Did the Eleventh Circuit Just Make It Harder to Attain Summary Judgment in Diversity Cases?

Last week, the Eleventh Circuit handed a major victory to Florida FedEx drivers who brought claims for back pay against FedEx. The claims of these and of other FedEx drivers around the country were consolidated as an MDL, and the MDL court certified a Florida-driver class. But the court then granted FedEx’s motion for summary judgment, concluding that the drivers were independent contractors and not -- as the Florida drivers alleged -- employees. After a few of the Florida drivers lost their individual claims, the Florida drivers appealed from the grant of summary judgment, and the Eleventh Circuit reversed, concluding that the question whether the drivers were employees or independent contractors under Florida law was for the jury to decide.

Judge Jordan’s comprehensive opinion for the court in Carlson will surely serve as the go-to source for employee–independent contractor questions under Florida law. But -- even outside the employment context -- it may also serve as a principal source for how close summary-judgment questions are resolved in cases by district courts sitting in diversity. Not only did the court apply Florida substantive law on determining when somebody’s an employee, but the court also appeared to defer quite heavily to how Florida courts would make that determination on summary judgment -- an apparently procedural inquiry.

Here’s the first full paragraph on page 7 of the opinion:

The claims of the Florida drivers stand or fall on the common question of whether FedEx properly classified them as independent contractors. In Florida, “[i]t is well-established that the question of an employer/employee relationship is generally a question of fact, and therefore a question for the trier of fact.” Pate v. Gilmore, 647 So. 2d 235, 236 (Fla. 1st DCA 1994). Accord Villazon v. Prudential Health Care Plan, Inc., 843 So. 2d 842, 853 (Fla. 2003) (“The existence of an agency relationship is normally one for the trier of fact to decide.”). Nevertheless, the general default rule does not always apply, and Florida courts have not hesitated to grant summary judgment on the employee/independent contractor question when the circumstances warrant. See, e.g., Miami Herald Pub. Co. v. Kendall, 88 So. 2d 276, 279 (Fla. 1956).

The court then reviewed Florida case law, the facts before it, and concluded that although the material facts were “largely undisputed,” the “inferences that can be drawn from those facts are not.” Summary judgment, the court held, was inappropriate.

The court -- relying squarely on established circuit precedent that all inferences are drawn in the non-movant’s favor -- could’ve stopped the opinion there and reversed. But it went on:

After all, employee/independent contractor cases are necessarily fact-intensive, and the general rule in Florida is that whether a worker is an employee is usually a question of fact. Factually speaking, Del Pilar [where an appellate court reversed a grant of summary judgment] is the closest Florida opinion we have, and we cannot say that the Florida Supreme Court would have decided that case different…. Although we recognize that Del Pilar is not binding in the Rule 56/summary judgment sense -- because federal law determines whether the evidence suffices to entitle a party to summary judgment -- it is nevertheless highly informative given that it involves the same package delivery industry and that Florida’s summary judgment standard is very similar to that of Rule 56.

Erie and its progeny have opted for vertical uniformity in diversity cases, so that with respect to substantive law a case filed in federal court will be handled in the same way as it would be in the courts of the state where the federal court sits. By ruling consistently with Del Pilar, we ensure that this case is decided in a Florida federal court as it would be in a Florida state court, and thereby discourage forum shopping as between federal and state courts in Florida and prevent the inequitable administration of the law.

Federal courts exercising diversity jurisdiction must “apply state substantive law and federal procedural law.” Hanna v. Plumer, 380 U.S. 460, 465 (1965). And in Carlson the court certainly did that -- it applied Florida substantive law to whether the drivers were employees and it applied federal procedural law to whether summary judgment was properly granted. But the court appeared to apply that federal procedural law with a healthy dose of Florida procedural law, too.

