Windham v. Medestar Locum Tenens CA4/2 (2024) · DecisionDepot
Windham v. Medestar Locum Tenens CA4/2
California Court of Appeal Feb 28, 2024 No. E078518Unpublished
Filed 2/28/24 Windham v. Medestar Locum Tenens CA4/2 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION TWO
SUZONNE WINDHAM,
Plaintiff and Appellant, E078518
v. (Super.Ct.No. CVRI2101244)
MEDESTAR LOCUM TENENS, LLC, et OPINION al.,
Defendants and Respondents.
APPEAL from the Superior Court of Riverside County. Sunshine S. Sykes, Judge.
Affirmed.
The Law Office of Karen J. Sloat, Karen J. Sloat; Hellmich Law Group and
Christopher W. Hellmich, for Plaintiff and Appellant.
Lewis Brisbois Bisgaard & Smith, Lann G. McIntyre, Derek S. Sachs, and
George J. Theofanis, for Defendant and Respondent Medestar Locum Tenens, LLC.
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Suzonne Windham, plaintiff, filed a wage and hour lawsuit against defendants
Medestar Locum Tenens, LLC (Medestar), a health care staffing agency, and MACT
Health Board, Inc. (MACT), a health care consortium of two federally recognized tribes,
as well as several federally acknowledged tribal organizations. After Medestar answered
the complaint, MACT filed a motion to quash service of the summons on the ground of
tribal immunity from lawsuits. Medestar joined the motion, which was granted by the
On appeal, Windham argues (1) the trial court erred by conferring tribal immunity
on Medestar derivative from its contractual relationship with MACT without requiring it
to prove it was an arm of the tribe, and (2) Medestar waived immunity by filing an
answer to the complaint. We affirm.
BACKGROUND
Medestar is a health care staffing agency, headquartered in Dallas, Texas,
matching medical health care providers with health care facilities. MACT is a health care
consortium of the Jackson Rancheria of Me-Wuk Indians of California (now known as
the Jackson Band of Miwuk Indians) and the Ione Band of Miwok Indians of California,
as well as several federally acknowledged tribal organizations. The primary mission of
MACT is to improve the health status of the American Indian Native population in its
service area, comprising four counties that give MACT its name: Mariposa, Amador,
Calaveras, and Tuolumne.
2
MACT is a nonprofit corporation formed in 1979. It is governed by a board of
directors comprising three individuals who are: (1) members of federally recognized
Native American tribes; and (2) appointed by the leadership of those tribes and an
advisory council comprised of five individuals who are members of Native American
tribes and appointed by the Native American communities they serve, which represents
all Indian people living in the four-county service area. The board and advisory council
are active in MACT’s administration and management.
MACT received federal funds as a subcontractor of the California Rural Indian
Health Board from 1972 until 2012. In March 2013, MACT negotiated its own contract
with Indian Health Service (IHS) under the Indian Self-Determination and Education
Assistance Act (ISDEAA). On April 1, 2016, MACT renegotiated its ISDEAA
agreement with IHS. Under these agreements, MACT receives funding from IHS to
provide health care services to eligible members of Native American tribes.
In approximately January 2020, MACT contracted with Medestar to provide
MACT with health care providers to work temporarily at one or more of MACT’s
facilities. At that time, MACT had a staffing need for nursers. Medestar hired Windham
as an independent contractor to work as a nurse at a MACT clinic in northern California
for a fixed term of 90 days at $95/hour.
In March 2020, Medestar reclassified Windham as an employee. Medestar also
extended Windham’s fixed-term contract but terminated her employment in April 2020
as the pandemic impacted many health care facilities. A wage and hour dispute arose
3
when her employment was terminated, and Windham filed a proposed class action
against Medestar and MACT, alleging numerous causes of action under the Labor Code.1
In the complaint, Windham alleges that Medestar and MACT were her joint employers.
On September 14, 2021, Medestar answered the FAC, asserting various
affirmative defenses, including sovereign immunity. On September 23, 2021, MACT
filed a motion to quash service of summons and to dismiss the action on the ground of
sovereign immunity (the motion). MACT requested judicial notice of the Federal
Register, Volume 85, No. 20 pages 5462-5467 (Jan. 30, 2020), listing the Jackson Band
of Miwuk Indians (formerly known as the Jackson Rancheria of Me-Wuk Indians of
California) and the Ione Band of Miwok Indians of California as Federally Registered
Indian Tribes.
