Burke v. Alta Colleges, Inc.

Filing 24

ORDER granting 16 Motion to Stay. All scheduling and discovery is stayed pending issuance of the Christopher decision. ORDERED that the statute of limitations in this matter is TOLLED as of the date of this Order until the date of issuance of t he Supreme Court's decision in Christopher. ORDERED that the Scheduling Conference set for March 6, 2012 at 10:30 a.m. is VACATED. ORDERED that Defendant shall file a Notice with the Court within ten (10) days of the issuance of the Christopher decision indicating that the decision has been issued by Magistrate Judge Kristen L. Mix on 02/15/12.(jjhsl, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 11-cv-02990-WYD-KLM
SCOTT BURKE, on behalf of himself and others similarly situated,
Plaintiff,
v.
ALTA COLLEGES, INC., a Delaware corporation doing business as Westwood College,
Defendant.
_____________________________________________________________________
ORDER
_____________________________________________________________________
ENTERED BY MAGISTRATE JUDGE KRISTEN L. MIX
This matter is before the Court on Defendant’s Motion to Stay Proceedings
[Docket No. 16; Filed January 25, 2012] (the “Motion”). On February 1, 2012, Plaintiff filed
a Response [#18]. On February 9, 2012, Defendant filed a Reply [#21]. The Motion is ripe
for review.
Plaintiff initiated this lawsuit for lost wages on November 16, 2011 pursuant to the
Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq. See Compl. [#1] at 1. Plaintiff
asserts that employees of Defendant who worked under the job title of “Admissions Field
Representative” were incorrectly classified by Defendant as exempt from the mandatory
overtime pay provisions of the FLSA. See id. at 2. Plaintiff seeks to certify a class of such
individuals as plaintiffs in this litigation. See id. at 1-2.
On January 25, 2012, Defendant filed an Answer [#15] and the Motion [#16].
Defendant asserts that Plaintiff was properly classified as “exempt” pursuant to the “outside

