Opinion ID: 4096417
Heading Depth: 2
Heading Rank: 2

Heading: Dismissal of Age-Discrimination Claim

Text: Plaintiffs next challenge the district court’s dismissal of their state-law age discrimination claim as preempted by ERISA. We review de novo whether a state-law claim is preempted by ERISA. Briscoe v. Fine, 444 F.3d 478, 496 (6th Cir. 2006) (citing Nester v. Allegiance Healthcare Corp., 315 F.3d 610, 613 (6th Cir. 2003)). ERISA preempts all state laws that “relate to any employee benefit plan.” 29 U.S.C. § 1144(a). A state law “relates to” an employee benefit plan “if it has a connection with or reference to such a plan.” Shaw v. Delta Air Lines, Inc., 463 U.S 85, 96–97 (1983). ERISA also contains a preemption savings clause, however, providing that “[n]othing in [ERISA] shall be construed to alter, amend, modify, invalidate, impair, or supersede any law of the United States . . . or any rule or regulation issued under any such law.” 29 U.S.C. § 1144(d). 8 Case No. 15-1443, Loffredo v. Daimler AG In Shaw, the Supreme Court held that state laws are saved from ERISA preemption to the extent the state laws “play a significant role in the enforcement of” a federal statute. See 463 U.S at 101. Specifically, the Court considered whether New York’s Human Rights Law—which extended employment protections to pregnant workers that Title VII, at the time, did not provide—was preempted by ERISA. See id. at 88–89. Under Title VII, when an unlawful employment practice occurs in a state that also prohibits that practice, the EEOC “refers the charges to the state agency,” and the EEOC itself “may not actively process” the charge until the conclusion of the state proceedings. Id. at 101–02; see 42 U.S.C. §§ 2000e-5(c), 2000e-7. The Court explained that, if ERISA were to preempt the entirety of New York’s Human Rights Law, the EEOC “would be unable to refer the claim to the state agency,” which would “frustrate the goal of encouraging joint state/federal enforcement of Title VII; an employee’s only remedies for discrimination prohibited by Title VII in ERISA plans would be federal ones.” Id. at 102. Given Title VII’s design, this would “‘modify’ and ‘impair’ federal law,” activating ERISA’s savings clause to preserve the Human Rights Law to the extent it provided a means of enforcing Title VII’s commands. Id. (quoting 29 U.S.C. § 1144(d)). The Court nevertheless concluded that ERISA’s savings clause did not preserve the Human Rights Law “[i]nsofar as [it] prohibit[s] employment practices that are lawful under Title VII.” See id. at 103. Enforcement of Title VII “in no way depends” on extension of “nondiscrimination laws to areas not covered by Title VII,” and the Court “fail[ed] to see how federal law would be impaired by preemption of a state law prohibiting conduct that federal law permitted.” Id. at 103–04. As the Court reasoned, “Title VII would prohibit precisely the same employment practices, and be enforced in precisely the same manner, even if no State made additional employment practices unlawful.” Id. at 103. 9 Case No. 15-1443, Loffredo v. Daimler AG Applying the principles of Shaw in our 2012 opinion, we held that the ADEA—like Title VII—“uses state-law counterparts to bolster enforcement of the federal law,” and thus ERISA’s savings clause “preserves state-law claims from preemption to the extent they mirror ADEA claims.” Loffredo, 500 F. App’x at 498 (Sutton, J., majority opinion) (citations omitted). Because the ADEA prohibits the type of conduct Plaintiffs alleged in their complaint, we reversed the district court’s holding that ERISA preempted Plaintiffs’ age-discrimination claim and remanded for further proceedings. Id. at 498–99 (Sutton, J., majority opinion). On remand, Defendants argued for the first time that Plaintiffs’ ELCRA claim did not “mirror” an ADEA claim, even though the ADEA covered the same substantive conduct, because Plaintiffs filed it outside the ADEA’s statute of limitations. The district court agreed and again dismissed the claim as preempted by ERISA. Defendants broadly posit that a state-law claimant must follow all administrative prerequisites of a corresponding federal statute—such as filing an administrative charge or exhausting a preliminary administrative process—even if, unlike a statute of limitations, they are of a type entirely absent in the state law and thus wholly inapplicable to the state-law proceeding. Plaintiffs respond just as broadly that they were not required to satisfy any of the ADEA’s procedural requirements and that “[i]nterpreting ERISA to preempt each and every aspect of the ELCRA (including its procedural provisions) that are inconsistent with the ADEA . . . would improperly undermine ERISA’s foremost goal of protecting the interests of