Appeal from the United States District Court for the Eastern District of Washington Edward F. Shea, District Judge, Presiding D.C. No. 2:07-CV-05020-EFS.
The opinion of the court was delivered by: Graber, Circuit Judge
Argued and Submitted July 14, 2010 -- Seattle, Washington
Before: Stephen Reinhardt, Susan P. Graber, and Richard A. Paez, Circuit Judges.
When is a new employer a "successor in interest" to a former employer under the Family and Medical Leave Act of 1993 ("FMLA"), 29 U.S.C. §§ 2601-2654? The answer matters because an employee is not eligible for the protections of the FMLA until he or she has worked for a particular employer for at least 12 months, and the term "employer" "includes... any successor in interest of an employer." 29 U.S.C. § 2611(4)(A)(ii). Today we adopt the persuasive reasoning of Grace v. USCAR, 521 F.3d 655 (6th Cir. 2008), and apply the regulations promulgated by the United States Department of Labor ("DOL") at 29 C.F.R. § 825.107. After doing so, we conclude that Plaintiff Christina Sullivan is not entitled to FMLA benefits because her new employer, Defendant Dollar Tree Stores, Inc. ("Dollar Tree"), for whom she worked for less than 12 months, is not a successor in interest of her former employer, Factory 2-U. Accordingly, we affirm the summary judgment in Dollar Tree's favor.
FACTUAL AND PROCEDURAL HISTORY
Factory 2-U was a retail store that sold discount clothing. At its height, Factory 2-U operated more than 200 stores in the western United States and employed more than 4,000 people. Seven stores were located in the Tri-Cities area of southeastern Washington (Kennewick, Richland, and Pasco), and each of those stores had about 30 employees. Plaintiff Christina Sullivan was the full-time Store Manager of the Pasco Factory 2-U store.
By 2004, however, Factory 2-U had filed for Chapter 11 bankruptcy. In September 2004, the bankruptcy court approved the sale of Factory 2-U's existing leasehold on the Pasco store (and 39 other store leaseholds) to Dollar Tree. Dollar Tree is a chain retail store that sells a variety of items, including clothing, for one dollar. Apart from the leaseholds, Dollar Tree purchased no other assets of Factory 2-U. Others purchased the remainder of Factory 2-U's assets. At the end of September 2004, the Factory 2-U store in Pasco closed its doors.
Dollar Tree opened for business at the Pasco location four weeks later. During those four weeks, Dollar Tree reconfigured the store. First, a construction crew remodeled the interior to support a Dollar Tree store, in accordance with Dollar Tree's specifications. Second, a set-up team prepared the inventory, stocked the shelves with Dollar Tree's merchandise, and performed other preparatory work. Finally, on October 30, 2004, Dollar Tree opened for business in the former location of Factory 2-U, with 15 to 25 Dollar Tree employees.
In September 2004, Plaintiff filled out an application for employment with Dollar Tree. Dollar Tree hired her as an assistant manager of the soon-to-be-opened Dollar Tree store at the same Pasco location. Even though the store was closed for four weeks, Plaintiff's employment was continuous. During the first two weeks of the renovations in Pasco, Plaintiff trained at a pre-existing Dollar Tree store in nearby Richland. After her two-week training, Plaintiff then assisted with the preparatory work at the Pasco store. When the Pasco store opened, Plaintiff began full-time work at that store as an assistant manager. Only one other former Factory 2-U employee worked at the new Dollar Tree store in Pasco after its opening.*fn1
From September 2004 until May 2005, Plaintiff worked as assistant manager at the Pasco Dollar Tree without incident. In May 2005, Plaintiff's mother experienced serious health problems, and Plaintiff provided assistance and care for her. Dollar Tree granted Plaintiff some amount of unpaid leave but less than Plaintiff requested. Plaintiff either quit or was fired in late May or June 2005.
