Almanza v. United States , 935 F.3d 1332 ( 2019 )

United States Court of Appeals
for the Federal Circuit
______________________
MANUEL ALMANZA, AND OTHER SIMILARLY
SITUATED PERSONS,
Plaintiffs-Appellants
v.
UNITED STATES,
Defendant-Appellee
______________________
2018-1803
______________________
Appeal from the United States Court of Federal Claims
in No. 1:13-cv-00130-EDK, Judge Elaine Kaplan.
______________________
Decided: August 21, 2019
______________________
DANIEL M. ROSENTHAL, James & Hoffman, PC, Wash-
ington, DC, argued for plaintiff-appellant. Also repre-
sented by RYAN EDWARD GRIFFIN, ALICE HWANG; DAVID L.
KERN, Kern Law Firm, El Paso, TX.
ALBERT S. IAROSSI, Commercial Litigation Branch,
Civil Division, United States Department of Justice, Wash-
ington, DC, argued for defendant-appellee. Also repre-
sented by JOSEPH H. HUNT, STEVEN JOHN GILLINGHAM,
ROBERT EDWARD KIRSCHMAN, JR.
______________________
2 ALMANZA v. UNITED STATES
Before NEWMAN, CLEVENGER, and REYNA, Circuit Judges.
REYNA, Circuit Judge.
Manuel Almanza represents a group of United States
Border Patrol Agents who seek compensation from the
United States for activities they claim were performed dur-
ing “hours of work” while attending a voluntary canine in-
structor course. The United States Court of Federal
Claims granted summary judgment in favor of the govern-
ment and denied Almanza’s claims. Because the court cor-
rectly determined that Almanza is not entitled to
compensation as a matter of law, we affirm.
BACKGROUND
I. Border Patrol Agents, Canine Handlers,
and Canine Instructors
Border Patrol Agents (“agents”) of the United States
Customs and Border Protection (“CBP”) are responsible for
patrolling the international borders of the United States.
In performing those responsibilities, some agents choose to
be paired with a trained detection canine. Those agents
are referred to as “canine handlers.” Trained canines as-
sist the canine handlers in detecting controlled substances
and concealed individuals attempting to enter the United
States illegally. Agents who wish to work with canines
must attend a seven-week program of field and classroom
training at a canine training program center. Successful
graduates of the training program are certified canine han-
dlers.
Canine handlers perform the same duties as agents
who do not work with canines. Canine handlers also re-
ceive the same compensation as agents who do not work
with canines, except that canine handlers receive addi-
tional pay for hours dedicated to canine care and mainte-
nance training.
ALMANZA v. UNITED STATES 3
Certified canine handlers may seek additional certifi-
cation as “canine instructors.” Seeking canine instructor
certification is voluntary. Certified canine instructors may
take on collateral duties to help canine handlers maintain
their certification, but canine instructors do not receive a
pay raise, new title, or any other additional compensation
absent a promotion. Agents who do not seek or secure ca-
nine instructor certification do not suffer any adverse con-
sequences with respect to their existing jobs. They are not
demoted, disciplined, or precluded from later seeking certi-
fication. Agents are nonetheless motivated to obtain ca-
nine instructor certification in order to “mak[e] that next
step in [their] career” and to potentially become a “course
development instructor or . . . to be maybe an assistant di-
rector, even director.” J.A. 165–66 (Bordeaux Dep. Tr.).
II. Detection Canine Instructor Course
To obtain canine instructor certification, agents must
enroll in CBP’s Detection Canine Instructor Course
(“DCIC”), a voluntary, twelve-week training program. CBP
solicits interest in the DCIC by circulating memoranda
that advertise the program and advise agents how to apply.
Agents interested in attending the DCIC must submit an
application and undergo a competitive interview process.
The DCIC trains student instructors through a combina-
tion of classroom instruction, hands-on training, and field-
work.
During the time period relevant to this case, student
instructors were required to meet certain performance
standards and to pass all exams with a minimum score of
90%. Students were also graded on their completion of pa-
perwork that certified instructors used to evaluate the per-
formance of the detection canines (“white sheets”) and
canine handlers (“green sheets”).
