FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
MICHAEL SHANE CHRISTOPHER;
FRANK BUCHANAN, individually and
on behalf of all others similarly
situated, No. 10-15257
Plaintiffs-Appellants,
v. D.C. No.
2:08-cv-01498-FJM
SMITHKLINE BEECHAM OPINION
CORPORATION, DBA
GlaxoSmithKline,
Defendant-Appellee.
Appeal from the United States District Court
for the District of Arizona
Frederick J. Martone, District Judge, Presiding
Argued and Submitted
November 3, 2010—Pasadena, California
Filed February 14, 2011
Before: Mary M. Schroeder, Richard C. Tallman, and
Milan D. Smith, Jr., Circuit Judges.
Opinion by Judge Milan D. Smith, Jr.
2331
2334 CHRISTOPHER v. SMITHKLINE BEECHAM
COUNSEL
Michael R. Pruitt, Esq.; Christine F. Crockett, Esq., Jackson
White, P.C., Mesa, Arizona, for plaintiffs-appellants Michael
Christopher and Frank Buchanan.
Neal D. Mollen, Esq.; Barbara L. Johnson, Esq., Paul Has-
tings Janofsky & Walker, L.L.P., Los Angeles, California, for
defendant-appellee SmithKline Beecham Corporation.
OPINION
M. SMITH, Circuit Judge:
Plaintiffs-Appellants Michael Christopher and Frank
Buchanan appeal the judgment of the district court that they
are not entitled to overtime pay under the Fair Labor Stan-
dards Act of 1938 (FLSA), 29 U.S.C. §§ 201 et seq. Plaintiffs
were employed as Pharmaceutical Sales Representatives
CHRISTOPHER v. SMITHKLINE BEECHAM 2335
(PSRs) for Defendant-Appellee SmithKline Beecham Corpo-
ration d/b/a GlaxoSmithKline (Glaxo). Glaxo classified Plain-
tiffs as “outside salesmen”—a legal designation that exempts
an employee from the FLSA’s overtime-pay requirement.
Plaintiffs’ suit challenges Glaxo’s classification and seeks
back pay.
The district court granted summary judgment to Glaxo. We
affirm.
FACTUAL AND PROCEDURAL BACKGROUND
I. Pharmaceutical Sales Representatives
Glaxo is in the business of developing, producing, market-
ing, and selling pharmaceutical products. Christopher and
Buchanan began working as PSRs for Glaxo in 2003. Glaxo
terminated Christopher in May 2007. Buchanan’s career at
Glaxo ended when he accepted a PSR position at another
pharmaceutical company. Since the enactment of the Pure
Food and Drug Act of 1906, Pub. L. No. 59-384, 34 Stat. 768,
federal law has, to varying degrees, regulated and influenced
the sale of pharmaceuticals.1 In 1938, the Federal Food, Drug,
and Cosmetic Act, Pub. L. 75-717, 52 Stat. 1040 (codified as
amended at 21 U.S.C. §§ 301 et seq.), clothed the Food and
Drug Administration with broad regulatory authority over,
inter alia, drug manufacturers.2 The Durham-Humphrey
Amendment of 1951 established the first comprehensive
scheme governing the sale of prescription pharmaceuticals to
the public. See Pub. L. No. 82-215, 65 Stat. 648 (1951) (codi-
fied at 21 U.S.C. § 353(b)). Importantly, for our purposes,
Durham-Humphrey formalized the now well-established dis-
1
Cf. Francis B. Palumbo & C. Daniel Mullins, The Development of
Direct-to-Consumer Prescription Drug Advertising Regulation, 57 Food
& Drug L.J. 423, 424-27 (2002).
2
See Palumbo & Mullins, supra, at 425 & n.17.
2336 CHRISTOPHER v. SMITHKLINE BEECHAM
tinction between prescription and over-the-counter drugs.3
The Controlled Substances Act of 1970, Pub. L. 91-513, 84
Stat. 1260, continues the prescription/non-prescription dichot-
omy, and prohibits dispensing the former without the authori-
zation of a “practitioner, other than a pharmacist, to an
ultimate user.” 21 U.S.C. § 829(b)-(d). Currently, all pharma-
ceuticals requiring a physician’s prescription are branded “Rx
only.” 21 U.S.C. § 353(b)(4)(A).
We analyze this case within the framework of how Glaxo
sells its “Rx only” products to an “ultimate user.” A key,
undisputed fact underlying our analysis is that the ultimate
user—the patient—cannot purchase a prescription drug with-
out first obtaining a physician’s authorization.
Because Glaxo is proscribed from selling Rx-only products
directly to the public, it sells its prescription pharmaceuticals
to distributors or retail pharmacies, which then dispense those
products to the ultimate user, as authorized by a licensed phy-
sician’s prescription. In this restrictive sales environment,
Glaxo employs PSRs to make “calls” on physicians to encour-
age them to prescribe Glaxo products. On calls, PSRs typi-
cally present physicians with a variety of information about
Glaxo products, provide product samples, and attempt to con-
vince the physicians to prescribe Glaxo products, when medi-
cally appropriate, over competitor products. PSRs also try to
build business relationships with physicians, respond to their
concerns, and recruit them to attend Glaxo-organized dinners
and conventions. Each PSR is responsible for a particular
“drug bag” of medications he or she tries to induce physicians
to prescribe. As perceived by the Plaintiffs, the primary duty
of a PSR is to communicate features and benefits of Glaxo
products to physicians. In Buchanan’s words, he tried to “con-
vince prescribers that the benefits of [Glaxo’s] products war-
ranted them prescribing that product to the appropriate
patient.”
3
See Palumbo & Mullins, supra, at 426.
CHRISTOPHER v. SMITHKLINE BEECHAM 2337
PSRs usually work outside of a Glaxo office and spend
much of their time traveling to the offices of, and working
with, physicians within their assigned geographic territories.
Plaintiffs visited between eight and ten physicians each day,
usually between the hours of 8:30 a.m. and 5:00 p.m. Plain-
tiffs claim that they worked between ten and twenty hours
each week outside of normal business hours, for which they
received no overtime wages. When not making calls on physi-
cians, Plaintiffs studied Glaxo products and relevant disease
states, prepared new presentation modules, answered phone
calls, checked email, generated reports, and attended events
on evenings and weekends.
Before a PSR makes his or her daily calls, Glaxo provides
him or her with detailed reports about the physicians he or she
will visit. These reports include information about a physi-
cian’s prescribing habits and drug preferences, the market
volume of Glaxo products prescribed by the physician versus
the volume of competitor products, and the volume of pre-
scriptions filled in a particular region. Glaxo also provides
each PSR with a budget to use for speaker programs and to
engage socially with physicians.
Glaxo prepares and provides information about its products
—called “Core Messages”—for PSRs to present to physicians
during calls. Core Messages include information about prod-
uct benefits and risks, dosage instructions, and the types of
patients for whom Glaxo recommends each product. Glaxo
expects PSRs to use the Core Messages and then “[d]evelop
and deliver informative sales presentations based on customer
needs.”
PSRs do not carry any prescriptions with them for direct
sale; rather, Glaxo provides PSRs with small amounts of sam-
ple products to distribute to physicians. PSRs do not contact
patients or market anything to them. To the contrary, in com-
pliance with federal law, PSRs cannot sell the samples, take
2338 CHRISTOPHER v. SMITHKLINE BEECHAM
orders for any medication, or negotiate drug prices or con-
tracts with either physicians or patients.
