Weeks v. Matrix Absence Management Incorporated

• Court: District Court, D. Arizona
• Decided: May 25, 2023
• Docket: 2:20-cv-00884
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8

Tina We eks, et al., ) No. CV-20-00884-PHX-SPL ) 9 ) 10 Plaintiffs, ) ORDER vs. ) ) 11 ) Matrix Absence Management ) 12 Incorporated, ) 13 ) ) 14 Defendant. )

15 Before the Court are Defendant’s Motion for Summary Judgment (Doc. 136) and 16 Plaintiffs’ Motion for Partial Summary Judgment (Doc. 138). The Court rules as follows. 17 I. BACKGROUND1 18 Plaintiffs Tina Weeks, Michael McDonald, Cassandra Magdaleno, and Samantha 19 Stocklein bring a claim against Defendant Matrix Absence Management Incorporated for 20 violation of the Fair Labor Standards Act (“FLSA”) for failure to pay overtime. (Doc. 60 21 at 18–21). Plaintiff Stocklein also brings a claim against Defendant for violation of 22 Oregon Wage Law for failure to pay overtime. (Doc. 60 at 21). On November 22, 2022, 23 the Court granted Defendant’s Motion for Decertification of Collective Action and 24 denied Plaintiffs’ Motion to Certify Class, so Plaintiffs have only individual claims 25 remaining. (Doc. 128). 26 Defendant is a licensed third-party administrator that processes leave of absence 27

28 1 The Court recites only undisputed facts in the Background section. 1 (“LOA”), short-term disability (“STD”) and long-term disability (“LTD”) claims for its 2 customers according to the policies, procedures, and criteria in customers’ plans. (Doc. 3 140 ¶¶ 2, 13). Plaintiffs were each employed by Defendant as claims examiners. (Doc. 4 140 ¶¶ 6–8; Doc. 60 ¶ 22). Plaintiffs McDonald and Stocklein worked as AMS Claims 5 Examiners, which involved processing both STD and LOA claims filed under 6 Defendant’s customers’ policies. (Doc. 140 ¶¶ 6, 8). Plaintiff Magdaleno worked as an 7 LOA claims examiner, processing LOA claims filed under Defendant’s customers’ 8 policies. (Doc. 140 ¶ 7). Plaintiff Weeks administered LTD claims. (Doc. 137 ¶ 2). 9 Defendant classified Plaintiffs as exempt from the FLSA under the administrative 10 exemption and paid them on a salary basis. (Doc. 140 ¶ 1). 11 Plaintiffs’ main duty was to process claims, which “require[d] them to review 12 information provided by the client, compare it to client’s policies and guidelines and 13 make a decision on whether to approve or deny a claim.” (Doc. 140 ¶ 9 (internal 14 quotation marks omitted)). All decisions to approve or deny a claim had to comply with 15 legal requirements and the terms of the client’s plan or policy. (Doc. 140 ¶ 34). An 16 incorrect claims decision could expose Defendant’s clients to legal or regulatory issues 17 and financial and reputational harm. (Doc. 137 ¶¶ 85–87). Defendant trained and 18 expected Plaintiffs to follow its own internal guidelines, including best practices and 19 standard operating procedures, when processing claims for its customers. (Doc. 140 20 ¶ 10). 21 Plaintiff Weeks’s primary job duty was overseeing stable and mature LTD claims 22 for the Federal Reserve. (Doc. 137 ¶¶ 2, 6). To perform that job, she interpreted and 23 applied the Federal Reserve’s LTD policy, gathered information to determine whether 24 claimants were still disabled, and made a determination by comparing the medical 25 information to the policy. (Doc. 137 ¶¶ 5, 7, 8). She could seek input from nurses, send 26 out and review activity questionnaires, review a claimant’s social media accounts, have a 27 file reviewed by a vocational specialist, and make decisions to conduct independent 28 medical examinations or outside investigations. (Doc. 137 ¶¶ 9, 12, 13, 15, 17, 18). With 1 her supervisor’s approval, Plaintiff Weeks could have a claimant surveilled, which 2 required her to select a vendor and provide the vendor with necessary information. (Doc. 3 137 ¶ 14). She did not have authority to close a LTD claim, but she made 4 recommendations to her supervisor that claims should be closed, which were always 5 followed except when there was medical information missing. (Doc. 137 ¶¶ 21, 22). 6 Plaintiff McDonald reviewed claims against a client’s policy to determine if an 7 employee was eligible for benefits under the policy. (Doc. 137 ¶ 27). His primary client 8 was XPO Logistics. (Doc. 137 ¶ 26). Plaintiff McDonald interpreted clients’ policies but 9 not a claimant’s medical records. (Doc. 137 ¶ 30). Still, he did not send medical records 10 for nurse review when a claim involved an “obvious” condition like pregnancy or a 11 broken bone. (Doc. 137 ¶ 31). Once he had fully processed a claim, Plaintiff McDonald 12 sent a recommendation to his supervisor for approval. (Doc. 137 ¶ 29). When 13 communicating a denial, he exercised judgment regarding how much information to share 14 with the claimant. (Doc. 137 ¶ 32). 