employees.” Like the district court, however, we need only address a narrower question, though one of first impression in our circuit: whether ERISA preempts a state-law antidiscrimination claim that is filed outside a corresponding federal law’s statute of limitations but within the state law’s longer 10 Case No. 15-1443, Loffredo v. Daimler AG statute of limitations, despite both state and federal law imposing liability for the same substantive conduct. In answering affirmatively the question now before us, the district court cited Nolan v. Otis Elevator Co., 505 A.2d 580 (N.J.), cert. denied, 479 U.S. 820 (1986), and Warren v. Oil, Chemical & Atomic Workers, Union-Industry Pension Fund, 729 F. Supp. 563 (E.D. Mich. 1989). In Nolan, the New Jersey Supreme Court considered whether ERISA preempted an agediscrimination claim under New Jersey’s Law Against Discrimination (“NJLAD”) “when the action is brought after the comparable federal time requirement for such an action.” Nolan, 505 A.2d at 581. Analyzing Shaw, the state court determined that, because ERISA’s savings clause “preserves a state law only if its extinction would impair a federal law,” “the question of the availability of the state remedy sought turns on whether it is necessary to the continued life of the federal program.” Id. at 585, 589. The state court concluded that “invocation of the state judicial remedy after a federal remedy is no longer available does not further the federal program,” and thus ERISA preempted the NJLAD age-discrimination claim because it was untimely under the ADEA. Id. at 588–89. In Warren, a Michigan district court relied on Nolan to find that the plaintiff’s ELCRA claims were preempted by ERISA. 729 F. Supp. at 567. Because Michigan’s “longer period of limitations did not further the goal of the ADEA,” the ELCRA was preempted by ERISA “to the extent that the state’s limitation period exceeds the 300 day period under ADEA.” Id.; see also Alston v. Atl. Elec. Co., 962 F. Supp. 616, 625 (D.N.J. 1997) (“An age discrimination suit brought under a state statute, such as NJLAD, which has a longer period of limitation than its federal counterpart and does not require any state mediative process, does not further the goals of the ADEA so as to escape ERISA preemption.” (citing Nolan, 505 A.2d 580)). 11 Case No. 15-1443, Loffredo v. Daimler AG Nolan and Warren have grounding in the logic of Shaw. The Shaw Court’s concern was that, if ERISA preempted state antidiscrimination laws, a claimant would be left with only a federal remedy even though Title VII encouraged a “joint state/federal enforcement” scheme. See Shaw, 463 U.S. at 102. ERISA’s savings clause, therefore, preserved the state law to the extent that preemption would disrupt enforcement of Title VII. Id. Here, by contrast, the federal right has been extinguished as untimely under the ADEA. The ADEA provides that “[n]o civil action may be commenced by an individual . . . until 60 days after a charge alleging unlawful discrimination has been filed with the [EEOC].” 29 U.S.C. § 626(d)(1). In a state like Michigan that “has a law prohibiting discrimination in employment because of age,” the EEOC charge for a federal claim “shall be filed . . . within 300 days after the alleged unlawful practice occurred, or within 30 days after receipt by the individual of notice of termination of proceedings under State law, whichever is earlier.” Id. at §§ 626(d)(1), 633(b). For its state claims, Michigan law imposes a three-year statute of limitations. See Mich. Comp. Laws Ann. § 600.5805(1), (10); see also Loffredo, 500 F. App’x at 499 (Sutton, J., majority opinion). Based on the allegations of Plaintiffs’ first amended complaint, Plaintiffs filed neither an EEOC charge nor their civil action within the ADEA’s required timeframe, but did meet Michigan’s requirement. Under Shaw’s reasoning, however, because the ADEA would continue to “prohibit precisely the same employment practices, and be enforced in precisely the same manner,” if Plaintiffs’ ELCRA claim is preempted, ERISA’s savings clause does not preserve Michigan’s statute of limitations. See Shaw, 463 U.S. at 103. While it may seem odd that Plaintiffs—bringing only a state-law discrimination claim and not seeking federal relief—must allege compliance with a federal statute of limitation, the Shaw Court recognized that its interpretation of ERISA’s savings clause “may cause certain 12 Case No. 15-1443, Loffredo v. Daimler AG practical problems” with enforcement of state laws. Id. at 105. The Court illustrated one problem it foresaw: “Courts and state agencies, rather than considering whether employment practices are unlawful under a broad state law, will have to determine whether they are prohibited by Title VII. If