Attached to the motion documents were the articles of incorporation and the
corporate bylaws of MACT reflects the corporate purpose: “The specific and primary
purposes are to establish, govern, organize, and maintain and expand existing direct
health care services, projects and programs for the Indian population of Central
California and to provide and improve on the delivery of direct health services to the
aforementioned population.” Additionally, the bylaws included the purpose of
supporting the collection of artifacts of importance to Native Americans served, as well
as to provide health care services to nonIndian population as deemed appropriate by the
MACT Board of Directors.
1 A first amended complaint (FAC) was subsequently filed on August 19, 2021, but it is substantially the same as the original complaint, as is Medestar’s answer to the FAC.
4
Membership in MACT is limited to Federally Recognized Indian Tribes in the
service area, who may apply for membership after participating as an advisory member
for no less than three years. The bylaws further explain that the term “Federally
Recognized Indian Tribe” means any tribal entity recognized and eligible for funding and
services from the Bureau of Indian Affairs by virtue of its status as an Indian tribe.
Additional attachments to the motion included a tribal resolution by the Jackson
Rancheria Band of Miwuk Indians designating MACT as a tribal organization, and
authorizing MACT to contract with IHS for comprehensive health services to its
members and other eligible Indians in the service area. A similar tribal resolution by the
Ione Band of Miwok Indians also designated MACT as the local care provider of
comprehensive health care and related services. This resolution named an official tribal
delegate to serve on the MACT Board of Directors.
Finally, the attachments to the motion included an ISDEAA between MACT and
the Department of Health and Human Services Indian Health Service. On September 23,
2021, Medestar joined in the motion.
Windham opposed both the motion by MACT and the joinder by Medestar and
objected to the evidentiary matters proffered by MACT. Attached to Windham’s
opposition papers was a copy of her employment contract with Medestar.
The motion was heard on November 22, 2021, at which time the court took the
matters of the motion as well as Medestar’s joinder under submission. On December 15,
2021, the court issued its rulings, granting both MACT’s motion and Medestar’s joinder,
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granting MACT’s request for judicial notice, overruling plaintiff’s evidentiary objections
to MACT’s declarations, and sustaining objections by MACT to plaintiff’s declaration.
The court found MACT met its burden of proving it was an arm of the tribe entitled to
tribal immunity, that it did not waive its immunity because a tribe is only subject to suit
where Congress has authorized it, or the tribe has waived immunity. The court found that
a tribe’s consent cannot be implied and that the asserted waiver at issue was an agreement
to arbitrate included in a contract between MACT and Medestar, which was not a clear
consent to suit by the tribes. Further, because plaintiff was not a party to that contract,
she failed to establish she is a third party beneficiary thereto.
On February 10, 2022, plaintiff Windham appealed.
DISCUSSION
1. Whether Medestar and MACT Are “Arms of the Tribes”
Plaintiff argues that MACT failed to establish it was an “arm of the tribe,” entitled
to immunity from lawsuit. Here, Windham asserts that MACT was a tribally affiliated
entity whose attenuated relationship to the tribes did not entitle it to immunity, under the
reasoning of People v. Miami Nation Enterprises (2016) 2 Cal.5th 222 (Miami Nation).
We disagree.
A. Background of Tribal Immunity
Indian tribes are “‘domestic dependent nations’” that exercise ‘“inherent sovereign
authority.”’ (Michigan v. Bay Mills Indian Community (2014) 572 U.S. 782, 788 (Bay
Mills), quoting Oklahoma Tax Comm’n v. Citizen Band Potawatomi Tribe of Okla.
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(1991) 498 U.S. 505, 509.) As dependents, the tribes are subject to plenary control by
Congress. (See United States v. Lara (2004) 541 U.S. 193, 200.) However, they remain
“separate sovereigns pre-existing the Constitution.” (Santa Clara Pueblo v. Martinez
(1978) 436 U.S. 49, 56.) Thus, unless and “until Congress acts, the tribes retain” their
historic sovereign authority. (United States v. Wheeler (1978) 435 U.S. 313, 323; see
also Self v. Cher-Ae Heights Indian Community of Trinidad Rancheria (2021) 60
Cal.App.5th 209, 213.)
As a matter of federal law, an Indian tribe is subject to suit only where Congress
has authorized the suit, or the tribe has waived its immunity. (Kiowa Tribe of Okla. v.
