Court Opinion

ID: 2811999
Source: CourtListenerOpinion
Date Created: 2015-06-25 19:01:02.786877+00
Date Added: 2024-06-11T12:14:23.192478
License: Public Domain

UNPUBLISHED

                     UNITED STATES COURT OF APPEALS
                         FOR THE FOURTH CIRCUIT

                                No. 14-1362

SUNDERSINGH BALA,

                 Plaintiff − Appellant,

           v.

COMMONWEALTH    OF   VIRGINIA   DEPARTMENT    OF   CONSERVATION   AND
RECREATION,

                 Defendant − Appellee.

Appeal from the United States District Court for the Eastern
District of Virginia, at Richmond.  Henry E. Hudson, District
Judge. (3:12-cv-00748-HEH)

Argued:   May 13, 2015                         Decided:   June 25, 2015

Before TRAXLER, Chief Judge, and WILKINSON and FLOYD, Circuit
Judges.

Affirmed by unpublished opinion.     Judge Wilkinson wrote the
opinion, in which Chief Judge Traxler joined. Judge Floyd wrote
a dissenting opinion.

ARGUED: Scott Gregory Crowley, Sr., CROWLEY & CROWLEY, Glen
Allen, Virginia, for Appellant. Gregory Clayton Fleming, OFFICE
OF THE ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for
Appellee.    ON BRIEF: Mark R. Herring, Attorney General of
Virginia, Rhodes B. Ritenour, Deputy Attorney General, Ronald N.
Regnery, Senior Assistant Attorney General, OFFICE OF THE
ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.

                                2
WILKINSON, Circuit Judge:

      Sundersingh Bala brought a Title VII claim for retaliatory

discharge    against      the     Commonwealth       of    Virginia         Department     of

Conservation and Recreation (“DCR”). The district court granted

summary judgment to the DCR because Bala released this claim in

a   July   7,    2011,    Settlement      Agreement.         We    affirm      the     trial

court’s    holding       that     the   Settlement         Agreement        included      the

retaliatory discharge claim. Having obtained the benefit of his

bargain, Bala cannot now seek a remedy from the courts after

knowingly and voluntarily relinquishing the underlying claim.

                                          I.

      Bala is a naturalized United States citizen of East Indian

origin who joined the DCR’s accounting department in 1985. Since

that time, he has filed numerous employee grievances with the

Department       of   Employee      Dispute    Resolution          (“EDR”)        alleging,

among other things, that the DCR refused to promote him for

discriminatory        reasons.     Most   recently,         he    filed      two    related

grievances: one in May 2009, alleging that the DCR failed to

select him for the DCR’s Accounts Payable Supervisor position

owing to discrimination against his age and national origin; and

another    in     October       2009,   alleging      that       his    September        2009

termination       (effective       December    31,        2009)    violated        internal

Department       of    Human       Resource     Management             (“DHRM”)      layoff

policies,       discriminated      against     him    because          of   his    age    and

                                           3
national    origin,          and    retaliated       against         his     prior    protected

allegations of discrimination. J.A. 370.

       Bala’s termination was part of a series of layoffs pursuant

to an overall budget reduction for state agencies. Bala did not

volunteer       for    early        retirement       and       was     not    suggested      for

termination by his supervisors, but was nevertheless included on

a   list   of    employees          under   consideration            for     termination     and

eventually selected to be laid off. He alleged in his grievance,

and later in his complaint, that he was selected for involuntary

termination       in     retaliation         for     his       numerous       complaints       of

discrimination in grievances and court proceedings.

       Employees of Virginia’s state agencies who have employment

complaints file grievances with the EDR as part of a statutorily

created    dispute       resolution         process.       The       grievances       are   first

reviewed by management in a three-step internal review process.

Employees       who    are    dissatisfied         with        the   resolution       of    their

grievances       after       this    process       may    request       a    hearing    with    a

neutral arbiter. The hearing officer’s decision is appealable to

Virginia     state       circuit       court   if        the     employee      believes      the

decision is contrary to law. Va. Code Ann. § 2.2-3006.