For example, the court accepted -- if not outright adopted -- Florida courts’ characterizations that the employee–independent contractor issue is “generally a question of fact” “for the trier of fact,” and referred to this as a “general default rule” and a “general rule.” Whether it should have done so is unclear. On the one hand, a recent decision of the Ninth Circuit seems to support this approach. See EncompassIns. Co. v. Coast Nat’l Ins. Co., 764 F.3d 981, 984 (9th Cir. 2014) (“Whether an issue is a question of law or a question of fact is a substantive question, to which state law applies. Once we determine whether an issue is a question of law or a question of fact, however, the proper standard of review is a question of federal procedure and is governed by federal law.” (citation omitted) (internal quotation marks omitted)). But a treatise leans in the other direction: “[c]haracterization as fact or law is governed by federal law, because it implicates the relationship between judge and jury.” 19 Charles Alan Wright et al., Federal Practice and Procedure § 4511 (2d ed. Apr. 2015). The Seventh Circuit, too, has stated that “the fixing of the boundary between questions of law and questions of fact[] is a matter of federal procedural law and therefore governed by federal rather than state law in diversity as in other federal suits.” Dilworth v. Dudley, 75 F.3d 307, 309 (7th Cir. 1996). In the light of the Carlson court’s statements, a judge who might otherwise conclude that no genuine dispute exists about whether a plaintiff is an employee might instead leave that question to the jury.

Further, although the panel in Carlson stated it wasn’t bound by a Florida court’s decision in the “Rule 56/summary judgment sense,” it nonetheless found desirable ruling consistently with it (that is, against summary judgment) to discourage forum shopping. But other authorities suggest -- at least in broad language -- that similar cases might indeed be decided differently on summary judgment depending on the forum in which the case was brought. See McEwen v. Delta Air Lines, Inc., 919 F.2d 58, 60 (7th Cir. 1990) (“Erie does not require a federal court to employ the state’s rules on the allocation of issues between judge and jury.... Federal courts may grant summary judgment under Rule 56 on concluding that no reasonable jury could return a verdict for the party opposing the motion, even if the state would require the judge to submit an identical case to the jury.”).

Carlson is an important employment-law decision. But it might be an even more important summary-judgment decision, and it could influence -- it arguably requires -- lower courts sitting in diversity in the Eleventh Circuit to consider how state courts would handle motions for summary judgment. Most of the time, to be sure, the result will unquestionably be the same. But given how many issues Florida courts regard as questions of fact for the jury to decide (according to a quick Westlaw search in the Florida state database, courts have characterized as fact issues intent, causation, whether touching is “offensive” so as to make it a tort, the value of property, and the existence of a partnership, to name a few), summary judgment in some diversity cases may now be harder to attain.

Thursday News & Notes

1.  N.D.Fla Judge John Richard Smoak Jr. has reassigned all of his cases.  Anyone know what's going on?

2.  Should DOJ be prosecuting Hastert and FIFA?  Here's an editorial from the Washington Post:

Not every bad act is a crime. Not every bad act that can technically be categorized as a crime should be pursued by prosecutors. And not every bad act that clearly amounts to a crime should be pursued by prosecutors in the United States.
Those thoughts are sparked by the recent indictments of international soccer officials on bribery and corruption charges and of former House speaker Dennis Hastert on charges of structuring hush money payments to avoid bank reporting laws and then lying to the FBI about his conduct.

Ruth Marcus is a columnist and editorial writer for The Post, specializing in American politics and domestic policy. 

For different reasons, I find both indictments unsettling — not necessarily wrong, but worth thinking through whether they ought to have been brought.
The indictment of FIFA officials raises questions about the exercise of U.S. authority to pursue international corruption whose chief harm does not seem to be to U.S. interests or citizens.
The Hastert indictment raises questions even more gut-wrenching: about the proper use of the criminal law; the degree to which technical statutes should be employed to punish alleged conduct that is offensive but uncharged; and the role that celebrity and prominence should play in making prosecutorial decisions.

3.  The 11th Circuit sides with jail officials in a lawsuit involving a suicide of an inmate.  From the Ocala Star Banner:

A federal appeals court on Wednesday found that seven Marion County jail officers cannot be held liable in the 2007 suicide of an inmate who hanged himself with a bed sheet.