Glaxo recruits applicants who have prior sales experience
for its PSR positions. When Glaxo hires new PSRs, it pro-
vides them with more than one month of training that focuses
on making presentations, learning about Glaxo products, and
building interpersonal skills. PSRs are taught how to ask for
a commitment from a physician to prescribe Glaxo products
if the physician believes the medication is appropriate.
Since 2001, Glaxo has instructed PSRs on various methods
of completing a call. When Plaintiffs were hired, they
received training in Glaxo’s “Assertive Selling Always Pro-
fessional (ASAP)” model. They were also trained to follow
Glaxo’s “Winning Practices” program. ASAP and Winning
Practices are similarly structured and emphasize that a PSR
should: (1) analyze and understand what is happening in an
assigned region; (2) work with the team to drive results; (3)
master professional knowledge to understand clinical manage-
ment of patients; (4) prepare for calls; (5) “Sell Through
Customer-Focused Dialogue”; (6) obtain the strongest com-
mitment possible from a healthcare professional at the end of
the call; and (7) provide added value to the customer relation-
ship.
In 2004, Glaxo started a new program called “When? Why?
How?” which distilled the old model into three questions
PSRs should use to bond the targeted physician to the Glaxo
brand: “(1) When should I use this product? (2) Why should
I use this product? (3) How should I use this product?” PSRs
strive to ensure that their targeted physicians have the answers
to all three questions before PSRs leave the physicians’
offices.
Plaintiffs received two types of pay—salary and incentive-
based compensation. Incentive-based compensation is paid if
Glaxo’s market share for a particular product increases in a
CHRISTOPHER v. SMITHKLINE BEECHAM 2339
PSR’s territory, sales volume for a product increases, sales
revenue increases, or the dose volume increases. Glaxo aims
to have a PSR’s total compensation be approximately 75%
salary and 25% incentive compensation.4 However, the dollar
value of incentive-based compensation is uncapped.
The process of providing information to physicians is
referred to within the pharmaceutical industry as “detailing,”
and PSRs have traditionally been known by the moniker “de-
tail men” or “detailers.” Plaintiffs’ job functions during their
tenures at Glaxo varied little from those of their predecessors
of fifty or sixty years ago.5 Moreover, there is homogeneity
4
In 2004, Christopher received $72,576 gross pay, of which $29,993
was incentive compensation (41% of gross); in 2005, he received $67,243,
of which $21,231 was incentive (32% of gross); and in 2006, he received
$77,552, of which $28,249 was incentive (37% of gross).
In 2004, Buchanan received $70,740 gross pay, of which $19,232 was
incentive compensation (27% of gross); in 2005, he received $74,358, of
which $27,743 was incentive (32% of gross); in 2006, he received
$84,932, of which $32,519 was incentive (38% of gross); and in 2007, he
received $75,776, of which $19,957 was incentive (26% of gross).
5
See Thomas L. Hafemeister, et ano., Beware Those Bearing Gifts: Phy-
sician’s Fiduciary Duty to Avoid Pharmaceutical Marketing, 57 U. Kan.
L. Rev. 491, 493-94 (2009) (“Detailing is the term used to denote the prac-
tice of pharmaceutical representatives visiting the offices of physicians or
otherwise contacting physicians to promote their company’s drugs and/or
medical devices.”). The pharmaceutical-representative/detailist position
has deep roots in the industry, dating back until at least the 1930s. See
Lars Noah, Death of a Salesman: To What Extent Can the FDA Regulate
the Promotional Statements of Pharmaceutical Sales Representatives, 47
Food & Drug L.J. 309, 311 (1992) (“During the 1930s, . . . [m]arketing
efforts by salesmen therefore focused almost exclusively on retail pharma-
cies.”). Indeed, we trace the first mention of detail men in the federal case
reports to 1940. See United States v. Fifty-Nine Tubes, More or Less, of
Lutein Tablets, 32 F. Supp. 958, 960 (S.D.N.Y. 1940) (describing how
“detail men or salesmen” interacted with physicians); see also Motus v.
Pfizer, Inc., 358 F.3d 659, 661 (9th Cir. 2004) (referring to “Pfizer’s detail
men” providing drug information to a physician); N. Cal. Pharm. Ass’n v.
United States, 306 F.2d 379, 386 (9th Cir. 1962) (“ ‘Detail men,’ or local
sales representatives of the out-of-state manufacturers are constantly at
2340 CHRISTOPHER v. SMITHKLINE BEECHAM
within the industry—PSRs carry out essentially the same
business functions regardless of which drug manufacturers
they represent.6
The pharmaceutical industry self-regulates PSRs and their
contacts with physicians by way of a voluntary industry-wide
code of conduct—the Pharmaceutical Research and Manufac-
turers of America (PhRMA) Code. The PhRMA Code does
not speak of selling, but, rather, provides that “[i]nteractions
[with health care professionals] should be focused on inform-
ing [them] about products, providing scientific and educa-
tional information, and supporting medical research and
education.” The PhRMA Code refers to PSRs as “industry
representatives” and states that “[i]nformational presentations
and discussions by industry representatives speaking on
behalf of a company provide valuable scientific and educa-
tional benefits.” The PhRMA Code also regulates the provi-
sion of meals and gifts to physicians and professes an industry
commitment to independent medical decisionmaking.
work in northern California acquainting physicians and pharmacists with
new drugs, stimulating interest generally in the firm’s products, and urging
physicians to prescribe, and pharmacists to order, the manufacturer’s
goods.”); Schering Corp. v. Sun Ray Drug Co., 320 F.2d 72, 74 (3d Cir.
1963) (explaining company’s advertising included “efforts on the part of
its detail men (who are salesmen)”); Hoffmann-La Roche, Inc. v. Schweg-
mann Bros. Giant Super Mkts., 122 F. Supp. 781, 783 (E.D. La. 1954)
(“[Detail men] regularly call upon physicians . . .”).
6
See e.g., IMS Health, Inc. v. Mills, 616 F.3d 7, 14 (1st Cir. 2010)
(“Detailing is a massive and expensive undertaking for pharmaceutical
manufacturers, which spend billions of dollars a year to have some 90,000
pharmaceutical sales representatives make weekly or monthly one-on-one
visits to prescribers nationwide.”); Pfizer, Inc. v. Astra Pharm. Prods.,
Inc., 858 F. Supp. 1305, 1314 (S.D.N.Y. 1994) (“It is not disputed that the
parties’ marketing efforts are conducted in substantially similar ways
through (a) advertising in medical journals, (b) mailings sent to doctors,
and (c) the use of large forces of ‘detail men’ who solicit doctors at the
latter’s offices and discuss their products directly with the doctors.”).
CHRISTOPHER v. SMITHKLINE BEECHAM 2341
II. Proceedings in the District Court
This litigation commenced in August 2008, when Plaintiffs
filed the Complaint challenging Glaxo’s practice of requiring
overtime work without paying additional compensation as a
violation of 29 U.S.C. §§ 207(a)(1), 216(b). The parties cross-
moved for summary judgment, and Plaintiffs moved to certify
a conditional class. Glaxo contended that Plaintiffs were
exempt under the “outside salesman” provision in FLSA or,
alternatively, under the “administrative” exemption. 29
U.S.C. § 213(a)(1).
