Sullivan v. Oracle Corp.
127 Cal. Rptr. 3d 185
| Cal. | 2011Background
- Nonresident Oracle instructors (Sullivan, Evich, Burkow) worked in multiple states, including California, training Oracle customers.
- During 2001–2004, days worked in California: Sullivan 74, Evich 110, Burkow 20; they were paid overtime-protected wages only after reclassification.
- Oracle treated instructors as exempt; overtime was not paid until 2003 (Labor Code) and 2004 (FLSA) reclassification occurred.
- Plaintiffs sue in federal court for California Labor Code overtime, restitution under UCL, and restitution under the FLSA for out-of-state overtime.
- Ninth Circuit certified three questions on application of California overtime law and UCL to in-state and out-of-state overtime.
- California Supreme Court answers: Labor Code applies to California-based work by out-of-state employees; UCL applies to CA-overtime violations; UCL does not apply to out-of-state FLSA overtime claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Labor Code overtime apply to work performed in California by nonresidents? | Sullivan argues CA overtime applies to all work performed in CA by Oracle employees. | Oracle argues conflict-of-laws may exclude nonresidents from CA overtime protections. | Yes; CA overtime law applies. |
| Does the UCL apply to California overtime violations under CA law? | Sullivan contends UCL provides restitution for unpaid CA overtime. | Oracle contends no additional UCL relief beyond statutory remedies exist. | Yes; UCL applies to CA overtime violations. |
| Does UCL apply to FLSA-based overtime claims for out-of-state work? | UCL should reach FLSA-based claims to broaden recovery for out-of-state overtime. | UCL should not extend to extraterritorial FLSA claims given presumption against extraterritorial application. | No; UCL does not apply to out-of-state FLSA overtime claims. |
Key Cases Cited
- Tidewater Marine Western, Inc. v. Bradshaw, 14 Cal.4th 557 (Cal. 1996) (extraterritorial limits discussed; limited extraterritorial enforcement anticipated)
- Gentry v. Superior Court, 42 Cal.4th 443 (Cal. 2007) (overtime aims to protect health, safety, and limit overwork)
- Kearney v. Salomon Smith Barney, Inc., 39 Cal.4th 95 (Cal. 2006) (governmental interest analysis in conflict-of-laws)
- Bernhard v. Harrah's Club, 16 Cal.3d 313 (Cal. 1976) (three-step governmental interest framework)
- Reich v. Purcell, 67 Cal.2d 551 (Cal. 1967) (clear articulation of conflict-of-laws principles)
- Offshore Rental Co. v. Continental Oil Co., 22 Cal.3d 157 (Cal. 1978) (conflict-of-laws methodology adoption in CA)
- Cortez v. Purolator Air Filtration Products Co., 23 Cal.4th 163 (Cal. 2000) (UCL includes unlawful wage practices; restitution for wages owed)
- Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (U.S. 1985) (due process and extraterritoriality considerations in multi-state regulation)
- Wershba v. Apple Computer, Inc., 91 Cal.App.4th 224 (Cal. Ct. App. 2000) (unlawful conduct basis for CA-involved out-of-state claims)
- Clothesrigger, Inc. v. GTE Corp., 191 Cal.App.3d 605 (Cal. Ct. App. 1987) (California-law applicability to out-of-state circumstances)
- Sullivan v. Oracle Corp. (9th Cir. 2008), 547 F.3d 1177 (9th Cir. 2008) (Ninth Circuit remanded on CA overtime and UCL applicability; later CA decision governs)