Sacchi v. Ihc Health Servs., Inc., 918 F.3d 1155

Background

Plaintiff Karna Sacchi, a graduate student seeking child life specialist certification, began an unpaid hospital internship (Aug–Dec 2015) that was terminated early by Director Joy Singh.
The Child Life Council requires 480 internship hours to be eligible for certification; the Hospital’s program was accredited to satisfy that requirement.
Sacchi alleged no wages or traditional employment benefits; she claimed the internship would enable certification and thereby a likely pathway to paid employment.
Sacchi sued for discrimination/retaliation under the ADA, Title VII, and the ADEA; the district court dismissed federal claims for failure to allege employment status and declined supplemental jurisdiction over state claims.
On appeal, Sacchi argued (1) that access to certification or a path to employment can be ‘‘indirect, significant’’ remuneration under the threshold-remuneration test, or (2) that unpaid interns generally should be treated as employees under federal antidiscrimination statutes.
The Tenth Circuit affirmed dismissal: held the alleged benefits were neither direct employer-provided remuneration nor sufficiently substantial and non-attenuated indirect benefits to meet the threshold-remuneration test; also denied sealing of a contract appendix.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Sacchi plausibly alleged she was an "employee" under Title VII/ADA/ADEA	Internship provided substantial indirect remuneration because it was necessary to obtain certification and commonly led to paid employment	No direct pay or traditional employment benefits; certification and later hire are speculative and not employer-provided remuneration	Held: Not an employee — benefits are too attenuated/conditional to satisfy threshold-remuneration test
Whether access to professional certification alone can satisfy threshold-remuneration	Certification requirement and typical hiring after internships make the internship sufficiently valuable as indirect remuneration	Certification is contingent on passing exam and later hiring is contingent on separate competitive processes; benefits are speculative	Held: Certification/pathway to employment alone insufficient as a matter of law
Whether most unpaid interns should be treated as employees under antidiscrimination statutes	Argues for categorical protection of interns under statutes	Court defers to Congress; declines to adopt broad rule judicially	Held: Declined to extend statutes to all interns; left to Congress
Whether contract in sealed appendix should remain sealed on appeal	Hospital contended confidentiality clause and non-party involvement justify sealing	Public right of access to judicial records; Hospital failed to show substantial interest overcoming presumption	Held: Motion to seal denied; public access favored

Key Cases Cited

McGuinness v. Univ. of N.M. Sch. of Med., 170 F.3d 974 (10th Cir. 1999) (unpaid student not an employee absent remuneration; university benefits/control can be incidental)
Juino v. Livingston Par. Fire Dist. No. 5, 717 F.3d 431 (5th Cir. 2013) (volunteer firefighter’s modest benefits held incidental, not sufficient remuneration)
Haavistola v. Cmty. Fire Co. of Rising Sun, Inc., 6 F.3d 211 (4th Cir. 1993) (numerous, substantial benefits including pathway to certification could present triable employee-status question)
Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318 (1992) (statutory term "employee" presumed to reflect common-law master-servant concept)
Valley Forge Ins. Co. v. Health Care Mgmt. Partners, Ltd., 616 F.3d 1086 (10th Cir. 2010) (court should decide only necessary questions)
Eugene S. v. Horizon Blue Cross Blue Shield of N.J., 663 F.3d 1124 (10th Cir. 2011) (presumption of public access to judicial records; heavy burden to justify sealing)
Williams v. FedEx Corp. Servs., 849 F.3d 889 (10th Cir. 2017) (appellate courts are not bound by a district court’s decision to seal documents)