15 Plaintiff Magdaleno’s primary duty was administering Family and Medical Leave 16 Act (“FMLA”), California Family Rights Act, and non-protected leave policy claims for 17 employees of the Dignity Health hospital system. (Doc. 137 ¶¶ 34, 35). When processing 18 Dignity Health claims, she reviewed information received from claimants after their 19 claims passed through an automatic screening for certain eligibility criteria. (Doc. 137 20 ¶ 36). Based on that information, Plaintiff Magdaleno either approved or denied the 21 claim. (Doc. 137 ¶ 36). If a claimant was not eligible for protected leave, she would 22 determine whether they were eligible under Dignity Health’s other leave policies. (Doc. 23 137 ¶ 37). Plaintiff Magdaleno had discretion to decide when she needed a supervisor’s 24 input. (Doc. 137 ¶ 43). In her two or three years in her role, she sought input from a 25 supervisor once or twice a week and passed a claim to her supervisor for a decision once 26 or twice a month; otherwise, Plaintiff Magdaleno had complete autonomy in approving or 27 denying the thousands of claims she handled. (Doc. 137 ¶¶ 52–53). After a claim was 28 approved, Plaintiff Magdaleno looked for abuse of leave, and Dignity Health would 1 contact her if it suspected abuse. (Doc. 137 ¶¶ 44–45). When a claim was flagged as 2 suspicious, she analyzed the claim file; prepared a fact-specific inquiry for a claimant’s 3 doctor if such a follow-up was warranted; and presented the complaint, her findings, and 4 a recommendation to her managers, who generally followed her recommendation. (Doc. 5 137 ¶¶ 46–47). 6 Plaintiff Stocklein administered LOA and STD claims, which required her to 7 assess FMLA guidelines and client policies to determine whether an employee was 8 entitled to leave. (Doc. 137 ¶¶ 58–59). She administered claims from three clients, each 9 of which had a different self-insured STD policy that she had to interpret and apply. 10 (Doc. 137 ¶ 60–61). She used a phone-call script she created to gather relevant 11 information from claimants. (Doc. 137 ¶ 66). When processing STD claims, she input 12 information into a computer system that then generated a recommendation for the number 13 of days of leave the disability supported. (Doc. 137 ¶ 67). If the request was consistent 14 with the computer system’s recommendation, Plaintiff Stocklein could approve the claim 15 for that time period. (Doc. 137 ¶ 167). With more complicated claims, she could seek 16 input from a nurse—and was required to do so for mental health conditions—or the 17 Official Disability Guidelines (“ODG”). (Doc. 137 ¶¶ 67–68, 70). Plaintiff Stocklein was 18 not required to follow either the computer system recommendation or the ODG. (Doc. 19 137 ¶ 69). If she disagreed with a nurse’s assessment, she requested a supervisor’s 20 review. (Doc. 137 ¶ 71). Plaintiff Stocklein was responsible for approving or denying 21 STD claims and approved about 75% of claims with no supervisor involvement. (Doc. 22 137 ¶ 75). She could not, however, deny a claim absent supervisor approval and nurse 23 support. (Doc. 137 ¶ 74). 24 Defendant’s human resources and legal departments reviewed the classification of 25 claims examiners like Plaintiffs as exempt from the FLSA in 2017 in response to a 26 lawsuit filed in this District, Ries v. Matrix Absence Management Inc., No. 2:16-cv- 27 03388-ROS. (Doc. 137 ¶ 88–89). On February 22, 2017, Judge Silver rejected the 28 parties’ Joint Stipulation of Dismissal in Ries, instead asking the parties for additional 1 information justifying approval of the settlement. (Doc. 140 ¶ 40). On February 24, 2017, 2 the parties filed a Joint Supplemental Notice explaining that “Matrix would forebear from 3 requesting attorneys’ fees and costs, in exchange for Plaintiffs’ agreement to dismiss the 4 action with prejudice,” citing to In re Farmers Insurance Exchange, Claims 5 Representatives’ Overtime Pay Litigation, 481 F.3d 1119 (9th Cir. 2007) as authority 6 suggesting that the Ries plaintiffs were subject to the FLSA’s administrative exemption. 7 (Doc. 140 ¶ 41). Judge Silver thereafter dismissed the case with prejudice, finding that it 8 was a fair and reasonable resolution of the dispute. (Doc. 140 ¶ 42). 