Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-05-03496/USCOURTS-ca8-05-03496-0/pdf.json

Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 

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The Honorable James E. Gritzner, United States District Judge for the Southern

District of Iowa.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

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No. 05-3496

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Roger D. Parsons,

Appellant,

v.

Pioneer Seed Hi-Bred International,

Inc.,

Appellee.

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Appeal from the United States

District Court for the

Southern District of Iowa.

 [PUBLISHED]

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Submitted: April 20, 2006

 Filed: May 19, 2006

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Before WOLLMAN, HANSEN, and BENTON, Circuit Judges. 

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HANSEN, Circuit Judge.

Roger D. Parsons appeals from the district court's1

 dismissal of his age

discrimination claim against Pioneer Seed Hi-Bred International, Inc. (Pioneer).

Because Parsons validly waived his right to bring an age discrimination claim in his

severance agreement with Pioneer, we affirm the district court's judgment.

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Parsons began working for Pioneer in 1972, and beginning in 2000 he held the

position of Project Manager of the Warehouse Management System (WMS). In

September 2002, Dean Oestreich (Vice President of Global Supply Management) and

Bill Tomlinson (Director of North America Corn Production) determined that the

initial phase of the WMS project was complete, that a WMS Coordinator was needed

instead of a WMS Project Manager, and that the Coordinator position would not

require the level of skills possessed by Parsons. Pioneer eliminated the WMS Project

Manager position and gave the part-time WMS Coordinator duties to a younger

current employee, Larry Lubinus (age 41), who continued to perform some of his own

prior duties as well. 

Oestreich told Parsons (age 55 at the time) on September 25, 2002, that his

position was being eliminated and gave him two severance options. Parsons sought

the advice of counsel and chose one of the severance agreements, which provided as

relevant:

10. Further, you agree to keep the terms of this settlement and

release confidential. You hereby acknowledge that failure to abide by the

terms of this Agreement could result in the loss of the consideration

provided for in Sections 11(a) and 11(b) herein. If you bring any legal

action challenging this Agreement, you agree to immediately repay the

consideration set forth in Sections 11(a) and 11(b) herein, unless such

legal action directly pertains to the Age Discrimination in Employment

Act.

11. In consideration of receipt of a lump sum payment of (a) Nine

Thousand Eight Hundred Ninety-Six Dollars ($9,896.00); (b) the

prorated portion of Part II of the Annual Reward Program Bonus in the

amount of Eleven Thousand Five Hundred Seventy-Eight Dollars

($11,578.00) . . .; and (c) receipt of the payments and benefits as outlined

in this Agreement and identified in the attached Severance . . . Summary,

you hereby forever release and discharge Pioneer . . . from . . . any and

all other causes of action, claims or demands or expenses of any kind

(including attorney fees and costs actually incurred), at law or equity, to

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settle potential claims you may have pursuant to . . . the Age

Discrimination in Employment Act or any other Equal Employment

Opportunity claims; . . . the Iowa Civil Rights Act, Iowa Code Chapter

216; . . . whether now known or unknown, foreseen or unforeseen,

arising out of, or due to the employment relationship with Pioneer. . . .

. . . .

17. In any action to enforce this Agreement, except a claim

pertaining to the Age Discrimination in Employment Act, the prevailing

party's attorney fees shall be paid by the party against whom this

Agreement is being enforced.

(J.A. at 144-45.) 

After signing the agreement, Parsons brought suit for age discrimination under

the Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621-34 (2000),

and the Iowa Civil Rights Act (ICRA), Iowa Code Ch. 216 (2005). In ruling on

Pioneer's motion for summary judgment, the district court determined that the

severance agreement validly waived Parsons' right to bring an age discrimination suit

and that even if it did not, he failed to make a prima facie case of age discrimination.

The district court entered summary judgment in favor of Pioneer, and Parsons appeals.

We review the district court's grant of summary judgment de novo, viewing the

evidence in the light most favorable to Parsons as the nonmoving party. Summary

judgment is appropriate if, so viewed, the evidence reveals no material issues of fact,

and Pioneer is entitled to judgment as a matter of law. See Thomforde v. IBM, 406

F.3d 500, 503 (8th Cir. 2005). 

Congress enacted the Older Workers Benefits Protection Act (OWBPA) in 1990

to clarify the protections afforded older workers under the ADEA. Pub. L. 101-433,

104 Stat. 978 (1990). Congress addressed employers' attempts to pressure departing

workers into waiving their right to bring an ADEA claim in exchange for a severance

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or settlement agreement. See Long v. Sears Roebuck & Co., 105 F.3d 1529, 1534 (3d

Cir. 1997) (explaining the legislative history leading up to the enactment of the

OWPBA), cert. denied, 522 U.S. 1107 (1998). While such waivers are valid,

Congress requires that the waivers be knowing and voluntary, and it enacted specific

statutory requirements that must be met before the waiver can bind the worker. See

29 U.S.C. § 626(f) ("An individual may not waive any right or claim under this

chapter unless the waiver is knowing and voluntary. . . . [A] waiver may not be

considered knowing and voluntary unless at a minimum" it satisfies a list of

requirements.) The requirements are strict and unqualified; if the waiver does not

satisfy the statute, it is ineffective as a matter of law. See Oubre v. Entergy

Operations, Inc., 522 U.S. 422, 427 (1998) ("Congress delineated these duties with

precision and without qualification: An employee 'may not waive' an ADEA claim

unless the employer complies with the statute."). 