A regular day at the DCIC lasted eight hours (6:00 am
to 2:00 pm). Student instructors received their full com-
pensation for those hours. But students testified that
4 ALMANZA v. UNITED STATES
successful passage of the exams required substantial stud-
ying during off-hours. Students also testified that they
spent substantial off-hours time completing green sheets
and white sheets. Students were not compensated for any
off-hours time spent studying or completing green sheets
and white sheets (“off-hours activities”).
III. Fair Labor Standards Act and OPM Regulation
5 C.F.R. § 551.423
The Fair Labor Standards Act (“FLSA”) entitles em-
ployees to overtime pay for their hours of work that exceed
forty hours per week. 29 U.S.C. § 207(a)(1). The Office of
Personnel Management (“OPM”) administers the FLSA
with respect to federal employees. 29 U.S.C. § 204(f). OPM
regulations provide that “[h]ours of work means all time
spent by an employee performing an activity for the benefit
of an agency and under the control or direction of the
agency.” 5 C.F.R. § 551.104. Two provisions of the OPM
regulations are relevant here: 5 C.F.R. § 551.423(a)(2) and
(a)(4).
First, under 5 C.F.R. § 551.423(a)(2), time spent in
training outside of regular working hours is considered
“hours of work” if both of the following conditions are sat-
isfied:
(i) The employee is directed to participate in the
training by his or her employing agency; and
(ii) The purpose of the training is to improve the
employee’s performance of the duties and responsi-
bilities of his or her current position.
An employee is “directed to participate” in the training
when “the training is required by the agency and the em-
ployee’s performance or continued retention in his or her
current position will be adversely affected by nonenrolment
in such training.” Id. § 551.423(b)(1).
ALMANZA v. UNITED STATES 5
Second, under 5 C.F.R. § 551.423(a)(4), “[t]ime spent by
an employee performing work for the agency during a pe-
riod of training” is “considered hours of work.” For an ac-
tivity to constitute “work for the agency,” it must be, among
other things, undertaken “primarily for the benefit of the
employer.” Tenn. Coal, Iron & R. Co. v. Muscoda Local No.
123, 321 U.S. 590, 598 (1944); Bull v. United States, 68 Fed.
Cl. 212, 222, decision clarified, 68 Fed. Cl. 276 (2005), aff’d,
479 F.3d 1365 (Fed. Cir. 2007).
IV. Claims Court Proceedings
Manuel Almanza and about two hundred other simi-
larly situated persons (collectively, “Almanza”) filed suit in
the United States Court of Federal Claims (“Claims Court”)
on February 20, 2013, arguing entitlement to overtime pay
because the off-hours activities constituted “hours of work”
under 5 C.F.R. § 551.423(a)(2) and (a)(4). Almanza filed a
motion for summary judgment on December 8, 2015, and
the government filed a cross-motion for summary judgment
on January 18, 2016. On July 26, 2016, the Claims Court
granted summary judgment in favor of the government,
finding no material facts in dispute and determining that,
as a matter of law, Almanza was unable to show that any
of the off-hours activities constituted “hours of work” under
5 C.F.R. § 551.423.
With respect to Almanza’s claim under 5 C.F.R.
§ 551.423(a)(2) (training outside of work hours), the Claims
Court concluded that Almanza failed to satisfy either of the
two independently required conditions. First, the Claims
Court determined that the agents were not “directed to par-
ticipate” in the DCIC because undisputed facts showed
that “participation in the DCIC was voluntary in the first
instance and [the agents’] failure to apply or enroll would
have had no effect on their existing jobs as canine han-
dlers.” J.A. 8. Second, the Claims Court determined that
the purpose of training was not to improve the agents’ per-
formance of their existing position, but instead “was to
6 ALMANZA v. UNITED STATES
provide the [agents] with new skills and knowledge needed
to take on additional collateral duties as canine instruc-
tors, perhaps leading to promotion within the canine pro-
gram.” J.A. 9.
