Opinion ID: 2205569
Heading Depth: 1
Heading Rank: 10

Heading: Was the Statute of Limitations Tolled by the Filing of the Federal Action?

Text: Under the FLSA, a cause of action must be commenced within two years after the cause of action accrues, except that an action arising out of a willful violation may be commenced within three years after the cause of action accrued. 29 U.S.C. § 255. The district court found a willful violation. Thus, the district court determined the peace officers could recover damages for the three-year period preceding the tolling of the statute of limitations. The State did not appeal this ruling. Federal law, including the federal equitable tolling doctrine, not state law, governs the tolling of the statute of limitations. Moore Co. v. Sid Richardson Carbon & Gasoline Co., 347 F.2d 921, 922 (8th Cir.1965); Abbott v. State, 979 P.2d 994, 997 (Alaska 1999). The parties, however, disagree as to the date when the peace officers tolled the statute of limitations. The State argues the peace officers tolled the statute in April 1996, when the peace officers filed their petition in state court. [5] The peace officers argue they tolled the statute when they filed their action in federal court on May 2, 1994, [6] because of the federal equitable tolling doctrine. Originally, the peace officers filed their action in federal court seeking to establish their right to overtime compensation. Initially, the federal court granted the peace officers' motion for summary judgment on the merits of their claim and set a hearing on damages for a later date. On June 21, 1996, before the date set for the damage hearing, the Supreme Court filed Seminole Tribe v. Florida, 517 U.S. 44, 116 S.Ct. 1114, 134 L.Ed.2d 252 (1996), establishing the immunity of states under the Eleventh Amendment to be sued in federal court with respect to similar claims. Seminole Tribe overruled Pennsylvania v. Union Gas Co., 491 U.S. 1, 109 S.Ct. 2273, 105 L.Ed.2d 1 (1989), under which the peace officers would have been allowed to maintain their action in federal court. Seminole Tribe, 517 U.S. at 72, 116 S.Ct. at 1131-32, 134 L.Ed.2d at 276-77. Based on Seminole Tribe, the federal district court dismissed the peace officers' action for lack of subject matter jurisdiction based on the Eleventh Amendment. Raper, 940 F.Supp. at 1421. The Eighth Circuit Court of Appeals affirmed the federal district court. Raper v. Iowa, 115 F.3d 623. In April 1996, pending a decision from the federal district court, the peace officers filed the present action in state court. On appeal, the State makes two arguments concerning the non-applicability of the federal equitable tolling doctrine. It first argues this doctrine only applies to cases dismissed for improper venue, not for lack of subject matter jurisdiction. Second, the State argues even if the doctrine tolls the statute of limitations, it does not apply to this case because the State never waived its sovereign immunity to be sued in state court.
The genesis of the equitable tolling doctrine is found in Burnett v. New York Central R.R., 380 U.S. 424, 436, 85 S.Ct. 1050, 1058-59, 13 L.Ed.2d 941, 950 (1965). In Burnett, the plaintiff filed his federal employer's liability claim in state court. Id. at 424, 85 S.Ct. at 1052, 13 L.Ed.2d at 943. Although the state court had jurisdiction over the claim, the claim was dismissed because of improper venue. Id. at 425, 85 S.Ct. at 1053, 13 L.Ed.2d at 943. Plaintiff refiled in federal court eight days later but after the statute of limitations had run. Id. The federal district court dismissed the action as untimely. Id. On appeal, the Supreme Court adopted the federal common-law doctrine of equitable tolling, which tolls a federal statute of limitations on claims dismissed in one forum and promptly refiled in the proper forum as long as the defendant has proper service of process and the service adequately informed the defendant of the claim in the original forum. [7] Id. at 434-35, 85 S.Ct. at 1058, 13 L.Ed.2d at 949. The State argues the equitable tolling doctrine only applies to cases dismissed for improper venue, not for jurisdictional defects. We disagree. Courts have applied the doctrine to cases dismissed due to jurisdictional defects. In Platoro Ltd., Inc. v. Unidentified Remains of a Vessel, 614 F.2d 1051, 1054-55 (5th Cir.1980), the Fifth Circuit relied on the reasoning in Burnett to toll the statute of limitations in an action originally filed in a court that lacked jurisdiction. The Fifth Circuit found it was reasonable for the plaintiff to conclude the court had jurisdiction over the sunken treasure in the district where the plaintiff recovered it. Id. at 1054. Relying heavily on plaintiff's due diligence in filing the original claim and the notice it provided to the defendant, the court applied the doctrine of equitable tolling and allowed the plaintiff to proceed with the claim. Id. at 1054-55. The Sixth Circuit in Fox v. Eaton Corp., 615 F.2d 716 (6th Cir.1980), also relied on Burnett to toll the statute of limitations when the state court dismissed an action for lack of subject matter jurisdiction. Id. at 720-21. In Fox, the plaintiff brought a Title VII action in state court within ninety days after she received her right-to-sue letter. Id. at 717. At the time she brought the action in state court, there were conflicting opinions as to whether the federal courts had exclusive jurisdiction over Title VII actions. Id. at 719-20. There was no controlling decision by the Ohio Supreme Court indicating that the federal courts had exclusive jurisdiction over Title VII actions. Id. at 720. At the trial level, the court entered judgment on the merits. Id. at 717. The court of appeals affirmed the trial court's decision on appeal. Id. On appeal to the Supreme Court of Ohio, the supreme court sua sponte held state courts do not have subject matter jurisdiction over Title VII matters. Id. Plaintiff refiled in federal court. Id. The federal