In granting Glaxo’s motion for summary judgment, the dis-
trict court addressed only the outside sales exemption and
held that PSRs “unmistakably fit within the terms and spirit
of the exemption.” Christopher v. SmithKlein Beecham Corp.,
No. 08 Civ. 1498 (FJM), 2009 WL 4051075, at *5 (D. Ariz.
Nov. 20, 2009). The court observed that PSRs “are not hourly
workers, but instead earn salaries well above minimum wage
—up to $100,000 a year,” and that they receive bonuses in
lieu of overtime as “an incentive to increase their efforts.” Id.
The district court continued, “A PSR’s ultimate goal is to
close an encounter with a physician by obtaining a non-
binding commitment from the physician to prescribe the
PSR’s assigned product. In this highly regulated industry, that
is the most a PSR can achieve.” Id.
Thereafter, Plaintiffs moved to alter or amend the judgment
based on the district court’s failure to consider an amicus brief
filed by the Secretary (Secretary) of the Department of Labor
(DOL) in a FLSA appeal then pending before the United
States Court of Appeals for the Second Circuit, In re Novartis
Wage & Hour Litig., 611 F.3d 141 (2d Cir. 2010). The district
court rejected Plaintiffs’ argument that the DOL brief was
entitled to deference under either Chevron U.S.A., Inc. v. Nat-
ural Resources Defense Council, Inc., 467 U.S. 837 (1984),
or Auer v. Robbins, 519 U.S. 452 (1997), and noted that the
DOL’s brief recapitulated the points argued at summary judg-
2342 CHRISTOPHER v. SMITHKLINE BEECHAM
ment. Finding the DOL’s “current interpretation inconsistent
with the statutory language and its prior pronouncements,
[and] [ ] also def[ying] common sense,” the district court
denied the motion to amend the judgment. Plaintiffs appeal.
JURISDICTION AND STANDARD OF REVIEW
We have jurisdiction under 28 U.S.C. § 1291.
We review a district court’s interpretation of the FLSA and
its grant of summary judgment de novo. Gieg v. DDR, Inc.,
407 F.3d 1038, 1044-45 (9th Cir. 2005); see also Dent v. Cox
Commc’ns Las Vegas, Inc., 502 F.3d 1141, 1143 (9th Cir.
2007). Summary judgment “should be rendered if the plead-
ings, the discovery and disclosure materials on file, and any
affidavits show that there is no genuine issue as to any mate-
rial fact and that the movant is entitled to judgment as a mat-
ter of law.” Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 247 (1986).
DISCUSSION
I. The FLSA Outside Sales Exemption
The FLSA imposes minimum labor standards on employers
to promote “the health, efficiency, and general well-being of
workers.” 29 U.S.C. § 202(a); Nigg v. U.S. Postal Serv., 555
F.3d 781, 784 (9th Cir. 2009). The FLSA was “enacted
because Congress found that the existence ‘in industries
engaged in commerce or in the production of goods for com-
merce’ of labor conditions detrimental to maintaining mini-
mum standards of living necessary for health, efficiency and
general well-being of workers perpetuates substandard condi-
tions among workers, burdens commerce, constitutes an
unfair method of competition in commerce, leads to labor dis-
putes, and interferes with the orderly and fair marketing of
goods.” Hale v. Arizona, 993 F.2d 1387, 1396 (9th Cir. 1993)
CHRISTOPHER v. SMITHKLINE BEECHAM 2343
(en banc) (quoting 29 U.S.C. § 202(a)) (emphasis added); see
also Nigg, 555 F.3d at 784.
[1] To meet those goals and expand employment opportu-
nities across the economy, the FLSA includes a baseline
“overtime payment requirement” that employers must pay
employees “a rate not less than one and one-half times the
regular rate at which he is employed” for hours worked in
excess of forty per week. 29 U.S.C. § 207(a)(1). There are
numerous exceptions to this general rule. See 29 U.S.C.
§ 213. These exemptions to the overtime-pay requirement
vary widely from “white-collar” executive, administrative,
and professional exemptions to those for babysitters. 29
U.S.C. § 213(a)(1), (15). Relevant here is one part of the
“white-collar” exemption for persons employed “in the capac-
ity of outside salesman.” 29 U.S.C. § 213(a)(1); Vinole v.
Countrywide Home Loans, Inc., 571 F.3d 935, 946 (9th Cir.
2009). The white-collar exemption removes from the over-
time pay requirement:
any employee employed in a bona fide executive,
administrative, or professional capacity . . . or in the
capacity of outside salesman (as such terms are
defined and delimited from time to time by regula-
tions of the Secretary [of Labor]). . . .
29 U.S.C. § 213(a)(1) (emphasis added).
As the statute indicates, a proper interpretation of the FLSA
is necessarily guided by the regulations issued by the Secre-
tary of Labor—“[t]he FLSA grants the Secretary broad
authority to ‘define and delimit’ the scope of the exemption
for executive, administrative, and professional employees.”
Auer, 519 U.S. at 456 (alterations and citation omitted). Con-
gress did not define the term “outside salesman” or the other
white-collar exemptions in the FLSA. Rather, “[p]ursuant to
Congress’s specific grant of rulemaking authority, the [DOL]
has issued implementing regulations, at 29 C.F.R. Part 541
2344 CHRISTOPHER v. SMITHKLINE BEECHAM
[(Part 541)], defining the scope of the section 13(a)(1) exemp-
tions.” See Defining and Delimiting the Exemptions for Exec-
utive, Administrative, Professional, Outside Sales and
Computer Employees, 69 Fed. Reg. 22,122, 22,124 (Apr. 23,
2004). In 2004, the DOL’s Wage and Hour Division promul-
gated supplemental rules concerning the outside sales and
administrative exemptions (the 2004 Rule). Among other
things, the 2004 Rule explained that “the major substantive
provisions of the Part 541 regulations have remained virtually
unchanged for 50 years.” 69 Fed. Reg. at 22,124.
[2] The Secretary defines an “outside salesman” as any
employee:
(1) Whose primary duty is: (i) making sales within
the meaning of section 3(k) of the Act; or (ii) obtain-
ing orders or contracts for services or for the use of
facilities for which a consideration will be paid by
the client or customer; and
(2) Who is primarily and regularly engaged away
from the employer’s place or places of business in
performing such primary duty.
29 C.F.R. § 541.500(a). An employee’s “primary duty” is “the
principal, main, major, or most important duty that the
employee performs.” 29 C.F.R. § 541.700. The outside sales
regulation provides:
In determining the primary duty of an outside sales
employee, work performed incidental to and in con-
junction with the employee’s own outside sales or
solicitations, including incidental deliveries and col-
lections, shall be regarded as exempt outside sales
work. Other work that furthers the employee’s sales
efforts also shall be regarded as exempt work includ-
ing, for example, writing sales reports, updating or
CHRISTOPHER v. SMITHKLINE BEECHAM 2345
revising the employee’s sales or display catalogue,
planning itineraries and attending sales conferences.