With respect to Almanza’s claim under 5 C.F.R.
§ 551.423(a)(4) (performing work for the agency), the
Claims Court determined that the off-hours activities were
not “work” that benefited the agency, and thus were not
compensable. The court based its decision in part on Al-
manza’s admission in summary judgment briefing that
completion of the green sheets and white sheets “was a
form of study and homework because correctly filling out
such paperwork was part of learning to be a Canine In-
structor.” J.A. 9 n.3 (quoting J.A. 3199 n.54).
Almanza timely appealed. We have jurisdiction under
28 U.S.C. § 1295(a)(3).
DISCUSSION
Almanza raises three issues on appeal: (i) whether
5 C.F.R. § 551.423(a)(2) is invalid under Billings v. United
States, 322 F.3d 1328 (Fed. Cir. 2003); (ii) whether the
Claims Court erred in concluding on summary judgment
that Almanza’s time spent on off-hours activities was not
“hours of work” under 5 C.F.R. § 551.423(a)(2); and (iii)
whether the Claims Court erred in concluding on summary
judgment that Almanza’s time spent on off-hours activities
was not “hours of work” under 5 C.F.R. § 551.423(a)(4).
We review a grant of summary judgment by the Claims
Court de novo. FastShip, LLC v. United States, 892 F.3d
1298, 1302 (Fed. Cir. 2018). Summary judgment is appro-
priate “if the movant shows that there is no genuine dis-
pute as to any material fact and the movant is entitled to
judgment as a matter of law.” Id. (quoting Rule of the
Court of Federal Claims 56(a)). In applying this standard,
“the evidence of the non-movant is to be believed, and all
justifiable inferences are to be drawn in the non-movant’s
ALMANZA v. UNITED STATES 7
favor.” Cross Med. Prods., Inc. v. Medtronic Sofamor
Danek, Inc., 424 F.3d 1293, 1302 (Fed. Cir. 2005) (brackets
omitted) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 255 (1986)). In the event of cross-motions for sum-
mary judgment, the court must evaluate each motion on its
own merits, taking care in each instance to view the evi-
dence in favor of the non-moving party. Id.
I. Almanza’s Challenge to the
Validity of § 551.423(a)(2)
Almanza asserts that 5 C.F.R. § 551.423(a)(2) is incon-
sistent with the FLSA and with Department of Labor reg-
ulations governing the compensability of training time.
Almanza asks us to therefore invalidate § 551.423(a)(2) un-
der Billings. Appellant Br. 38–42 (citing 322 F.3d at 1334.)
We hold that Almanza waived its newly raised chal-
lenge to the validity of § 551.423(a)(2). Our precedent gen-
erally counsels against entertaining arguments not
presented to the trial court. M-I Drilling Fluids UK Ltd. v.
Dynamic Air Ltda., 890 F.3d 995, 1000 n.1 (Fed. Cir. 2018)
(citing Sage Prods., Inc. v. Devon Indus., Inc., 126 F.3d
1420, 1426 (Fed. Cir. 1997) (“In short, this court does not
‘review’ that which was not presented to the district
court.”)). We “retain[] case-by-case discretion over whether
to apply waiver.” Harris Corp. v. Ericsson Inc., 417 F.3d
1241, 1251 (Fed. Cir. 2005). Only rarely do we exercise
that discretion to decide an argument newly raised on ap-
peal. Mass. Mut. Life Ins. Co. v. United States, 782 F.3d
1354, 1369 (Fed. Cir. 2015).
Almanza concedes that he never challenged the valid-
ity of § 551.423(a)(2) to the Claims Court. In fact, Almanza
admits that he expressly relied on § 551.423(a)(2) when he
sought compensation for the off-hours activities. Specifi-
cally, Almanza contended in his Claims Court briefing that
“a key federal regulation, 5 CFR 551.423, supports pay-
ment to Plaintiffs under each one of three independent sub-
8 ALMANZA v. UNITED STATES
components: (1) 5 CFR 551.423(a)(2); (2) 5 CFR
551.423(a)(4); (3) 5 CFR 551.423(d).” J.A. 3180–81.