       The initial three-step review of Bala’s May and October

2009   grievances,           consolidated      at        his    request,       J.A.    290-293,

found that DCR had not discriminated, retaliated, or failed to

follow the DHRM policy governing layoffs. Displeased with this

                                               4
result,     Bala        requested    and      was   granted      a    hearing.      The

administrative review of his grievances on February 1, 2011,

found that the DCR had violated the DHRM’s policies (without

reversing the other findings), and the hearing officer directed

DCR to reinstate Bala to his former position. J.A. 372-374.

       Meanwhile, Bala had already resumed work with the DCR as an

hourly     employee       starting       in   February    2010,      and   had     been

receiving early retirement benefits since his termination. Both

his hourly wages and the early retirement benefits would have

been offset against any back pay he was due upon reinstatement.

So     instead     of     pursuing      reinstatement,        Bala   and     the    DCR

“concluded that it would be in their best interests to resolve

this situation by agreement,” and they consequently negotiated a

settlement agreement on July 7, 2011. J.A. 46.

       Under the terms of the agreement, the agency agreed to not

seek     revocation       of   Bala’s      enhanced    retirement      and    related

benefits, and to maintain his hourly position for at least three

years as long as his job performance was satisfactory. J.A. 47.

In return, Bala agreed to “waive any rights accorded to him

pursuant to the hearing officer’s decision of February 1, 2011,

including his reinstatement to his former salaried position.”

Id. The agreement applied to “the grievance dated October, 2009

and/or    case   #      9295   Hearing    officer     final   decision     issued    on

February 1, 2011.” Id. The parties declared that each had an

                                              5
opportunity       to       seek    counsel,           and     that       the     terms      had     been

carefully read, fully understood, and agreed to voluntarily. Id.

     On October 23, 2012, however, Bala initiated this civil

action alleging violations of Title VII of the Civil Rights Act

of   1964,       as        amended,        42        U.S.C.      § 2000e-2         and      -3,      for

discrimination and retaliation based on his race and national

origin. The complaint contained a count of discrimination and a

count    of   retaliation             against         the     DCR    for       both    refusing      to

interview      Bala        for    a    grants         manager        position         in    2011    and

involuntarily         terminating              him    in     the    layoffs       in       2009.    The

district      court        granted     a       12(b)(6)       motion       to    dismiss      on    all

counts. Bala          v.    Commonwealth             of    Va.     Dep’t    of    Conservation        &

Recreation, No. 3:12CV748, 2013 WL 53744, at *1-2 (E.D. Va. Jan.

3,   2013).       On        appeal,        we        upheld        the     dismissal         of      the

discrimination         claim      for      Bala’s          layoff,       but    reversed      on     the

other three counts for “consider[ing] DCR’s proffered legitimate

nondiscriminatory            reasons           at     a     procedurally         improper          time,

within     the    context         of       a     Rule       12(b)(6)       motion.”         Bala     v.

Commonwealth of Va. Dep’t of Conservation & Recreation, 532 F.

App’x 332, 335 (4th Cir. 2013).

     On remand, Bala amended his complaint to allege only the

retaliatory       discharge           claim.         He     claimed       his    layoff       was    in

retaliation       for       his       numerous            grievances       and    court       filings

“complaining of race, national origin and age discrimination” --

                                                     6
in particular his May 2009 grievance for failing to interview

him for an Accounts Payable Supervisor position. J.A. 11-2, 16.

After oral argument and supplemental briefing on the Settlement

Agreement, the district court granted DCR’s motion for summary

judgment on the grounds that the Settlement Agreement precluded

Bala from bringing the claim. Bala v. Commonwealth of Va. Dep’t

of Conservation & Recreation, No. 3:12CV748, 2014 WL 1281235, at

*1, *5 (E.D. Va. Mar. 27, 2014). We now affirm the judgment.