Vivian Jackson, the mother of inmate Darius Johnell James, filed a lawsuit alleging that 10 officers violated James’ constitutional due process rights by failing to prevent his death. A U.S. district judge said three of the officers were shielded by what is known as “qualified immunity” but allowed the lawsuit to proceed against the other seven.
James, 22, was arrested in 2007 on robbery and home-invasion robbery charges and was initially assigned to a suicide-prevention section before being moved to another area of the jail, according to Wednesday’s ruling by the 11th U.S. Circuit Court of Appeals.
The 24-page ruling detailed a series of incidents involving James at the jail but found that the lawsuit failed to prove that the seven remaining officers showed “deliberate indifference” to the risk that he would commit suicide.
“This case is troubling,” said the ruling, written by appeals court Judge Beverly Martin and joined by judges Robin Rosenbaum and L. Scott Coogler.
“The Marion County Jail tragically failed to keep Mr. James safe while he was incarcerated. Under our precedent, however, an officer is liable … for the suicide of an inmate only if he had subjective knowledge of a serious risk that the inmate would commit suicide and he disregarded that known risk.”

4.  And we have this piece by Paula McMahon about a swallower.  I like the intro:

A spoonful of sugar makes the medicine go down, but it takes honey to swallow 54 pellets filled with nearly 1.5 pounds of cocaine, according to a Broward County drug mule suspect.
Regis Walker, 28, of Pembroke Pines, spent five days in a hospital "passing" the drug pellets after she was arrested last week at Fort Lauderdale-Hollywood International Airport.

containing nearly 1.5 pounds of cocaine before she boarded a flight to Fort Lauderdale from Jamaica.
(Sun Sentinel / Broward Sheriff's Office Handout)

"Walker said she used honey to swallow the pellets, an idea she learned by watching the movie 'The Mule' on Netflix," Homeland Security Investigations Special Agent Jeanne Neill wrote in court records.
Walker, a U.S. citizen, arrived last Thursday on a flight from Montego Bay, Jamaica. U.S. Customs and Border Protection officials took her aside for a baggage search and interview.
She told them she had spent four days in Jamaica visiting her husband. She was taken to Broward Health Medical Center in Fort Lauderdale after agreeing to be X-rayed.

"The X-ray revealed that Walker appeared to be a drug mule carrying drug pellets within her body," investigators wrote.

 

"One of the wonderful things about graduating the eighth grade is that you have a chance — the best chance that you will ever have in life — to become what you want to become."

That was Justice Sotomayor at Pompano Beach Middle School yesterday.  The Sun-Sentinel has the details:

Supreme Court Justice Sonia Sotomayor was greeted by a standing ovation and thunderous applause from students and parents as she took the stage at the Pompano Beach Middle School end-of-year award ceremony Monday evening.
Sotomayor spoke for about five minutes to an auditorium of about 1,000 students and families during the event at Pompano High.
Sotomayor briefly spoke of her childhood in the Bronx and of the decisions ahead for the Supreme Court this session. She closed her remarks by congratulating her niece, Michelle Zuniga, and wishing her and her fellow students "the happiest in life in reaching what you want to reach."
Principal Sonja Braziel said that Zuniga "told me that her aunt would be attending and asked if we would like her to say a few words. When she told me who it was, we thought of course. She was just coming to share in her niece's recognition. We are just so excited to have her."
Students did not know beforehand that Sotomayor would be attending the event.
"This was a big surprise for everyone," said Francesca Mundy, 62, whose granddaughter is a graduating eighth-grader. "This was something that I expect to be done in college, not at middle school.

Pretty cool.

11th Circuit report says Judge Fuller's actions...

