Connecticut Employment Lawyer & Attorney : Daniel Schwartz : Stamford, Hartford New Haven, CT

It keeps going and going and going.....

When I learned of a new lawsuit filed in federal court yesterday by former CHRO Regional Manager Femi Bogle-Assegai arising from her termination back in April 2001, I couldn't help but think of the cliched advertisement of the Energizer Bunny.

First, the quick background as described by the U.S. Court of Appeals - Second Circuit in a November 2006 decision:

Ms. Bogle Assegai served as Regional Manager at the CHRO for several years before her termination in the spring of 2001. In September 2001 -- 186 days after she was notified of her termination -- she filed a claim with the Equal Employment Opportunity Commission alleging, among other things, race discrimination.  There is no reference to her filing a similar claim at the CHRO.  She received a right to sue letter from the EEOC and in December 2002, she filed a lawsuit in federal court.

The State moved for summary judgment on a variety of grounds including the fact that Ms. Bogle-Assegai missed the statute of limitations (or the deadline) for filing race discrimination claims, which was 180 days.  The District Court granted the motion in a decision available here.  Ms. Bogle-Assegai appealed.

At the Second Circuit, she claimed that a work-sharing agreement existed between the CHRO and the EEOC that should have extended the time period for filing discrimination claims (why a CHRO Regional Manager would not know about the existence or non-existence of the agreement is an unanswered question of the case).   The EEOC denied the existence of such an agreement.  The Second Circuit rejected such claims in a November 2006 decision found that Ms. Bogle-Assegai had not raised that issue before:

In sum, faced with a summary judgment motion expressly asserting that her charge had not been dually filed with the state agency and that the 300-day filing period therefore did not apply to her claims, Bogle-Assegai had every incentive and opportunity to contest that argument. She made no argument to the district court in opposition. And in arguing to this Court that the 300-day period is applicable, she has proffered no reason for her failure to make that argument in the district court and has pointed to no evidence that would support her factual premises. In the circumstances, appellate consideration of her unpreserved argument is unwarranted. We affirm the district court's dismissal of Bogle-Assegai's Title VII claims on the ground that her administrative charge was not timely filed.

She then filed a petition for certiorari with the United States Supreme Court.  That petition was rejected earlier this year.

Under normal circumstances, that would end matter. But this story does not end there.  Yesterday, Ms. Bogle-Assegai brought a new lawsuit against the state contending that her equal protection rights were violated. How so?

She contends first that the Second Circuit actually denied her first claim based on the state's "affirmative statement that no work sharing agreement was in existence at the time of Plaintiff's filing of her EEOC complaint". (Paragraph 16) Readers can decide whether this is accurate.

She then contends that based on a Freedom of Information Act request, she learned in November 2007 that the CHRO "continued to accept complaints and forward them to the EEOC with the notation that their action was 'pursuant to the work sharing agreement'." (Paragraph 18.)  She contends that she was "singled" out because her complaint was also not filed pursuant to the "work-sharing agreement".

It appears on first glance that the situation she alleges is different than the facts of her case. Here, Ms. Bogle-Assegai only filed with the EEOC, not the CHRO, at least according to the court decisions, so her analogy may fall flat.  She also doesn't actually provide a copy of an alleged agreement, only that there was a notation on a document about such an agreement.

Regardless, however, don't be surprised if she ends up running up against another issue she had to address before: statute of limitations.  Add to that the theories of collateral estoppel and res judicata grounds (which prevent parties from retrying the same claims or issues) and the outlook for this lawsuit remains cloudy indeed.

How long will it keep going? Stay tuned.  But even Energizer batteries eventually run out of energy.

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A few years ago, there was lots of debate among attorneys about whether summary judgment was still a disfavored remedy in employment discrimination cases in federal court.  (For those readers unclear what "summary judgment" is, the Wikipedia entry is a pretty good start and George's Employment Blawg has a nice post about how to best prepare a motion for summary judgment.) 

If the latest in a series of recent decisions by Judge Vanessa Bryant is any indication (see prior posts here, here and here), summary judgment is still alive and well. 