Almanza now asks us to consider the validity of
§ 551.423(a)(2). Almanza attempts to avoid waiver by
claiming he relied on § 551.423(a)(2) only “in the alterna-
tive,” and only after the Government “invoked” that sec-
tion. Reply Br. at 9. We are unpersuaded. Almanza does
not provide any authority or further explanation for his as-
sertion that we should decline to find waiver on either ba-
sis.
We also reject Almanza’s argument that his challenge
to the validity of § 551.423(a)(2) constitutes one of the ex-
ceptional situations in which we consider an argument in
the first instance on appeal. See Reply Br. 9–11. While
Almanza argues that finding waiver would “result in a mis-
carriage of justice,” Reply Br. 10, we believe the opposite is
true. Fairness and other policy considerations compel us
to find Almanza’s untimely challenge to § 551.423(a)(2)
waived because Almanza previously sought relief from the
Claims Court under that exact provision. See HTC Corp.
v. IPCom GmbH & Co., 667 F.3d 1270, 1281–82 (Fed. Cir.
2012) (explaining that our rule against considering new ar-
guments on appeal ensures finality, conserves judicial re-
sources, and “discourages parties from inviting an alleged
error below only to raise it on appeal”); Finnigan Corp. v.
Int’l Trade Comm’n, 180 F.3d 1354, 1363 (Fed. Cir. 1999)
(“A party’s argument should not be a moving target. The
argument at the trial and appellate level should be con-
sistent.”); Sierra Club v. Yeutter, 926 F.2d 429, 438 (5th
Cir. 1991) (finding the government’s argument waived be-
cause the government originally “sought review under the
standard it now challenges”).
The cases cited by Almanza do not persuade us other-
wise. For example, Almanza cites Forshey v. Principi for
the proposition that “appellate courts may apply the cor-
rect law even if the parties did not argue it below and the
ALMANZA v. UNITED STATES 9
court below did not decide it.” Reply Br. 10 (quoting 284
F.3d 1335, 1356 (Fed. Cir. 2002)). But Almanza’s quotation
omits a critical aspect of the Forshey holding, which states
in full that “appellate courts may apply the correct law
even if the parties did not argue it below and the court be-
low did not decide it, but only if an issue is properly before
the court.” 284 F.3d at 1356 (emphasis added). In Forshey,
we explained that an issue is not properly before the court
where, for example, the appellant argued to this court that
the Court of Appeals for Veterans Claims applied the
wrong standard of review, yet “raised no issue below con-
cerning the correct standard of review.” Id. at 1357. For
these reasons, we find that Almanza waived his challenge
to the validity of § 551.423(a)(2).
II. Almanza’s Claim for Compensation
Under § 551.423(a)(2)
Turning to the merits of Almanza’s claim for compen-
sation under § 551.423(a)(2), Almanza asserts that a tria-
ble issue exists with respect to both required conditions.
We disagree. We conclude that Almanza fails as a matter
of law to satisfy either condition required under
§ 551.423(a)(2), and we therefore hold that the Claims
Court properly granted summary judgment in favor of the
government with respect to that provision.
As to the first requirement of § 551.423(a)(2)—that the
employee is “directed to participate” in the training activi-
ties—Almanza argues that off-hours studying was “doubly”
required because student instructors were required to at-
tend and participate in the course, and then required to
study during off-hours in order to pass the exams and to
avoid failing the course. Appellant Br. 49. Almanza fur-
ther contends that failure to engage in these required ac-
tivities would have likely resulted in discharge from the
program. According to Almanza, this in turn would have
adversely affected the student instructors in their position
as “course participants” (by being discharged from that
10 ALMANZA v. UNITED STATES
position) and as “canine-handling agents” (by remaining
only “competent” canine handlers, rather than “expert” ca-
nine handlers like their peers who graduated from the
DCIC). Id. at 51.
