify Class (Indiana), Mar. 12, 2007, at 1 [Doc. No. 556]. The parties filed cross-motions for summary judgment. For the reasons stated below, the court grants summary judgment to FedEx and denies the
Riewe
drivers’ summary judgment motion. Because the Indiana claims stand or fall on the common question of whether FedEx Ground misclassified its drivers as independent contractors, judgment will be entered for FedEx on all claims in the Indiana case.
The applicable Indiana statutes don’t define the term “employee,” and the parties agree the court should interpret the term by using Indiana’s common law test for employment status.
See Mortgage Consultants, Inc. v. Mahaney,
655 N.E.2d 493, 495 (Ind.1995). Indiana courts look to the ten-factor analysis outlined in Restatement (Second) of Agency § 220 to resolve employment status.
Moberly v. Day,
757 N.E.2d 1007, 1009-1010 (Ind.2001). The right to control the means and methods of achieving results is the most important factor; the right to control contracted-for results doesn’t indicate employee status. The Restatement factors should be weighed in a balancing test that takes account of the facts and circumstances as a whole and “not merely tallied in a majority-wins formulation.”
See Moberly v. Day,
757 N.E.2d at 1010 & n. 3, 1011, 1013;
Mortgage Consultants v. Mahaney,
655 N.E.2d at 495-496 .
The drivers rely heavily on
Dague v. Fort Wayne Newspapers, Inc.,
647 N.E.2d 1138 (Ind.Ct.App.1995), in which a husband was delivering newspapers for his wife, who herself had contracted to deliver newspapers for Fort Wayne Newspapers. The husband collided with a motorcycle and the motorcyclist was killed. The wife had signed a contract stating she was an independent contractor; Fort Wayne Newspapers provided a list of subscribers to whom papers needed to be delivered; the delivery person could hire replacements; the delivery person bore the costs of papers delivered wet or torn; Fort Wayne Newspapers didn’t provide a vehicle or dictate the vehicle type; and Fort Wayne Newspapers provided a manual to carriers on how to generate sales, conduct collections, and provide good service. The
Dague
court reversed a grant of summary judgment to Fort Wayne Newspapers and held that a material issue of fact existed because competing inferences could be drawn from the undisputed facts.
See id.
at 1143 .
A few overlapping facts aren’t enough to make
Dague
controlling under a legal test in which no one fact is dispositive and the totality of the circumstances must be considered. The
Dague
court made the effort to point out that “Christine could not buy or lease her route, and she could not sell the route to another person if she discontinued as a carrier.”
Id.
at 1141 . The FedEx Ground drivers have a proprietary interest in their routes, can sell their routes, and can acquire multiple routes— they have real profit potential, and, like any independent business, loss potential.
See Kansas Decision,
734 F.Supp.2d at 573-574, 596-597, 600-601 .
The drivers hint that because FedEx restricts the sale of routes to approved buyers and because FedEx can reconfigure routes, their situation is like that of
*682
the contractor in
Dague ,
who had no proprietary interest in her newspaper delivery route. The court can’t agree: a mildly qualified right to sell isn’t equivalent to no right to sell — the Fort Wayne Newspaper employees couldn’t sell their job and didn’t have the contractual rights for entrepreneurial growth that FedEx Ground drivers have. FedEx can’t be expected to provide this right to its contractors without ensuring contracted-for results. FedEx’s limitations on these rights are to the mutual benefit of drivers and FedEx: customer satisfaction means business for both. Nothing about the limitations in themselves compels a finding of employee status.
Additionally, Fort Wayne Newspapers provided subscriber lists indicating to whom the carriers had to deliver papers and required papers to be delivered dry and in one piece or else the carrier would bear the cost of the paper. Without more, these facts wouldn’t have indicated employee status.