9 II. LEGAL STANDARD 10 Summary judgment is appropriate if “the movant shows that there is no genuine 11 dispute as to any material fact and the movant is entitled to judgment as a matter of law.” 12 Fed. R. Civ. P. 56(a). A party seeking summary judgment always bears the initial burden 13 of establishing the absence of a genuine issue of material fact. See Celotex Corp. v. 14 Catrett, 477 U.S. 317, 323 (1986). The moving party can satisfy its burden by 15 demonstrating that the nonmoving party failed to make a showing sufficient to establish 16 an element essential to that party’s case on which that party will bear the burden of proof 17 at trial. See id. at 322–23. When considering a motion for summary judgment, a court 18 must view the factual record and draw all reasonable inferences in a light most favorably 19 to the nonmoving party. Leisek v. Brightwood Corp., 278 F.3d 895, 898 (9th Cir. 2002). 20 III. ADMINISTRATIVE EXEMPTION DEFENSE 21 Plaintiffs and Defendant both seek summary judgment on Defendant’s 22 administrative exemption defense. An “employee employed in a bona fide executive, 23 administrative, or professional capacity” is exempt from the FLSA’s minimum wage and 24 overtime requirements. 29 U.S.C. § 213(a). To fall under the administrative exemption, 25 an employee “must (1) be compensated not less than $[684] per week; (2) perform as her 26 primary duty ‘office or non-manual work related to the management or general business 27 operations of the employer or the employer’s customers;’ and (3) have as her primary 28 duty ‘the exercise of discretion and independent judgment with respect to matters of 1 significance.’” McKeen-Chaplin v. Provident Sav. Bank, FSB, 862 F.3d 847, 851 (9th 2 Cir. 2017) (quoting 29 C.F.R. § 541.200(a)). These criteria “are absolute and the 3 employer must prove that any particular employee meets every requirement before the 4 employee will be deprived of the protection of the [FLSA].” Bothell v. Phase Metrics, 5 Inc., 299 F.3d 1120, 1125 (9th Cir. 2002) (internal quotation marks omitted). There is no 6 dispute that the compensation prong is satisfied. The Court addresses the remaining two 7 elements in turn. 8 a. Relation of work to management or general business operations 9 Both Plaintiffs and Defendant seek summary judgment on the second prong of the 10 administrative exemption. This element requires that an employee’s primary duty is 11 “work directly related to the management or general business operations of the employer 12 or the employer’s customers.” 29 C.F.R. § 541.200(a)(2). To satisfy this requirement, “an 13 employee must perform work directly related to assisting with the running or servicing of 14 the business, as distinguished, for example, from working on a manufacturing production 15 line or selling a product in a retail or service establishment.” Id. § 541.201(a). The second 16 element is commonly referred to as the “administrative-production dichotomy” as it 17 “distinguishes[es] between work related to the goods and services which constitute the 18 business’ marketplace offerings and work which contributes to running the business 19 itself.” McKeen-Chaplin, 862 F.3d at 851 (internal quotation marks omitted). In other 20 words, “this requirement is met if the employee engages in running the business itself or 21 determining its overall course or policies, not just in the day-to-day carrying out of the 22 business’ affairs.” Id. (internal quotation marks omitted). Still, “the dichotomy is only 23 determinative if the work falls squarely on the production side of the line.” Id. (emphasis 24 added) (internal quotation marks omitted). The regulations instruct that “[w]ork directly 25 related to management or general business operations includes, but is not limited to, work 26 in functional areas such as . . . personnel management; human resources; [and] employee 27 benefits.” Id. § 541.201(b). The full list illustrates the distinction between “work that any 28 employer needs performed,” which “is part and parcel of running a business and therefore 1 exempt administrative work,” and “work that is particular to the employer’s industry,” 2 which is not. Bollinger v. Residential Capital, LLC, 863 F. Supp. 2d 1041 (W.D. Wash. 3 2012). 4 Here, it is plain from the undisputed facts that Plaintiffs perform administrative 5 human resources and employee benefits work on behalf of Defendant’s customers such 6 that the second element is satisfied as a matter of law. Plaintiffs examined claims for 7 customers as disparate as the Dignity Health hospital system, XPO Logistics, and the 8 Federal Reserve. Those customers produce very different services as their marketplace 9 offerings, yet Plaintiffs performed relatively similar claims examination work for each of 10 them, making clear that their work was not related to the customers’ industry affairs. 