United States Court of Appeals for the Fifth Circuit ____________ United States Court of Appeals Fifth Circuit

FILED No. 23-20494 July 31, 2024 ____________ Lyle W. Cayce Elizabeth Escobedo, Clerk

Plaintiff—Appellee,

versus Ace Gathering, Incorporated,

Defendant—Appellant. ______________________________

Appeal from the United States District Court for the Southern District of Texas USDC No. 4:22-CV-538 ______________________________ Before Higginson, Willett, and Oldham, Circuit Judges. Don R. Willett, Circuit Judge: In this certified interlocutory appeal concerning unpaid overtime wages, we must decide whether tanker-truck drivers who transport crude oil solely within the State of Texas are transporting property in “interstate or foreign commerce” under the Motor Carrier Act of 1980. Because most of the crude oil being transported is ultimately bound for destinations outside the state, our precedent requires that we answer yes. Case: 23-20494 Document: 55-1 Page: 2 Date Filed: 07/31/2024

I Ace Gathering, Inc. is in the business of “crude oil gathering,” which Ace describes simply as “gathering crude oil from oil fields and transporting it to pipelines in order to fulfill contracts with Ace’s customers.” For transportation between the oil fields and pipelines, Ace employs so-called Crude Haulers. Crude Haulers are drivers of large, 18-wheeled tanker trucks who drive to producers’ oil fields, load crude oil onto their trucks, and then transport that oil on public roads and highways to an “injection point” on a pipeline. Once injected, the oil travels through the pipeline to Ace’s customers, who then receive their monthly contractual volume of oil at the pipeline terminal. Everyone agrees that, as far as Ace’s business is concerned, the entire process described above takes place solely within the State of Texas. There is, to be sure, evidence in the record that some of Ace’s Crude Haulers occasionally drove across state lines and that these interstate routes were assigned on a volunteer basis. But all the Crude Haulers in this case attest that they never volunteered for such routes and that their driving duties never took them beyond state lines. Everyone also agrees that once the crude oil reaches Ace’s customers at the pipeline terminal, the oil is then taken either to out-of-state refineries (usually in Louisiana) or to export markets for shipment outside the United States. Granted, it is also clear from the record that not all the crude oil ultimately leaves the state. But some of Ace’s executives submitted affidavits attesting that approximately 68% to 90% of the oil is later exported to foreign markets and that a “significant portion” of it is taken to out-of-state refineries. Based on these undisputed facts, lead plaintiff Elizabeth Escobedo, along with a putative class of former Ace Crude Haulers, sued Ace for unpaid

2 Case: 23-20494 Document: 55-1 Page: 3 Date Filed: 07/31/2024

overtime wages under the Fair Labor Standards Act (FLSA). The Crude Haulers collectively allege that they “regularly or occasionally worked in excess of forty hours a week” and that Ace misclassified them as exempt from FLSA overtime pay. After conducting discovery