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Carey v. GateHouse Media Massachusetts I, Inc.

Appeals Court of Massachusetts, Norfolk

February 27, 2018

SUZANNE E. CAREY, personal representative, [1]

          Heard: September 14, 2017.

         Civil action commenced in the Superior Court Department on September 22, 2011.

         Motions for summary judgment were heard by Angel Kelley Brown, J.; the entry of separate and final judgment was ordered by her; and a motion for postjudgment relief was heard by her.

          Mark W. Batten for the defendant.

          James W. Simpson, Jr., for the plaintiff.

          Peter J. Caruso & Robert J. Ambrogi, for Massachusetts Newspaper Publishers Association, amicus curiae, submitted a brief.

          Present: Green, Sullivan, & Sacks, JJ.

          SACKS, J.

         Defendant GateHouse Media Massachusetts I, Inc. (GateHouse), publisher of the Patriot Ledger newspaper, appeals from a separate and final judgment under Mass.R.Civ.P. 54(b), 365 Mass. 821 (1974), declaring that David King, who had delivered the Patriot Ledger by automobile to some of its subscribers, was, under G. L. c. 149, § 148B (§ 148B), GateHouse's employee rather than an independent contractor. Gatehouse also appeals from the denial of its motion for relief from the rule 54(b) judgment, which asserted that the relevant portion of § 148B is preempted by the Federal Aviation Administration Authorization Act of 1994 (FAAAA), codified at 49 U.S.C. § 14501(c)(1). We affirm.[2]


         We recount certain undisputed material facts from the summary judgment record, reserving for later discussion the details of GateHouse's contract with King. GateHouse, a subsidiary of New York-based GateHouse Media, "publishes and distributes" a variety of daily and weekly newspapers within Massachusetts. Gatehouse describes itself as a publisher and distributor of publications in its "Wholesale Agreements" with newspaper delivery drivers such as King. GateHouse employs a sales and advertising department, which works to increase circulation and advertising revenue. Among GateHouse's newspapers is the Patriot Ledger, published on all five weekday afternoons and on Saturday mornings.

         GateHouse distributes the Patriot Ledger out of a distribution center in Braintree, employing supervisors, district managers, distribution managers, and others to manage that process. GateHouse has three main distribution methods. First, to distribute the newspaper to residential and business subscribers, GateHouse enters into agreements with individual carriers, [3] whom it classifies as independent contractors. The carriers are required to buy copies of the newspaper from GateHouse at wholesale rates, for resale and distribution within delivery areas designated by GateHouse. Second, GateHouse hires unionized employees to distribute bulk quantities of the newspaper to various types of stores, where they are resold at retail. Third, GateHouse reaches some customers through online publishing.

         King became a carrier for GateHouse in 2009, using his own automobile to deliver up to 250 copies of the Patriot Ledger, six days per week, in the Weymouth area. His contract was terminated in 2011, apparently by GateHouse, for reasons not stated in the record.

         King then filed this action in Superior Court, asserting that GateHouse had misclassified him as an independent contractor rather than an employee under § 148B. He also asserted claims -- dependent on his being an employee under § 148B[4] -- that GateHouse had deducted unauthorized charges and fees from its payments to him, in violation of G. L. c. 149, §§ 148 and 150; failed to pay him a minimum wage, in violation of G. L. c. 151, § 1; and violated his rights under the tip-sharing statute, G. L. c. 149, § 152A. He also asserted an unjust enrichment claim. King sought to represent, and later obtained certification of, a class consisting of all individuals who had signed a written contract to deliver the Patriot Ledger and had provided delivery services under those contracts, during the "class period."[5]

         On cross motions for summary judgment limited to the misclassification claim, the judge ruled in July, 2014, that under § 148B, King was an employee, rather than an independent contractor. She based her ruling on GateHouse's inability to meet its burden of proving that the service furnished by King was "performed outside the usual course of the business of the employer, " as is required under prong two of § 148B's three-prong test. See Somers v. Converged Access, Inc., 454 Mass. 582, 588-589 (2009), citing Athol Daily News v. Board of Review of the Div. of Employment & Training, 439 Mass. 171, 175 (2003) (Athol Daily News), and its interpretation of "nearly identical language in G. L. c. 151A, § 2." The judge therefore did not decide whether GateHouse could meet its burden under prongs one and three.[6] After an additional sixteen months of motion practice over individual damages, prejudgment interest, and class certification, the parties moved for, and in November, 2015, the judge ordered, entry of a separate and final judgment, under Mass.R.Civ.P. 54(b), on the misclassification claim. GateHouse appealed.

         After the appeal was docketed in this court in August, 2016, GateHouse sought and obtained a stay of appellate proceedings and leave to file a motion for relief from judgment in the trial court. The basis for GateHouse's motion was that two recent Federal appellate decisions had held prong two of § 148B to be preempted, as to certain delivery drivers, by a section of the FAAAA, codified at 49 U.S.C. § 14501(c) (1), concerning motor carriers' transportation of property. See Schwann v. FedEx Ground Packaging Sys., Inc., 813 F.3d 429 (1st Cir. 2016) (Schwann); Massachusetts Delivery Assn. v. Healey, 821 F.3d 187 (1st Cir. 2016) (Massachusetts Delivery Assn.). GateHouse asked that the rule 54(b) judgment be vacated so that it could assert a similar preemption defense. In December, 2016, the judge denied the motion on the ground, among others, that GateHouse had waived the issue by not asserting the preemption defense in its answer or summary judgment motion.[7]GateHouse's appeal of this ruling was consolidated with its appeal of the rule 54(b) judgment on the misclassification issue.


         1. Usual course of business.

         As the purpose and operation of § 148B's three prong test[8] have been recently and thoroughly reviewed in Sebago v. Boston Cab Dispatch, Inc., 471 Mass. 321 (2015) (Sebago), and Chambers v. RDI Logistics, Inc., 476 Mass. 95 (2016) (Chambers), we proceed directly to the question whether GateHouse has proven under prong two -- as it must to defeat King's claim of employee status -- that King performed newspaper delivery services "outside the usual course of the business" of GateHouse. G. L. c. 149, § 148B(a)(2), as appearing in St. 2004, c. 193, § 26. No single test controls this inquiry, so we consider several factors previously held relevant.

         a. Business's self-description.

         Essentially the same question arose in Athol Daily News, under the usual course of business portion of the closely-related three-prong employment test of G. L. c. 151A, § 2. 439 Mass. at 175, 178-179. In addressing that question, albeit briefly, the Supreme Judicial Court observed that the manner in which a business defines itself is relevant to determining its usual course of business. Id. at 179. "In light of the fact that the News itself defines its business as 'publishing and distributing' a daily newspaper, we agree that the carriers' services are performed in 'the usual course of [the News's] business.'" Ibid. See Sebago, 471 Mass. at 333 (stating, in a § 148B case, "We have recognized that a purported employer's own definition of its business is indicative of the usual course of that business"); Id. At 335 (analyzing how various defendant businesses advertised and otherwise held themselves out).[9]

         Gatehouse describes its business as "[n]ewspaper [p]ublishing" in its annual corporate filing with the Secretary of the Commonwealth, and describes itself as a publisher and distributor in its agreements with delivery drivers. This description is notable because, even aside from its use of the term "distribute, " GateHouse acknowledges that it is a "publisher, " and to "publish" means, among other things, "to place before the public (as through a mass medium); DISSEMINATE." Webster's Third New International Dictionary 1837 (2002). A newspaper ...

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