11 Rather, Plaintiffs performed administrative work related to the running of the customers’ 12 businesses, work that any business needs done no matter its marketplace offering— 13 specifically the administration of the customers’ employee benefit plans. And the 14 regulations explicitly place work done for the employer and the employer’s customers on 15 equal footing.2 See 29 C.F.R. § 541.201(c); 69 Fed. Reg. 22,142. Thus, Plaintiffs’ work 16 falls squarely on the administrative side of the administrative-production dichotomy.3 17 Still, as noted, the administrative-production dichotomy is dispositive only if work 18 falls squarely on the production side, so the inquiry does not end there. Further

19 2 To illustrate this rule, the regulation states that, “for example, employees acting 20 as advisers or consultants to their employer’s clients or customers (as tax experts or financial consultants, for example) may be exempt.” 29 C.F.R. § 541.201(c). On this 21 basis, Plaintiffs argue that because Plaintiffs did not act as advisers or consultants to Defendant’s clients, they are not subject to the administrative exemption. But as the 22 language of § 541.201(c) twice indicates, the quoted sentence provides examples, not exclusive conditions. Section 541.201(c) “is meant to place work done for a client or 23 customer on the same footing as work done for the employer directly . . . as long as the work relates to ‘management or general business operations.’” 69 Fed. Reg. 22,142. 24 Here, if Plaintiffs worked for the customers directly, it is apparent that they would be performing employee benefits or human resources work unrelated to the customers’ 25 marketplace offerings such that they would satisfy the second prong. Section 541.201(c) makes clear that the fact that Plaintiffs performed that work for the customers while 26 employed by a third-party claims administrator does not change that outcome. 27 3 Although Plaintiff’s Motion for Summary Judgment argues that “Plaintiffs are Production Workers that Do Not Qualify as Administrators,” (Doc. 138 at 18), they 28 concede in their Reply that they “agree they are not production workers.” (Doc. 150 at 5). 1 consideration of the regulations also supports the applicability of the second prong. The 2 regulation’s requirement that work be directly related to “management or general 3 business operations” recognizes that “there are many other administrative functions that 4 support managing a business” besides management policies themselves. 69 Fed. Reg. 5 22,138. Here, by examining LOA, STD, and LTD claims, Plaintiffs performed employee 6 benefits work, which is a functional area listed in the regulations as a type of 7 administrative function that falls within the second prong. It is true that not all employee 8 benefits or human resources employees are covered by the administrative exemption; 9 “[w]ithin such areas or departments, it is still necessary to analyze the level or nature of 10 the work (i.e., does the employee exercise discretion and independent judgment as to 11 matters of significance) in order to assess whether the administrative exemption 12 applies”—but the parenthetical is an explicit reference to the third prong of the 13 administrative exemption. Id. at 22,142. Accordingly, Plaintiffs’ arguments that they did 14 not perform the type of employee benefits or human resources work that falls within the 15 administrative exemption, including arguments that they merely applied preexisting legal 16 requirements and criteria, go to the third prong, not the second prong. The undisputed 17 facts establish that Plaintiffs’ primary duty was work directly related to the general 18 business operations of Defendant’s customers, so the second prong of the administrative 19 exemption is satisfied as a matter of law. 20 b. Discretion and independent judgment on matters of significance 21 Only Defendant seeks summary judgment on the third prong of the administrative 22 exemption. “In general, the exercise of discretion and independent judgment involves the 23 comparison and the evaluation of possible courses of conduct, and acting or making a 24 decision after the various possibilities have been considered.” 29 C.F.R. § 541.202(a). It 25 must involve “more than the use of skill in applying well-established techniques, 26 procedures or specific standards described in manuals or other sources.” Id. § 541.202(e). 