Manufacturing Technologies, Inc. (1998) 523 U.S. 751, 754 (Kiowa).) As a matter of
federal law, this immunity from suit “is not subject to diminution by the States.” (Miami
Nation, supra, 2 Cal.5th at pp. 234-235, quoting Kiowa, at p. 756.)
Tribal immunity applies in both federal and state court and extends to “suits
arising from a tribe’s commercial activities, even when they take place off Indian lands.”
(Bay Mills, supra, 572 U.S. at p.790.) Immunity can be abrogated by Congress, but
congressional intent to abrogate tribal immunity must be “‘“unequivocally expressed.”’”
(Santa Clara Pueblo, supra, 436 U.S. at p. 58.) Immunity may also be waived, but “a
tribe’s waiver must be ‘clear.’” (C & L Enterprises, Inc. v. Citizen Band Potawatomi
Indian Tribe of Okla. (2001) 532 U.S. 411, 418.) As discussed in more detail below,
tribal “immunity applies not just broadly but deeply, frequently protecting not just tribal
governments, but tribal entities and corporations that are considered subentities of the
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tribe.” (Miami Nation, supra, 2 Cal.5th at p. 235, citing Florey, Indian Country’s
Borders: Territoriality, Immunity, and the Construction of Tribal Sovereignty (2010) 51
B.C.L.Rev. 595, 627.)
The general rule is that although Indian tribes are not immune from lawsuits filed
against them by the United States, the Indian tribes’ sovereign status affords them
immunity from state jurisdiction. (Agua Caliente Band of Cahuilla Indians v. Superior
Court (2006) 40 Cal.4th 239, 247-248, citing Cohen, Handbook of Federal Indian Law
(2005 ed.) § 7.05[1][a], p. 636.) But there is a limitation: “Although the immunity
extends to entities that are arms of the tribes, it apparently does not cover tribally
chartered corporations that are completely independent of the tribe. Nor does the
immunity extend to members of the tribe just because of their status as members. . . .
When tribal officials act outside the bounds of their lawful authority, however, most
courts would extend the doctrine of Ex Parte Young (1908) 209 U.S. 123 . . . , to allow
suits against the officials, at least for declaratory or injunctive relief.” (Agua Caliente at
pp. 247-248, citing Cohen, supra, § 7.05[1][a], pp. 636–637, fns. omitted.)
B. Immunity of MACT As An Arm of the Tribe
The question presented here is whether MACT established that it is an “arm of the
tribe” for which it is immune from suit. We review the immunity issue de novo. (Self v.
Cher-Ae Heights Indian Community of Trinidad Rancheria, supra, 60 Cal.App.5th at
p. 216, citing Miami Nation, supra, 2 Cal.5th at p. 250.)
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Tribal sovereign immunity may extend to subdivisions of a tribe, including those
engaged in economic activities, provided the relationship between the tribe and the entity
is sufficiently close to properly permit the entity to share in the tribe’s immunity.
(Breakthrough Mgmt. Group, Inc. v. Chukchansi Gold Casino & Resort (10th Cir. 2010)
629 F.3d 1173, 1183.) “[A]n entity asserting immunity bears the burden of showing by a
preponderance of the evidence that it is an ‘arm of the tribe’ entitled to tribal immunity.”
(Miami Nation, supra, 2 Cal.5th at p. 236.)
In the case of Miami Nation, our Supreme Court addressed the situation in which
two federally recognized tribes created affiliated business entities, and those entities or
their subsidiaries then provided deferred deposit loans through the Internet to California
borrowers under terms that allegedly violated the California Deferred Deposit
Transaction Law. (Fin. Code, §23000 et seq.) It concluded that an entity asserting
immunity bears the burden of showing by a preponderance of the evidence that it is an
“arm of the tribe” entitled to tribal immunity. However, Miami Nation concerned off-
reservation commercial activity. (See discussion at 2 Cal.5th pp. 234-235.)
To determine if the tribally created entities were entitled to tribal immunity as
“arms of the tribe,” the Supreme Court devised “a five-factor test that considers (1) the
entity’s method of creation, (2) whether the tribe intended the entity to share in its
immunity, (3) the entity’s purpose, (4) the tribe’s control over the entity, and (5) the
financial relationship between the tribe and the entity.” (Miami Nation, supra, 2 Cal.5th
at p. 236.) In addition to these five factors, a sixth factor has been identified: “whether
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the purposes of tribal sovereign immunity are served by granting [the entity] immunity.”