they are not, the state law will be superseded and the agency will lack authority to act.” Id. at 105–06. Nevertheless, the Court concluded, these minor practical difficulties do not represent the kind of “impairment” or “modification” of federal law that can save a state law from pre-emption under [ERISA’s savings clause]. To the extent that our construction of ERISA causes any problems in the administration of state fair employment laws, those problems are the result of congressional choice and should be addressed by congressional action. Id. at 106. In other words, Congress’s concern in preempting state laws under ERISA, as expressed by ERISA’s savings clause, was the impairment and modification of federal law, not state law. Moreover, the outcome of applying Shaw’s reasoning here recognizes, as both we and the Supreme Court have, that a statute of limitation is a significant and substantive limitation on the rights created by a statute, not just a procedural detail. See Engel v. Davenport, 271 U.S. 33, 38 (1926) (describing statute of limitations as “material element” in holding Merchant Marine Act preempted state statute of limitations); Whitfield v. Knoxville, 756 F.2d 455, 461–62 (6th Cir. 1985). Accordingly, ERISA preempts Plaintiffs’ age-discrimination claim because it is untimely under the ADEA and preemption of Michigan’s statute of limitations neither impairs nor modifies federal law. C. Denial of Leave to Include EEOC Charge in Complaint Plaintiffs lastly argue that the district court erred in denying leave to file a second amended complaint to add allegations regarding Piedra’s EEOC charge. The district court construed Plaintiffs’ motion for leave as a motion for reconsideration. We review the denial of a motion for reconsideration under the abuse-of-discretion standard. Indah v. U.S. S.E.C., 13 Case No. 15-1443, Loffredo v. Daimler AG 661 F.3d 914, 924 (6th Cir. 2011) (citing Gage Prods. Co. v. Henkel Corp., 393 F.3d 629, 637 (6th Cir. 2004)). “A motion for reconsideration is governed by the local rules in the Eastern District of Michigan, which provide that the movant must show both that there is a palpable defect in the opinion and that correcting the defect will result in a different disposition of the case.” Id. (citing E.D. Mich. Local Rule 7.1(h)). Piedra’s EEOC charge lists the earliest date of discrimination as May 1, 2009, the date that Chrysler LLC filed for bankruptcy. The charge alleged that Chrysler Group, LLC—the company formed as part of Chrysler LLC’s bankruptcy—discriminated on the basis of age by only partially assuming the obligation to pay benefits under the SRP after the bankruptcy. (Id.) Plaintiffs’ first amended complaint alleged different discriminatory conduct by Defendants that took place prior to Chrysler LLC’s bankruptcy: specifically, Defendants’ practice in 2005 and/or 2006 of “purchasing annuities, providing lump sum payments, transferring benefits to a qualified retirement plan, or otherwise securitizing the SRP retirement benefits of participants in the plan who were at the time still actively employed” at the company but not the benefits of former employees, including Plaintiffs. According to the complaint, this practice “continued until the time of Chrysler[ LLC]’s bankruptcy.” Plaintiffs argue that their age-discrimination claim is “reasonably expected to grow” from the allegations of Piedra’s EEOC charge. Under our “expected scope of investigation test,” “where facts related with respect to the charged claim would prompt the EEOC to investigate a different, uncharged claim, the plaintiff is not precluded from bringing suit on that claim.” Dixon v. Ashcroft, 392 F.3d 212, 217 (6th Cir. 2004) (citing Weigel v. Baptist Hosp. of E. Tenn., 302 F.3d 367, 380 (6th Cir. 2002)). For example, if a plaintiff’s EEOC charge complains only of 14 Case No. 15-1443, Loffredo v. Daimler AG discrimination based on race, but lists facts from which a retaliation charge could be anticipated, the plaintiff will not be prevented from bringing a lawsuit alleging the retaliation claim. See id. Here, however, while complaining of age discrimination on behalf of Piedra, the EEOC charge alleges different conduct by a different employer from a different timeline that started after the bankruptcy, and thus after the discrimination alleged in the first amended complaint ended. Plaintiffs cite no authority supporting their argument that Chrysler Group, LLC’s conduct after Chrysler LLC’s bankruptcy in 2009 would prompt investigation into Defendants’ conduct before it. Finding no “palpable defect” in the district court’s order, see Indah, 661 F.3d at 924, we therefore conclude that the district court did not abuse its discretion in denying Plaintiffs’ motion for reconsideration.