See Twin States Publ’g Co., Inc. v. Indiana Unemp’t Ins. Bd.,
678 N.E.2d 110, 114 (Ind.Ct.App.1997) (finding carriers weren’t employees even though they had to deliver “by 5:00 p.m. on Tuesdays, place the guides in a dry place, and perform their services in a workmanlike manner”). As Indiana courts have repeated,
When the person employing may prescribe what shall be done, but not how it is to be done, or who shall do it, the person so employed is a contractor and not a servant. The fact that the work is to be done under the direction and to the satisfaction of certain persons representing the employer does not render the [worker] ... a servant.
Nash v. Meguschar,
228 Ind. 216 , 91 N.E.2d 361, 363 (1950);
Dallas Moser Transporters, Inc. v. Ensign,
594 N.E.2d 454, 457 (Ind.Ct.App.1992).
This court held that “the only reasonable inference that can be drawn is that FedEx hasn’t retained the right to control the details of the contractors’ work methods on a class-wide basis.”
Kansas Decision,
734 F.Supp.2d at 589 . The
Kansas Decision
listed and addressed the Restatement factors, as well as all other relevant factors under the totality of the circumstances, and the court incorporates here that decision. The
Riewe
drivers are independent contractors under Indiana law.
H. Kentucky (3:05-cv-599, Coleman)
The
Coleman
drivers claim unlawful withholding of wages in violation of Kentucky’s Wage Payment statute and fraud; they seek rescission, and declaratory and injunctive relief. Though the drivers didn’t seek to certify the fraud claim, they don’t indicate that their claims turn on anything other than a determination of their employment status under Kentucky law.
See
Memo, in Support of Mot. to Certify Class (Kentucky), Apr. 23, 2007, at 1 [Doc. No. 602]. The drivers and FedEx filed cross-motions for summary judgment. The drivers’ claims raise two distinct questions: (1) whether the drivers are employees under Kentucky common law; and (2) whether the drivers are employees under Kentucky’s Wage Payment statute, Ky. Rev.Stat. §§ 337.060 and 337.070.
For the reasons stated below, the court grants in part FedEx’s motion for summary judgment to the extent it seeks a determination that the drivers are independent contractors under Kentucky common law, and the court grants in part the drivers’ summary judgment motion to the extent it seeks a determination that they are employees under Kentucky Revised Statute § 337.010
et seq.
To the extent the Kentucky plaintiffs’ claims rely on a generalized determination that they are employees under Kentucky common law, their claims won’t proceed beyond this stage. To the extent the Kentucky plain
*683
tiffs’ claims depend on a determination that they are employees under Kentucky Revised Statute § 337.010
et seq.,
the court will suggest remand for further proceedings in the transferor court.
Kentucky common law considers the same multi-factor test set forth in the Restatement (Second) of Agency § 220(2), outlined in the
Kansas Decision. See Kentucky Unemp’t Ins. Comm’n v. Landmark Cmty. Newspapers of Kentucky, Inc.,
91 S.W.3d 575, 579 (Ky.2002). Both parties rely heavily on the
Landmark Newspapers
case, which clarifies that Kentucky treats the right to control differently from Kansas: rather than being the most important factor, the right to control is weighed as just one among many factors.
See id.
at 580 . Though the
Landmark Newspapers
case was an unemployment insurance case, its analysis of the right to control test applies here. Each case must be addressed on its own facts and, when the. facts are undisputed, employment status is a question of law for the court to decide.
Id.
The drivers’ key argument is that the “regular business of the employer” Restatement factor is of prime importance and even dispositive in Kentucky. This court has held that the plaintiff drivers form an integral part of FedEx’s business, and a line of Kentucky worker’s compensation cases emphasize this factor.
See Purchase Transp. Servs. v. Estate of Wilson,
39 S.W.3d 816, 818 (Ky.2001);
Uninsured Empl’rs Fund v. Garland,
805 S.W.2d 116, 118-119 (Ky.1991);
Chambers v. Wooten’s IGA Foodliner,
436 S.W.2d 265, 266 (Ky.1969);
Ratliff v. Redmon,
396 S.W.2d 320, 325 (Ky.1965) (noting right to control should focus not on control of details of the work to be done but rather on “the nature of the claimant’s work in relation to the regular business of the employer.”);
see also Hargis v. Baize,
168 S.W.3d 36, 42 (Ky.2005) (noting that if the case were a worker’s compensation case, the
Garland
( 805 S.W.2d at 118-119 ) test would apply). These cases refocus the Restatement inquiry into four factors, recognizing “the difference between compensation law and vicarious liability in the purpose and function of the employment concept” as a policy matter for worker’s compensation.