(Breakthrough Management Group, Inc. v. Chukchansi Gold Casino and Resort, supra,
629 F.3d at p. 1181.) As decisional law recognizes, immunity for subordinate economic
entities “directly protects the sovereign Tribe’s treasury, which is one of the historic
purposes of sovereign immunity in general.” (Allen v. Gold Country Casino (9th Cir.
2006) 464 F.3d 1044, 1047, citing Alden v. Maine (1999) 527 U.S. 706, 750.)
Here, an examination of the six factors supports the trial court’s determination:
(1) The method of MACT’s creation demonstrates it was incorporated as a not-for-
profit corporation, for the express purpose of providing health care services to tribal
members. In addition, its formation was accomplished by means of a tribal resolution,
and its board consists of tribal members.
(2) The resolution by the Jackson Rancheria Band of Miwuk Indians designated
MACT as a tribal organization, authorizing MACT to contract with IHS for
comprehensive health services to its members and other eligible Indians in the service
area; the tribal resolution by the Ione Band contains similar provisions, and named an
official tribal delegate to serve on the MACT Board.
(3) The entity’s stated purpose was to provide health care services to Central
California tribal members.
(4) The tribes maintained control over the entity by naming delegates to the health
care board and membership in MACT is limited to Federally Recognized Indian Tribes in
the service area. In this respect, the tribes are not passive participants, as suggested by
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plaintiff. The declaration of the executive director of MACT established that MACT is
entirely subject to the oversight and control of its member tribes and tribal organizations.
(5) The financial relationship between the entity and the board demonstrates a
tribal function given that the authorization to enter into contracts with IHS was for the
stated purpose of providing comprehensive health services to tribal members and other
eligible Indians in the service area. This was not a commercial agreement, as plaintiff
described it during oral argument. The nonprofit nature of the health care organization is
itself a feature distinguishing this case from Miami Nation. Unlike Miami Nation, the
articles of incorporation and corporate bylaws do not refer to the payment of any
revenues to the tribes. Instead, the funding of MACT was provided pursuant to its
contract with IHS, and the contract designates MACT as a “public health service.”
(6) Finally, the purposes of tribal sovereign immunity are served by granting
MACT immunity given the tribes’ duty to provide health care services for the tribal
members they serve, and the need to promote Indian self-determination. (See Pink v.
Modoc Indian Health Project (9th Cir. 1998) 157 F.3d 1185, 1188-1189.)
Plaintiff argues that MACT failed to make its proof with admissible, authenticated
evidence, but the trial court overruled her objections at the hearing. At that time, counsel
for MACT pointed out that the declarant, to whose declaration the relevant documents
were attached, was the executive director of MACT, who had the requisite knowledge to
provide a foundation for the evidence. Plaintiff’s other arguments that MACT’s evidence
did not fully explain the manner of its formation in 1979, objections which were also
11
overruled by the trial court, do not demonstrate prejudicial error given the matters recited
in the articles of incorporation and the corporate bylaws that reaffirm that the creation of
MACT was for the tribal purpose of providing health care services to tribal members, and
that MACT is comprised wholly of tribal members.
Plaintiff also argues that MACT failed to disclose the amount of revenue it derives
from non-Native American patients versus Native Americans whose care is paid for by
the federal government nor provide concrete evidence demonstrating the actual services
MACT performs for its various beneficiaries, and its proportionate sources of revenue.
The five-factor Miami Nation test does not require such a level of proof, particularly
where the entity is a not-for-profit public health service under contract with the IHS. The
fact MACT’s health care services may be available to nonIndian patients “as deemed
appropriate by the M.A.C.T. Health Board”, does not affect the calculus.2
The record demonstrates MACT met its burden of proving by a preponderance of
evidence that it was an arm of the tribes, entitled to tribal immunity.
2 The Emergency Medical Treatment and Active Labor Act (42 U.S.C. §1395dd) requires any hospital with an emergency department to screen or treat any patient who comes to that department. The challenged paragraph in the article of incorporation and bylaws simply reflects this congressionally mandated obligation, and, absent other evidence to the contrary, does not suggest the possibility that MACT engages in profit- making medical services inconsistent with its stated purposes. MACT’s revenues are irrelevant to the nature of this wage and hour action where plaintiff has not alleged a corporate fraud, so these assertions appear to be more of a fishing expedition.
