In Ray v. County of Los Angeles, published August 22, 2019, the 9th Circuit affirmed in part and reversed in part a district court's ruling on a motion to dismiss in a Fair Labor Standards Act case brought by employees of California’s In-Home Supportive Services program, which is implemented and run by the State and its counties. The defendant county argued that it should be dismissed because it was immune from liability under the Eleventh Amendment. The district court ruled that the county was not immune as an arm of the state.
The 9th Circuit agreed. Although courts have long held counties are not entitled to Eleventh Amendment immunity, case law from the Supreme Court suggests that they might be entitled to that immunity under some circumstances. The 9th Circuit therefore declined to rule categorically that counties were not entitled to the immunity. Instead, it applied the five-factor test set forth in Mitchell v. Los Angeles Community College District, 861 F.2d 198 (9th Cir. 1988) for determining whether an entity is an arm of the state for purposes of Eleventh Amendment immunity. The court held that MItchell was still valid law. The most important factor under Mitchell is whether a judgment against the county would be satisfied out of state funds. The county could not show that a judgment against it under the FLSA by in-home care workers would be paid out of state funds. Of the remaining four factors, only one weighed in favor of finding the county an arm of the state: because the state mandated the payment rules at issue, the county had no control over the conduct that exposed it to potential liability. But since all the other factors weighed against finding the county acted as an arm of the state, the 9th Circuit ruled that Eleventh Amendment immunity did not apply to the subject matter of the lawsuit.
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