27 Separately, “[t]he term ‘matters of significance’ refers to the level of importance or 28 consequence of the work performed.” Id. § 541.202(a). The regulations set forth ten non- 1 exclusive factors to consider when assessing whether an employee exercises discretion 2 and independent judgment with respect to matters of significance: 3 [1] whether the employee has authority to formulate, affect, interpret, or implement management policies or operating 4 practices; [2] whether the employee carries out major assignments in conducting the operations of the business; 5 [3] whether the employee performs work that affects business operations to a substantial degree, even if the employee's 6 assignments are related to operation of a particular segment of the business; [4] whether the employee has authority to 7 commit the employer in matters that have significant financial impact; [5] whether the employee has authority to waive or 8 deviate from established policies and procedures without prior approval; [6] whether the employee has authority to 9 negotiate and bind the company on significant matters; [7] whether the employee provides consultation or expert 10 advice to management; [8] whether the employee is involved in planning long- or short-term business objectives; 11 [9] whether the employee investigates and resolves matters of significance on behalf of management; and [10] whether the 12 employee represents the company in handling complaints, arbitrating disputes or resolving grievances. 13 Id. § 541.202(b). 14 The regulations provide examples of what types of employees do and do not fall 15 under the administrative exemption. Relevant here, 20 C.F.R. § 541.203(e) states that 16 “[h]uman resources managers who formulate, interpret or implement employment 17 policies . . . generally meet the duties requirements for the administrative exemption.” In 18 contrast, “personnel clerks who ‘screen’ applicants to obtain data regarding their 19 minimum qualifications and fitness for employment generally do not meet the duties 20 requirements for the administrative exemptions.” Id. § 541.203(e). The regulations also 21 offer insurance adjusters as an example: 22 23 Insurance claims adjusters generally meet the duties requirements for the administrative exemption . . . if their 24 duties include activities such as interviewing insureds, witnesses and physicians; inspecting property damage; 25 reviewing factual information to prepare damage estimates; evaluating and making recommendations regarding coverage 26 of claims; determining liability and total value of a claim; negotiating settlements; and making recommendations 27 regarding litigation. 28 Id. § 541.203(a). 1 Considering the record in the light most favorable to Plaintiffs, the Court finds that 2 there is a triable issue of fact as to whether each Plaintiff exercised discretion and 3 independent judgment in the performance of his or her primary duty. Defendant has 4 presented some evidence that each Plaintiff exercised discretion in how they went about 5 administering claims. For example, Plaintiff Weeks could decide how to go about 6 investigating a claimant’s disability—whether through a questionnaire, an independent 7 medical examination, surveillance, or other means. Plaintiff McDonald could decide 8 whether to have a nurse review a file and what information to share with a claimant. 9 Plaintiff Magdaleno could decide whether to seek supervisor input and whether and how 10 to investigate suspicious claims. Plaintiff Stocklein could decide whether to follow the 11 recommendations of a computer system, the ODG, and nurses. Moreover, all Plaintiffs 12 made recommendations about claims that were generally followed. See id. § 541.202(c) 13 (“The decisions made as a result of the exercise of discretion and independent judgment 14 may consist of recommendations for action rather than the actual taking of action. The 15 fact that an employee’s decision may be subject to review and that upon occasion the 16 decisions are revised or reversed after review does not mean that the employee is not 17 exercising discretion and independent judgment.”). On the other hand, Plaintiffs have 18 presented evidence that their primary duty of administering leave claims merely involved 19 the application of standards prescribed by client policies and the applicable law using 20 Defendant’s established procedures and guidelines. Whether and to what extent each 21 individual Plaintiff ultimately exercised discretion and independent judgment is unclear 22 at this stage, so Defendant is not entitled to summary judgment.4 See C.A.R. Transp.