                                         II.

      Title    VII    of     the    Civil       Rights        Act    of    1964     protects

employees from harms caused by an employer’s discriminatory or

retaliatory actions. While litigation of such claims remains the

ultimate option, the statute itself selected “[c]ooperation and

voluntary compliance” as the “preferred means” for eliminating

unlawful    discrimination.         Alexander      v.        Gardner-Denver        Co.,   415

U.S. 36, 44 (1974).

      To    that     end,     Congress      created           the    Equal        Employment

Opportunity       Commission       (“EEOC”)      as      a     mechanism     “to      settle

disputes through conference, conciliation, and persuasion before

the   aggrieved      party    was    permitted        to      file    a    lawsuit.”      Id.

Consistent with that purpose, the EEOC maintains a preference

for “voluntary and expeditious resolution of disputes” between

employers     and    employees      through      settlement.          Admin.      Exemption

Allowing    for     Waivers    Under     the     ADEA,        50    Fed.    Reg.     40,870,

                                            7
40,870-40,871 (proposed Oct. 7, 1985) (comparing ADEA and Title

VII    claims).       Waiver   of   Title      VII      claims       through       settlement,

therefore,       is    authorized,      provided          the        waiver    is     knowing,

voluntary, and part of a bargain that resolves the underlying

employment discrimination dispute. See Alexander, 415 U.S. at 52

& n.15; Keith v. Aldridge, 900 F.2d 736, 741 (4th Cir. 1990).

       We     must    therefore     determine        whether         Bala    and    the   DCR’s

Settlement      Agreement      effected       a    waiver       of    Bala’s       retaliation

claim.      “Settlement    agreements       operate         on   contract          principles,

and thus the preclusive effect of a settlement agreement ‘should

be measured by the intent of the parties.’” Ohio Valley Envtl.

Coal. v. Aracoma Coal Co., 556 F.3d 177, 211 (4th Cir. 2009);

see    also    First    Sec.   Fed.     Sav.      Bank,     Inc.      v.    McQuilken,     480

S.E.2d 485, 487 (Va. 1997). Where the parties’ intent is clear

from    the    unambiguous      terms    of       the     contract,         construed     as   a

whole, we need not and cannot resort to extrinsic evidence of

intent. See Goodman v. Resolution Trust Corp., 7 F.3d 1123, 1126

(4th Cir. 1993); W.D. Nelson & Co. v. Taylor Heights Dev. Corp.,

150 S.E.2d 142, 145 (Va. 1966).

       The Settlement Agreement stated plainly that “the parties

have    concluded      that    it   would     be     in    their      best     interests       to

resolve this situation by agreement.” J.A. 46. The “situation”

referenced in that provision is described immediately before it

-- Bala was laid off, filed the October 2009 grievance, and

                                            8
pursued administrative review until he was awarded reinstatement

by    a    hearing       officer.     Id.   Furthermore,            the    Agreement      stated

clearly that it applied to the October 2009 grievance and/or the

hearing officer’s final decision on February 1, 2011. J.A. 47.

These documents, therefore, were incorporated by reference as if

included in the contract itself. See W.D. Nelson & Co., 150

S.E.2d at 146 (“Writings referred to in a contract are construed

as    a     part     of     the      contract         for     the   purpose        and    extent

indicated.”). Finally, Bala explicitly waived any rights related

to or flowing from that February 1, 2011, decision, specifically

including the right to reinstatement to his former position.

J.A. 47.

          There    can     be   no    doubt     that        this    Settlement       Agreement

addressed and resolved the matter now alleged in Bala’s Title

VII       retaliation      claim.     By    its       plain    language,     the     Agreement

covered “the grievance dated October, 2009 and/or case # 9295

Hearing officer final decision issued on February 1, 2011.” J.A.

47. The October 2009 grievance alleged misapplication of the

agency’s      layoff       policies,       discrimination,           and    retaliation     for

prior charges and grievances, resulting in Bala’s termination.

