in R E : Fedex Ground Package System, Inc. Employment Practices Litigation. Carlene… v. Fedex Ground Package System, Inc.

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 10-3115
IN R E :
FEDEX G ROUND P ACKAGE SYSTEM,
INC. E MPLOYMENT P RACTICES LITIGATION.
C ARLENE M. C RAIG , et al.,
Plaintiffs-Appellants,
v.
FEDEX G ROUND P ACKAGE SYSTEM, INC.,
Defendant-Appellee.
____________________
Appeal from the United States District Court for the
Northern District of Indiana, South Bend Division.
No. 3:05-md-00527-RLM-CAN – Robert L. Miller, Jr., Judge.
____________________
D ECIDED J ULY 8, 2015
____________________
Before EASTERBROOK , R OVNER , and T INDER , Circuit Judges.
P ER C URIAM. This appeal is from the MDL court’s grant
of summary judgment to FedEx Ground Package System,
Inc., and denial of summary judgment to the plaintiffs, hold-
ing that the plaintiff drivers were independent contractors as

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2 No. 10-3115
a matter of law under the Kansas Wage Payment Act
(KWPA), Kan. Stat. Ann. §§ 44-312 to 33-340. See In Re FedEx
Ground Package Sys., Inc., 734 F. Supp. 2d 557 (N.D. Ind.
2010).
After hearing oral argument, we certified two questions
to the Kansas Supreme Court: (1) Given the undisputed facts
presented to the district court in this case, are the plaintiff
drivers employees of FedEx as a matter of law under the
KWPA? (2) Drivers can acquire more than one service area
from Fed Ex. Is the answer to the preceding question differ-
ent for plaintiff drivers who have more than one service ar-
ea? Craig v. FedEx Ground Package Sys., Inc., 686 F.3d 423, 431
(7th Cir. 2012). The court expresses its appreciation to the
Justices of the Kansas Supreme Court for their willingness to
answer these questions.
The Kansas Supreme Court answered “yes” to the first
question and, as applied to the members of the certified
class—drivers who “drive a vehicle on a full-time basis”—
answered “no” to the second question. Craig v. FedEx Ground
Package Sys., Inc., 335 P.3d 66, 92–93 (Kan. 2014) (per curiam).
In responding to the questions, the court restated the twenty
factors from Crawford v. Kansas Dep’t of Human Resources, 845
P.2d 703 (1989), used to determine whether an employer-
employee relationship exists. 335 P.3d at 74, 76. The court
explained that the twenty-factor test “includes economic re-
ality considerations, while maintaining the primary focus on
an employer’s right to control” and held that the test “is the
tool to be used in Kansas to determine whether an employ-
er/employee relationship exists under the KWPA.” Id. at 76.
Upon receipt of the Kansas Supreme Court’s answers to
our questions, we requested the parties to brief their respec-

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No. 10-3115 3
tive positions in light of those answers and decisions from
other circuits issued after argument in our case. FedEx’s un-
derstanding of the Kansas Supreme Court’s decision strays
from reality. The Kansas court restated the 20-factor test for
determining employment status under the KWPA by elimi-
nating ambiguous or duplicative descriptions; it did not
enunciate a new test that requires further development of
the factual record. The Kansas court stated a slightly differ-
ent articulation of the 20-factor test, but the essence of the 20
factors remains the same.
And contrary to FedEx’s view, the Kansas court’s deci-
sion did not rest on whether FedEx exercises “actual control”
over the plaintiff drivers. We repeat what the court actually
said:
The District Court in this case primarily focused on
the OA’s [Operating Agreement] statements of Fed-
Ex’s right to control the drivers, opining that the actu-
al control that FedEx exercised over the drivers was
not the question. But we consider the manner in
which FedEx implemented the OA to be a compelling
factor in determining the substantive question of the
company’s right to control its drivers.
Id. at 76 (citation omitted). This is simply another way of
saying that FedEx’s policies and procedures bear on its right
to control the drivers, which is how the MDL court viewed
the matter as well. See, e.g., In re FedEx Ground Package Sys.,
734 F. Supp. 2d at 577 (“[T]he court finds it appropriate to
review the policies and procedures that FedEx managers re-
ly on when interacting with drivers to determine right to
control. The court isn’t required to turn a blind eye to Fed-
Ex’s procedures implemented on a class-wide basis.”); id. at