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sales” exemption of the FLSA; specifically, Defendant avers that Plaintiff and others with
his job title performed work comprised of “sales” and/or “obtaining orders or contracts for
services” pursuant to 29 C.F.R. § 541.500(a). See Motion [#16] at 2.
In the Motion, Defendant seeks a stay of scheduling and discovery until after the
United States Supreme Court issues its decision in Christopher v. SmithKline Beecham
Corp. (No. 11-204), which is currently on appeal from Christopher v. SmithKline Beecham
Corp., 635 F.3d 383 (9th Cir. 2011). The questions presented in the Christopher case are:
“(1) Whether deference is owed to the Secretary’s interpretation of the Fair Labor
Standards Act’s [“FLSA”] outside sales exemption and related regulations; and (2) Whether
the Fair Labor Standards Act’s outside sales exemption applies to pharmaceutical sales
representatives.” http://www.supremecourt.gov/qp/11-00204qp.pdf. Defendant argues that
the second question, although not dispositive of the issues presented in the present case,
“will present a ‘roadmap’ for analyzing the outside sales exemption and its application in
[this] case” because “Christopher will be the first Supreme Court decision interpreting the
outside sales exemption in the more than seventy-year history of the FLSA.” Motion [#16]
at 2-3; Response [#18] at 2; Reply [#21] at 2. The duration of the requested stay is
dependant on when the Supreme Court issues the Christopher decision, which could be
issued any time between the present and the end of the Supreme Court term in June 2012;
therefore, the maximum length of the stay would be less than five months.
Although the stay of proceedings in a case is generally disfavored, the Court has
discretion to stay discovery when critical issues are pending. See, e.g., Wason Ranch
Corp. v. Hecla Mining Co., No. 07-cv-00267-EWN-MEH, 2007 WL 1655362, at *1 (D. Colo.
June 6, 2007) (unreported decision) (“A stay of all discovery is generally disfavored in this
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District.” (citation omitted)); String Cheese Incident, LLC v. Stylus Shows, Inc., No. 1:02-cv01934-LTB-PAC, 2006 WL 894955, at *2 (D. Colo. Mar. 30, 2006) (unreported decision)
(finding that a thirty-day stay of discovery was appropriate when a motion to dismiss for
lack of personal jurisdiction was pending); 8 Charles Alan Wright, et al., Federal Practice
and Procedure § 2040, at 521-22 (2d ed. 1994) (“[W]hen one issue may be determinative
of a case, the court has discretion to stay discovery on other issues until the critical issue
has been decided.”); Vivid Techs., Inc. v. Am. Sci. & Eng’g, Inc., 200 F.3d 795, 804 (Fed.
Cir. 1999) (“When a particular issue may be dispositive, the court may stay discovery
concerning other issues until the critical issue is resolved.”).
It is not uncommon for lower courts to stay proceedings in pending matters when
cases containing material issues are awaiting determination by the United States Supreme
Court. For example, in Brin v. State, a Kansas federal judge sua sponte raised the issue
of a stay because the Supreme Court had accepted certiorari on a material legal issue
related to the Americans with Disabilities Act of 1990. See No. 97-4243-SAC, 2000 WL
1542830, at *3 (D. Kan. Sept. 19, 2000). The court imposed a stay “[i]n light of the strong
possibility that the Supreme Court’s upcoming decision in Garrett will resolve all of plaintiff’s
remaining ADA claims,” noting that a stay also served “the interests of conserving both
judicial resources and those of the parties.” Id.
As the Ninth Circuit Court of Appeals has stated:
A trial court may, with propriety, find it is efficient for its own docket and the
fairest course for the parties to enter a stay of an action before it, pending
resolution of independent proceedings which bear upon the case. This rule
applies whether the separate proceedings are judicial, administrative, or
arbitral in character, and does not require that the issues in such proceedings
are necessarily controlling of the action before the court. In such cases the
court may order a stay of the action pursuant to its power to control its docket
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and calendar and to provide for a just determination of the cases pending
before it.
Leyva v. Certified Grocers of California, Ltd., 593 F.2d 857, 863-64 (9th Cir. 1979).
When exercising its discretion to stay a matter, the Court considers the following
factors: (1) the interest of the plaintiff in proceeding expeditiously with discovery and the
potential prejudice to the plaintiff of a delay; (2) the burden on the defendant of proceeding
with discovery; (3) the convenience to the Court of staying discovery; (4) the interests of
nonparties in either staying or proceeding with discovery; and (5) the public interest in
either staying or proceeding with discovery. String Cheese Incident, 2006 WL 894955, at
*2 (citing FDIC v. Renda, No. 85-2216-O, 1987 WL 348635, at *2 (D. Kan. Aug. 6, 1987)
(unreported decision)).
Turning to the first element, Plaintiff presents several generalized arguments, such
as that it “has an interest in proceeding immediately with its prosecution of this claim;” that
it “will be extremely prejudiced” by the stay of discovery; and that unnecessary delay “will
result in a further degradation of witness memory as well as increase the likelihood that
witnesses will be unavailable.” Response [#18] at 5. However, aside from Plaintiff’s
conclusory assertions, nothing indicates that these unidentified witnesses or other relevant
evidence are at risk of loss or spoliation. Accordingly, the Court finds that Plaintiff has
identified no non-speculative prejudicial impact which would result from waiting up to five
months to proceed with discovery. The Court finds that the first String Cheese Incident
factor weighs in favor of staying scheduling and discovery.
With regard to the second factor, the Court finds that Defendant has demonstrated
that proceeding with the discovery process may present an undue burden. It is likely that
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the Supreme Court’s decision in Christopher regarding the “outside sales” exemption will
directly impact the parties’ discovery efforts and motions practice. Although it is impossible
to know the extent to which the Supreme Court opinion will affect litigation strategies here,
it is reasonable to conclude that the Christopher decision will likely impact this case in some
fashion. Not only may it serve to properly focus the parties’ discovery efforts, but it may
also drive settlement of this case. Waiting less than five months for the Supreme Court
decision will likely streamline the scope of discovery and, in turn, the scope of this litigation.
The Court therefore finds that the second String Cheese Incident factor weighs in favor of
staying scheduling and discovery.
With regard to the third factor, the Court will have to expend its time and limited
resources to adjudicate this dispute. It is certainly more convenient for the Court to stay
discovery until it is clear that the case is not mooted or otherwise redirected or resolved as
the result of a Supreme Court decision on a fundamental legal issue. Accordingly, the third
String Cheese Incident factor weighs in favor of staying scheduling and discovery.
With regard to the fourth factor, Plaintiff specifies the interest of potential class action
plaintiffs who are not yet parties to this action whose claims may expire pursuant to the
statute of limitations. See Response [#18] at 5. Defendant agrees to a tolling of the statute
of limitations for these potential plaintiffs, thus negating any adverse impact on them. See
Reply [#21] at 6-7 & n.1. Accordingly, the fourth String Cheese Incident factor neither
weighs in favor of nor against staying scheduling and discovery.
With regard to the fifth and final factor, the Court finds that the public’s only interest
in this case is a general interest in its efficient and just resolution. Avoiding wasteful efforts
by the parties and the Court clearly serves this interest. Thus, the fifth String Cheese
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Incident factor weighs in favor of staying scheduling and discovery.
Weighing the relevant factors, the Court concludes that staying scheduling and
discovery pending the issuance of the Supreme Court’s decision in Christopher is
appropriate. Accordingly,
IT IS HEREBY ORDERED that the Motion to Stay [#16] is GRANTED.

All

scheduling and discovery is stayed pending issuance of the Christopher decision.
IT IS FURTHER ORDERED that the statute of limitations in this matter is TOLLED
as of the date of this Order until the date of issuance of the Supreme Court’s decision in
Christopher.
IT IS FURTHER ORDERED that the Scheduling Conference set for March 6, 2012
at 10:30 a.m. is VACATED. The Court will reset the Scheduling Conference after the
Christopher decision is issued.
IT IS FURTHER ORDERED that Defendant shall file a Notice with the Court within
ten (10) days of the issuance of the Christopher decision indicating that the decision has
been issued.
DATED: February 15, 2012 at Denver, Colorado.

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