We agree with the Claims Court that the student in-
structors were not “directed to participate” in off-hours
studying within the meaning of § 551.423(a)(2). There is
no dispute that participation in the DCIC was voluntary,
not required. Merely because a voluntary training pro-
gram has certain required tasks does not alone render the
program “required by the agency.” See § 551.423(b)(1). We
expect that nearly all voluntary training programs will
have at least some requirements regarding attendance,
participation, or tasks that must be completed. Our adop-
tion of Almanza’s argument would thus render the “di-
rected to participate” requirement of § 551.423(a)(2)(i)
essentially meaningless.
It is also undisputed that agents who declined to enroll
in the DCIC, or who enrolled in but failed the DCIC, were
not adversely affected in the performance of their current
duties or in their continued retention as canine handlers.
Those agents were not demoted or disciplined in any way.
E.g., J.A. 166; 230; 318. To the contrary, they continued to
work as canine handlers with the same pay and responsi-
bilities as agents who completed the DCIC program, and
they were permitted to reapply to the DCIC at a later date.
J.A. 3–4. We reject Almanza’s argument that agents are
“adversely affected” under § 551.423(a)(2)(i) merely be-
cause DCIC graduates attain certain skills not attained by
agents who did not enroll or who failed out of the course.
As to the second requirement of § 551.423(a)(2)—that
the “purpose of training is to improve the employee’s per-
formance of the duties and responsibilities of his or her cur-
rent position”—Almanza argues that a triable issue exists
as to whether the purpose of training was to improve the
skills of agents as canine handlers. Appellant Br. 43.
ALMANZA v. UNITED STATES 11
Specifically, Almanza contends that agents who completed
the DCIC program “improved vastly” in their canine han-
dling skills and that the program “allowed them to perform
new functions.” Id.
Even viewing these facts with all justifiable inferences
in Almanza’s favor, we conclude that the primary purpose
for enrolling in the DCIC was for career advancement, i.e.,
for agents to “mak[e] that next step in [their] career.”
J.A. 165 (Bordeaux Dep. Tr.); see also J.A. 166 (Bordeaux
Dep. Tr.) (completion of DCIC was “necessary” for “moving
on to course development instructor or . . . to be maybe an
assistant director, even director”); J.A. 318 (Kraus Dep.
Tr.) (“I wanted to further my career, further my
knowledge.”); J.A. 404 (Salas Dep. Tr.) (“I would like to fur-
ther my career in the canine department . . . [and attend-
ing DCIC] was a big part of that.”). This type of “upward
mobility training” is expressly exempted from the type of
training compensable under § 551.423(a)(2)(ii). 5 C.F.R.
§ 551.423(b)(2).
Evidence of incidental improvements to the employees’
performance of their current responsibilities does not con-
vert “upward mobility training” into the type of training
compensable under § 551.423(a)(2)(ii). We agree with the
government that “[r]are indeed is the training which has
no beneficial effects on an employee’s current job.” Appel-
lee Br. 36 (emphasis omitted).
Because we conclude that Almanza is unable, as a mat-
ter of law, to satisfy either of the two requirements of
§ 551.423(a)(2), we affirm the Claims Court’s decision on
summary judgment that the off-hours activities were not
compensable as “hours of work” under § 551.423(a)(2).
III. Almanza’s Claim for Compensation
Under § 551.423(a)(4)
Almanza also seeks compensation by asserting that the
off-hours time spent completing green sheets and white
12 ALMANZA v. UNITED STATES
sheets constituted “hours of work” under § 551.423(a)(4).
Almanza contends that the agents’ off-hours completion of
this paperwork benefits the CBP in two ways. First, Al-
manza asserts that the green sheets and white sheets “ad-
vance[] the Government’s efforts to train canines and
canine handlers during the instructor course.” Appellant
Br. 33. Second, Almanza argues that the “white sheets” are
“essential to the Government’s interdiction efforts” because
they provide documentary support in criminal proceedings
for the government to show training history for the canines
and also the “the fruits of the canine detection program.”
