Ninth Circuit Unconvinced that Out-of-State Employee Claims Are Invalid

On December 13, 2011, the Ninth Circuit Court of Appeals reconsidered the case, Sullivan v. Oracle Corp., after the California Supreme Court had decided several certified questions of law. The Ninth Circuit had previously delayed ruling, and instead asked the California Supreme Court to decide three questions of California law, including whether a company with its principal place of business in California was required to pay out-of-state employees temporarily working in California according to California’s daily overtime rules. The California Supreme Court took up the issue, and according to the Ninth Circuit, “[t]he California Supreme Court agreed with the answers we had given in our original opinion to these three questions” – that Oracle was required to pay daily overtime to its instructors temporarily working in California. The Ninth Circuit took up the case again after the California Supreme Court’s ruling, and considered several constitutional arguments raised by Oracle. Oracle argued that applying California’s daily overtime rules to out-of-state employees temporarily in the state violates the Due Process Clause of the Fourteenth Amendment and the Dormant Commerce Clause of the United States Constitution. The Ninth Circuit rejected these arguments and remanded the case to the district court.

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