Ratliff v. Redmon,
396 S.W.2d 320, 324 (Ky.1965). The four factors are: (1) the nature of the work being performed as it relates to employer’s business; (2) the extent of control that the employer exercises; (3) the professional skill required of the worker; and (4) the true intentions of the parties.
E.g., Purchase Transp. Servs. v. Estate of Wilson,
39 S.W.3d at 818 .
The court can’t agree that this four factor test, which gives greater emphasis to the integral nature of the work, is the test to be applied to whether, as a general matter under Kentucky common law, the FedEx drivers are employees or independent contractors. A review of Kentucky cases, published and unpublished,
12
shows
*684
that this shift in emphasis occurs only in the worker’s compensation and personal injury contexts. The full Restatement test, with no single factor being dispositive, applies here.
See generally Kentucky Unemp’t Ins. Comm’n v. Landmark Cmty. Newspapers of Ky., Inc.,
91 S.W.3d 575 (Ky.2002) (applying Restatement test in unemployment insurance context).
The court incorporates here its reasoning from the
Kansas Decision,
which applies even when, as here, the right to control factor is considered as just one among the other factors. The parties explicitly stated their intent in the Operating Agreement that the drivers would be independent contractors. The drivers aren’t terminable at will, they hold proprietary interests in their routes, and they may hire assistants and expand their businesses to include multiple trucks and routes. These entrepreneurial opportunities show decreased control of the drivers (they are free to work or not work, as they please) and give rise to distinct businesses and increased need for skill. Also, the drivers are responsible for obtaining their own equipment. When weighed equally with the lack of right to control, these factors outweigh the factors pointing toward employment outlined in the
Kansas Decision.
Although some facts cut both ways, the court still may make a determination of law on the undisputed facts that the
Coleman
drivers are independent contractors under Kentucky common law.
See Kentucky Unemp’t Ins. Comm’n v. Landmark Cmty. Newspapers,
91 S.W.3d at 581 .
The Kentucky drivers’ claims also turn on whether they are employees under Kentucky’s Wage Payment statute, Ky. Rev.Stat. § 337.010
et seq.
The wage payment statute defines “employee” broadly as “any person employed by or suffered or permitted to work for an employer.” Ky. Rev.Stat. § 337.010(1)(e). Kentucky’s Administrative Regulations clarify that employee status under Kentucky Revised Statutes Chapter 337 is “broader than the traditional common law concept of the master and servant relation.” 803 Ky. Admin. Regs. 1 :005 § 1(2).
Kentucky’s Administrative Regulations identify factors similar to the Restatement and common law factors discussed in the
Kansas Decision.
Some factors favor a finding of an independent contractor relationship, such as the right to control, 803 Ky. Admin. Regs. 1 :005 § 4(1), and the alleged employee’s opportunities for profit and loss.
Id.
at § 4(2)(c). But the Regulations also identify factors broadening the scope of statutory employees beyond the traditional common law factors. “Where the facts clearly establish that the possible employee is the subordinate party, the relation is one of employment.”
Id.
at § 4(3). Factors used to determine whether the drivers are subordinate parties are:
a. Whether there are restrictive provisions in the contract between the possible employer and possible employee which require that the work must be satisfactory to the possible employer and detailing, or giving the possible employees the right to detail how the work is to be performed;
b. Whether the possible employer has control over the business of the person performing work for him even
*685
though the possible employer does not control the particular circumstances of the work;
c. Whether the contract is for an indefinite period or for a relatively long period;
d. Whether the possible employer may discharge employees of the alleged independent contractor;
e. Whether the possible employer may cancel the contract at his discretion, and on how much notice;
f. Whether the work done by the alleged independent contractor is the same or similar to that done by admitted employees.