J.A. 370. That the hearing officer only reversed the claim of

violating         agency    policy     does     not      magically        remove    the    other

claims from the proceedings. The agency’s alleged retaliation,

in    the    form    of    laying     him    off,      is     the   crux    of   Bala’s     only

                                                  9
remaining claim in his Title VII complaint. See J.A. 16-17. The

complaint      clearly    describes      the     same    “situation”     that      both

parties thought best to resolve by agreement. By so agreeing,

Bala waived the right to resurrect his retaliation claim and

reinstatement remedy in later litigation.

      Bala cannot obtain through litigation what he voluntarily

relinquished in the Settlement Agreement for good consideration.

The   relief    sought    in   the    grievance       was   reinstatement     to    his

former position, with back pay and benefits. J.A. 370. He was

granted this relief in the administrative review, and chose to

negotiate away that specific remedy in order to retain his early

retirement benefits and secure his hourly job for the next three

years.   J.A.    46-47.    Now   he     seeks    to     obtain   through     judicial

action   the    same   remedy    that    he     voluntarily      forfeited    in    the

Settlement Agreement. J.A. 17. He could have expressly reserved

the right to bring the retaliation claim at a later time, but

declined to do so. See Keith, 900 F.2d at 741. Bala negotiated

his terms and obtained the benefit of his bargain. He cannot now

claim what he earlier relinquished.

      We thus hold that the Title VII claim for retaliation was

unambiguously      included      in    Bala’s     July      7,   2011,   Settlement

Agreement with the DCR, and that therefore he is precluded from

                                         10
bringing that claim now in order to achieve a second bite at the

apple.

                                                        AFFIRMED

                               11
FLOYD, Circuit Judge, dissenting:

       This appeal presents a straightforward question regarding

the scope of the parties’ release.               In the governing agreement,

Bala agreed “to waive any rights accorded to him pursuant to the

hearing officer’s decision of February 1, 2011.”                    J.A. 47.     It

is   undisputed    that   the   only     “right”     awarded   to   Bala    in   the

February 2011 decision was reinstatement to his former position

at the DCR.        And the hearing officer granted Bala this right

only because the DCR failed to follow its own internal layoff

policies; the officer did not address Bala’s additional claims

under Title VII.

       Yet, the majority concludes that the release also precludes

Bala from pursuing his Title VII retaliation claim in federal

court.       This result would be correct if the release stated that

Bala    agreed    to   waive    “any    and   all    claims    related      to   his

employment” with the DCR.         But that is not what the Agreement--

drafted by the DCR--says.              By holding otherwise, the majority

transforms the narrow, specific release at issue into a general

release broadly precluding all claims brought in the October

2009 grievance.        The parties were certainly free to negotiate

and agree to such a release.            But nothing in the plain language

of     the    Agreement   suggests        they      actually   did     so    here.

Accordingly, I respectfully dissent.

                                         12
                                             I.

       It is well-settled that an employee may release a cause of

action under Title VII if the employee’s consent to settlement

is “voluntary and knowing.”                  Alexander v. Gardner–Denver Co.,

415 U.S. 36, 52 n.15 (1974).                 But circuits diverge on what an

assessment      of   voluntariness       and      knowledge     entails:     some    look

solely to principles of contract interpretation, while others

evaluate     the      totality     of    the      circumstances       surrounding       a

purported release.            See Pierce v. Atchison, Topeka & Santa Fe

Ry. Co., 65 F.3d 562, 570 (7th Cir. 1995) (collecting cases).

Under    either      approach,    however,        the    clarity    of   a   purported

waiver’s language is significant.                  Compare O’Shea v. Commercial

Credit Corp., 930 F.2d 358, 362 (4th Cir. 1991) (considering

this    split   and    determining       that      the   “better     approach    is    to

analyze    waivers       of      ADEA    claims         under     ordinary    contract

principles”), superseded by statute, 29 U.S.C. § 626(f), with

Beadle v. City of Tampa, 42 F.3d 633, 635 (11th Cir. 1995)

(listing    factors      relevant       in   assessing      the    totality     of    the

circumstances, including “the clarity of the agreement”).                             And

although the Fourth Circuit lacks binding precedent on which

approach governs releases of Title VII claims, see Randolph v.

