GEO Group can't nix $23 mln verdict over immigrant detainee pay

Geo

16/01/2025 22:13

By Daniel Wiessner
       Jan 16 (Reuters) - A U.S. appeals court on Thursday
upheld rulings requiring private prison operator GEO Group
 GEO.N  to pay more than $23 million to the state of Washington
and hundreds of immigrant detainees who were paid $1 a day to
participate in a work program.
    The San Francisco-based 9th U.S. Circuit Court of Appeals in
a 2-1 decision said that while GEO operates a Tacoma,
Washington, detention center under a contract with U.S.
Immigration and Customs Enforcement, it does not enjoy the
immunity from state minimum wage laws afforded to the federal
government. 
    GEO was appealing a $17.3 million jury verdict for detainees
who were paid $1 a day to cook, clean, perform repairs, and
staff a barber shop and library at the detention center, and a
separate $6 million award for the state. Washington had sued GEO
for unjust enrichment for not paying detainees the minimum wage.
    The Washington Supreme Court, in response to certified
questions from the 9th Circuit, ruled in 2023 that the detainees
were GEO's employees under state law and had to be paid the
minimum wage. That left the federal court to consider GEO's
claim that because it was operating a government detention
center, it was shielded from state wage laws just like the
federal government. 
    The 9th Circuit on Thursday said the government did not
dictate the wages GEO must pay to detainees or require it to
operate the work program and also rejected the company's claim
that the state minimum wage was preempted by federal immigration
law. 
    "There is nothing — either in federal law or in GEO’s
contract with the federal government — that prevents GEO from
paying Washington’s minimum wage to its civil detainees who
perform work for the benefit of GEO," Circuit Judge William
Fletcher wrote.
        Florida-based GEO Group in a statement said it disagreed
with the decision "and will continue to vigorously pursue all
available appeals of this ruling.”
  
        Washington Attorney General Nick Brown, a Democrat, in a
statement said the decision makes clear that for-profit
businesses must comply with state employment laws.
  
    A group of detainees sued GEO in Tacoma, Washington, federal
court in 2017 and the case was consolidated with the state's
lawsuit filed later that year.
    U.S. District Judge Robert Bryan in Tacoma held a trial in
the case in 2021 - the first in a federal court to be held
virtually during the COVID-19 pandemic - and upheld the jury's
verdict in favor of the detainees while also siding with the
state in a bench ruling. 
    The Washington Supreme Court in its 2023 decision rejected
GEO's claim that an exemption in state wage law for inmates at
government-run institutions applied to detainees at its
facility.
    On Thursday, 9th Circuit Judge Mark Bennett in a dissenting
opinion said applying state wage laws to contractors like GEO
improperly "punishes" the federal government for its policy
choice to have private companies operate detention facilities.  
    "That is the very definition of a state affording itself
better treatment than it affords the United States," in
violation of the U.S. Constitution's Supremacy Clause, wrote
Bennett, who was appointed by Republican President-elect Donald
Trump in his first term.    
    Fletcher was joined by Circuit Judge Mary Murguia. Both
judges were appointed by Democratic presidents. 
    The case is Nwauzor v. GEO Group Inc, 9th U.S. Circuit Court
of Appeals, No. 21-36024.
    For the plaintiffs: Jennifer Bennett of Gupta Wessler
    For the state: Marsha Chien of the Washington Attorney
General's Office
    For GEO Group: Michael Kirk of Cooper & Kirk

    Read more:
    GEO Group must pay minimum wage to immigrant detainees,
court rules
    GEO Group appeal over $1-a-day detainee pay sent to Wash.
top court
    GEO Group can't nix $17.3 mln award in $1-a-day detainee pay
case
    Jury says GEO Group must pay minimum wage to immigrant
detainees
    GEO Group can't avoid virtual trial in class action over
dollar-a-day detainee pay
    Immigrant detainees not owed minimum wage under FLSA- 4th
Circuit

 (Reporting by Daniel Wiessner in Albany, New York)