Id. at 35; see also id. at 13.
We agree with the Claims Court that the record evi-
dence, even when drawing all justifiable inferences in Al-
manza’s favor, shows that the agents’ off-hours completion
of green sheets and white sheets was a form of homework
and practice for the agents, rather than “primarily for the
benefit” of CBP. See Tenn. Coal, 321 U.S. at 598. The evi-
dence shows that the agents practiced completing green
sheets and white sheets during off-hours “to learn how to
do it and learn how to do it correctly.” J.A. 311 (Kraus Dep.
Tr.). The agents were graded on how well they completed
this practice paperwork. J.A. 1164 (Shaw Dep. Tr.) (con-
firming “student instructors [are] graded on how well they
fill out the white sheets”); J.A. 218 (Cuevas Dep. Tr.) (DCIC
instructors would “review those [green] sheets and look at
how [student instructors were] documenting, see if I’m
evaluating properly . . . how I speak to them, my knowledge
that I’m giving.”).
Almanza conceded in briefing to the Claims Court that
off-hours completion of this paperwork “itself was a form of
study and homework because correctly filling out such pa-
perwork was learning to be a Canine Instructor.” J.A. 3199
n.54. And while Almanza contends that the CBP generally
uses green sheets and white sheets for certain purposes,
Almanza has not identified any evidence that shows the
specific green sheets and white sheets completed by DCIC-
ALMANZA v. UNITED STATES 13
enrolled agents during off-hours were used for those pur-
poses. Instead, the evidence shows that paperwork com-
pleted by DCIC-enrolled agents during off-hours was for
practice and grading purposes, not primarily for the benefit
of CBP. See J.A. 517 (Smith Dep. Tr.) (“Q. If you had given
repeatedly low scores to a handler, is it possible that han-
dler would have failed the course? A. I don’t think we had
that power, because we were being graded on our grading
of students. So no, it would take a certified instructor ob-
serving the same thing that I’m observing to make that de-
cision.”); J.A. 310 (Kraus Dep. Tr.) (“The green sheets are
part of our recordkeeping score as a student instruc-
tor. . . . And if you did a poor job on your green sheets, it
got reflected on your score as an instructor.”).
Almanza also cites the testimony of Laren Shaw, CBP’s
Assistant Director for Headquarters Canine Program, who
indicated that CBP has used white sheets (canine evalua-
tions) in court proceedings. Appellant Br. 13 (citing
J.A. 1164). But the record does not support Almanza’s as-
sertion that the specific white sheets completed by DCIC-
enrolled agents during off-hours were used in court pro-
ceedings. To the contrary, Ms. Shaw testified that each ca-
nine had “two canine training records, two white sheets,
two versions,” and that only “[o]ne is for the student in-
structors,” which was graded on “how well they fill out the
white sheets.” J.A. 1163–64. The white sheets that Ms.
Shaw testified were used in court proceedings, on the other
hand, were “closed out at the end of every day”; they were
not completed during off-hours. J.A. 1165. We find no rec-
ord evidence that the government has ever used in a crim-
inal proceeding a white sheet completed by a DCIC-
enrolled agent during off-hours.
On this record, we agree with the Claims Court that
any “work” performed by the student instructor agents was
“performed during regular duty hours for which [the
agents] were compensated.” J.A. 9. We affirm the Claims
Court’s decision on summary judgment that off-hours time
14 ALMANZA v. UNITED STATES
spent completing green sheets and white sheets was not
“hours of work” under § 551.423(a)(4).
CONCLUSION
We have considered Almanza’s other arguments and
find them unpersuasive. We conclude that Almanza
waived his challenge to the validity of 5 C.F.R.
§ 551.423(a)(2) and that the Claims Court correctly
granted summary judgment in favor of the government af-
ter concluding that Almanza’s time spent on after-hours ac-
tivities was not “hours of work” compensable under
§ 551.423(a)(2) or (a)(4). We affirm.
AFFIRMED
COSTS
No costs.