Goodly v. Check-6, Inc. et al

Filing 352

OPINION AND ORDER by Chief Judge Gregory K Frizzell ; granting in part and denying in part 277 Motion for Partial Summary Judgment (kjp, Dpty Clk)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF OKLAHOMA
JOSEPH GOODLY, on behalf of himself
and other persons similarly situated,
Plaintiffs,
v.

Case No. 16-CV-334-GKF-JFJ

CHECK-6, INC., YAREMA SOS, BRIAN
BRURUD, DENNIS ROMANO, S. ERIC
BENSON, LAURA OWEN, and JOHN
DILLON,
Defendants.
OPINION AND ORDER
In this action, the plaintiffs seek overtime compensation pursuant to the Fair Labor
Standards Act (“FLSA”), 29 U.S.C. §§ 201, et seq. Before the court is the defendants’ Motion for
Partial Summary Judgment [Doc. 277], in which the defendants argue that the overtime claims of
certain plaintiffs fall, in whole or in part, within the foreign workplace exemption pursuant to 29
U.S.C. § 213(f). For the reasons set forth below, the court grants in part and denies in part the
motion.
I. Background
Unless otherwise noted, the court treats the following facts as undisputed for the purpose
of deciding the instant motion. In this collective action, there are currently nineteen plaintiffs,
each of whom contracted with Check-6, Inc. to act as a “coach” at client worksites. The instant
motion does not apply to eight of the plaintiffs—John David, Joseph Flatley, Lia Mastronardi,
Randall Scully, Richard Wolfe, Gary Daige, Harold Schmitt, and Gary Snells—who, according to
the defendants, performed all coaching services for Check-6 clients in the United States or a
territory covered under the FLSA. [Doc. 277, p. 19].

Four of the plaintiffs—Aleksandr Goncharov, David Fuller, Edward Swanda, and Stephen
Wall—performed all coaching services internationally. [Doc. 277, pp. 6–8 ¶¶ 1–7; Doc. 297, p. 2
n.1, pp. 3–4 ¶¶ 1–7]. Messrs. Goncharov, Fuller, and Swanda never traveled to the United States
for any reason in connection with their coaching for Check-6. [Doc. 277, pp. 6–8 ¶¶ 2, 4, 6;
Doc. 297, pp. 3–4 ¶¶ 2, 4, 6]. Mr. Wall only traveled to the United States in connection with
Check-6 for three days of training. [Doc. 277, p. 8 ¶ 9; Doc. 297, p. 4 ¶ 9].
Plaintiffs Joseph Goodly and Keith Proze both resided in Louisiana during their tenure with
Check-6. [Doc. 277, p. 8 ¶¶ 12, 14; Doc. 297, p. 4 ¶¶ 12, 14]. They both attended training in the
United States and performed coaching services on the Vantage Titanium Explorer, a deepwater
drillship flagged by the Bahamas and located off the Louisiana coast in the Gulf of Mexico.
[Doc. 277, p. 8 ¶¶ 10–11, 13–14; Doc. 297, p. 4 ¶¶ 10–11, 13–14; Doc. 297-2, p. 1 ¶ 2; Doc. 297-3,
p. 1 ¶ 2].
Plaintiff Thomas Howard resided in Virginia during his tenure with Check-6. [Doc. 277,
p. 9 ¶ 18; Doc. 297, p. 5 ¶ 18]. He attended training in the United States and performed coaching
services in the United Kingdom, Guyana, Angola, South Africa, and Romania, on land rigs and
ocean rigs flagged by the United Kingdom, the Marshall Islands, Liberia, and Vanuatu. [Doc. 277,
pp. 8–9 ¶¶ 16–17; Doc. 297, p. 5 ¶¶ 16–17].
Plaintiff Randal Newbold resided in Michigan during his tenure with Check-6. [Doc. 277,
p. 9 ¶ 21; Doc. 297, p. 5 ¶ 21]. He attended training in the United States and performed coaching
services in Australia, Norway, Egypt, Malaysia, Thailand, and Iraq, on land rigs and ocean rigs
flagged by Panama, Vanuatu, and the Marshall Islands. [Doc. 277, p. 9 ¶¶ 19–20; Doc. 297, p. 5
¶¶ 19–20].

