Court Opinion

ID: 3040420
Source: CourtListenerOpinion
Date Created: 2015-10-13 23:02:56.45712+00
Date Added: 2024-06-11T11:51:54.043295
License: Public Domain

United States Court of Appeals
                             FOR THE EIGHTH CIRCUIT
                                ________________

                                   No. 05-3496
                                ________________

Roger D. Parsons,                         *
                                          *
             Appellant,                   *
                                          *       Appeal from the United States
      v.                                  *       District Court for the
                                          *       Southern District of Iowa.
Pioneer Seed Hi-Bred International,       *
Inc.,                                     *            [PUBLISHED]
                                          *
             Appellee.                    *

                                ________________

                                Submitted: April 20, 2006
                                    Filed: May 19, 2006
                                ________________

Before WOLLMAN, HANSEN, and BENTON, Circuit Judges.
                      ________________

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.

      1
        The Honorable James E. Gritzner, United States District Judge for the Southern
District of Iowa.
        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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