Plaintiff eventually contacted the DOL, which initiated an investigation of whether Dollar Tree had violated the FMLA. The DOL concluded that Dollar Tree's actions had violated the FMLA and informed the parties of its conclusion. During the negotiations that followed, Dollar Tree offered Plaintiff reinstatement to her former position at the Pasco store, a partial payment of $5,000 toward lost wages, and certain other benefits such as accrued sick leave. Although Plaintiff had sought more than $20,000 in lost wages, she accepted the offer*fn2 and began work again on April 14, 2006.
After her reinstatement, Plaintiff continued working at the Pasco Dollar Tree store until she quit voluntarily in December 2006. Soon thereafter, Plaintiff filed this action in federal court seeking the full amount of her lost wages. The district court held that Dollar Tree was not a successor in interest under the FMLA and granted summary judgment to Dollar Tree. Plaintiff timely appeals.
We review de novo both a grant of summary judgment in general, Sharer v. Oregon, 581 F.3d 1176, 1177 (9th Cir. 2009), and pure questions of law decided on summary judgment, Bjustrom v. Trust One Mortg. Corp., 322 F.3d 1201, 1205 (9th Cir. 2003). "Whether the district court correctly construed the hearsay rule is a question of law reviewed de novo. We review the admission of evidence under an exception to the hearsay rule for abuse of discretion." United States v. Hernandez-Herrera, 273 F.3d 1213, 1217 (9th Cir. 2001) (citation and internal quotation marks omitted).
Plaintiff submitted many documents in support of her case, two of which are relevant here. First, Plaintiff submitted a report prepared by the DOL during or after its investigation of Plaintiff's complaints ("DOL Report"). Second, she submitted her own affidavit. Plaintiff argues that the district court erred by disregarding certain statements in the two documents.*fn3
 Plaintiff argues that the district court erred when it held that the DOL Report was inadmissible hearsay not exempted by Federal Rule of Evidence 803(8)(C), which provides:
The following are not excluded by the hearsay rule, even though the declarant is available as a witness:
(8) Public records and reports. Records, reports, statements, or data compilations, in any form, of public offices or agencies, setting forth... (C) in civil actions and proceedings... factual findings resulting from an investigation made pursuant to authority granted by law, unless the sources of information or other circumstances indicate lack of trustworthiness.
The disputed portion of the DOL Report states:
Dollar Tree Stores, Inc., a covered employer, is considered a "successor in interest" to the covered employer Factory 2-U Stores, Inc. The circumstances of the transition that occurred between the two companies coincide with six out of eight factors that determine a "successor in interest." These factors are: 1) the same retail business operation continued; 2) the same rental space was used; 3) most of the same personnel continued to work; 4) the store continued to employ retail salespeople who worked during regular hours; 5) the same supervisory personnel continued with the opening of the Dollar Tree store; and 6) the products continued to include clothing along with other personal, gift and household items (Exhibit E-6).
a. Legal Conclusions as "Factual Findings"
 Some portions of the DOL Report, including the first sentence in particular, state legal conclusions. The district court ruled that, because Rule 803(8)(C) applies to "factual findings," legal conclusions are inadmissible. This seemingly straightforward holding uncovers an open question of law in this circuit: Does Rule 803(8)(C) cover an investigative report's legal conclusions as well as its factual findings?
In Beech Aircraft Corp. v. Rainey, 488 U.S. 153 (1988), the Supreme Court rejected the argument that the term "factual findings" in Rule 803(8)(C) encompassed only "facts" and not "opinions" and "conclusions." The Court held that "factually based conclusions or opinions are not on that account excluded from the scope of Rule 803(8)(C)." Id. at 162. Particularly relevant here, the Court cabined its decision:
We emphasize that the issue in this litigation is whether Rule 803(8)(C) recognizes any difference between statements of "fact" and "opinion." There is no question here of any distinction between "fact" and "law." We thus express no opinion on whether legal conclusions contained in an ...