23 4 Plaintiffs “request that the Court sua sponte reconsider its Order” decertifying 24 the FLSA collective and denying class certification “[t]o the extent the Court rules for or against all of the Plaintiffs” based on common evidence. (Doc. 150 at 13). First, a party 25 cannot request that the Court take action sua sponte. See Sua Sponte, Black’s Law Dictionary (11th ed. 2019) (defining sua sponte as “[w]ithout prompting or suggestion”). 26 If Plaintiffs wanted to request that the Court reconsider its previous Order, they needed to follow the proper procedures for filing a motion for reconsideration. See, e.g., LRCiv 27 7.2(g). But regardless, the Court finds no error in its previous rulings, as a determination of whether each Plaintiff falls under the administrative exemption will require 28 consideration of facts specific to how each Plaintiff performed his or her primary duty. 1 Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir. 2000) (“When the party 2 moving for summary judgment would bear the burden of proof at trial, it must come 3 forward with evidence which would entitle it to a directed verdict if the evidence went 4 uncontroverted at trial.” (internal quotation marks omitted)). Thus, the issue of whether 5 the third prong of the administrative exemption applies to Plaintiffs will proceed to trial. 6 IV. WILLFULNESS AND THE GOOD-FAITH DEFENSE 7 Plaintiffs seek summary judgment on the issue of whether Defendant acted 8 willfully, while Defendant seeks summary judgment on the issue of whether it acted in 9 good faith. These issues go to the applicable statute of limitations and Plaintiffs’ 10 entitlement to liquidated damages if Defendant is found liable. A FLSA action for unpaid 11 overtime is subject to a two-year statute of limitations, except that a three-year statute of 12 limitations applies if the violation was willful. 29 U.S.C. § 255(a). A violation is willful if 13 “the employer either knew or showed reckless disregard for the matter of whether its 14 conduct was prohibited by the statute.” McLaughlin v. Richland Shoe Co., 486 U.S. 128, 15 133 (1988). Separately, in a FLSA unpaid overtime suit, if the defendant shows that the 16 act or omission giving rise to a violation “was in good faith and that he had reasonable 17 grounds for believing that his act or omission was not a violation” of the FLSA, “the 18 court may, in its sound discretion, award no liquidated damages.” 29 U.S.C. § 260. The 19 Court discusses the willfulness and good-faith issues together because “a finding of good 20 faith is plainly inconsistent with a finding of willfulness,” and because Plaintiffs and 21 Defendant both rely on Judge Silver’s dismissal of the Reis case in support of their 22 positions. Chao v. A-One Med. Servs., Inc., 346 F.3d 908, 920 (9th Cir. 2003). 23 Plaintiffs argue that Defendant’s reliance on Ries “showed reckless disregard for 24 the law” because In re Farmers Insurance Exchange—which the Ries parties cited to in 25 support of dismissal—involved insurance claims adjusters, and Defendant does not claim 26 Plaintiffs in this case were insurance adjusters. (Doc. 138 at 20). Further, Plaintiffs 27 contend that their job duties are not analogous to the job duties of the insurance adjusters 28 in In re Farmers Insurance Exchange. Thus, Plaintiffs maintain that Defendant’s reliance 1 on inapposite cases to support their classification of Plaintiffs as exempt was in reckless 2 disregard of the law. On the other hand, Defendant argues that the dismissal of Ries, 3 together with Defendant’s review of its classification of claims examiners as exempt in 4 2017, shows that it acted in good faith. Defendant suggest that the court in Ries could not 5 have granted the Joint Stipulation of Dismissal if it believed the plaintiffs in that case 6 were misclassified as exempt, and that the outcome of Ries gave Defendant reasonable 7 grounds for believing that claims examiners were exempt from the FLSA. (Doc. 136 at 8 20). 9 The Court cannot conclude as a matter of law that Defendant acted either willfully 10 or in good faith in classifying Plaintiffs as exempt. There is minimal evidence in the 11 record about the Ries plaintiffs, their job duties, and how they went about those duties, so 12 it is unclear how factually analogous that case was to this one. It is therefore impossible 13 to determine at this stage whether it was reasonable for Defendant to conclude that the 14 Plaintiffs in this case, too, were appropriately categorized as exempt. It is likewise 15 impossible to conclude that the Ries plaintiffs were so different from the Plaintiffs in this 16 case that Defendant acted with reckless disregard by relying on Ries. The issues of 17 willfulness and good faith will be left for the factfinder to resolve at trial. 18 V. CONCLUSION 19 Defendant has demonstrated as a matter of law that Plaintiffs’ primary job duties 20 related to the general business operations of Defendant’s clients such that the second 21 prong of the administrative exemption is satisfied. The other issues raised by the parties’ 22 Cross-Motions for Summary Judgment will proceed. Accordingly, 23 IT IS ORDERED that Defendant’s Motion for Summary Judgment (Doc. 136) is 24 granted in part as to the second prong of the FLSA’s administrative exemption and is 25 otherwise denied in part. 26 /// 27 /// 28 /// 1 IT IS FURTHER ORDERED that Plaintiffs’ Motion for Partial Summary 2| Judgment (Doc. 138) is denied. 3 Dated this 24th day of May, 2023. 4 5 LEGG 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28