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Donovan v. DialAmerica Marketing, Inc.

United States Court of Appeals for the Third Circuit
757 F.2d 1376 (3d Cir. 1985)


DialAmerica Marketing, Inc. (DialAmerica) (defendant) was a telephone-marketing firm primarily engaged in selling magazine-subscription renewals over the phone. DialAmerica obtained the telephone numbers of magazine subscribers through its home-researcher program. The researchers picked up cards from DialAmerica containing the names and addresses of subscribers, then took the cards home and researched the telephone numbers of the subscribers. The researchers returned the cards one week later with the cards filled out in a manner prescribed by DialAmerica. The researchers chose their own hours and the numbers of cards to research. DialAmerica compensated the researchers at a set price per card. DialAmerica also hired distributors, who distributed work to the researchers. The distributors paid their own expenses and negotiated the compensation paid to the researchers. DialAmerica was sued by Raymond Donovan, the secretary of labor of the United States, for alleged violations of the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201, et seq. The district court held in favor of DialAmerica and found that the FLSA was inapplicable, because the researchers and the distributers were not employees within the meaning of the FLSA. Donovan appealed.

Rule of Law


Holding and Reasoning (Becker, J.)

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