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Plaintiff Joseph Powers resided in North Carolina and Virginia during his tenure with
Check-6. [Doc. 277, p. 9 ¶ 24; Doc. 297, p. 5 ¶ 24]. He attended training in the United States and
performed coaching services in the Gulf of Mexico, Nigeria, Denmark, and Thailand, on rigs
flagged by Liberia, Denmark, Vanuatu, and Singapore. [Doc. 277, p. 9 ¶¶ 22–23; Doc. 297, p. 5
¶¶ 22–23].
Plaintiff Randall Tashjian resided in California during his tenure with Check-6. [Doc. 277,
p. 10 ¶ 27; Doc. 297, p. 6 ¶ 27]. He attended training in the United States and performed coaching
services in the United States and Canada and in the Gulf of Mexico on ocean rigs flagged by
Liberia. [Doc. 277, p. 10 ¶¶ 25–26; Doc. 297, pp. 5–6 ¶¶ 25–26].
Plaintiff George Wilson resided in Louisiana and Nevada during his tenure with Check-6.
[Doc. 277, p. 10 ¶ 30; Doc. 297, p. 6 ¶ 30]. He attended training in the United States and performed
coaching services in the United States and in the Gulf of Mexico, which included work on ocean
rigs flagged by Liberia. [Doc. 277, p. 10 ¶¶ 28–29; Doc. 297, p. 6 ¶¶ 28–29].
No training weeks were over forty working hours for any of the plaintiffs, except the
plaintiffs assert that initial on-the-job training provided to coaches while acting as a “wingman”
required more than forty working hours in a workweek. [Doc. 277, p. 10 ¶ 31; Doc. 297, p. 6
¶ 31].
Messrs. Goodly, Proze, Howard, Newbold, Powers, Tashjian, and Wilson all assert in
sworn declarations that their work for Check-6 required them to begin working prior to arriving at
client worksites, to work during the transit to and from client worksites, and to conclude work after
returning from client worksites. [Doc. 297-2, p. 2 ¶ 8; Doc. 297-3, p. 2 ¶ 8; Doc. 297-4, p. 2 ¶ 8;
Doc. 297-5, p. 2 ¶ 8; Doc. 297-6, p. 2 ¶ 8; Doc. 297-7, p. 3 ¶ 9; Doc. 297-8, p. 2 ¶ 7].

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II. Standard of Review
A motion for summary judgment shall be granted “if 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.”
Fed. R. Civ. P. 56(a). Federal Rule of Civil Procedure 56(a) “mandates the entry of summary
judgment, after adequate time for discovery and upon motion, against a party who fails to make a
showing sufficient to establish the existence of an element essential to that party’s case, and on
which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986); Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 670 (10th Cir. 1998). A court must examine
the factual record in the light most favorable to the party opposing summary judgment. Wolf v.
Prudential Ins. Co. of Am., 50 F.3d 793, 796 (10th Cir. 1995).
When the moving party has carried its burden, “its opponent must do more than simply
show that there is some metaphysical doubt as to the material facts . . . . Where the record taken as
a whole could not lead a rational trier of fact to find for the non-moving party, there is no ‘genuine
issue for trial.’” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586–87 (1986)
(citations omitted). In essence, the inquiry for the court is “whether the evidence presents a
sufficient disagreement to require submission to a jury or whether it is so one-sided that one party
must prevail as a matter of law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251–52 (1986).
III. Analysis
The plaintiffs bring their claims pursuant to 29 U.S.C. § 207, which requires employers to
pay non-exempt employees additional compensation for hours worked over forty hours per
workweek. 29 U.S.C. § 207(a). It is undisputed that some of the plaintiffs performed work outside
the territorial jurisdiction of the United States.