In Grunberg v. Quest Diagnostics, Inc., Judge Bryant was faced with a multi-count complaint alleging claims under the Americans with Disabilities Act (“ADA”), 42 U.S.C. § 12101 et seq., the Family and Medical Leave Act (“FMLA”), 29 U.S.C. § 2601 et seq., the Connecticut Fair Employment Practices Act (“CFEPA”), Conn. Gen. Stat. § 46a-60 et seq., and Connecticut common law.  The court granted Quest's request for summary judgment on each and every count. 

The decision itself is fairly routine in its analysis of the issues. Among the notable points:

• Employees cannot rely on generalized statements of progressive discipline in an employee handbook to create a "contract" claim, particularly if the employer has set forth adequate disclaimers.
• An employee cannot prevail on an FMLA claim, where the employer can show that it had already made a decision to remove the employee from his/her position prior to the exercise of FMLA rights.  This is important for employers to understand; the employee need not be notified of the decision in order to invoke this protection, but the decision must have already been made in one fashion or another.

So, does this decision signal a trend of granting summary judgment in Connecticut?  No, at least not generally. Certainly, Judge Bryant has shown that she is not afraid to use this procedural device to dispose of cases.  But each federal district court judge in Connecticut has their own style of handling cases.  Indeed, in a prior post, I noted that two federal court judges even outlined their summary judgment philosophies in their chambers practices.

For example, Judge Thompson believes that "dispositive motions are overused. In discrimination cases, he rarely grants motions for summary judgment that dispose of the entire case." ...  Judge Droney, however, states that, "in employment cases, for example, many summary judgment motions and motions to dismiss are being filed. He believes that most of these motions have merit and need to be considered by the court."

Thus, when employees and employers are in federal court, the best way to evaluate a case may not be to merely look at the merits of the case, but to also understand the judge's philosophy and history as well.  An employer who may have a shot at summary judgment (thereby avoiding the cost of a trial) may value a case entirely differently than a party who knows that the case is going to trial regardless of what the parties uncover during discovery. 

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First, a warning.

If your eyes glaze over at discussing the difference between cash balance plans and defined benefit plans, this post is not for you.  However, for those employers who are considering converting their retirement plans or who have done so, a new case released this morning provides some much-needed guidance in Connecticut about the legality of doing so, with a well-reasoned opinion to boot.  It also provides a bit of a primer to people who've heard  "something" about retirement plans, but have been curious about what the big deal was with converting from traditional pension plans to newer reitrement plans.

In Custer v. SNET (download here), federal judge Stefan Underhill has upheld SNET's conversion to a cash benefit plan from 1995.  In doing so, he methodically deconstructs the Plaintiff's arguments (while still acknowledging that this area of law is developing).  His discussion on the background on the case -- for those who need a bit of re-education in the area -- is particularly instructive.

First, he discusses the two types of retirement plans.

ERISA’s statutory structure contemplates two types of retirement plans; defined contribution plans and defined benefit plans. 29 U.S.C. §1002(34) - (35). A defined contribution plan is “a pension plan which provide[s] for an individual account for each participant and for benefits based solely upon the amount contributed to the participant’s account, and any income, expenses, gains and losses, and any forfeitures of accounts of other participants which may be allocated to such participant’s account.” 29 U.S.C. § 1002(34). By contrast, “a defined benefit plan is any retirement plan that is not a defined contribution plan.” Id. (citing 29 U.S.C. § 1002(35)). A typical defined benefit plan grants retirees a percentage of their final salary for the remainder of their lives.

Cash balance plans generally share certain attributes with both defined contribution plans and defined benefit plans. Like a traditional defined contribution plan, participants in a cash balance plan accrue benefits in an “account.” Unlike a traditional defined contribution plan, however, a participant’s account in a cash balance plan is not “real;” it is a mathematical construct to determine the size of a plan participant’s lifetime annuity that the employer will pay out when the participant retires. The account is not capitalized in the sense that neither the participant, nor the employer, is actually setting aside money. Instead, the employer is simply accruing an obligation to pay out benefits at a future date.

