Pruitt v. State

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

DAVID LEE PRUITT, Plaintiff/Appellant,

v.

STATE OF ARIZONA, et al., Defendants/Appellees.

No. 1 CA-CV 24-0418
FILED 05-06-2025

Appeal from the Superior Court in Maricopa County
No. CV2021-053278
The Honorable Michael D. Gordon, Judge

AFFIRMED

COUNSEL

Ahwatukee Legal Office, P.C., Phoenix
By David L. Abney
Co-Counsel for Plaintiff/Appellant

Shapiro Law Team, Scottsdale
By Rick Horton, David C. Shapiro
Co-Counsel for Plaintiff/Appellant

Arizona Attorney General’s Office, Phoenix and Tucson
By Jennifer Rethemeier, Claudia Acosta Collings
Counsel for Defendant/Appellee State of Arizona
 PRUITT v. STATE, et al.
Opinion of the Court

OPINION

Judge Samuel A. Thumma delivered the opinion of the Court, in which
Presiding Judge Kent E. Cattani and Judge Angela K. Paton joined.

T H U M M A, Judge:

¶1 Plaintiff David Lee Pruitt appeals from the grant of summary
judgment for defendant State of Arizona (State) and the denial of his motion
for new trial. Pruitt challenges the conclusion that the State is his statutory
employer, arguing that the only contractual relationship is between the
Arizona Department of Corrections, Rehabilitation and Reentry (ADCRR)
and Pegasus Research Group d/b/a Televerde (Televerde). Because Pruitt
has shown no error, the rulings are affirmed.

FACTS AND PROCEDURAL HISTORY

¶2 Televerde contracts with ADCRR to employ inmates to work
at Televerde’s call centers. Pruitt, a civilian, was employed by Televerde to
supervise inmates working in the call center at the Perryville State Prison
Complex. While escorting inmates from one building to another, Pruitt
stepped in a pothole, fell and was injured.

¶3 Pruitt filed for and received workers’ compensation benefits
from Televerde for his injuries. Pruitt then filed this tort case against the
State and ADCRR, claiming negligence, premises liability and negligent
hiring, entrustment and training.

¶4 The State, after conducting discovery, moved for summary
judgment arguing Pruitt was a statutory employee under Arizona Revised
Statutes (A.R.S.) section 23-902 (2025),1 making the State immune from
Pruitt’s tort claims. The State also argued that ADCRR is a non-jural entity,
which cannot be sued. After full briefing, the superior court granted the
State’s motion. After Pruitt unsuccessfully moved to reconsider, the court
entered a final judgment resolving all of the parties’ claims.

1 Absent material revisions after the relevant dates, statutes and rules cited

refer to the current version unless otherwise indicated.

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 PRUITT v. STATE, et al.
Opinion of the Court

¶5 Pruitt then filed a motion for new trial under Arizona Rule of
Civil Procedure 59. He argued for the first time that, because “the State and
[ADCRR] are distinct legal entities,” the State could not be Pruitt’s statutory
employer considering “the only contract of employment regarding Pruitt
was the contract between [ADCRR] and Televerde.” The State responded
that (1) Pruitt waived this argument by failing to raise it before entry of final
judgment and (2) because ADCRR is an arm of the State, the court properly
granted the State summary judgment. In reply, Pruitt argued waiver did
not apply because “if there was no employment contract between the State
and Televerde—and there was not,” then the superior court lacked subject-
matter jurisdiction to declare the State was a statutory employer.

¶6 In denying the motion for new trial, the court affirmed the
State “is the party who entered the contract at issue and therefore could [be]
(and was) [Pruitt’s] statutory employer.” Pruitt timely appealed from both
the final judgment and the denial of his new trial motion. This court has
appellate jurisdiction pursuant to Article 6, Section 9, of the Arizona
Constitution and A.R.S. §§ 12-120.21(A)(1) and -2101(A)(1-2).

DISCUSSION

I. The Superior Court Did Not Err in Granting the State’s Motion for
Summary Judgment.

¶7 Pruitt’s core argument asserts that the State is not, and could
never have been, his statutory employer, meaning the entry of summary
judgment was error. “The court shall grant summary judgment if the
moving party shows that there is no genuine issue as to any material fact
and that the moving party is entitled to judgment as a matter of law.” Ariz.
R. Civ. P. 56(a). Whether the State was Pruitt’s statutory employer at the
time of his injury is a mixed question of law and fact subject to de novo
review. See Mitchell v. Gamble, 207 Ariz. 364, 367 ¶ 7 (App. 2004) (citing
cases). The court views “the evidence and reasonable inferences in the light
most favorable to the party opposing the motion” for summary judgment.
Andrews v. Blake, 205 Ariz. 236, 240 ¶ 12 (2003).