803 Ky. Admin. Reg. 1 :005 § 4(3)(a)-(f). Though the court’s research finds no case law to guide its interpretation of these Regulations, it seeks here to follow the plain meaning of the Regulations’ text and the explicitly stated purpose of broadening the scope of who is an employee beyond the common law. On balance, these factors indicate that the plaintiff drivers are “subordinate” to FedEx and so are employees for purposes of Kentucky’s Wage Payment Act.
Factor (a) eliminates the results vs. means distinction at common law. Though the drivers have the right to detail how their work is to be accomplished, the Operating Agreement contains many results-oriented controls and the results of the drivers’ work must be satisfactory to FedEx for the drivers’ contracts to continue. Factor (b) eliminates any distinction between “a little control” and “a lot of control” of the drivers’ businesses. FedEx limits the number of routes drivers may own at a given terminal, sets minimum requirements for who may be a hired assistant or employee of the contractor (though it is up to the driver to find assistants or employees and not up to FedEx to suggest candidates to the driver), requires drivers to accept assigned work, and controls the flow of packages through individual trucks (though this is a mutually beneficial contractual obligation on FedEx to maximize efficient use of drivers’ trucks). Factor (f) partially indicates employee status because the drivers’ work as drivers (but not as business owners) is the same as that done by admitted employees of FedEx Express and by employees at UPS, DHL, and the USPS.
Factors (c), (d), and (e) don’t outweigh the refocusing of the employment status balance caused by factors (a) and (b). The drivers’ contracts are for limited duration, but they renew automatically absent any other action. FedEx can’t discharge drivers’ employees, but FedEx can refuse to dispatch a truck if a driver’s employee is unsatisfactory to FedEx. FedEx can’t cancel the contract at will, but it can cancel the contract for breach or on thirty days’ notice (as can the drivers). While factors (c), (d), and (e) cut in the direction of independent contractor status, they don’t do so strongly enough to outweigh the reshaping of the control question caused by factors (a) and (b). Finding the drivers to be subordinate to FedEx, in light of the clearly stated policy of the Kentucky statutes and regulations, the
Coleman
drivers are employees for purposes of the Kentucky Wage Payment statute, Ky.Rev.Stat. § 337.010
et seq.
No reason exists for the statutory wage payment claims to remain in this centralized docket, so the court instructs the parties to file a joint proposed pretrial order with this court within twenty-one days of entry of this order. In addition to summarizing the history of this case, including significant orders and their docket numbers (including, but not limited to, evidentiary, class certification, and dispositive orders), the parties should provide a detailed description of the wage payment statute-related claims that remain outstanding,
*686
without arguing the merits of those claims, and should outline for the court and the transferor court how they anticipate resolving those claims.
I. Louisiana (3:08-cv-193, Boudreaux)
The
Boudreaux
drivers allege fraud, misrepresentation, violations of Louisiana Revised Statutes §§ 28:631, 23:634, 23:635, 23:824, and 23:963, and breach of the duty of good faith and fair dealing. They seek rescission and declaratory relief. The drivers didn’t move to certify the fraud and misrepresentation claims. This court denied certification of the drivers’ claims under Louisiana Revised Statutes §§ 23:635 and 23:963, as well as their rescission claim.
See
Op. and Ord., 662 F.Supp.2d at 1087-1095 [Doc. No. 1770]. The drivers have argued — and have never indicated otherwise — that all their claims are premised on a determination of whether they are employees or independent contractors under Louisiana law.
See
Memo, in Support of Mot. for Summ. Judg., Sept. 28, 2009, at 1 [Doc. No. 1797] (“The over-arching issue in this case is whether FXG has categorically misclassified its workforce of pickup and delivery drivers as independent contractors.”); Memo, in Support of Mot. to Certify Class (Louisiana), Aug. 4, 2008, [Doc. No. 1540]. The parties filed cross-motions for summary judgment. For the reasons stated below, the court grants summary judgment to FedEx and denies the drivers’ motion for summary judgment. The Louisiana drivers are independent contractors under Louisiana law. Because the Louisiana claims stand or fall on the common question of whether FedEx Ground misclassified its drivers as independent contractors, judgment will be entered in FedEx’s favor in the Louisiana case.