29 C.F.R. § 541.500(b).
The Secretary’s outside sales regulation references Section
3(k) of the Act. 29 C.F.R. § 541.500(a). Section 3(k) provides
that “ ‘[s]ale’ or ‘sell’ includes any sale, exchange, contract to
sell, consignment for sale, shipment for sale, or other disposi-
tion.” 29 U.S.C. § 203(k). The Secretary’s regulations pro-
vide:
Sales within the meaning of section 3(k) of the Act
include the transfer of title to tangible property, and
in certain cases, of tangible and valuable evidences
of intangible property. Section 3(k) of the Act states
that “sale” or “sell” includes any sale, exchange,
contract to sell, consignment for sale, shipment for
sale, or other disposition.
29 C.F.R. § 541.501(b).
In the regulations, the Secretary draws a distinction
between sales work and promoting:
Promotion work is one type of activity often per-
formed by persons who make sales, which may or
may not be exempt outside sales work, depending
upon the circumstances under which it is performed.
Promotional work that is actually performed inciden-
tal to and in conjunction with an employee’s own
outside sales or solicitations is exempt work. On the
other hand, promotional work that is incidental to
sales made, or to be made, by someone else is not
exempt outside sales work.
29 C.F.R. § 541.503(a). To illustrate the concept of promoting
sales, as opposed to selling, the Secretary’s regulations pro-
2346 CHRISTOPHER v. SMITHKLINE BEECHAM
vides two examples—a manufacturer’s representative and a
company representative who visits chain stores:
(b) A manufacturer’s representative, for example,
may perform various types of promotional activities
such as putting up displays and posters, removing
damaged or spoiled stock from the merchant’s
shelves or rearranging the merchandise. . . . Promo-
tion activities directed toward consummation of the
employee’s own sales are exempt. Promotional
activities designed to stimulate sales that will be
made by someone else are not exempt outside sales
work. . . .
(c) Another example is a company representative
who visits chain stores, arranges the merchandise on
shelves, replenishes stock by replacing old with new
merchandise, sets up displays and consults with the
store manager when inventory runs low, but does not
obtain a commitment for additional purchases. The
arrangement of merchandise on the shelves or the
replenishing of stock is not exempt work unless it is
incidental to and in conjunction with the employee’s
own outside sales. Because the employee in this
instance does not consummate the sale nor direct
efforts toward the consummation of a sale, the work
is not exempt outside sales work.
29 C.F.R. § 541.503(b)-(c).
In a FLSA overtime-wage case, the question of how an
employee spends his or her workday is one of fact, while the
question of whether his or her activities exclude him or her
from the overtime-pay requirement is one of law. See Icicle
Seafoods v. Worthington, 475 U.S. 709, 714 (1986); Bratt v.
Cnty. of Los Angeles, 912 F.2d 1066, 1068 (9th Cir. 1990).
Although the outside sales exemption is more than seven dec-
ades old, our encounters with the exemption are few and lim-
CHRISTOPHER v. SMITHKLINE BEECHAM 2347
ited to the class-certification context. See In re Wells Fargo
Home Mortg. Overtime Pay Litig., 571 F.3d 953 (9th Cir.
2009); Vinole, 571 F.3d at 939, 945. Thus, whether a PSR’s
job duties make him or her an outside salesperson is a ques-
tion of first impression for our court.
We construe the outside sales exemption consistent with
other Section 13(a) exemptions under the FLSA. The
employer always has the burden of showing the exemption
applies to its employee. Bratt, 912 F.2d at 1069; see also
Nigg, 555 F.3d at 788. The exemption can only apply to per-
sons “plainly and unmistakably within [its] terms and spirit.”
Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392 (1960);
Klem v. Cnty. of Santa Clara, 208 F.3d 1085, 1089 (9th Cir.
2000). Because exemptions are “narrowly construed” against
the employer, to meet its burden, an employer must establish
that the employee satisfies each of the criteria set forth in the
Secretary of Labor’s regulations. See Bratt, 912 F.2d at 1069;
see also Wang v. Chinese Daily News, Inc., 623 F.3d 743, 751
(9th Cir. 2010). Reviewing a FLSA exemption is well under-
stood to be “a fact-intensive” inquiry. Vinole, 571 F.3d at 945
(citation omitted).
II. Whether Deference to the Secretary’s Position is
Appropriate
[3] The Secretary’s appearance as amicus supporting
Plaintiffs requires us to determine what, if any, deference we
must accord to her view that PSRs do not meet the primary
duties test for the outside sales exemption. The Secretary also
advocated this construction of the regulations before the Sec-
ond Circuit in Novartis. 611 F.3d at 149. Although the Novar-
tis court held that Secretary’s interpretation was owed Auer
deference, 611 F.3d at 153, our review of the relevant authori-
ties leads us to a different conclusion. We conclude that we
owe no deference to the Secretary’s current interpretation of
the regulations, and, in any event, we respectfully disagree
with that interpretation.
2348 CHRISTOPHER v. SMITHKLINE BEECHAM
A. Administrative Deference in the FLSA
When a question arises as to the meaning of the FLSA or
the Secretary’s regulations, we apply traditional rules of con-
struction and, where required, administrative deference. See,
e.g., Webster v. Pub. Sch. Emp. of Wash., Inc., 247 F.3d 910,
915 (9th Cir. 2001) (citing Auer, 519 U.S. at 457). Thus, if the
language of a statute or regulation is unambiguous, we apply
the terms as written. See Christensen v. Harris Cnty., 529
U.S. 576, 588 (2000) (“[D]eference is warranted only when
the language of the regulation is ambiguous.”); Chevron, 467
U.S. at 842-43 (“If the intent of Congress is clear, that is the
end of the matter; for the court, as well as the agency, must
give effect to the unambiguously expressed intent of Con-
gress.”). By contrast, when Congress has not “directly spoken
to the precise question at issue,” Auer, 519 U.S. at 457, we
will defer to the Secretary’s regulation “so long as it is ‘based
on a permissible construction of the statute.’ ” Id. (citing
Chevron, 467 U.S. at 842-43). If the Secretary’s regulations
are themselves ambiguous, and the Secretary uses her rule-
making authority to provide clarity, we give controlling defer-
ence to the Secretary’s view unless it is “plainly erroneous or
inconsistent with the regulation.” Auer, 519 U.S. at 461 (cita-
tion and internal quotation mark omitted); see also Christen-
sen, 529 U.S. at 586-87, 588 (“Auer deference is warranted
only when the language of the regulation is ambiguous.”); cf.
In re Farmers Ins. Exch., Claims Representatives’ Overtime
Pay Litig., 481 F.3d 1119, 1129 (9th Cir. 2007) (“We must
give deference to the DOL’s interpretation of its own regula-
tions through, for example, Opinion Letters.”). Lastly, if the
Secretary interprets an unambiguous statute by way of an
opinion letter, enforcement guidelines, or the like, her opinion
is merely “entitled to respect” to the extent the interpretation
has the “power to persuade” the court. See Christensen, 529
U.S. at 587 (citing Skidmore v. Swift & Co., 323 U.S. 134,
140 (1944)).
CHRISTOPHER v. SMITHKLINE BEECHAM 2349
B. In re Novartis Wage & Hour Litigation
In Novartis, the Second Circuit held that PSRs did not meet
the requirements of the outside sales exemption. As it has
done here, the DOL took the position that “when an employee
promotes to a physician a pharmaceutical that may thereafter
be purchased by a patient from a pharmacy . . . the employee
does not in any sense make the sale.” Novartis, 611 F.3d at
153. In reviewing the Secretary’s position, the Second Circuit
laid out the relevant statutory and regulatory history and
focused its attention on the Secretary’s regulations, and, in
particular, the Preamble in the 2004 Rule which “emphasized
that no one could be considered a salesman within these regu-
lations unless he in some sense made a sale.” Id. at 152. The
Novartis court highlighted a series of comment letters sent to
the DOL by manufacturers’ associations and industry trade
groups that had requested “the Department [ ] eliminate the
emphasis upon an employee’s ‘own’ sales . . . because of
team selling, customer control of order processing, and
increasing computerization of sales and purchasing activities.
. . .” 69 Fed. Reg. at 22,162. The United States Chamber of
Commerce emphasized that “promotional activities, even
when they do not culminate in an individual sale, are nonethe-
less an integral part of the sales process.” Id. Based on these
concerns, the DOL made a “minor change” to “address com-
menter concerns that technological changes in how orders are
taken and processed should not preclude the exemption for
employees whose primary duty is making sales.” Id. The 2004
Rule continues: “[T]he Department does not intend to change
any of the essential elements required for the outside sales
exemption, including the requirement that the outside sales
employee’s primary duty must be to make sales or to obtain
orders or contracts for services. An employer cannot meet this
requirement unless it demonstrates objectively that the
employee, in some sense, has made sales.” Id.
The Novartis court also quoted the Preamble’s elaboration
of the primary-duty standard: “Employees have a primary
2350 CHRISTOPHER v. SMITHKLINE BEECHAM
duty of making sales if they ‘obtain a commitment to buy’
from the customer and are credited with the sale.’ ” 611 F.3d
at 152 (quoting 69 Fed. Reg. at 22,162) (emphasis in origi-
nal). The Secretary’s interpretation is based on a 1949 DOL
interpretation, which provided: “In borderline cases the test is
whether the person is actually engaged in activities directed
toward the consummation of his own sales, at least to the
extent of obtaining a commitment to buy from the person to
whom he is selling. If his efforts are directed toward stimulat-
ing the sales of his company generally rather than the con-
summation of his own specific sales his activities are not
exempt.” 69 Fed. Reg. at 22,162-63 (citation omitted).
The Second Circuit determined that the Secretary’s regula-
tions “do far more than merely parrot the language of the
FLSA.” Novartis, 611 F.3d at 153. For that reason, “the Sec-
retary’s interpretations of her regulations are [ ] entitled to
‘controlling’ deference unless those interpretations are
‘plainly erroneous or inconsistent with the regulation.’ ” Id.
(quoting Auer, 519 U.S. at 461 (internal quotation omitted)).
The Novartis court could find no inconsistencies or errors in
the Secretary’s amicus position. Id. The court stated it did not
believe the distribution practices of the drug company consti-
tuted an “other disposition,” as that term is used in the FLSA.
Rather, the court said that because “other disposition” fol-
lowed a line of words which, apparently, emphasized “a sale”
being consummated, “other disposition” was not intended as
a “catch-all” category. Id. Ultimately, the Novartis court sum-
marized its reasoning:
[W]here the employee promotes a pharmaceutical
product to a physician but can transfer to the physi-
cian nothing more than free samples and cannot law-
fully transfer ownership of any quantity of the drug
in exchange for anything of value, cannot lawfully
take an order for its purchase, and cannot lawfully
even obtain from the physician a binding commit-
ment to prescribe it, we conclude that it is not plainly
CHRISTOPHER v. SMITHKLINE BEECHAM 2351
erroneous to conclude that the employee has not in
any sense, within the meaning of the statute or the
regulations, made a sale.
Id. at 154.
C. Deference Owed in this Case
[4] Our view of the level of deference we owe to the Sec-
retary in this matter is best captured by the Supreme Court’s
instruction in Gonzales v. Oregon: “An agency does not
acquire special authority to interpret its own words when,
instead of using its expertise and experience to formulate a
regulation, it has elected merely to paraphrase the statutory
language.” 546 U.S. 243, 257 (2006); see also Chase Bank
USA, N.A. v. McCoy, 562 U.S. ___, (slip op. at 15) (Jan. 24,
2011) (“Accordingly, no deference was warranted to an
agency interpretation of what were, in fact, Congress’
words.”); N. Cal. River Watch v. Wilcox, 620 F.3d 1075, 1088
(9th Cir. 2010) (“Here, the three rules cited by the United
States essentially parrot the statutory language.”). The “par-
roting” with which the Gonzales Court took issue is present
in the Secretary’s interpretation of Section 3(k).
According to the Secretary’s regulations, a salesman is
someone who either “mak[es] sales within the meaning of
section 3(k) of the Act” or someone who “obtain[s] orders or
contracts.” 29 C.F.R. 541.500(a)(1). Since there is no dispute
that PSRs do not obtain orders for anything, only the “sales”
element is relevant here. To define “sales within the meaning
of section 3(k),” we look to 29 C.F.R. § 541.501(b), which
provides that “[s]ales within the meaning of section 3(k) of
the Act include the transfer of title to tangible property, and
in certain cases, of tangible and valuable evidences of intangi-
ble property.” Section 3(k) of the Act states that “ ‘[s]ale”’ or
‘sell’ includes any sale, exchange, contract to sell, consign-
ment for sale, shipment for sale, or other disposition.” 29
U.S.C. § 203(k). Thus, the Secretary has given us two mean-
2352 CHRISTOPHER v. SMITHKLINE BEECHAM
ings with which to set the boundaries of the sales exemption.
First, in 29 C.F.R. § 541.501(b), the Secretary provides an
open-ended definition that sales, unsurprisingly, “include the
transfer of title to tangible property.” In the next sentence, the
Secretary cross-references back to the language of Section
3(k) of the Act—the very language purportedly being defined.
Accordingly, the Secretary’s regulations define “sale” or
“sell” by statutory renvoi—that is, a “sale” means a “sale.”
This clarifies nothing about the meaning of Section 3(k); it
merely incorporates the very undefined, very un-delimited
term the Secretary seeks to clarify. A definition dependent
almost entirely on Congress’s seventy-two-year old statutory
language is not an example of the DOL employing its “exper-
tise” to elucidate meaning to which we owe Auer deference.
See N. Cal. River Watch, 620 F.3d at 1085-87.
In Gonzales v. Oregon, the Supreme Court confronted an
analogous situation when it rejected the Attorney General’s
regulatory attempt to frustrate the implementation of Ore-
gon’s Death with Dignity Act. In that case, Oregon statutory
law exempted licensed physicians from liability when they
prescribed medication to hasten death for terminally ill indi-
viduals. 546 U.S. at 249-54. In 2001, shortly after a change
of presidential administration, the Attorney General promul-
gated a new interpretive rule that restricted the use of con-
trolled substances in physician-assisted suicides. Id. at 254. In
defending that rule, the government contended in its appeal
that the judiciary was required to give “considerable defer-
ence” to the Attorney General’s interpretive rule as it was “an
elaboration of one of [his] own regulations.” Id. at 256. In
rejecting that contention, the Supreme Court drew meaningful
distinctions with its decision in Auer:
In Auer, the underlying regulations gave specificity
to a statutory scheme the Secretary was charged with
enforcing and reflected the considerable experience
and expertise the [DOL] had acquired over time.
CHRISTOPHER v. SMITHKLINE BEECHAM 2353
. . . Here, on the other hand, the underlying regula-
tion does little more than restate the terms of the
statute itself. The language the Interpretive Rule
addresses comes from Congress, not the Attorney
General, and the near equivalence of the statute and
regulation belies the Government’s argument for
Auer deference.
Id. at 256-57 (emphasis added).
[5] The failure to add specificity to the statutory scheme
that troubled the Gonzales Court, indeed the “parroting” of
statutory language, is present in the Secretary’s outside sales
regulations. Rather than setting forth a particular test for
“sale” or instructing employers to look for indicia of sales, the
Secretary’s regulations direct employers, employees, and this
court back to the language of the FLSA. Given the admoni-
tion in Gonzales, we are unable to accord Auer deference to
a regulation written in this manner.
[6] Thus, when we look to the Secretary’s brief for her
application of the regulations, we see only a reinterpretation
of Section 3(k). Rather than applying the regulation to the
facts presented, the Secretary has used her appearance as
amicus to draft a new interpretation of the FLSA’s language.
Were we to accept the Secretary’s offer, and give controlling
deference even where there exists no meaningful regulatory
language to interpret, we would unduly expand Auer’s appli-
cability to interpretations of statutes expressed for the first
time in case-by-case amicus filings. See N. Cal. River Watch,
620 F.3d at 1088 (“In this case, the amicus brief purports to
interpret statutory, not regulatory, language.”). In essence, we
would sanction bypassing of the Administrative Procedures
Act and notice-and-comment rulemaking. C.f. Christensen v.
Harris Cnty., 529 U.S. 576, 587 (2000) (“Here, however, we
confront an interpretation contained in an opinion letter, not
one arrived at after, for example, a formal adjudication or
notice-and-comment rulemaking.”). Accordingly, we hold
2354 CHRISTOPHER v. SMITHKLINE BEECHAM
that we need not give “controlling” deference to the Secre-
tary’s interpretations in this matter.7 Furthermore, even if
Auer applied, deference is not warranted because the Secre-
tary’s position is both plainly erroneous and inconsistent with
her own regulations and practices, as demonstrated in the
analysis that follows.
III. “Sales” and “Selling” in the Pharmaceutical
Industry
Absent an agency-determined result, it is the province of
the court to construe the relevant statutes and regulations. N.
Cal. River Watch, 620 F.3d at 1088-89. As noted supra,
Plaintiffs argue that by not transferring any product to physi-
cians, they are not selling pharmaceuticals, but only “promot-
ing” them. Plaintiffs say this distinction is warranted in light
of the rule that the FLSA be “narrowly construed against . . .
employers.” Webster, 247 F.3d at 914. For its part, Glaxo
urges us to view “sale” in Section 3(k) in a commonsensical
fashion, while contending that the meaning of “sale” is per-
missive. Glaxo urges us to adopt the rationale that the phrase
“other disposition” in Section 3(k)’s definition of “sale” is a
broad catch-all category.8 This view was cited with approval
by the district court here, and is supported by the Secretary’s
usage, dating back to 1940, of the language that an employee
must “in some sense make a sale.” 69 Fed. Reg. at 22,162
(quoting “Executive, Administrative, Professional Outside
Salesman” Redefined, Wage and Hour Division, U.S. Dept. of
Labor, Report & Recommendations of the Presiding Officer
7
As explained infra, we likewise find unpersuasive the Secretary’s inter-
pretation of the FLSA provisions, thus vitiating any Skidmore deference.
See Section III.
8
See Steven I. Locke, The Fair Labor Standards Acts Exemptions and
the Pharmaceuticals Industry: Are Sales Representatives Entitled to Over-
time?, 13 Barry L. Rev. 1, 25 (2009) (“Applying these [common-usage]
definitions, it is logical to conclude that the term ‘other disposition,’ as it
is used to define a ‘sale’ under the Act, includes a physician’s decision to
write a prescription for a particular medication.”).
CHRISTOPHER v. SMITHKLINE BEECHAM 2355
(Harold Stein) at Hearings Preliminary to Redefinition, at 46
(Oct. 10, 1940)) (emphasis added).
[7] Plaintiffs’ contention that they do not “sell” to doctors
ignores the structure and realities of the heavily regulated
pharmaceutical industry. It is undisputed that federal law pro-
hibits pharmaceutical manufacturers from directly selling pre-
scription medications to patients. Plaintiffs suggest that
despite being hired for their sales experience, being trained in
sales methods, encouraging physicians to prescribe their prod-
ucts, and receiving commission-based compensation tied to
sales, their job cannot “in some sense” be called selling. This
view ignores the reality of the nature of the work of detailers,
as it has been carried out for decades. Plaintiffs’ argument
also fails to account for the fact that the relevant “purchasers”
in the pharmaceutical industry, and the appropriate foci of our
inquiry, are not the end-users of the drug but, rather, the pre-
scribing physicians whom they importune frequently. See,
e.g., Baum v. AstraZeneca LP, 605 F. Supp. 2d 669, 678-79
(W.D. Pa. 2009) (discussing why the “professional paradigm”
places the physician as the relevant decision maker in the
health services industry), aff’d on other grounds, 372 Fed.
App’x 246 (3d Cir. 2010). Unlike conventional retail sales,
the patient is not at liberty to choose personally which pre-
scription pharmaceutical he desires. As such, he cannot be
fairly characterized as the “buyer.” Instead, it is patient’s phy-
sician, who is vested with both a moral and legal duty to pre-
scribe medication appropriately, who selects the medication
and is the appropriate focus of our “sell/buy” inquiry. In this
industry, the “sale” is the exchange of non-binding commit-
ments between the PSR and physician at the end of a success-
ful call. Through such commitments, the manufacturer will
provide an effective product and the doctor will appropriately
prescribe; for all practical purposes, this is a sale. Because
pharmaceutical manufacturers appreciate who the “real”
buyer is, they have structured their 90,000-person sales force
and their marketing tactics to accommodate this unique envi-
ronment.
2356 CHRISTOPHER v. SMITHKLINE BEECHAM
[8] When a PSR visits a doctor, he or she attempts to
obtain the absolute maximum commitment from his or her
“buyer”—a non-binding commitment from the physician to
prescribe the PSR’s assigned product when medically appro-
priate. In most industries, there are no firm legal barriers that
prohibit the actual physical exchange of the goods offered for
sale. Because such barriers do exist in this industry, the fact
that commitments are non-binding is irrelevant; the record
reveals that binding or non-binding, a physician’s commit-
ment to a PSR is nevertheless a meaningful exchange because
pharmaceutical manufacturers value these commitments
enough to reward a PSR with increased commissions when a
physician increases his or her use of a drug in the PSR’s bag.
See, e.g., Baum, 605 F. Supp. 2d at 681 (“This Court believes
that other courts, and perhaps regulatory agencies, underesti-
mate the significance of this oral commitment from physi-
cians. In part, this error emerges from a misunderstanding of
the ways in which human beings are socially and informally
motivated. Sometimes lawyers and judges forget that a per-
son’s word means something; remarkably, many people do
not actually need a 400-page contract to bind themselves to
their word.”).
Moreover, the industry has agreed upon and abides by the
PhRMA Code to regulate the marketing of medicine to
healthcare professionals—just as any consumer-products
maker might develop rules to limit the express warranties its
sales force might offer to a customer. Such industry practice
and prevailing customs should inform our disposition. Cf. Rei-
seck v. Universal Commc’ns of Miami, Inc., 591 F.3d 101,
106 (2d Cir. 2010) (in resolving whether advertising sales
director was an administrative or sales worker in the publish-
ing industry “a careful consideration of [employer’s] business
model provides some clarity”).
Under Plaintiffs’ view, PSRs are not salespeople, despite
the fact that more than 90,000 pharmaceutical representatives
make daily calls on physicians for the purpose of driving
CHRISTOPHER v. SMITHKLINE BEECHAM 2357
greater sales. See IMS Health, 616 F.3d at 14. We cannot
square this view with Section 3(k)’s open-ended use of the
word “sale,” which includes “other disposition[s].” While we
recognize that the FLSA is to be narrowly construed in light
of its remedial nature, that general principle does not mean
that every word must be given a rigid, formalistic interpreta-
tion. For example, for over seventy years, the Secretary has
emphasized a sensible application of the exemptions; in the
Preamble to the 2004 Rule, the Secretary employs the open-
ended concept that a salesman is someone who “in some
sense” sells. 69 Fed. Reg. at 22,162-63 (emphasis added). In
other words, while the Secretary asks us to narrowly interpret
this exemption, she herself acknowledges that technical con-
siderations alone and changes in the way sales are made
should not be grounds for denying the exemption. See 69 Fed.
Reg. at 22,162.
To further explain our common sense understanding of why
PSRs make sales, we find the paradigm “outside salesman”
case Jewel Tea Co. v. Williams—instructive. 118 F.2d 202
(10th Cir. 1941). The importance of Jewel Tea is illustrated
by the fact that both parties and the amicus offer it as favor-
able precedent for their conflicting positions.
Jewel Tea involved a FLSA overtime-wage suit brought by
three employees of a tea, coffee, and sundry goods manufac-
turer and distributor. 118 F.2d at 203. The plaintiffs held the
position of “route salesmen” to “sell and distribute” products
to customers in their homes. Id. The area in which the com-
pany sold its goods was divided and “[e]ach salesman [was]
assigned an exclusive territory which he cover[ed].” Id. The
employees made no immediate deliveries but instead took
orders for future delivery, although they might advance an
item to a customer. Id. The company provided sales training
and sent a supervisor with a new hire on early sales calls
before permitting the employee to “go out on a route by him-
self.” Id. at 204. Further, employees were taught a “five-point
sale” method to employ when speaking with customers. Id. A
2358 CHRISTOPHER v. SMITHKLINE BEECHAM
certain degree of knowledge about the products and potential
customers was also required—“[t]he salesman must know
recipes for the preparation of the Company’s products . . .
[and] must learn the general requirements of each family, in
order to avoid over-stocking his customer and in order to
anticipate the family’s needs.” Id. After working in the field
during the day, employees completed some clerical tasks at
night. Id. at 205. Finally, employees were paid a base salary
plus a commission if their collections were in excess of a sum
certain. Id.
The Jewel Tea plaintiffs brought suit to collect unpaid
overtime, asserting they did not fall within the “outside sales”
exemption, primarily employing the argument that they were
“delivery men.” Id. at 208. In its decision denying plaintiffs
overtime pay, the Tenth Circuit penned the oft-quoted justifi-
cation for the outside sales exemption:
The reasons for excluding an outside salesman are
fairly apparent. Such salesman, to a great extent,
works individually. There are no restrictions respect-
ing the time he shall work and he can earn as much
or as little, within the range of his ability, as his
ambition dictates. In lieu of overtime, he ordinarily
receives commissions as extra compensation. He
works away from his employer’s place of business,
is not subject to the personal supervision of his
employer, and his employer has no way of knowing
the number of hours he works per day. To apply
hourly standards primarily devised for an employee
on a fixed hourly wage is incompatible with the indi-
vidual character of the work of an outside salesman.
Id. at 207-08.
[9] Reviewing the undisputed facts here, we consider the
rationale for applying the outside sales exemption to PSRs to
be as “apparent” as it was in Jewel Tea. Of course, this case
CHRISTOPHER v. SMITHKLINE BEECHAM 2359
does not involve door-to-door consumer-product sales. But,
the FLSA is not an industry-specific statute. As the Second
Circuit recognized in Reiseck, not all FLSA claims will
involve the “archetypal businesses envisaged by the FLSA,”
591 F.3d at 106. Even though there are differences, it is nota-
ble that the salesmen in Jewel Tea and Plaintiffs here each (1)
worked in assigned territories, (2) did not make immediate
deliveries, (3) were required to analyze client backgrounds,
(4) received product training, (5) employed a pre-planned rou-
tine for client interaction, (6) were accompanied by supervi-
sors for training, (7) were later subject to minimal supervisor
oversight, (8) completed clerical activities at the end of the
day, and (9) had a dual salary and commission-based compen-
sation plan tied to their performance. Even though PSRs lack
some hallmarks of the classic salesman, the great bulk of their
activities are the same, as is the overarching purpose of
obtaining a commitment to purchase (prescribe) something.
[10] The primary duty of a PSR is not promoting Glaxo’s
products in general or schooling physicians in drug develop-
ment. These are but preliminary steps toward the end goal of
causing a particular doctor to commit to prescribing more of
the particular drugs in the PSR’s drug bag. Without this com-
mitment and the concomitant increase in prescriptions, or
drug volume, or market share—i.e. without more sales—the
PSR would not receive his or her commission salary and
could soon find himself or herself unemployed. While not all
steps in the PSR’s daily activities constitute “selling,” that
fact does not render the totality of those activities non-exempt
promotion; “work performed incidental to and in conjunction
with the employee’s own outside sales or solicitations . . .
shall be regarded as exempt outside sales work . . . [and] . . .
other work that furthers the employee’s sales efforts also shall
be regarded as exempt work.” 29 C.F.R. § 541.500(b).
The Secretary’s distinction between selling and promoting
is only meaningful if the employee does not engage in any
activities that constitute “selling” under the Act. This much is
2360 CHRISTOPHER v. SMITHKLINE BEECHAM
seen from the plain language of the regulations, which gives
the example of promotional work as “a company representa-
tive who visits chain stores, arranges the merchandise on
shelves, replenishes stock by replacing old with new mer-
chandise, sets up displays and consults with the store manager
when inventory runs low, but does not obtain a commitment
for additional purchases.” 29 C.F.R. § 541.503(c) (emphasis
added). PSRs do far more than collect general data or provide
consultations; indeed they ask for, and sometimes obtain, a
commitment by the doctor to prescribe Glaxo drugs, and
whether the doctor keeps that commitment is verified and
traced using aggregated pharmacy data Glaxo collects. See
IMS Health, 550 F.3d at 44-47 (“A valuable tool in this
endeavor, available through the omnipresence of computer-
ized technology, is knowledge of each individual physician’s
prescribing history.”).
In Reisick, the Second Circuit highlighted an important dis-
tinction between selling and promoting, noting that the latter
is directed to the public at large, as opposed to a particular cli-
ent:
Consider a clothing store. The individual who assists
customers in finding their size of clothing or who
completes the transaction at the cash register is a
salesperson under the FLSA, while the individual
who designs advertisements for the store or decides
when to reduce prices to attract customers is an
administrative employee for the purposes of the
FLSA.
Reiseck, 591 F.3d at 107. At Glaxo, Plaintiffs had no interest
in “generally” promoting sales by the company or improving
sales across the board. Rather, Plaintiffs directed their sales
efforts only towards certain products, only to a discrete group
of physicians, and only within a defined geographic area. Tar-
geting physicians is not based on mass appeals or general
advertisements, but is the result of a personalized review of
CHRISTOPHER v. SMITHKLINE BEECHAM 2361
each physician’s prescribing habits and history. The process,
like any sales process, is tailored to the customer’s prefer-
ences.
[11] We also find that the Secretary’s acquiescence in the
sales practices of the drug industry for over seventy years fur-
ther buttresses our decision. The outside sales exemption has
existed since 1938. Detail men have practiced their craft over
that same period. Generally, they have been considered sales-
people.9 Until the Secretary’s appearance in Novartis, the
DOL did not challenge the conventional wisdom that detailing
is the functional equivalent of selling pharmaceutical prod-
ucts. Indeed, the DOL has recognized as much in its Dictio-
nary of Occupation Titles, which provides the following
definition for pharmaceutical detailers:
9
See N. Cal. Pharm., 306 F.2d at 386 (9th Cir. 1962) (“ ‘Detail men,’
or local sales representatives. . .”); see also IMS Health, 550 F.3d at 54
(“In the service of maximizing drug sales, detailers use prescribing histo-
ries as a means of targeting potential customers more precisely and as a
tool for tipping the balance of bargaining power in their favor. As such,
detailing affects physician behavior and increases the likelihood that phy-
sicians will prescribe the detailers’ (more expensive) drugs.” (emphasis
added)); Williams v. Bristol-Myers Squibb, Co., 85 F.3d 270, 273 (7th Cir.
1996) (“Federal law requires a maker of prescription drugs to have a sam-
ples control program designed to prevent its salesmen, who frequently
give free samples to the physicians they call on, from distributing prescrip-
tion drugs outside authorized channels.”); Sun Ray Drug, 320 F.2d at 74
(“efforts on the part of its detail men (who are salesmen)”); Beale v. Bio-
met, Inc., 492 F. Supp. 2d 1360, 1377 (S.D. Fla. 2007) (“In each of these
cases, the courts found that the drugs were overpromoted by salesmen
known as ‘detail men,’ who visited physicians’ offices and encouraged
physicians to prescribe the drug.”); Skill v. Martinez, 91 F.R.D. 498, 508
(D.N.J. 1981) (“comments by drug “‘detail men’ (drug salesmen who visit
physicians)”); Smith, Kline & French Lab. v. State Tax Comm’n, 403 P.2d
375, 378 (Or. 1965) (“By soliciting the stocking of plaintiff’s products by
druggists and the prescription of those drugs by physicians, plaintiff ’s
detail men perform the same sales function in plaintiff’s field that sales-
men soliciting actual orders from the ultimate user perform in other busi-
nesses.”).
2362 CHRISTOPHER v. SMITHKLINE BEECHAM
Promotes use of and sells ethical drugs and other
pharmaceutical products to physicians, [dentists],
hospitals, and retail and wholesale drug establish-
ments, utilizing knowledge of medical practices,
drugs, and medicines: Calls on customers, informs
customer of new drugs, and explains characteristics
and clinical studies conducted with drug. Discusses
dosage, use, and effect of new drugs and medicinal
preparations. Gives samples of new drugs to cus-
tomer. Promotes and sells other drugs and medicines
manufactured by company. May sell and take orders
for pharmaceutical supply items from persons con-
tacted.
D.O.L. Dictionary of Occupational Titles § 262.157-010 (4th
ed. 1991) (emphases added). Likewise, although it emerged in
a different context, we find Judge Posner’s observation in Yi
v. Sterling Collison Centers, Inc., 480 F.3d 505, 510-11 (7th
Cir. 2007), informative—while it is “possible for an entire
industry to be in violation of the [FSLA] for a long time with-
out the Labor Department noticing[, the] more plausible
hypothesis is that the . . . industry has been left alone”
because DOL believed its practices were lawful.
[12] In view of many similarities between PSRs and sales-
people in other fields, pharmaceutical industry norms, and the
acquiescence of the Secretary over the last seventy-plus years,
we cannot accord even minimal Skidmore deference to the
position expressed in the amicus brief. Under Skidmore, “[t]he
fair measure of deference to an agency administering its own
statute has been understood to vary with circumstances, and
courts have looked to the degree of the agency’s care, its con-
sistency, formality, and relative expertness, and to the persua-
siveness of the agency’s position.” United States v. Mead
Corp., 533 U.S. 218, 228 (2001) (internal citations omitted);
see also League of Wilderness Defenders v. Forsgren, 309
F.3d 1181, 1189 (9th Cir. 2002) (quoting Skidmore, 323 U.S.
at 140) (internal quotation marks omitted). Many, if not all,
CHRISTOPHER v. SMITHKLINE BEECHAM 2363
of these hallmarks of “respectful” deference are absent here.
The about-face regulation, expressed only in ad hoc amicus
filings, is not enough to overcome decades of DOL nonfea-
sance and the consistent message to employers that a sales-
man is someone who “in some sense” sells. Moreover, we are
unable to accept an argument that fails to account for industry
customs and emphasizes formalism over practicality, in par-
ticular the argument that “obtaining a commitment to buy” is
the sine qua non of the exemption. Under the Secretary’s
view, “sale” means unequivocally the final execution of a
legally binding contract for the exchange of a discrete good.
In addition to the point that such stringent wording is not
found in Section 3(k), or plausibly implied from phrases like
“other disposition,” the Secretary’s approach transforms what
since the time of Jewel Tea has been recognized as a multi-
factor review of an employee’s functions into a single, stag-
nant inquiry.
Telephones, television, shopping malls, the Internet and
general societal progress have largely relegated the profes-
sional pitchman embodied in Jewel Tea to the history books.
But selling continues, and, as in prior eras, a salesperson
learns the nuances of a product and those of his or her poten-
tial clientele, tailors a scripted message based on intuition
about the customer, asks for the customer to consider her need
for the product, and then receives a commission when the cus-
tomer’s positive impression ultimately results in a purchase.
[13] For the past seventy-plus years, selling in the pharma-
ceutical industry has followed this process. PSRs are driven
by their own ambition and rewarded with commissions when
their efforts generate new sales. They receive their commis-
sions in lieu of overtime and enjoy a largely autonomous
work-life outside of an office. The pharmaceutical industry’s
representatives—detail men and women—share many more
similarities than differences with their colleagues in other
sales fields, and we hold that they are exempt from the FLSA
overtime-pay requirement.
2364 CHRISTOPHER v. SMITHKLINE BEECHAM
CONCLUSION
For the foregoing reasons, we AFFIRM the district court’s
summary judgment for Defendant-Appellee SmithKline Bee-
cham Corporation.
AFFIRMED.