A. By Statute, ADCRR Is the State.

¶8 Pruitt argues “the State and [ADCRR] are distinct legal
entities” and “the contract under which Pruitt was employed was
exclusively a contract between [ADCRR] and Televerde,” thus making it
impossible for the State to be Pruitt’s statutory employer. Pruitt also argues
he did not waive the issue by failing to raise it until the motion for new trial
because, if there was no employment contract between the State and

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 PRUITT v. STATE, et al.
Opinion of the Court

Televerde, then the superior court would have had no subject-matter
jurisdiction “to declare that the State was a ‘statutory employer’ of
Televerde (and, hence, of Pruitt).”

¶9 Setting aside issues of waiver, Pruitt’s argument is
unavailing. By statute, “‘State’ means this state and any state agency, board,
commission, or department.” A.R.S. § 12-820(8). ADCRR is a department of
the State. Pruitt also concedes that ADCRR is a non-jural entity that cannot
be sued. And by statute, “[a]ny and all causes of action that may arise out
of tort caused by the director, prison officers or employees of [ADCRR],
within the scope of their legal duty, shall run only against the state.” A.R.S.
§ 31-201.01(F).

¶10 Given these statutory provisions, Pruitt points to the
language of the contract signed by ADCRR and Televerde, arguing it is
exclusively between those two entities and does not include the State. Not
so. The first page of the contract expressly uses “State of Arizona” in the
heading, adding that “[r]eferences to State shall mean the State of Arizona.”
The contract, in turn, specifies various rights and obligations of the State
and Televerde, including cancellation provisions, audit of records, e-
verification of employee records and indemnification and workers
compensation. Pruitt admits the employer in this instance was ADCRR,
which is an arm of the State. Because ADCRR is an arm of the State, the
court did not err in concluding that, for purposes of Pruitt’s tort claims here,
ADCRR is the State.

B. Pruitt Has Not Shown the Superior Court Erred in
Concluding ADCRR Is Pruitt’s Statutory Employer.

¶11 Pruitt argues the State was never his statutory employer and
therefore had no right to use the statutory employer doctrine as an
immunity defense. An entity seeking to show it is a statutory employer
must show two things: (1) retention of supervision or control over the work
procured to be done by a contractor and (2) the work entrusted to the
subcontractor must be a “part or process in the trade or business” of the
employer against whom the third-party tort action is asserted. Young v.
Env’t Air Prods., Inc., 136 Ariz. 158, 161 (1983) (citing authority).

1. ADCRR Retained Supervision or Control Over the
Work Procured by Televerde.

¶12 To determine whether an employer is a statutory employer of
an independent contractor’s employee, the court considers the control
exercised by the employer over the contractor, not the employee. Young, 136

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Ariz. at 163. Pruitt claims that “reasonable jurors could have concluded and
inferred from the facts that [ADCRR] had no relevant supervision or control
over the for-profit call center trade or business that Televerde was
contracted to provide.” But an entity hiring a contractor exercises
supervision or control over the contractor if the hiring entity retains “the
right to control or supervise the methods of obtaining a specific result.”
Hunt Bldg. Corp. v. Indus. Comm’n, 148 Ariz. 102, 105 (1986) (citation
omitted).

¶13 In making this determination, the court considers the totality
of the circumstances, including the following factors:

[T]he duration of the employment; the method
of payment; who furnishes necessary
equipment; the right to hire and fire; who bears
responsibility for work[ers’] compensation
insurance; the extent to which the employer
may exercise control over the details of the
work[] and whether the work was performed in
the usual and regular course of the employer's
business.

Home Ins. Co. v. Indus. Comm’n, 123 Ariz. 348, 350 (1979) (citations omitted).

¶14 Wagner v. State applied these factors in a similar context,
affirming summary judgment for the State. 242 Ariz. 95 (App. 2017). In
Wagner, a clinical social worker, who worked for a contractor that provided
healthcare services at state-owned prisons under a contract with ADCRR,
slipped, fell and injured herself at a prison. Id. at 96 ¶ 2. The contract
between the contractor and ADCRR required ADCRR to maintain facilities
and fixtures for health services. Id. at 97 ¶ 10. Additionally, ADCRR
retained the authority to approve the contractor’s hires, the contractor was
required to have workers’ compensation insurance and ADCRR had the
authority to monitor “any correspondence, records, reports, or other
written and/or electronic materials” dealing with the contract. Id. at 97–98
¶ 10. Looking to the substance of the contract and recognizing that the court
should strictly construe the statute “when loss of the worker’s common law
rights is the object for which the statute is invoked,” Wagner affirmed the
grant of summary judgment for the State. Id. at 96 ¶ 1, 96 ¶ 7 (citing Young,
136 Ariz. at 163). The court held the employee was a statutory employee of
the State because the State retained the right to control or supervise the
contractor’s work and because the services constituted a part or process in
the usual and regular course of the State’s business. Id. at 96 ¶ 1.

