Appeals from the United States District Court for the
Southern District of Texas
HIGGINBOTHAM, ELROD, and HO, Circuit Judges.
JENNIFER WALKER ELROD, CIRCUIT JUDGE
Jeff Faludi, a former practicing attorney, took a consulting
job at an oil and gas services company. When Faludi left the
company, he filed this lawsuit under the Fair Labor Standards
Act (FLSA), seeking to recover unpaid overtime wages. Because
Faludi was exempt from the FLSA, we AFFIRM the district
court's summary judgment in favor of his former employer.
However, because the district court did not state its reasons
for declining to award costs to the prevailing party, we
VACATE the award of costs and REMAND that issue to the
Faludi became a licensed lawyer in 1998, and he practiced law
for sixteen years until he allowed his license to lapse.
Around the same time, one of his former colleagues offered
him a consulting position at a newly-formed oil and gas
services company, U.S. Shale Solutions, L.L.C. Faludi
accepted the position, and the parties signed an
"Independent Contractor Master Consulting Services
Agreement" in November 2014.
the agreement, Faludi agreed to work for U.S. Shale for
"an indefinite period of time" at a rate of $1, 000
per day for every day he worked in Houston and $1, 350 per
day for every day he worked outside of Houston. The agreement
required Faludi to submit invoices to U.S. Shale for payment
twice a month. The agreement also contained a non-compete
clause prohibiting Faludi from working for U.S. Shale's
competitors while the agreement was in effect and for one
year after its termination.
the approximately sixteen months that Faludi worked for U.S.
Shale, he submitted invoices to U.S. Shale once or twice a
month. Although his day rate applied regardless of how many
hours he worked, he often billed U.S. Shale for less than the
day rate when he did not work a full day. Faludi testified
that he did this voluntarily, and U.S. Shale paid the
requested amounts without asking why Faludi had billed for
less than his day rate. Even with these prorated invoices,
Faludi was paid at least $1, 000 for every week in which he
performed work for U.S. Shale, and his annual compensation
was approximately $260, 000.
left U.S. Shale in March 2016 after an internal
reorganization. Shortly thereafter, he filed this lawsuit
against the company for unpaid overtime wages he claimed he
was owed under the FLSA. U.S. Shale sought summary judgment
in the district court, arguing that Faludi was an independent
contractor and thus not subject to the FLSA, or alternatively
that he was an exempt employee under either the
"practice of law" exemption or the "highly
compensated employee" exemption to the FLSA. Faludi also
sought a partial summary judgment on the ground that he was
an employee under the FLSA and did not fall under any
district court determined that genuine issues of material
fact existed as to whether Faludi was an employee or an
independent contractor and whether he fell within the
FLSA's practice of law exemption. However, the district
court granted U.S. Shale's summary judgment motion
because it found that Faludi was exempt as a matter of law
under the highly compensated employee exemption to the FLSA.
Although U.S. Shale was the prevailing party, the district
court did not award U.S. Shale costs, nor did it explain why
it declined to do so. Faludi appeals the adverse summary
judgment, and U.S. Shale cross-appeals on the issue of costs.
review a district court's grant of summary judgment de
novo. Johnson v. Heckmann Water Res. (CVR), Inc.,
758 F.3d 627, 630 (5th Cir. 2014). Where the parties filed
cross-motions for summary judgment, "we review each
party's motion independently, viewing the evidence and
inferences in the light most favorable to the nonmoving
party." Parrish v. Premier Directional Drilling,
L.P., 917 F.3d 369, 380 (5th Cir. 2019) (quoting
Duval v. N. Assurance Co. of Am., 722 F.3d 300, 303
(5th Cir. 2013)). Summary judgment is appropriate when
"the movant shows that there is no genuine dispute as to
any material fact and the movant is entitled to judgment as a
matter of law." Fed.R.Civ.P. 56(a). We review a district
court's award of costs for an abuse of discretion.
Gagnon v. United Technisource, Inc., 607 F.3d 1036,
1045 (5th Cir. 2010).
the FLSA, an employer must pay overtime compensation to its
non-exempt employees who work more than forty hours a week.
Cleveland v. City of Elmendorf, 388 F.3d 522, 526
(5th Cir. 2004). In contrast, independent contractors are not
entitled to overtime under the FLSA. See 29 U.S.C.
§ 207(a)(1) ("[N]o employer shall employ any of his
employees . . . for a workweek longer than forty
hours unless such employee receives [overtime]
compensation[.]" (emphasis added)); Parrish,
917 F.3d at 379 (explaining that to make a prima
facie case for unpaid overtime, a plaintiff must prove,
inter alia, that "there existed an
employer-employee relationship during the unpaid overtime
periods claimed"). In addition, the FLSA describes
various types of exempt employees who are excluded from the
overtime requirement. See 29 U.S.C. §§
207, 213. Relevant here, "the FLSA excludes from this
requirement those employees working in a bona fide executive,
administrative or professional capacity." Lott v.
Howard Wilson Chrysler-Plymouth, Inc., 203 F.3d 326, 331
(5th Cir. 2000) (citing 29 U.S.C. § 213(a)(1)).
argues on appeal that he was an employee and that no FLSA
exemption applied to him, so U.S. Shale was required to pay
him overtime under the statute. U.S. Shale counters that
Faludi was either an independent contractor or, in the
alternative, an exempt employee under the highly compensated
employee and practice of law exemptions to the FLSA-both of
which are regulatory expansions on the "bona fide
executive, administrative, or professional" exemption in
29 U.S.C. § 213(a)(1). See 29 C.F.R. §
541.601 (highly compensated employee exemption); 29 C.F.R.
§ 541.304(a)(1) (practice of law exemption). We agree
with the conclusion reached by the district court: Faludi was
exempt from the FLSA as a highly compensated employee and was
therefore not entitled to overtime as a matter of law.
ultimate decision whether [an] employee is exempt from the
FLSA's overtime compensation provisions is a question of
law." Lott, 203 F.3d at 331. The employer has
the burden of establishing that an exemption applies by a
preponderance of the evidence. Meza v. Intelligent
Mexican Mktg., Inc., 720 F.3d 577, 581 (5th Cir. 2013).
Under the Supreme Court's decision in Encino
Motorcars, we must give FLSA exemptions a "fair
reading" rather than narrowly construing them against
the employer. Encino Motorcars, LLC ...