Adams v. All Coast, L.L.C.

• Decision Date: 30 September 2021
• Docket Number: No. 19-30907,19-30907
• Citation: 15 F.4th 365
• Parties: William ADAMS, Plaintiff—Appellant, v. ALL COAST, L.L.C., Defendant—Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

15 F.4th 365

William ADAMS, Plaintiff—Appellant,

v.ALL COAST, L.L.C., Defendant—Appellee.

No. 19-30907

United States Court of Appeals, Fifth Circuit.

FILED September 30, 2021

Melissa Ann Moore, Esq., Curt Christopher Hesse, Moore & Associates, Houston, TX, Matthew Edward Lundy, Attorney, Lundy, Lundy, Soileau & South, L.L.P., Lake Charles, LA, for Plaintiff - Appellant.

Armin J. Moeller, Jr., Ashley Eley Cannady, Esq., Balch & Bingham, L.L.P., Jackson, MS, Matthew Armin Moeller, Moeller Firm, L.L.C., New Orleans, LA, for Defendant - Appellee.

Leigh Ann Schell, Adams & Reese, L.L.P., New Orleans, LA, for Amici Curiae Offshore Marine Service Association and National Ocean Industries Association.

Erika Lindberg, James C. Winton, Baker & Hostetler, L.L.P., Houston, TX, for Amicus Curiae American Maritime Association.

Before Smith, Clement, and Oldham, Circuit Judges.

ON PETITION FOR REHEARING EN BANC

Per Curiam:

The court, having been polled at the request of one of its members, and a majority of the judges who are in regular active service and not disqualified not having voted in favor ( Fed. R. App. P. 35 and 5th Circ. R. 35 ), the petition for rehearing en banc is DENIED.

In the en banc poll, two judges voted in favor of rehearing (Judges Jones and Elrod), and fifteen judges voted against rehearing (Chief Judge Owen, and Judges Smith, Stewart, Dennis, Southwick, Haynes, Graves, Higginson, Costa, Willett, Ho, Duncan, Engelhardt, Oldham, and Wilson).

It is ORDERED that our prior panel opinion, Adams v. All Coast, L.L.C., 988 F.3d 203 (5th Cir. 2021), is WITHDRAWN and the following opinion is SUBSTITUTED therefor.

Edith Brown Clement, Circuit Judge:

William Adams filed this collective action on behalf of himself and others employed on All Coast's fleet of liftboats. Although All Coast hired Adams and the other plaintiffs to serve in various maritime jobs, the employees claim they spent most of their time doing something completely terrestrial: using cranes attached to the boats to move their customers’ equipment on and off the boats, the docks, and the offshore oil rigs.

All Coast did not pay the plaintiffs overtime because it classified them as seamen, who are exempt from the overtime pay rules in the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201 et seq. Persuaded by All Coast's reading of the FLSA, the district court entered summary judgment for All Coast because the employees’ work served the liftboats’ operation "as a means of transportation." 29 C.F.R. § 783.31. We disagree. Such a reading strays from the statutory and regulatory text and our jurisprudence. As we explain below, All Coast was not entitled to summary judgment. Accordingly, we reverse and remand.

I.

All Coast hired Adams as an able-bodied seaman to work on its fleet of liftboats that service offshore oil and gas platforms in the Gulf of Mexico.¹ But despite his job title, Adams maintains that his main duty had nothing to do with maritime work. Instead, Adams spent much of his time operating a hydraulic crane to move personnel and equipment between the liftboat and the dock, offshore worksite platforms, and other vessels, as well as on the liftboat itself. Adams claims that because he was really a crane operator and not a seaman, All Coast owes him unpaid overtime wages under the FLSA.

Adams filed a collective action on behalf of himself and other similarly-situated All Coast mates, deckhands, ordinary seamen, and able-bodied seamen, who all say their job titles hide their true task: crane operator. Along with the crew members, liftboat cooks joined the class, alleging that they too are entitled to overtime pay since they spent their time cooking for third parties and these allegedly non-seamen crew members.

Adams and the other crew member plaintiffs say they spent no less than 80 percent of their time in the jacked-up, stationary position. Indeed, for some jobs or "hitches," the boats were jacked up 100 percent of the time. And regardless the duration of the hitch, they never used the cranes when the boats were underway. All told, the district court found that the plaintiffs "spent between 25% and 90% of their day operating the crane." The plaintiffs all ate, slept, and worked aboard a boat. And, when they weren't operating the cranes, they performed traditional maritime functions under the command of the boat's captain.