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¶15 Here, ADCRR and Televerde entered into a contract where
Televerde agreed to pay ADCRR for the right to operate a call center in the
prison. Televerde then provided work opportunities to ADCRR inmates to
assist in their rehabilitation. ADCRR screened and approved the hires after
performing a background check before allowing them access to the call
center or to supervise inmates. Televerde’s employees were subject to
annual background checks to maintain access to the prison facilities. The
contract with ADCRR required Televerde to provide workers’
compensation insurance, and Televerde did so. Indeed, Pruitt received
workers’ compensation benefits before filing this suit. ADCRR provided the
land, the building and the infrastructure for the call center, while Televerde
provided the necessary business equipment. Televerde provided
supervisors “knowledgeable in the types of work tasks to be accomplished
and the correct way to complete each task,” and who “supervise[d] inmate
work production.” The contract limited the type of equipment that could
be used in the call center, and ADCRR required Televerde’s staff to monitor
and record all phone calls made by inmates to ensure the calls were
pertinent to the inmates’ work. The contract also required Televerde to
comply with ADCRR’s “procedures in recording inmate work hours and
rendering all payments.” These contract provisions show the same type of
control over the work by ADCRR as in Wagner, if not more.

¶16 Pruitt repeatedly states that “[t]here are genuine disputes on
the ‘statutory employee’ totality-of-the-circumstances supervision-and-
control factors” that can only be resolved by a jury. But the State does not
dispute the facts Pruitt asserted, and even accepting them as true, Pruitt is
not entitled to relief.

¶17 In arguing summary judgment was improper, Pruitt relies on
Livingston v. Citizen’s Utils., Inc., 107 Ariz. 62 (1971), including a subsequent
appeal in that case, Citizen’s Utils., Inc. v. Livingston, 21 Ariz. App. 48 (1973).
Livingston, however, is distinguishable. In Livingston, there was no written
contract governing the relationship between the employer and the claimed
statutory employer, with the court stating:

Where there is [] no express agreement as to the
right of the employer to control the manner of
doing the work by an alleged employee, the
existence or non-existence of this right must be
determined by reasonable inferences drawn
from the surrounding circumstances and this is
normally a question of fact for the jury.

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 PRUITT v. STATE, et al.
Opinion of the Court

107 Ariz. at 65.2 But here, the relationship between ADCRR and Televerde
is governed by an express written contract. The control exercised by the
State over Televerde, which is the dispositive consideration, see Young, 136
Ariz. at 163, is defined in that written contract. “The construction of a
contract is a question of law when the terms are plain and unambiguous.”
Smith v. Melson, Inc., 135 Ariz. 119, 121 (1983) (citations omitted). Pruitt
concedes the terms of the contract between ADCRR and Televerde are plain
and unambiguous. Accordingly, the court did not err in concluding that
there is no genuine issue as to any material fact and that the State is entitled
to judgment as a matter of law. See Avila v. Northrup King Co., 179 Ariz. 497,
505 (App. 1994) (citing cases).

¶18 Pruitt argues “[s]tatutory immunity cannot apply in favor of
the State where it is not subject to any liability for paying any workers’
compensation benefits” because Televerde was the party that provided the
workers’ compensation insurance. But that expense was presumably
accounted for as part of the negotiated contract between Televerde and
ADCRR. And in any event, Pruitt’s argument is contrary to Wagner, where
the court concluded the State was a statutory employer and immune from
suit even where the third party contractor provided the workers’
compensation insurance. 242 Ariz. at 98 ¶¶ 11–13. On this record, and given
the similarities with Wagner, the superior court did not err in concluding
the State retained supervision or control over the work procured to be done
by Televerde.

2. The Work Entrusted to Televerde Was a “Part or
Process in the Trade or Business” of ADCRR.

¶19 Pruitt argues reasonable jurors could have concluded
“Televerde’s call-center trade or business was not—in any realistic or
meaningful way—‘part or process’ in [ADCRR]’s unique and distinctly
different prison-correctional trade or business.” He argues “no reasonable
juror would ever infer that the ‘particular work activity’ of operating a call
center is in any way regular, ordinary, or routine in [ADCRR’s] operations
or is something that [ADCRR] employees would do ‘regularly.’” Pruitt also
attempts to distinguish Wagner by arguing that, “unlike the provision of

2 Given this distinction, Pruitt’s reliance on “the decision-making process”

in the Livingston trial after remand is not relevant here. Moreover, in the
second Livingston appeal, the court vacated a $113,000 verdict for plaintiff,
finding her claim failed on grounds not at issue here. See 21 Ariz. App. at
53–54.

