Source: https://m.openjurist.org/251/f3d/84/mary-mcginty-v-state-of-new-york
Timestamp: 2020-01-20 21:56:41
Document Index: 129868873

Matched Legal Cases: ['§ 508', '§ 5', '§ 626', '§ 106', '§ 106', '§ 21', '§ 22', '§ 2', '§ 16', '§ 16', '§ 24', '§ 24', '§ 13', '§ 13', '§ 176', '§ 15', '§ 314', '§ 314', '§ 314', '§ 7', '§ 1988', '§ 2000', '§ 1132', '§ 1973', '§ 1988']

251 F3d 84 Mary McGinty v. State of New York | OpenJurist
251 F. 3d 84 - Mary McGinty v. State of New York
251 F3d 84 Mary McGinty v. State of New York
251 F.3d 84 (2nd Cir. 2001)
MARY MCGINTY, AS ADMINISTRATRIX OF THE ESTATE OF MAUREEN NASH, AND JAMES NASH ON BEHALF OF THEMSELVES AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS-APPELLANTS,
STATE OF NEW YORK, NEW YORK STATE AND LOCAL EMPLOYEES RETIREMENT SYSTEM, AND NEW YORK STATE DEPARTMENT OF TAXATION AND FINANCE, DEFENDANTS-APPELLEES.
Docket No. 00-7189
Argued October 20, 2000
Defendants admit that for some three-and-a-half years, from October 16, 1992 to June 20, 1996, the New York State death benefit system violated the ADEA. McGinty, 193 F.3d at 67. Death benefits were reduced when an employee joined the Retirement System after turning age 52, and were further reduced 10 percent for each year the employee worked after turning age 60, subject to a floor of 10 percent of the benefit in force at age 60. N.Y. Retire. & Soc. Sec. Law § 508(a)(2) (McKinney 1999); accord McGinty, 193 F.3d at 67 n.4. Maureen Nash became a member of the Retirement System at age 53 and died at age 62 while still employed; her death benefit was thereby reduced under state law, in what defendants concede was a violation of the ADEA.
When plaintiffs brought their first appeal, the district court had dismissed their action on defendants' motion under Fed. R. Civ. P. 12(b)(1). We reversed the determination that plaintiffs' death benefit claims were moot in light of the Retirement System's corrective supplemental payments, and ruled instead that the ADEA violations were "willful" and that plaintiffs were therefore entitled to liquidated damages under the ADEA. Id. at 69-71. We remanded for a determination of damages and for a resolution of plaintiffs' charge that the new administrative method for calculating death benefits still violated the ADEA. Id. at 71. We also vacated the dismissal of plaintiffs' disability benefit claims and remanded for the district court to reconsider plaintiffs' standing to bring these claims. Id. at 72. Finally, we rejected defendants' assertion of sovereign immunity. Id. at 71-72 (quoting Cooper v. N.Y. State Office of Mental Health, 162 F.3d 770, 776 (2d Cir. 1998), vacated sub nom. Bd. of Trustees of Univ. of Conn. v. Davis, 528 U.S. 110 (2000)).
II. Applicability of Kimel
The Supreme Court had previously ruled that the ADEA's embrace of state governments within its ambit was constitutional as an exercise of Congress' Commerce Clause powers under Article I of the Constitution. See EEOC v. Wyoming, 460 U.S. 226, 243 (1983). Kimel, however, reaffirmed the holding of Seminole Tribe that Article I "[did] not include the power to subject States to suit at the hands of private individuals." 528 U.S. at 80. The Court therefore turned its attention to § 5 of the Fourteenth Amendment where it applied a "congruence and proportionality" test to decide whether a federal statute is appropriate remedial legislation or improper legislation that purports to redefine the Fourteenth Amendment right at issue. Id. at 81-82. Because age is not a suspect classification under the Equal Protection clause, states may discriminate on the basis of age if the age classification is rationally related to a legitimate state interest. Id. at 83.