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Courts generally presume that federal statutes apply only within the territorial jurisdiction
of the United States, absent clearly expressed congressional intent to the contrary. RJR Nabisco,
Inc. v. European Cmty., 136 S. Ct. 2090, 2100 (2016) (citing Morrison v. National Australia Bank
Ltd., 561 U.S. 247, 255 (2010)). The presumption “serves to avoid the international discord that
can result when U.S. law is applied to conduct in foreign countries.” RJR Nabisco, 136 S. Ct. at
2100. It also reflects the “commonsense notion that Congress generally legislates with domestic
concerns in mind.” Id. (quoting Smith v. United States, 507 U.S. 197, 204, n.5 (1993)). A court in
the Southern District of Texas invoked the presumption in the FLSA context in Hodgson v. Union
de Permisionarios Circulo Rojo, S. de R. L., 331 F. Supp. 1119, 1122 (S.D. Tex. 1971). That case
involved Mexican employees of a Mexican corporation who drove buses between Mexico and
Texas. Relying on a majority of the work being performed in Mexico and an analogy to a foreignowned ship with foreign employees being temporarily in port, the court held that the FLSA was
inapplicable because of the presumption against extraterritorial application. See id. at 1121–22,
discussed by Gantchar v. United Airlines, Inc., No. 93 C 1457, 1995 WL 137053, at *7 n.14 (N.D.
Ill. Mar. 28, 1995) (“The court’s holding [in Hodgson] appears to rely entirely on the presumption
against extraterritorial application, not directly on the § 213(f) exemption.”).
Additionally, Congress expressly limited the FLSA’s geographical reach by enacting 29
U.S.C. § 213(f), which provides:
The provisions of sections 206, 207, 211, and 212 of this title shall
not apply with respect to any employee whose services during the
workweek are performed in a workplace within a foreign country or
within territory under the jurisdiction of the United States other than
the following: a State of the United States; the District of Columbia;
Puerto Rico; the Virgin Islands; outer Continental Shelf lands
defined in the Outer Continental Shelf Lands Act (ch. 345, 67 Stat.
462); American Samoa; Guam; Wake Island; Eniwetok Atoll;
Kwajalein Atoll; and Johnston Island.

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The Tenth Circuit has stated in a footnote that section 213(f) provides “for no extraterritorial
application” and has characterized the provision as a clear expression of congressional intent,
which “courts should be loath to circumvent.” Zahourek v. Arthur Young & Co., 750 F.2d 827,
829 (10th Cir. 1984).
In their response brief, the plaintiffs cite Cruz v. Chesapeake Shipping Inc., 738 F. Supp.
809, 818 (D. Del. 1990), aff’d, 932 F.2d 218 (3d Cir. 1991). [Doc. 297, p. 8]. In Cruz, seamen on
vessels located in the Persian Gulf attempted to invoke the minimum wage provisions of the FLSA
because the vessels were flying the American flag in order to gain the protection of American naval
forces during wartime. 738 F. Supp. at 810. The Third Circuit upheld the district court’s ruling
that the seamen were not entitled to minimum wages under the FLSA. 932 F.2d at 220.
As highlighted by the plaintiffs, the district court in Cruz advanced a somewhat narrow
reading of section 213(f), suggesting that “only foreign to foreign voyages should fall within the
foreign workplace exception of Section 213(f).” 738 F. Supp. at 823. This reading has limited
relevance here for a few reasons. First, the district court’s suggestion constituted dicta, as the court
found that, regardless, the FLSA did not apply. See id. (“Even with this limited application of
Section 213(f), however, the Plaintiffs fall within the exclusion; the minimum wage provisions do
not apply to them.”). Second, the court’s analysis in Cruz arose in a very different context, which
concerned minimum wage protections for seamen on American-flagged vessels—not overtime
compensation, as the plaintiffs seek in this action. Notably, the FLSA expressly exempts from its
overtime requirements “any employee employed as a seaman.” 29 U.S.C. § 213(b)(6). Third, the
district court’s narrow reading of section 213(f) relied on “the policy of interpreting FLSA
exclusions narrowly.” 738 F. Supp. at 823. However, the Supreme Court recently rejected this
principle as a useful guidepost for interpreting the FLSA and held that courts have no license to

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give FLSA exemptions “anything but a fair reading.” Encino Motorcars, LLC v. Navarro, 138 S.
Ct. 1134, 1142 (2018).
Based on the parties’ briefing, there appears to be some confusion as to several issues
regarding the FLSA’s application to the work performed by the plaintiffs. The court discusses
these issues below.
A. Plaintiffs Aleksandr Goncharov, David Fuller, Edward Swanda, and Stephen Wall
The plaintiffs concede that Messrs. Goncharov, Fuller, and Swanda performed all work
internationally and never traveled to the United States in connection with Check-6. As such, the
work performed for Check-6 by Messrs. Goncharov, Fuller, and Swanda falls within the foreign
workplace exemption, and their claims must be dismissed. See 29 U.S.C. § 213(f).
Furthermore, the plaintiffs concede that Mr. Wall’s only travel to the United States in
connection with Check-6 was for three days of training. The plaintiffs also concede that training
weeks—other than initial on-the-job training—did not involve more than forty working hours.
[Doc. 277, p. 10 ¶ 31; Doc. 297, p. 6 ¶ 31; Doc. 277-5, p. 2 ¶ 5]. Because an employee must work
more than forty hours in a week before overtime liability can attach, the claims of Mr. Wall must
also be dismissed.
B. Plaintiffs Thomas Howard, Randall Newbold, Joseph Goodly, Keith Proze, Joseph
Powers, Randall Tashjian, and George Wilson
1. Workweeks Involving Work Performed Exclusively in Foreign Countries
Pursuant to section 213(f), the plaintiffs are not entitled to overtime compensation under
the FLSA for hours worked during workweeks in which all work was performed exclusively in a
foreign country. 29 U.S.C. § 213(f). The complaint [Doc. 1] draws no distinction between work
performed in foreign countries and work performed in the U.S. territories enumerated in 29 U.S.C.
§ 213(f). The defendants are entitled to summary judgment to the extent the plaintiffs assert