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 PRUITT v. STATE, et al.
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healthcare services to inmates in Wagner, it is not a part or process of
[ADCRR’s] business to operate a for-profit call-center operation.”

¶20 Pruitt’s argument is unavailing. Like in Wagner, ADCRR has
a statutory duty to “[m]aintain and administer all institutions and
programs within the department, including prisons . . . and such other
facilities and programs as may be required and established for the custody,
control, correction, treatment and rehabilitation of all adult offenders who
are committed to the department.” A.R.S. § 41-1604(A)(2). By statute, the
ADCRR director may lease prison property in connection with the
Correctional Industries Program “to a private corporation for the purpose
of establishing and operating . . . [a] commercial enterprise deemed by the
director to provide employment opportunities for inmates in meaningful
jobs for wages.” A.R.S. § 41-1623(D). Thus, the work entrusted to Televerde
was a “part or process in the trade or business” undertaken by ADCRR to
provide rehabilitation services.

3. Pre-Wagner Case Law, as Well as Cases Applying
Wagner, Support the Grant of Summary Judgment
Here.

¶21 Despite Pruitt’s effort to portray Wagner as an outlier, cases
before Wagner and applying Wagner support the grant of summary
judgment. Karandbir Sandhu v. State, decided two weeks before Wagner,
involved an employee of the same contractor as in Wagner that provided
healthcare services to ADCRR. See No. 1 CA-CV 16-0095, 2017 WL 1278982,
at *1 ¶ 2 (Ariz. App. Apr. 6, 2017) (mem. decision). The employee filed a
negligence claim against the State after an inmate assaulted him. Id. at *1 ¶¶
2–3. The court affirmed the grant of summary judgment for the State,
concluding that “through the parties’ detailed contract,” ADCRR “retained
control over [the contractor’s] provision of health and dental services inside
[ADCRR] facilities.” Id. at *2 ¶ 9. Karandbir Sandhu supports the superior
court’s grant of summary judgment here.

¶22 More recently, Fox v. Arizona involved an employee of a
contractor providing healthcare services to ADCRR who filed tort claims
against the State after being sexually assaulted at a prison. CV-21-01089-
PHX-MTL, 2023 WL 4315221, at *1 (D. Ariz. July 3, 2023). The State moved
to dismiss the case under the workers’ compensation statute. Id. Applying
Wagner, the United States District Court concluded “the contract between
[the contractor] and [ADCRR] controls their relationship” and weighed the
Home Insurance factors to conclude the employee was a statutory employee

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of ADCRR. Id. at *4, *8. Fox, again in the prison context, applied Wagner in
a way supporting the superior court’s grant of summary judgment here.

¶23 Because both Young inquiries are satisfied, the superior court
did not err in concluding that Pruitt was a statutory employee of the State
at the time of his injury. Accordingly, the court properly entered summary
judgment for the State.

II. The Superior Court Properly Denied Pruitt’s Motion for New
Trial.

¶24 Pruitt argues the superior court erred in denying his Rule 59
motion for new trial. A superior court has considerable discretion in
deciding a motion for new trial. See, e.g., City of Glendale v. Bradshaw, 114
Ariz. 236, 238 (1977). This court will not reverse a ruling on a motion for
new trial “absent a clear abuse of discretion.” Delbridge v. Salt River Project
Agric. Improvement & Power Dist., 182 Ariz. 46, 53 (App. 1994) (citing cases).

¶25 Pruitt claims the superior court erred in denying his motion
for new trial because the judgment and orders related to it were based on
the conclusion that the State was Pruitt’s statutory employer, which he
argues was an abuse of discretion depriving Pruitt of a fair trial, Ariz. R.
Civ. P. 59(a)(1)(A), resulted from errors of law, Ariz. R. Civ. P. 59(a)(1)(F),
lacked evidentiary support, Ariz. R. Civ. P. 59(a)(1)(H) and was contrary to
law, Ariz. R. Civ. P. 59(a)(1)(H). As noted above, however, the superior
court properly concluded the State was Pruitt’s statutory employer.
Similarly, the superior court’s finding did not result from an error of law,
was not contrary to the law and did not lack evidentiary support. For these
reasons, Pruitt has shown no error in the superior court denying his motion
for new trial.

ATTORNEYS’ FEES ON APPEAL

¶26 Pruitt requests attorneys’ fees and costs incurred on appeal
pursuant to ARCAP 21(a) and A.R.S. §§ 12- 341 and 342. Because Pruitt is
not the successful party, his request is denied.

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CONCLUSION

¶27 The grant of summary judgment and the denial of Pruitt’s
motion for new trial are affirmed.

MATTHEW J. MARTIN • Clerk of the Court
FILED: JR

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