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4 No. 10-3115
579 (“The court can’t make generalizations about the class …
from a review of the actual control FedEx exercised…. The
court’s analysis will focus on FedEx’s right to control all
drivers based on the Operating Agreement and generally
applicable policies and procedures.”); id. at 589 (“[T]he court
is limited in determining whether FedEx retained the right
to control. The court relies on the policies and procedures to
the extent they show how FedEx implemented its authority
as retained by the Operating Agreement.”). The Kansas
court’s decision does not mandate an evidentiary inquiry
into actual control. “Actual control” cannot even be found
among the twenty factors used to determine whether an
employer-employee relationship exists under the KWPA. See
335 P.3d at 76.
FedEx’s other criticisms of the Kansas Supreme Court’s
decision are unavailing as well. For example, FedEx asserts
that the Kansas court relied on the factual record in Estrada
v. FedEx Ground Package Sys., 64 Cal. Rptr. 3d 327 (Cal. Ct.
App. 2007). However, the court’s reference to Estrada’s
commentary on FedEx’s right to control under the OA was
made to emphasize to the Kansas court’s own conclusions.
In addition, decertification of the class in the Craig case is
neither required nor appropriate. FedEx dismissed its cross-
appeal of the MDL court’s class certification order in this
case.
Not surprisingly, FedEx argues that we should not follow
the Kansas Supreme Court’s answers to the certified ques-
tions. FedEx argues that the Justices drew adverse inferences
from the record against FedEx. But “a certified question re-
quires [the state court] to conduct purely legal analysis.” Na-
tionwide Mut. Ins. Co. v. Briggs, 317 P.3d 770, 772 (Kan. 2014).

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No. 10-3115 5
“Certification would be a pointless exercise unless the state
court’s answers are regarded as an authoritative and binding
statement of state law. … [T]he state answers are binding.”
17A Charles Alan Wright et al., Federal Practice and Procedure
Jurisdiction § 4248 (3d ed., updated Apr. 2015); see Cnty. of
Westchester, N.Y. v. Comm’r of Transp., 9 F.3d 242, 246–47 (2d
Cir. 1991) (rejecting the argument that state supreme court’s
decision addressing the particular circumstances of the case
was not binding and stating that the decision was disposi-
tive). FedEx simply disagrees with the Kansas Supreme
Court’s legal conclusions.
Other circuit courts have considered FedEx’s relationship
with its drivers, see Carlson v. FedEx Ground Package Sys., Inc.,
No. 13–14979, — F.3d —, 2015 WL 3405994 (11th Cir. May
28, 2015) (reversing grant of summary judgment in favor of
FedEx and concluding there was a genuine issue of material
fact as to whether the drivers were employees or independ-
ent contractors under Florida law); Slayman v. FedEx Ground
Package Sys., Inc., 765 F.3d 1033 (9th Cir. 2014) (reversing
grant of summary judgment to FedEx and denial of partial
summary judgment to plaintiffs, holding that the drivers
were employees as a matter of law under Oregon law); Alex-
ander v. FedEx Ground Package Sys., Inc., 765 F.3d 981 (9th Cir.
2014) (same, but under California law); FedEx Home Delivery
v. NLRB, 563 F.3d 492 (D.C. Cir. 2009) (reversing agency de-
cision that FedEx drivers were employees), but they applied
different legal rules than applied under Kansas law.
The application of Kansas law to FedEx’s relationship
with its drivers has been authoritatively decided by the Kan-
sas Supreme Court: “under the undisputed facts presented,
the FedEx delivery drivers are employees for purposes of the

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6 No. 10-3115
KWPA.” Craig, 335 P.3d at 92. The Kansas Supreme Court’s
decision necessitates the reversal of the MDL court’s grant of
summary judgment in favor of FedEx and denial of the
plaintiff drivers’ summary judgment motion. Accordingly,
we now REVERSE the MDL court’s denial of the plaintiff
drivers’ motion for summary judgment and its grant of Fed-
Ex’s motion for summary judgment. The Craig case is
R EMANDED to the MDL court with instructions to enter
judgment for the plaintiff drivers that they are employees of
FedEx for purposes of the KWPA and for further proceed-
ings consistent with this opinion, which ultimately may re-
quire a remand of the case to the Kansas district court for a
determination of damages.

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