Consequently, while an aggrieved party can pursue avenues other than the ADEA when faced with age discrimination, see id. at 91-92 & n.*, it clearly cannot mount an ADEA claim against a state without its consent in federal court, see id. at 73 ("[T]he Constitution does not provide for federal jurisdiction over suits against non-consenting States."). Since plaintiffs in this case assert federal question jurisdiction premised solely on the ADEA, they may continue their suit only if defendants waived immunity. We turn next to that issue.
III. Waiver of Sovereign Immunity
Before addressing the merits of plaintiffs' contention, we pause to consider defendants' argument that it was not possible for them to have raised an immunity defense before the EEOC since states are deemed to have consented to suits brought by the federal government. See Alden, 527 U.S. at 755. The ADEA does give the EEOC authority to enforce employees' rights under the statute. See 29 U.S.C. § 626(c)(1) (1994) ("[T]he right of any person to bring such action [under the ADEA] shall terminate upon the commencement of an action by the [EEOC]...."). This enforcement, however, occurs when the EEOC brings suit in federal court. See, e.g., EEOC v. Kidder, Peabody & Co., 156 F.3d 298, 300 (2d Cir. 1998) (indicating the EEOC filed a complaint in federal court pursuant to the ADEA). That procedure is distinct from an individual filing a complaint with the agency.
Finally, plaintiffs point to one of our decisions to show defendants' participation in the EEOC proceeding amounts to a waiver of immunity. In that case, the state of New York imposed a gains tax upon a debtor about to sell its interest in a hotel as part of a reorganization plan. 995 Fifth Ave. Assocs., L.P. v. N.Y. State Dep't of Taxation & Fin.(In re 995 Fifth Ave. Assocs., L.P.), 963 F.2d 503, 506 (2d Cir. 1992). The debtor sought a declaration in bankruptcy court that it was exempt from the tax and entitled to a refund from the state. The state filed an administrative expense claim for additional gains tax liability. The lower courts considered that act of filing to be a waiver of sovereign immunity. The bankruptcy code then in effect provided that "[a] governmental unit is deemed to have waived sovereign immunity with respect to any claim against such governmental unit that is property of the estate and that arose out of the same transaction or occurrence out of which such governmental unit's claim arose." 11 U.S.C. § 106(a) (1988), later amended and recodified at 11 U.S.C. § 106(b) (1994). We read the statute on appeal as a clear expression of Congress' purpose to require a waiver of immunity. 963 F.2d at 508-09. Since the basis for the state's administrative expense claim and the debtor's claim for a refund both arose out of the sale of the debtor's interest in the hotel, we reasoned that the state had waived its Eleventh Amendment immunity. Id. at 509.
C. How the Retirement System Is Funded
Ascertaining the particular funds where these contributions are deposited and from which benefits are paid is equally important. Payroll deductions from a Retirement System member, once remitted to the comptroller, are deposited in the annuity savings fund. Id. § 21(f). Upon retirement, contributions to that fund are transferred to the annuity reserve fund, from which all annuities and all benefits in lieu of annuities are paid. Id. § 22(a) & (b). An "annuity" is defined as "[t]he annual allowance for life, payable in monthly installments and derived from a member's accumulated contributions." Id. § 2(3).
The state and other employers make contributions to the pension accumulation fund. Id. §§ 16(a), 23(a)(1). Expenses incurred by the Retirement System are covered by monies contributed to this fund, in addition to monies appropriated in the state executive budget. Id. §§ 16(b), 23(b)(3). When a pension becomes payable, monies are transferred from the pension accumulation fund to the pension reserve fund. Id. § 24(b). Ordinary death benefits, however -- such as those received by plaintiff James Nash -- are payable wholly out of the pension accumulation fund. Id. §§ 24(a), 60(b).