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C. Whether Medestar Is Entitled to Tribal Immunity
Plaintiff also argues the trial court erred in failing to require Medestar to show
proof it met the 5-part arm-of-the-tribe test of Miami Nation. We disagree again.
Throughout plaintiff’s complaint, she alleged she was jointly employed by
Medestar and MACT.3 As such, her claims were subject to Labor Code section 2810.3,
subdivision (b), which provides: “A client employer shall share with a labor contractor
all civil legal responsibility and civil liability for all workers supplied by that labor
contractor for both of the following: ¶ (1) The payment of wages. ¶ (2) Failure to secure
valid workers’ compensation coverage as required by Section 3700.”
There is a paucity of decisional law treating the shared liability or affirmative
defenses between a labor contractor and a client employer, although the statutory
language is unambiguous. California Labor Code § 2810.3(b) imposes shared liability
for wage-and-hour violations between a “client employer” and a “labor contractor.” A
“[c]lient employer” is a “business entity . . . that obtains or is provided workers to
perform labor within its usual course of business.” (Lab. Code, § 2810.3(a)(1)(A), (b).)
A “[l]abor contractor” is the entity “that supplies . . . a client employer with workers to
perform labor within the client employer’s usual course of business.” (Parsittie v.
3 At oral argument, plaintiff attempted to walk back this assertion, distancing itself from the joint employer theory, by pointing out that she had dismissed MACT on appeal and was proceeding against Medestar alone. However, there is nothing in the appellate record showing that her complaint was amended to delete the allegation that MACT and Medestar were joint employers.
jurisdiction, tribal immunity may also be waived, but unlike in personam or personal
jurisdiction, “a tribe’s waiver must be ‘clear.’” (Miami Nation, supra, 2 Cal.5th at p. 235,
quoting C & L Enterprises, Inc. v. Citizen Band Potawatomi Indian Tribe of Okla., supra,
532 U.S. at p. 418.) In the present case, there was no clear waiver of immunity by either
the tribe or Medestar, which had raised immunity as one of its affirmative defenses.
In this respect, plaintiff’s failure to raise this issue in the trial court has put the
parties and the court at a disadvantage. “An appellate court will not consider procedural
defects or erroneous rulings where an objection could have been, but was not, raised in
the court below.” (Children’s Hospital and Medical Center v. Bontá (2002) 97
Cal.App.4th 740, 776.) This is so because “[i]t is unfair to the trial judge and to the
adverse party to take advantage of an alleged error on appeal where it could easily have
been corrected at trial.” (Ibid.)
Plaintiff argues in her reply brief that there are reasons to doubt the wisdom of
extending tribal immunity to off-reservation commercial activity because doing so may
go ‘beyond what is needed to safeguard tribal self-governance,’ citing Kiowa, supra, 523
17
U.S. at p. 758.) The key point here is that the “activity” involved in this case was the
provision of health care services, which occurred on tribal land, at a tribal facility, for the
benefit of the tribes and tribal members.
Because the claim raised here was not presented in the trial court, Medestar was
deprived of an opportunity to produce evidence or argument to support the continued
viability of its affirmative defense of sovereign immunity following its general
appearance. Additionally, due to plaintiff’s failure to timely raise the issue, Medestar
was deprived of the opportunity to demonstrate how it, as joint employer, was an
affiliated entity, entitled to the protection of the sovereign immunity.
DISPOSITION
The judgment is affirmed. Medestar and MACT are entitled to costs on appeal.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
RAMIREZ P. J.
We concur:
MILLER J. RAPHAEL J.
18
AI Brief
AI-generated · verify before citing
Holding. The court held that MACT is an arm of the tribe entitled to sovereign immunity and that Medestar, as a joint employer, is entitled to share in that immunity regarding the plaintiff's wage and hour claims. The court further held that the plaintiff forfeited the argument that Medestar waived immunity by failing to raise it in the trial court.
Issues
Whether MACT established it is an 'arm of the tribe' entitled to sovereign immunity.
Whether Medestar is entitled to share in tribal immunity as a joint employer.
Whether Medestar waived its immunity defense by filing an answer to the complaint.
Disposition. Affirmed.
Quotations verified verbatim against the opinion
“The record demonstrates MACT met its burden of proving by a preponderance of evidence that it was an arm of the tribes, entitled to tribal immunity.”
“On this basis, the trial court’s finding that immunity extended to Medestar by virtue of the joint employment relationship is proper.”