The plaintiffs claim their work servicing offshore oil and gas wells consisted of "the types of things that anyone engaged in oil and gas exploration does regardless of whether drilling onshore or offshore." All Coast job tickets list tasks like "Coil tubing ops," "Crane ops," "Working with divers," and "Working with welders." Similarly, the plaintiffs’ deposition testimony explains how they used the cranes to hold coil tubing units in place for their customers on oil rigs, and to lower divers into the water and retrieve equipment the divers placed into the crane basket. On the other hand, the record also makes plain that the crew never stepped foot on the oil platforms, nor did they directly drill for oil and gas.

All Coast did not pay the crew and cooks overtime because it classified them as exempt seamen under the FLSA. See 29 U.S.C. § 213(b)(6). All Coast first filed a motion to dismiss, which the district court converted to summary judgment and then denied as premature. But the district court later granted summary judgment for All Coast. The court found that the cooks were exempt seamen because All Coast crew members ate at every meal the cooks prepared. And although the crew spent as much as 90 percent of their time operating the cranes, they too were exempt seamen because the liftboat crane operation was a "service which is rendered primarily as an aid in the operation of such vessel as a means of transportation." 29 C.F.R. § 783.31. Plaintiffs timely appealed.

II.

We review a grant of summary judgment de novo, "applying the same legal standards as the district court." Petro Harvester Operating Co., L.L.C. v. Keith , 954 F.3d 686, 691 (5th Cir. 2020). "Summary judgment is appropriate when ‘the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.’ " United States v. Nature's Way Marine, L.L.C. , 904 F.3d 416, 419 (5th Cir. 2018) (quoting FED. R. CIV. P. 56(a) ).

In a dispute about an FLSA exemption, the employer has the burden of establishing that the exemption applies by a preponderance of the evidence. Faludi v. U.S. Shale Sols., L.L.C. , 950 F.3d 269, 273 (5th Cir. 2020). The Supreme Court has "clarified that courts are to give FLSA exemptions ‘a fair reading,’ as opposed to the narrow interpretation previously espoused by this and other circuits." Carley v. Crest Pumping Techs., L.L.C. , 890 F.3d 575, 579 (5th Cir. 2018) (quoting Encino Motorcars, L.L.C. v. Navarro , ––– U.S. ––––, 138 S. Ct. 1134, 1142, 200 L.Ed.2d 433 (2018) ).

III.

The FLSA's baseline requirement is that any employee who works "longer than forty hours" in a workweek must be compensated "at a rate not less than one and one-half times the regular rate at which he is employed." 29 U.S.C. § 207(a)(1). "An employee is not protected by this broad prohibition, however, if he falls within an exemption." Coffin v. Blessey Marine Servs., Inc. , 771 F.3d 276, 279 (5th Cir. 2014). Among them, "any employee employed as a seaman." 29 U.S.C. § 213(b)(6). Although the FLSA does not define "seaman," we determined shortly after the FLSA's enactment that the exemption applies only when an employee performs nautical duties :

Since the Act does not define the word seaman, it must be taken in its ordinary meaning. ... [T]he words of the exemption are: "Employees employed as seamen." The italicized words mean something; they are not mere tautology. They warn us to look to what the employees do, and not to rest on a mere matter of a name, or the place of their work. The entire Act is pervaded by the idea that what each employee actually does determines its application to him.

Walling v. W.D. Haden Co. , 153 F.2d 196, 199 (5th Cir. 1946).

Even so, our later decisions have recognized that the statute has its limits. For that reason, we look "primarily" to the Department of Labor's regulations, "which we have held to be entitled to great weight." Coffin , 771 F.3d at 279 (citing Dole v. Petroleum Treaters, Inc. , 876 F.2d 518, 521 (5th Cir. 1989) ); see Tony & Susan Alamo Found. v. Sec'y of Labor , 471 U.S. 290, 297, 105 S.Ct. 1953, 85 L.Ed.2d 278 (1985) (describing the regulation's definition of "business purpose" under the FLSA as "entitled to considerable weight in construing the Act"). According to those criteria, an employee is a seaman if: "(1) the employee is subject to the authority, direction, and control of the master; and (2) the employee's service is primarily offered to aid the vessel as a means of transportation, provided that the employee does not perform a substantial amount of different work." Coffin , 771 F.3d at 281 (citing 29 C.F.R. § 783.31).

The parties do not dispute the first part of the test. There is no doubt that the employees all ate, slept, and worked aboard the vessels and were subject to a captain's authority. The dispute revolves around the second prong, particularly whether using a crane aids in a liftboat's operation as a means of transportation . The district court concluded that it did: "The amount of time the plaintiffs spent operating the crane, whether 10% of their time or 100%[,] is irrelevant because crane operation is seaman's work that aids the vessel as a means of transportation." That conclusion runs contrary to the regulatory language and our decisions interpreting it.

A.

One salient example in the regulation says that "assisting in the loading or unloading of freight at the beginning or end of a voyage" is not "connected with operation of the vessel as a means of transportation." 29 C.F.R. § 783.32. Another explains that "employees on floating equipment who are...