Caruso Homes, Inc., No. RWT–13–2069, 2014 WL 4661985, at *4 n.6

(D. Md. Sept. 16, 2014), we need not decide that issue, as the

                                             13
Agreement’s     plain   language      compels       one   result   under    either

approach.

     Here,     the   plain   language    of   the     Agreement    unambiguously

demonstrates that the parties agreed only to a limited release

that did not include Bala’s Title VII claim.                  Although we must

derive   the   parties’      intent   from    the    instrument    viewed    as   a

whole, Atalla v. Abdul–Baki, 976 F.2d 189, 193 (4th Cir. 1992),

Section 4 of the Agreement is the only section that defines the

scope of the release.           That section limits Bala’s release to

“any rights accorded to [Bala] pursuant to the hearing officer’s

decision of February 1, 2011, including his reinstatement to his

former salaried position.” *          J.A. 47.        Significantly, the only

right accorded to Bala pursuant to the February 1 decision was

     * This language stands in stark contrast to the broad
language typically used in general releases of Title VII claims.
See, e.g., Smith v. Amedisys Inc., 298 F.3d 434, 441-42 (5th
Cir. 2002) (finding Title VII claims clearly waived by an
employee’s agreement “to release [the employer] of any and all
employment related claims”); Stroman v. W. Coast Grocery Co.,
884 F.2d 458, 460-61 (9th Cir. 1989) (finding clear waiver of
Title VII claims based on a provision stating that the
agreement’s “terms represent a full and final settlement of any
and all claims arising out of [the employee’s] employment with
[his employer]”; Pilon v. Univ. of Minn., 710 F.2d 466, 467-68
(8th Cir. 1983) (finding clear waiver of a Title VII claim in a
provision in which a graduate student released the university
“from any and all manner of action . . . which [the plaintiff]
ever had”); Anderson v. Garbage Disposal Serv., No. 3:00CV294-
MU, 2000 WL 33912330, at *1 (W.D.N.C. Dec. 18, 2000) (finding
clear waiver of a Title VII claim in a provision in which the
plaintiff “released and forever discharged [the employer] of and
from any and all actions related to Plaintiff’s employment”
(brackets omitted)).

                                        14
the “specific remedy,” Maj. Op. at 10, of reinstatement to his

former (or a similar) position.                   And that right was based only

on his having proved his claim that the DCR “did not comply with

the terms and conditions of the Commonwealth of Virginia Layoff

Policy    and    Procedure     Number       1.30.”      J.A.    373-74.         Thus,    I

believe   the     release    clearly        applies    only    to   Bala’s   right      to

reinstatement for the violation of administrative policy, and I

would reverse the district court’s grant of summary judgment.

                                            II.

       Rather     than    conduct       a     straightforward        analysis,       the

majority contorts the Agreement and errs in four main respects.

       First,     the    majority       erroneously         declares    that      “Bala

explicitly waived any rights related to or flowing from” the

hearing officer’s February 1 decision.                  Maj. Op. at 9.          I agree

that   Bala     waived   his   limited       right     to   reinstatement--flowing

from or “accorded” by that decision--but I cannot find where the

Agreement       explicitly     says    that       he   also    waived     any    rights

“related to” the decision.            If such language existed, perhaps we

could interpret the waiver provision to capture the Title VII

claims as “related” (albeit distantly) to the final decision.

See Related Definition, Merriam–Webster Dictionary, www.merriam-

webster.com/dictionary/related (defining “related” as “connected

by reason of an established or discoverable relation”).                          But in

                                            15
actuality, such language is wholly absent, and the majority errs

by reading it into the Agreement.