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overtime claims for hours worked during workweeks in which all work was performed exclusively
in a foreign country.
2. Work Performed in the Gulf of Mexico
In their opening brief, the defendants seek summary judgment with respect to work
performed on certain “rigs/platforms” in the Gulf of Mexico. [Doc. 277, p. 13]. In their reply
brief, the defendants modify their position as follows:
Upon further inquiry, Defendants recognize that the Gulf of Mexico
work may be covered by the FLSA due to it being part of the Outer
Continental Shelf Lands covered by the Outer Continental Shelf
Lands Act . . . . The “attached” status of these individual vessels has
not been determined and thus the Gulf of Mexico work status is
undetermined.
[Doc. 312, pp. 2–3]. Because there are unresolved questions of material fact, the defendants are
not entitled to summary judgment with respect to work performed in the Gulf of Mexico.
3. Work Performed Aboard Foreign-Flagged Vessels outside U.S. Territorial
Waters and the Gulf of Mexico
Some of the plaintiffs performed work aboard foreign-flagged rigs outside U.S. territorial
waters and the Gulf of Mexico. For example, Joseph Powers worked on foreign-flagged rigs in
the Gulf of Thailand. [Doc. 277, p. 9 ¶ 22; Doc. 297, p. 5 ¶ 22; Doc. 277-7, p. 5; Doc. 277-19, p. 3
Tr. 46:5–25]. With respect to foreign-flagged vessels, excluding those in the Gulf of Mexico, the
defendants argue, “the vessel’s flagship must govern as to the applicability of United States’ laws,
including the FLSA, aboard the vessel.” [Doc. 312, p. 3]. In contrast, citing Cruz, 738 F. Supp. at
822, the plaintiffs contend: “Although seamen on the high seas are ‘extra-territorial,’ they are not
within a foreign country and they do not fall literally within [the section 213(f)] exception.”
[Doc. 297, p. 14]. As noted above, Cruz has limited relevance here because it concerned the
application of minimum wage requirements to seamen.

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The court holds that the FLSA’s overtime requirements do not apply to workweeks in
which the plaintiffs performed all work exclusively aboard foreign-flagged vessels outside U.S.
territorial waters and outside the Gulf of Mexico. Such work falls either within the foreign
workplace exemption pursuant to 29 U.S.C. § 213(f) or within the presumption against
extraterritorial application. Cf. Smith v. Raytheon Co., 297 F. Supp. 2d 399, 403 (D. Mass. 2004)
(“If there is any remaining doubt about whether Antarctica is a ‘foreign country’ and, thus, is
excluded from the coverage of the FLSA’s overtime rate requirement, the presumption against
extraterritorial application of United States statutes should resolve that doubt in favor of
exclusion.”).
4. Partial Workweeks Abroad
On its face, section 213(f) is ambiguous with regard to how the FLSA applies to employees
who work part of a week in the United States and part of the week abroad. See 29 U.S.C. § 213(f).
The Department of Labor, the administering agency for the FLSA, has promulgated a regulation
addressing this issue as follows:
Work performed by employees in “a work place within a foreign
country or within territory under the jurisdiction of the United
States” other than those enumerated in this paragraph is exempt by
this amendment from coverage under the Act. When part of the work
performed by an employee for an employer in any workweek is
covered work performed in any State, it makes no difference where
the remainder of such work is performed; the employee is entitled
to the benefits of the Act for the entire workweek unless he comes
within some specific exemption.
29 C.F.R. § 776.7 n.20 (emphasis added); see also 29 C.F.R. § 776.4(a) (“The workweek is to be
taken as the standard in determining the applicability of the [FLSA].”). Citing this regulation, a
court in the Northern District of California held that, “so long as [the plaintiffs] worked part of the
week in the United States . . . the entire week should be counted—i.e., even if the rest of the work