district court dismissed the action as untimely, because plaintiff filed the action more than ninety days after she received her right to sue letter. Id. at 718. The Sixth Circuit concluded it would be impossible for the plaintiff, even with the assistance of her attorney, to predict the jurisdictional theory the Ohio Supreme Court would adopt. Id. at 720. Because the plaintiff exercised great diligence in pursuing her claim and her only misfortune was the selection of an inappropriate forum, which she selected on a reasonable basis, the court found the ninety-day statute of limitation was tolled while the case was pending in state court. Id. At the time the peace officers filed this action in federal court, the federal circuit courts deciding this issue consistently held Union Gas gave the federal courts subject matter jurisdiction over FLSA actions when a state is the defendant. Brinkman v. Dep't of Corr., 21 F.3d 370, 371-72 (10th Cir.1994); Reich v. New York, 3 F.3d 581, 590 (2d Cir.1993); Hale v. Arizona, 993 F.2d 1387, 1391-92 (9th Cir.1993). At the time the peace officers filed this action in federal court, no person could reasonably predict the Supreme Court would overrule Union Gas. The peace officers' choice of forum was reasonable at the time they filed their action in federal court. The peace officers properly served process on the State in the federal court action and gave the State adequate notice of their claims. Under these facts, we believe the federal common-law doctrine of equitable tolling applies even though the federal courts dismissed their claims on jurisdictional grounds. See Ahern v. State, 244 A.D.2d 7, 676 N.Y.S.2d 232, 235 (1998) (holding the federal equitable tolling doctrine applies to an FLSA action refiled in state court after the action was dismissed from federal court for lack of subject matter jurisdiction).
The district court relied on Ahern to conclude the federal equitable tolling doctrine allows the peace officers to collect damages for the three-year period prior to filing the complaint in federal court. In Ahern, the plaintiffs refiled their FLSA action in state court after the federal court dismissed the action for lack of subject matter jurisdiction based on the Eleventh Amendment. Id. at 233. In reaching its decision, the New York court discussed sovereign immunity under the Eleventh Amendment and concluded the Eleventh Amendment, which gives the state immunity from being sued in federal court, did not apply to the state's ability to be sued in state court. Id. at 234. The New York court concluded Congress abrogated the state's sovereign immunity for an FLSA action brought in state court. Id. The Ahern court then applied the federal common-law doctrine of equitable tolling to toll the statute of limitations. Id. at 235. Subsequent to Ahern, the Supreme Court decided the case of Alden v. Maine, 527 U.S. 706, 119 S.Ct. 2240, 144 L.Ed.2d 636 (1999). In Alden, the Supreme Court noted the states do not derive sovereign immunity in state court from the Eleventh Amendment, but rather from the fundamental aspect of sovereignty which the States enjoyed before the ratification of the Constitution, and which they retain today ... except as altered by the plan of the Convention or certain constitutional Amendments. Id. at 713, 119 S.Ct. at 2246-47, 144 L.Ed.2d at 652. This sovereign immunity is the immunity retained by the states under the Tenth Amendment. The Supreme Court then concluded Congress could not abrogate a state's sovereign immunity preserved by the Tenth Amendment through Article I legislation, such as the FLSA. Id. at 712, 119 S.Ct. at 2246, 144 L.Ed.2d. at 652. After the Supreme Court decided Alden, the New York court agreed Alden effectively overruled Ahern on the grounds New York did not waive its sovereign immunity preserved by the Tenth Amendment and did not consent to be sued in state court under the FLSA. See Alston v. State, 97 N.Y.2d 159, 737 N.Y.S.2d 45, 762 N.E.2d 923, 925-26 (2001). The State argues the Alden decision, together with the Supreme Court decision of Raygor v. Regents of the University of Minnesota, 534 U.S. 533, 122 S.Ct. 999, 152 L.Ed.2d 27 (2002), does not allow us to apply the federal equitable tolling doctrine to the peace officers' action, because the State has not waived its sovereign immunity to be sued in state court for an FLSA action. In Raygor, the court discussed the issue of sovereign immunity in the context of the federal savings clause, [8] 28 U.S.C. § 1367(d). Id. at 542, 122 S.Ct. at 1005, 152 L.Ed.2d at 37. The Supreme Court concluded the federal savings provision does not apply to a state unless the state has waived its sovereign immunity to be sued for the specific action in state court. Id. at 548, 122 S.Ct. at 1008, 152 L.Ed.2d at 41. The determination we must make is whether the state has waived the sovereign immunity it enjoyed before the ratification of the Constitution to be sued in state court for violations of the FLSA. This analysis does not involve Eleventh Amendment immunity. In Anthony, we previously held: We are convinced that the statutory scheme for deriving pay plans has been implemented in a manner that includes FLSA overtime remuneration as compensation owed by an employer. Sections 91A.8 and 91A.10(3) provide an express consent to sue in the Iowa courts for purposes of recovering any compensation thus owed. 632 N.W.2d at 902 (emphasis added). In other words, we have already determined the State waived its sovereign immunity by expressly consenting to be sued in state court for FLSA overtime remuneration. Because the State has abrogated its sovereign immunity to be sued in state court for compensation owed under the FLSA, Alden and Raygor are inapplicable and the federal equitable tolling doctrine allows the peace officers to recover damages for the three-year period preceding the date the action was filed in federal court. We, therefore, affirm the district court's judgment on this issue.