        Second, the majority relies on Section 5 of the Agreement,

which the majority says incorporates by reference Bala’s October

2009 grievance and the February 1 decision.                       According to the

majority,       merely    incorporating       these      documents     by   reference

somehow expands the scope of the release to include all claims

at issue in the October 2009 grievance.                        I disagree.       Unlike

Section 4, Section 5 does not define the scope of the waiver.

Indeed, it says nothing about waiver at all.                     Rather, it states

that    the     Agreement    only    applies       to    the    grievance    and    the

resulting final decision; not that the “waiver” itself applies

to all claims raised in the grievance or adjudicated prior to

the February 1 decision.             In reading Section 5 as it does, the

majority      simply     conflates    Section      5    with    the   actual     waiver

language in Section 4.

       Third,    the     majority    relies   on       the   Agreement’s    recitals,

which describe the procedural posture of Bala’s grievance and

state     that    the     Agreement’s    purpose         was    to    “resolve     this

situation.”       J.A. 46.     The majority concludes that the amorphous

reference to a “situation” must mean all of Bala’s claims, and

thus expands the limited release into a general waiver.                          Again,

I do not believe this is correct.                  As an initial matter, I do

not read “situation” to unambiguously refer to all of Bala’s

                                         16
claims, as the majority does.                    Rather, it may just as easily

refer to Bala’s right to reinstatement based on the favorable

February 1 decision.         Thus, at best for the DCR’s case, the

recitals create an ambiguity about the scope of Bala’s release.

But even if there is an ambiguity, based on the inclusion of a

vague general expression of intent, “no rational court could say

that a general expression of intent trumps the specific terms

that it introduces.”         Kenneth A. Adams, A Manual of Style for

Contract     Drafting   32   (3d       ed.       2013);    see      also     United      Va.

Bank/Nat’l    v.   Best,   223    Va.       112,    115   (1982)       (“Under     settled

rules   of   construction,       if    the       prefatory     or     recital      language

conflicts with the obligatory provisions of the contract, then

the   obligatory   provisions         must       prevail.”).          And   even    if   the

recitals     somehow    suffice        to     create      an     ambiguity         in    the

Agreement, we should construe it (at least for the purposes of

the DCR’s summary-judgment motion) against the drafter, the DCR.

Sys. Research & Applications Corp. v. Rohde & Schwarz Fed. Sys.,

Inc., 840 F. Supp. 2d 935, 945 (E.D. Va. 2012) (citing Martin &

Martin, Inc. v. Bradley Enters., Inc., 256 Va. 288, 291 (1998)).

      Finally,     validating         such       vagueness       as     sufficient        to

constitute waiver poses a real threat to employees’ ability to

pursue their rights under Title VII.                   Essentially, the majority

equates the mere existence of a waiver provision to a full,

exhaustive release of an employee’s right to bring any pending

                                            17
claims.      If the Agreement at issue suffices for such a release,

I   am    hard   pressed   to   imagine    what   the   majority   would   find

inadequate.       Indeed, as the majority opinion hypothesizes, the

burden is now on employees to insist on language reserving any

such rights, Maj. Op. at 10, even where an agreement does not

reference Title VII claims and even where a waiver provision is

otherwise narrow.          In placing such a burden on employees, the

majority simply disregards the basic tenet that “[w]aivers of

federal remedial rights . . . are not lightly to be inferred.”

Torrez v. Pub. Serv. Co. of N.M., Inc., 908 F.2d 687, 689 (10th

Cir. 1990) (per curiam) (citing Watkins v. Scott Paper Co., 530

F.2d 1159, 1172 (5th Cir. 1976)); see also Pierce v. Atchison

Topeka & Santa Fe Ry. Co., 110 F.3d 431, 438 (7th Cir. 1997);

Lyght v. Ford Motor Co., 643 F.2d 435, 441 (6th Cir. 1981).

         For these reasons, I respectfully dissent.

                                      18