Christopher v. Smithkline Beecham Corp.
132 S. Ct. 2156
| SCOTUS | 2012Background
- FLSA exempts outside salesmen; DOL regulations define the term and its scope.
- Petitioners are pharmaceutical detailers whose primary duty is obtaining nonbinding commitments from physicians to prescribe their drugs.
- Detailers spend ~40 hours weekly visiting physicians, with 10–20 more hours on related activities; no clock-punching and minimal supervision.
- Petitioners were well compensated with base salary plus uncapped incentive pay; overtime pay was not provided.
- District court granted summary judgment to employer; Ninth Circuit held DOL interpretation not controlling and affirmed, leading to Supreme Court to decide deference and interpretation.
- The issue centers on whether detailers fall within the outside salesman exemption under the DOL regulations and how to interpret those regulations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether detailers are outside salesmen under the FLSA. | Detailers perform sales-related work by obtaining commitments from physicians. | Detailers do not transfer title or consummate sales; promotion work non-exempt. | Detailers qualify as outside salesmen under the regulations. |
| Whether the DOL interpretation deserves Auer deference. | DOL's view should be accorded deference as a reasonable interpretation. | Auer deference not warranted due to changeable, non-notice interpretations. | Auer deference not given; the interpretation not persuasive. |
| How to interpret the broad catchall 'other disposition' in §203(k). | Catchall extends to industry-specific sales-type arrangements e.g., nonbinding physician commitments. | Catchall should be read narrowly, requiring actual transfer of title or firm sale. | Catchall includes arrangements tantamount to a sale in the pharmaceutical context; petitioners are exempt. |
| What textual cues from the statute/regulations support the result. | Primary duty is making sales; regulation uses 'includes' and 'any' to extend meaning. | Text supports a narrower view requiring actual sale/transfer. | Text supports broad, functional interpretation aligning with exemption. |
Key Cases Cited
- Sorrell v. IMS Health Inc., 564 U.S. 552 (2011) (describes detailing process and regulatory context)
- United States v. Mead Corp., 533 U.S. 218 (2001) (Skidmore deference framework for agency interpretations)
- Auer v. Robbins, 519 U.S. 452 (1997) (deference limitations for agency interpretations of regulations)
- Long Island Care at Home, Ltd. v. Coke, 551 U.S. 158 (2007) (notice-and-comment considerations in deference analysis)
- Arnold v. Ben Kanowsky, Inc., 361 U.S. 388 (1960) (narrow construction of exemptions against employers)