There are certain legal restraints on the Retirement System. For example, funds are to be invested only in accordance with state law. Id. § 13(b). Without specifying exactly how funds may be invested, the statutory scheme includes percentage limits, and identifies permissible and impermissible investments. See generally id. § 13 (entitled "Management of funds"); id. §§ 176-179-a (entitled "Investments of Public Pension Funds"). Further, the System is subject to the supervision of the superintendent of insurance, id. § 15, who may require the comptroller to file an annual report and to respond to inquiries related to transactions or to the condition of the Retirement System, N.Y. Ins. Law § 314(b)(1). The superintendent may promulgate "standards" with respect to a number of financial practices including "investment policies and financial soundness." Id. § 314(b)(2). He is required to conduct an examination into the affairs of the Retirement System at least once every five years and to incorporate his findings in a report made available for public inspection and filed with the governor, the comptroller and the legislature. Id. § 314(b)(3). While these provisions do not constitute a veto power, they subject the comptroller to strong oversight protections limiting his discretion.
These concepts were reaffirmed in McDermott v. Regan, where the court stated that "[w]here the State maintains [some independent] authority in regard to the [comptroller],... concomitant with that authority is the State's duty to act in a manner consistent with the goal of the 'protection' of [the Retirement System] funds as required by article V, § 7 of New York's Constitution." 82 N.Y.2d at 362. Thus, any changes the legislature proposes for the Retirement System must be enacted for the purpose of protecting the interests of its beneficiaries.
This final factor provides the greatest weight in favor of immunity. See Feeney, 873 F.2d at 631 ("[W]hether liability will place the state treasury at risk, although not exclusively determinative, is the single most important factor."). As stated at the outset of our discussion, the Supreme Court has recognized that "the vulnerability of the State's purse [is] the most salient factor" when deciding whether sovereign immunity applies. Hess, 513 U.S. at 48. Indeed, we once remanded a case precisely for clarification as to what extent the state would be required to satisfy a judgment entered against the defendant, the City University of New York. See Pikulin v. City Univ. of N.Y., 176 F.3d 598, 600-01 (2d Cir. 1999) (per curiam).
V. Plaintiffs' Request for Attorney's Fees
We have recognized that "a plaintiff who has obtained at least some part of what he sought in bringing the suit may be considered a prevailing party and may therefore seek an award of attorney's fees." Marbley v. Bane, 57 F.3d 224, 234 (2d Cir. 1995) (considering award under 42 U.S.C. § 1988); accord Bonner v. Guccione, 178 F.3d 581, 593-94 (2d Cir. 1999) (42 U.S.C. § 2000e-5(k)); McManus v. Gitano Group, Inc., 59 F.3d 382, 384 (2d Cir. 1995) (29 U.S.C. § 1132(g)(1)); Gerena- Valentin v. Koch, 739 F.2d 755, 758-59 (2d Cir. 1984) (42 U.S.C. § 1973l(e)). The plaintiff need not necessarily obtain a judgment or settlement in his favor, so long as "the defendant, under pressure of the lawsuit, alters his conduct (or threatened conduct) towards the plaintiff that was the basis for the suit." Hewitt v. Helms, 482 U.S. 755, 761 (1987). A causal connection must exist between the lawsuit and the change in the defendant's conduct. Koster v. Perales, 903 F.2d 131, 135 (2d Cir. 1990).
But when a federal court lacks jurisdiction, the case must be stricken from the docket. The Mayor v. Cooper, 73 U.S. (6 Wall.) 247, 250 (1868). It therefore follows that where we lack subject matter jurisdiction, we also lack jurisdiction to award attorney's fees. W.G. v. Senatore, 18 F.3d 60, 64 (2d Cir. 1994); see also Farrar v. Hobby, 506 U.S. 103, 109 (1992) ("'[W]here a defendant has not been prevailed against, either because of legal immunity or on the merits, § 1988 does not authorize a fee award against that defendant.'") (quoting Kentucky v. Graham, 473 U.S. 159, 165 (1985)).