Parsons argues that his waiver did not satisfy the statute because it did not meet

the first enumerated requirement, that "the waiver [be] part of an agreement between

the individual and the employer that is written in a manner calculated to be understood

by such individual." § 626(f)(1)(A). Parsons relies almost exclusively on our recent

Thomforde v. IBM case, where we held that the severance agreement between the

plaintiff and IBM did not meet this first statutory requirement. See 406 F.3d at 504-

05. In Thomforde, the agreement specifically released IBM from all claims, including

claims under the ADEA. The agreement also contained a covenant not to sue IBM,

but specifically exempted ADEA claims from the covenant not to sue. The agreement

loosely used "release" and "covenant not to sue" interchangeably. The agreement was

not "written in a manner calculated to be understood" because a contradiction arose

from the interchangeable use of the terms "release" and "covenant not to sue" coupled

with the specific statement that the covenant not to sue did not apply to ADEA claims.

See id. at 503-04. Our holding in Thomforde turned on the fact-intensive inquiry

concerning the specific language used in the agreement and the agreement's imprecise

use of legal terms of art. 

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The waiver in this case does not suffer the same flaw. As Parsons concedes, the

severance agreement does not contain a covenant not to sue. The severance agreement

specifically released Pioneer from any cause of action under the ADEA in paragraph

11 of the agreement. Parsons claims that language in paragraphs 10 and 17 is

contradictory to that release, similar to the contradiction in Thomforde, rendering the

waiver ineffective. The language here is not similarly confusing or contradictory.

Paragraph 11 is the general release and states the consideration given for the release.

Paragraph 10 is a confidentiality clause and provides that an employee's failure to

abide by any of the terms of the agreement could result in loss of the consideration to

be received pursuant to paragraph 11(a) or (b). It specifically states that if the

employee "bring[s] any legal action challenging this Agreement," the employee will

repay the consideration provided in subsections 11(a) or (b) "unless such action

pertains to the [ADEA]." (J.A. at 144 (emphasis added).) By its terms, the forfeiture

provision applies only if the employee challenges the Agreement itself, and it provides

an exception for challenges pertaining to the ADEA, as required by the ADEA

regulations. See 29 C.F.R. § 1625.23(b) (precluding any waiver provisions that

penalize a party for challenging the validity of a waiver). Paragraph 10 does not

purport to exempt ADEA lawsuits from the general release in paragraph 11.

Nor does paragraph 17 contradict the explicit release of ADEA rights.

Paragraph 17 applies only "[i]n any action to enforce this agreement," and then

provides that the party against whom the agreement is enforced shall pay the

prevailing party's attorney's fees. The paragraph "except[s] a claim pertaining to the

[ADEA]" from its attorney's fee provision. By its terms, the attorney's fee provision

applies only to actions to enforce the agreement. The paragraph merely excepts

enforcement claims that pertain to the ADEA from the attorney's fee provision. This

again is consistent with the regulations that prohibit a waiver from penalizing an

employee for challenging the validity of the agreement. It does not purport to negate

the general release contained in paragraph 11. Legal documents by their nature are

often very detailed and complex due to the need to cover a host of variables often

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unseen at the time of their drafting, as well as the need in this case to comply with

specific regulatory requirements. Pioneer's attempts to comply with the OWPBA and

its accompanying regulations may make the agreement nuanced, but the language

employed is written in a manner that is understandable by the average participant.

While we agree with the district court that the waiver meets the statutory

requirements, we caution against the district court's reliance on Parsons' actions or

lack thereof, namely that he did not question Pioneer officials about the meaning of

the agreement or otherwise put Pioneer on notice that he did not understand that he

was waiving his rights under the ADEA. The statutory requirements are minimum

standards for creating a voluntary and knowing waiver. Without them, a waiver is not

valid as a matter of law, regardless of whether the employee actually understood the

waiver or not. The party asserting the validity of the waiver bears the burden of

establishing that the agreement itself was written in a manner calculated to be

understood. See 29 U.S.C. § 626(f)(3). The employee's subjective state of mind is

irrelevant to this initial inquiry. See Kruchowski v. Weyerhaeuser Co., 423 F.3d

1139, 1142 (10th Cir. 2005) (recognizing the difference between the statutory

requirements and the ultimate issue of whether the waiver was knowing and

voluntary). Thus, the writing itself must satisfy § 626(f)(1)(A). 

Issues of whether an employee expressed his misunderstanding or otherwise

questioned a waiver go to an employee's subjective state of mind, which may be

relevant to the ultimate issue of whether his waiver was in fact voluntary and

knowing. See § 626(f)(1) ("An individual may not waive any right or claim under this

chapter unless the waiver is knowing and voluntary."). Thomforde's actions of

questioning his employer about the waiver and explicitly putting IBM on notice that

he planned to pursue an ADEA claim before he signed the agreement supported our

conclusion that the waiver in that case was not sufficiently clear to meet the statutory

requirement contained in § 626(f)(1)(A). See Thomforde, 406 F.3d at 504 & n.1. His

actions were by no means necessary to our holding, however. We make clear that the

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waiver itself must be "written in a manner calculated to be understood by such

individual" to satisfy the minimum statutory requirements. § 626(f)(1)(A).

 

Parsons does not otherwise challenge on appeal whether his waiver was

knowing and voluntary. Having found that the waiver met the statutory requirements,

we agree with the district court that Parsons' age discrimination claims are precluded

by the waiver, and Pioneer is entitled to judgment as a matter of law on that basis

alone.

The district court's judgment is affirmed.

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