..."might constitute one of more grounds for impeachment."  Aly Palmer at the Daily Report has more:

When U.S. District Judge Mark Fuller of Alabama tendered his resignation on Friday, his fellow judges apparently were preparing to send his case to a national judicial body for consideration of possible impeachment by Congress.
On Monday the Judicial Council of the U.S. Court of Appeals for the Eleventh Circuit issued an order saying the conduct of Fuller, who was arrested on domestic abuse allegations in Atlanta last summer, "might constitute one or more grounds for impeachment." The order referred the matter to the Judicial Conference of the United States, which has the ability to send a judicial discipline matter to the House of Representatives for impeachment.
Friday's letter from Fuller to President Barack Obama, saying the judge would resign effective Aug. 1, would appear to moot the question of impeachment as a practical matter. But Monday's order signifies that judicial leaders within the Eleventh Circuit were willing to hand down the most significant disciplinary consequence within their arsenal.
The Judicial Council consists of all of the Eleventh Circuit's active members, minus its most junior member and Chief Judge Ed Carnes, who hasn't been participating in the Fuller matter, as well as the nine chief judges of the district courts within the Eleventh Circuit. The opinion noted that the chief judge of the Middle District of Alabama, where Fuller sits, did not participate either. Judge Gerald Tjoflat of the Eleventh Circuit acted as chief judge on the matter in Carnes' stead, and Tjoflat's signature appears on Monday's order.
An August police report said Fuller's then-wife accused him of assaulting her at the Ritz-Carlton hotel in downtown Atlanta. He later agreed to a domestic violence intervention program and alcohol and substance abuse assessment to resolve the resulting misdemeanor battery case against him. Fuller's Atlanta criminal defense lawyer has said that Fuller made no admission of guilt and that, upon completion of the program, the case against him would be dismissed and his arrest record expunged.

Why would the 11th tip Fuller off so he could resign on Friday?

Here's the one page order:

"It was, quite frankly, somewhat ingenious how he got the drugs into the jail"

That was AUSA Catherine Koontz to Judge Dimitrouleas about a man who mailed drugs into the prison.  Paula McMahon has more:

A onetime Broward County chemical engineer was sentenced to just over a year in prison Friday for mailing postcards laced with a hallucinogenic drug to inmates in the Broward CountyJail.

William Hahne, 57, pleaded guilty last month to two federal conspiracy charges for sending the synthetic hallucinogen NBOMe, which has a similar effect to LSD, to his pals in the Joseph V. Conte Jail in Pompano Beach.


Two men who received the extra special jail mail, disguised as artwork and tattoo designs, admitted they ran a popular drug-dealing business in the lockup. They tore the postcards into tiny squares they sold for $10 a "hit" or exchanged for treats from the commissary.

Hahne's lawyer, Glenn Kritzer, said his client has a long history of mental illness, including psychosis, that contributed to his track record of drug-related arrests. He asked the judge to consider sentencing Hahne to less than 15 months.

Assistant U.S. Attorney Catherine Koontz suggested Hahne receive the highest recommended penalty of one year and 11 months.

"It was, quite frankly, somewhat ingenious how he got the drugs into the jail," Koontz told the judge.

Hahne, handcuffed, shackled and wearing beige jail scrubs, apologized to U.S. District Judge William Dimitrouleas.

"I hope you'll believe me when I tell you I will never do this again," Hahne said.

The judge skeptically asked if Hahne said the same thing to another federal judge when he was sentenced to four years in prison for manufacturing the drug Euphoria in 2004 at a sophisticated drug lab in his home near Fort Lauderdale High School. That arrest got him fired from his county job.

"Yes, your honor. I mean, no, your honor," Hahne replied, clearly flustered by the blunt question.

"So maybe you figured you'd do it again so you didn't say that to Judge Hurley?" Dimitrouleas said.

"No, your honor, it just didn't enter my mind," Hahne said.

The judge said he weighed Hahne's history of mental illness and his criminal history and sentenced him to one year and three months in federal prison.

 Paula M. also had this interesting story about a fugitive over the weekend.  Good stuff.

And in your moment of Zen, indicted defendant Jack Warner cited to the Onion to support his claim that the U.S. is picking on him.  Too good: