Sigrid Williams v. Costco

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS OCT 29 2021
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT

SIGRID R. WILLIAMS, on behalf of herself No. 20-16455
and all others similarly situated,
D.C. No. 4:18-cv-00884-JSW
Plaintiff-Appellant,

v. MEMORANDUM*

COSTCO WHOLESALE CORPORATION,
a Washington corporation,

Defendant-Appellee.

Appeal from the United States District Court
for the Northern District of California
Jeffrey S. White, District Judge, Presiding

Argued and Submitted October 22, 2021
San Francisco, California

Before: WATFORD and HURWITZ, Circuit Judges, and BAKER,** International
Trade Judge.

Sigrid Williams appeals from a summary judgment to Costco Wholesale

Corporation on her wage and hour claims under California law and the Fair Labor

*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable M. Miller Baker, Judge for the United States Court of
International Trade, sitting by designation.
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Standards Act (FLSA). We affirm.

1. Williams argues that Costco is liable as a client employer under

California Labor Code § 2810.3 because the independent contractor staffing

agencies (Nichols and Flair) that hired her provided workers to perform labor on

Costco’s premises. However, the district court correctly concluded that Williams

failed to raise a genuine issue for trial whether her work selling suppliers’ products

at road show events fell within Costco’s “usual course of business.” Cal. Labor

Code § 2810.3(a)(1)(A).

In support of its motion for summary judgment, Costco presented

declarations showing that road shows are discrete events; account for no more than

0.5% of Costco’s warehouse sales in California; and, most importantly, operate

through a different economic model than Costco’s other lines of business. While

most Costco products are purchased in bulk and re-sold to customers, road show

merchandise is sold on consignment by sales representatives engaged by the

supplier. In response, Williams offered only the assertion that Costco’s usual

course of business is “demonstrating and selling merchandise to Costco customers”

and evidence of other similar lawsuits brought against Costco. She presented no

evidence to dispute Costco’s factual assertions and no evidence to suggest that,

notwithstanding the distinctions identified by Costco, road shows are sufficiently

similar to Costco’s other selling activities to fall within its usual course of
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business.

2. Williams also contends that, although she was hired and paid by Nichols

and Flair, Costco shares their liability for wage and hour violations as a joint

employer under Martinez v. Combs, 231 P.3d 259 (Cal. 2010). Martinez

establishes three alternative definitions for determining whether an entity

“employs” an individual. The entity must (1) “exercise control” over the

individual’s “wages, hours, or working conditions”; (2) “suffer or permit” the

individual to work; or (3) “engage” the individual, creating a common law

employment relationship. Id. at 278. The district court concluded that Costco was

not Williams’s employer under any of these definitions. On appeal, Williams

challenges only the court’s conclusions as to the first two definitions.

First, the district court correctly concluded that Costco did not control

Williams’s wages, hours, or working conditions. The record shows that Nichols

and Flair hired and paid Williams, scheduled her work on particular road shows,

set the length of her shifts, trained her, and set her sales targets. Williams does not

contest these facts, instead pointing to other evidence of Costco’s alleged control

over her work, such as dress code guidelines, a policy requiring the booth to be

staffed at all times, and an incident in which a Costco manager told her that she

could not leave until the last customer had exited the store. But Williams’s

evidence consists entirely of “activities in the areas of quality control and contract
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compliance,” and Martinez held such activities insufficient to establish that an

entity is a joint employer. Id. at 286. The fact that Williams interacted directly

with Costco staff without any Nichols or Flair managers present does not alone

establish that Costco controlled Williams’s work.

Second, the district court correctly concluded that Costco did not “suffer or

permit” Williams to work. Williams argues that Costco employed her under this

definition because it could stop her from working by barring her from a Costco

warehouse. However, Nichols and Flair indisputably retained the exclusive

contractual power to fire Williams, and her evidence does not raise a triable issue

as to whether Costco had the practical authority to cause her to be fired. Cf.

Medina v. Equilon Enters., LLC, 283 Cal. Rptr. 3d 868, 875 (Ct. App. 2021)

(denying summary judgment because oil company staff told a service station

operator’s employee that they had the power to fire him and had fired others in the

past). Williams’s claim that Costco knew of and “permitted” the alleged wage and

hour violations also fails because the suffer-or-permit test relates only to

“responsibility for the fact of employment itself,” not responsibility for causing the

labor code violations. Salazar v. McDonald’s Corp., 944 F.3d 1024, 1030 (9th Cir.

2019).

3. The district court correctly concluded that the “ABC” test set forth in

Dynamex Operations West, Inc. v. Superior Court, 416 P.3d 1 (Cal. 2018), does
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not apply to Williams’s joint employment claims. See Salazar, 944 F.3d at 1032

(“[Dynamex] has no bearing here, because no party argues that Plaintiffs are

independent contractors.”).

4. Williams’s briefs do not address the district court’s dismissal of her

FLSA claim. Accordingly, we deem any argument as to this claim waived. See

Indep. Towers of Wash. v. Washington, 350 F.3d 925, 929 (9th Cir. 2003) (“[W]e

will not consider any claims that were not actually argued in appellant’s opening

brief.”).

AFFIRMED.