In their original summary judgment motion, the Louisiana drivers argued that the common law right to control test applied to their employment status question and that the test was no different from other states’ right to control tests.
See
Memo, in Support of Mot. for Summ. Judg., Sept. 28, 2009, at 1
(citing Nationwide Mut. Ins. Co. v. Darden,
503 U.S. 318, 323 , 112 S.Ct. 1344 , 117 L.Ed.2d 581 (1992), as in the plaintiffs’ other summary judgment motions). The drivers originally argued that “it is not the supervision and control which is actually exercised which is significant; the important question is whether ... the right to do so exists.” Memo, in Support of Mot. for Summ. Judg., at 7 (citing multiple Louisiana cases emphasizing this point). The plaintiffs also emphasized that the principal test is the “control over the work reserved by the employer.”
Id.
at 9 (discussing
Hickman v. Southern Pac. Tramp. Co.,
262 La. 102 , 262 So.2d 385, 390-391 (1972)). In their motion for class certification — consistent with all their motions for class certification and their arguments to get their case before this MDL court — the Louisiana drivers argued that “FXG’s reserved rights to control the Louisiana pickup and delivery drivers flow directly from the standard form Operating Agreement (“OA”) that every driver must sign and FXG’s standardized policies and procedures the company uses to implement the OA. These common controls lie at the heart of each and every Louisiana driver’s claim and provide the common proof from which the Court can make a categorical determination of each driver’s employment status.” Memo, in Support of Mot. to Certify Class (Louisiana), Aug. 4, 2008, at 1.
After the
Kansas Decision,
the Louisiana drivers took a turn in their argument and now complain that this court “refused” to consider extrinsic evidence in the
Kansas Decision.
They further argue that Louisiana law looks to evidence of actual control to determine employment status. For years, the Louisiana drivers
*687
have been on notice of this case’s procedural posture and the resulting consequences on the scope of evidence the court could consider. Louisiana law looks to evidence of actual control to infer a right to control, but so do all the other states considered in today’s decisions.
See Fuller v. United States Aircraft Ins. Group,
530 So.2d 1282, 1289 (La.Ct.App.1988) (“The degree of supervision and control actually exercised by the principal over the work performed ... is highly indicative of reserved control.”). But just like other right-to-control states, Louisiana law doesn’t require a court to look to extrinsic evidence of actual control to infer a right to control. As the
Fuller
court stated, “[t]he amount of supervision and control actually exercised is not the crucial question, but rather the amount of supervision and control reserved by the principal from the nature of the relationship.”
Id.; see also McLeod v. Moore,
7 So.3d 190, 193 (La.Ct.App.2009) (“[I]t is not the supervision and control actually exercised that is significant; the important question is whether, from the nature of the relationship, the right to do so exists.”);
Arroyo v. East Jefferson Gen. Hosp.,
956 So.2d 661, 664 (La.Ct.App.2007) (“The important question is whether, from the nature of the relationship, the right to [control] exists, not whether supervision and control was actually exercised.”);
Hughes v. Goodreau,
836 So.2d 649, 656 (La.Ct.App.2002) (“It is not the actual supervision or control which is actually exercised by the employer that is significant, but whether, from the nature of the relationship, the right to do so exists.”). Louisiana courts, like courts in other states, take the evidence before them as it is and decide whether the right to control exists.
See generally Smith v. Prime, Inc.,
20 So.3d 1184 (La.Ct.App.2009) (relying on written agreement to determine nature of relationship);
compare Green v. Independent Oil Co.,
414 Pa. 477 , 201 A.2d 207 (1964) (finding independent contractor status on evidence available to court, which was mostly the parties’ written agreement),
with Juarbe v. City of Philadelphia,
288 Pa.Super. 330 , 431 A.2d 1073 (1981) (finding employee status where testimony of actual exercises of control shed light on the nature of the part

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/2478036. Public record. Not legal advice.