931 F.2d 1320 (9th Cir. 1991), 87-2831, Gilbreath v. Cutter Biological, Inc.

Docket Nº:87-2831, 88-15466 and 89-15658.
Citation:931 F.2d 1320
Party Name:Carral Raymond GILBREATH, Plaintiff-Appellant, v. CUTTER BIOLOGICAL, INC.; Miles Laboratory, Parent corporation of Cutter Biological, Defendants-Appellees. Donald Eugene YOUNG; Sonny Metcalf; Kenneth O. Ashelman; James Delbert Scott; Jose Alvarez Cardenas; Danny L. Try; Charles L. Boylan; Gary Keith Griffin; Donald A. Joy, Plaintiffs-Appellants, v.
Case Date:April 22, 1991
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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Page 1320

931 F.2d 1320 (9th Cir. 1991)

Carral Raymond GILBREATH, Plaintiff-Appellant,

v.

CUTTER BIOLOGICAL, INC.; Miles Laboratory, Parent

corporation of Cutter Biological, Defendants-Appellees.

Donald Eugene YOUNG; Sonny Metcalf; Kenneth O. Ashelman;

James Delbert Scott; Jose Alvarez Cardenas;

Danny L. Try; Charles L. Boylan; Gary

Keith Griffin; Donald A. Joy,

Plaintiffs-Appellants,

v.

CUTTER BIOLOGICAL, A DIVISION OF SCRIPT MILES LABORATORIES;

Norman L. Gray, Manager; Darrell Esteson, Manager

of Cutter Biological as Arizona State

Prison at Florence,

Defendants-Appellees.

Donald Eugene YOUNG; Sonny Metcalf; Kenneth O. Ashelman;

James Delbert Scott; Jose Alvarez Cardenas;

Danny L. Try; Charles L. Boylan; Gary

Keith Griffin; Donald A. Joy,

Plaintiffs-Appellants,

v.

CUTTER BIOLOGICAL, A DIVISION OF SCRIPT MILES LABORATORIES;

Norman L. Gray, Manager; Arizona Department of Corrections,

a Division of the State of Arizona, et al.; State of

Arizona; Samuel Lewis; James Ricketts; Robert Goldsmith,

Warden, Defendants-Appellees.

Nos. 87-2831, 88-15466 and 89-15658.

United States Court of Appeals, Ninth Circuit

April 22, 1991

Argued and Submitted Oct. 3, 1989.

Page 1321

Michael E. St. George, St. George & Reed, Tempe, Ariz., for plaintiffs-appellants.

June Ava Forescue, Asst. Atty. Gen. and Tibor Nagy, Jr., Snell & Wilmer, Phoenix, Ariz., for defendants-appellees.

Appeal from the United States District Court for the District of Arizona.

Before D.W. NELSON, TROTT and RYMER, Circuit Judges.

TROTT, Circuit Judge:

SUMMARY

Appellants, inmates in an Arizona penitentiary, appeal the dismissal of their action seeking damages, alleging the state did not pay them minimum wages for work in prison industry. They claim wage protection under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. Secs. 201-219 (1989), and Arizona law. They also claim they have been denied without due process their property interest in the funds due them under state law, in violation of 42 U.S.C. Sec. 1983. The district court's judgment is affirmed.

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FACTS

Plaintiffs are incarcerated in the Arizona State Prison at Florence, Arizona. During their incarceration, they worked in various capacities at a "plasma center" located at the institution and operated by defendant Cutter Biological ("Cutter"), a division of Scripps Miles Laboratory, pursuant to a contract between Cutter and the Arizona Department of Corrections ("Department"). Cutter operated at the institution for approximately twenty-one years. 1

Under the contract, the Department assigned prisoners to the plasma center to act as assistants to Cutter's technical staff. All inmates so assigned were approved for that work at the direction and discretion of the Department. The plasma center was required to pay the Department twelve dollars per week for each prisoner who worked at the center. This compensation for services was paid directly to the Inmates' Account Office of the Department. Pursuant to Arizona law, the Department retained control over the disposition of all compensation paid by Cutter to the Inmates' Accounts Office. No oral or written agreement existed between the plasma center and the inmates regarding compensation or conditions of employment.

Cutter did not have the power to hire and fire inmates, although it did request some prisoner assignments and removals over the years covered by the contracts. Nor did Cutter maintain employment records for the inmates. Cutter did have day-to-day supervision of the inmates' work responsibilities. The Department maintained control over the inmate workers to the extent it determined which inmates were eligible to work. It also maintained security over them as it did over all other inmates in its care and custody. State law requires that inmates work and be paid for their labor. Ariz.Rev.Stat.Ann. Sec. 31-251(A) (1989).