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was performed outside of the country or state.” Wright v. Adventures Rolling Cross Country, Inc.,
No. C-12-0982 EMC, 2013 WL 1758815, at *10 (N.D. Cal. Apr. 24, 2013).
Notably, in 1981, the Wage and Hour Division of the Department of Labor issued an
opinion letter reiterating and clarifying the language in 29 C.F.R. § 776.7 n.20. 1 U.S. Dep’t of
Labor, Wage & Hour Div., Opinion Letter, 1981 WL 179037 (June 29, 1981). The opinion letter
explains:
We do not count as compensable hours under the Act time spent
working in a foreign country, traveling from one foreign country to
another, or travel to and from a foreign country, when performed
during a workweek in which no work is performed in any area
described in section 13(f). . . . When part of the work performed by
an employee for an employer in any workweek is covered work
performed in any State, the employee is entitled to the benefits of
the Act for the entire workweek unless he or she comes within some
specific exemption.
1981 WL 179037, at *1 (emphasis added). The letter then discusses several examples of how to
calculate hours worked in different situations involving non-exempt employees who travel and
work outside of the United States during part of a workweek.
In this case, the defendants seek summary judgment with respect to weeks in which the
plaintiffs traveled to or from foreign job sites. The court finds the interpretation articulated in the
Wage and Hour Division’s opinion letter persuasive. When an employee performs all work during
a workweek in a foreign country, merely stepping on or off a plane in the United States is not
sufficient to bring the workweek within the scope of the FLSA’s overtime requirements. See 1981
WL 179037, at *1 (“We do not count as compensable hours under the Act . . . travel to and from a
foreign country, when performed during a workweek in which no work is performed in any area
described in section 13(f).”); cf. Nicholson v. World Bus. Network, Inc., 105 F.3d 1361, 1363 (11th

Courts give weight to the Wage and Hour Division’s opinion letters when they interpret the Department of Labor’s
own ambiguous regulations. Chavez v. City of Albuquerque, 630 F.3d 1300, 1308 n.6 (10th Cir. 2011).

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Cir. 1997) (“Because the FLSA does not apply to work performed in a foreign country . . . Smith’s
damages would be confined to the salary he earned before departing for Russia.” (emphasis
added)); DiGregorio v. Temple Univ., No. 79-3221, 1983 WL 2147, at *12 (E.D. Pa. Sept. 30,
1983) (holding that workweek in which plaintiff flew to Japan was not compensable under the
FLSA).
Here, however, the relevant plaintiffs assert in sworn declarations that their work for
Check-6 required them to begin working in the United States prior to visiting client worksites and
to work in the United States after returning from client sites. [Doc. 297-2, p. 2 ¶ 8; Doc. 297-3, p.
2 ¶ 8; Doc. 297-4, p. 2 ¶ 8; Doc. 297-5, p. 2 ¶ 8; Doc. 297-6, p. 2 ¶ 8; Doc. 297-7, p. 3 ¶ 9].
Construing the declarations in the light most favorable to the non-moving parties, the court finds
genuine disputes of material fact exist as to whether the plaintiffs performed work in the United
States during workweeks in which they traveled to and from foreign client worksites.
Consequently, the defendants are not entitled to summary judgment with respect to workweeks in
which the plaintiffs traveled between the United States and foreign client worksites and were
allegedly required to work in the United States prior to departure and/or after their return.
IV. Conclusion
WHEREFORE, the Motion for Partial Summary Judgment [Doc. 277] of defendants
Check-6, Inc., Yarema Sos, Brian Brurud, and Laura Owen is granted in part and denied in part.
The defendants are granted summary judgment on the claims asserted by four of the plaintiffs—
Aleksandr Goncharov, David Fuller, Edward Swanda, and Stephen Wall. The defendants are
granted partial summary judgment on the claims of the remaining plaintiffs to the extent the claims
concern workweeks in which all work was performed exclusively in a foreign country or aboard a

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foreign-flagged vessel outside U.S. territorial waters and the Gulf of Mexico. The motion is
otherwise denied.
IT IS SO ORDERED this 26th day of October, 2018.

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