Plaintiffs filed a complaint in district court against the state defendants and Cutter, alleging they had been denied minimum wages for their work performed at Cutter, in violation of state and federal law. First, plaintiffs complained they were not granted the minimum wage required by the FLSA, alleging (1) they were "employees" as defined by section 203(e)(1) and (2) defendants were "employers" as defined by section 203(d) of that statute. Second, plaintiffs sought relief under Arizona statutes, Ariz.Rev.Stat.Ann. Secs. 31-254(A) and 41-1624.01 (1989), alleging these and related statutes require that inmates engaged in correctional industries programs pursuant to sections 41-1621 through 41-1629 receive the minimum wage.

Plaintiffs also sought relief under 42 U.S.C. section 1983, alleging that the Department's failure to provide minimum wages mandated by Arizona statutes for inmates working for private parties under contract with the Department resulted in the inmates being deprived of a liberty interest without due process of law.

The district court granted summary judgment against plaintiffs on their FLSA claims, finding that defendants were not employers as contemplated by the FLSA. 694 F.Supp. 651. The court also granted summary judgment in favor of defendants on plaintiffs' state law claims, finding that the Eleventh Amendment acted as a bar to plaintiffs' claims against Arizona for the back-pay relief requested.

The court granted summary judgment to Cutter on plaintiffs' section 1983 claim. With reference to the state defendants, the court granted partial summary judgment in their favor, reasoning that although it lacked subject matter jurisdiction to hear the underlying state law claims, it could retain jurisdiction to hear the section 1983 suit against the state defendants. The court held that if plaintiffs were to prevail on the remaining section 1983 claims, the court could grant prospective relief that would not violate the Eleventh Amendment.

ANALYSIS

I

Notice of Appeal

Appellees argue that appellants have failed to comply with Rule 3(c) of the

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Federal Rules of Appellate Procedure. Rule 3(c) provides in pertinent part:

The notice of appeal shall specify the party or parties taking the appeal ...

The Notice of Appeal reads: "Come now plaintiffs, as consolidated into this cause and do hereby appeal the judgment of this court...." As appellees note, the Supreme Court has held that "although a court may construe the Rules liberally in determining whether they have been complied with, it may not waive the jurisdictional requirements of Rules 3 and 4, even for 'good cause shown' under Rule 2, if it finds that they have not been met." Torres v. Oakland Scavenger Co., 487 U.S. 312, 317, 108 S.Ct. 2405, 101 L.Ed.2d 285 (1988). The instant case, however, is distinguishable from Torres. In Torres, one party in a multiparty suit was missing from the notice of appeal due to a clerical error. Under that circumstance, there was no reason for opposing counsel to believe the unnamed party would be a party to the appeal. By contrast, appellants in this case accurately listed the parties to the appeal by describing them as all plaintiffs consolidated below. There was no need for appellants to list each party individually, since appellees could have covered their identities by referring to records of the lower court proceedings. The policy behind Rule 3(c) thus was adequately served.

II

The FLSA Claim

  1. Eleventh Amendment Immunity

    Appellants argue that the FLSA mandates minimum wage for their hours worked in prison industry. To decide this issue, we must first determine if the FLSA pierces all the states' Eleventh Amendment immunity, and second, whether these prisoners enjoyed with the state an "employee-employer" relationship as that relationship is understood by the FLSA.

    The FLSA was enacted in 1938. It requires employers to pay employees a minimum hourly wage and overtime pay. 29 U.S.C. Secs. 201-219 (1988). Its essential purpose is to provide for workers a "minimum standard of all living necessary for health, efficiency, and general well-being of workers." 29 U.S.C. Sec. 202. Originally, states and their political subdivisions were expressly excluded from the coverage of the FLSA. 29 U.S.C. Sec. 203(d) (1958) (current version at 29 U.S.C. Sec. 203(d) (1988)). In 1966, Congress amended the FLSA to extend coverage to employees of state schools, hospitals, and nursing homes. 29 U.S.C. Sec. 203(d), (s)(4) (1970) (current version at 29 U.S.C. Sec. 203(d) (1988)). In Employees of the Dept. of Pub. Health & Welfare v. Dept. of Pub. Health & Welfare, 411 U.S. 279, 93 S.Ct. 1614, 36 L.Ed.2d 251 (1973), the Supreme Court held that although the FLSA had been extended to some state employees by the 1966 amendments, the state itself was immune from suits brought by its employees because the Eleventh Amendment precluded such suits. The Court stated:

    [W]e have found not a word in the history of the 1966 amendments to indicate a purpose of Congress to make it possible for a citizen of that State or another State to sue the State in federal courts.... It would also be surprising in the present case to infer that Congress deprived Missouri of her constitutional immunity without changing the old Sec. 16(b) under which she could not be sued or indicating in some way by clear language that the constitutional immunity was swept away.

    Id. at 285, 93 S.Ct. at 1618. While the employees could not bring an action against the state, however, they were not totally without a remedy as the Secretary of Labor could bring an action against the state for unpaid minimum wages or unpaid overtime violations on their behalf. Id. at 285-86, 93 S.Ct. at 1618-19.

    The history of whether state employees fall...

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