So, what did SNET do? On July 1, 1995, SNET converted its defined benefit plan to a cash balance plan.

Under SNET’s cash balance plan, each participant’s cash balance account is comprised of three parts: the opening account balance; accrued service credits; and accrued interest credits.The opening balance is generally based on the participants’ benefits under the old plan as of July 1, 1995. Participants then earn service credits at the end of each month based upon their level of pay and years of service.

Finally, participants earn interest credits annually based upon fixed negotiated percentages. ... [Central to this argument is that] if a younger participant remains employed through retirement age, he will thus accrue more total interest per service credit than similarly situated older workers. ...

Perhaps as an incentive to take early retirement, as part of the switching to the new plan, SNET front-loaded some retirement benefits. ... As a practical matter, participants thus receive 110 percent of their benefits under the old plan until the value of the cash account under the new plan catches up to and exceeds their permanent enhanced benefit.

The parties, and other courts, refer to the catch-up period as the “wear-away” period because, plaintiffs argue, the benefits that participants can receive but will not increase during that period. The period is more aptly named a “catch-up” period, however, because it is the period during which employees’ benefits under the cash balance plan catch up to their front-loaded permanent enhanced benefit.

The first question for the court was whether the interest credit portion violates ERISA.  The court said no.  It suggests that cash benefit plans, in general are not age-discriminatory "because cash balance plans are functionally equivalent to defined contribution plans, at least with respect to accruing benefits."  The court then uses various support for its conclusion including :

I similarly hold that the interest credit formula of SNET’s cash balance plan is not actually age-discriminatory, and that it merely accounts for the time value of money. As set forth in greater detail below, an employee’s benefits are not calculated based upon whether that employee is older or younger, but are instead calculated based upon whether he is a newer or more senior employee. The critical determinant of an employee’s benefits are his years to retirement, not his age. The fact that age may often have a loose correlation with an employee’s years to retirement does not necessarily make a plan age-discriminatory. In fact, a cash balance plan would more likely violate ERISA § 204(b)(1)(H)(i) if it did not account for the time value of money.

The court also dismisses the employees' argument that the plan "wears away" at their benefits.

Plaintiffs’ allegation that “an older worker has to wait more years after the conversion to the cash balance formula to actually begin earning new retirement benefits,” however, is not accurate. The “wear-away” period is not necessarily longer for older workers; it is longer for workers that have greater frozen benefits. Under the old plan, the size of a worker’s frozen benefits is a function of a worker’s salary and years of service, not his age....

Because a workers’ frozen benefits are not a function of the worker’s age,the size of the “wear-away effect” is not a function of the worker’s age.  For example, the size of the “wear-away” period for an older worker with a given salary and years of service will not be greater than the length as a younger worker’s “wear-away” period with the same salary and years of service to the company.  Indeed, a participant’s age, as opposed to his salary and years of service, has no impact on the length of the “wear-away” period.  

Moreover, employees are not actually “losing” benefits during the “wear-away” period.  SNET chose to calculate the permanent enhanced benefit by starting with an employee’s account balance under the old defined benefit plan, and increasing the balance immediately by ten percent.  If SNET had chosen to evenly distribute the ten percent increase over the period of time during which the value of an employee’s cash balance account caught up to the permanent enhanced benefit, then an employee’s benefits would not remain stagnant, but would constantly increase (even if at a lower rate than the employee was previously receiving under the old plan).  SNET should not be penalized for front-loading the ten percent increase in benefits, as opposed to spreading that ten percent increase out over a period of years.

As you can see from the above, the issues with conversions are technical and, perhaps cumbersome. But for employers who have converted their plans or who are considering doing so, the case provides a roadmap to avoiding some legal pitfalls in the future.

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A few days ago, I noted that the new District Court of Connecticut website now posts the federal judge's Chambers Practices online.  For employment law practitioners, two of the judge's chambers practices refer to the judge's views on discrimination cases and the use or overuse of dispositive motions on such claims.

Judge Alvin Thompson and Judge Christopher F. Droney each take a different perspective that is useful to keep in mind when practicing before that judge.

Judge Thompson believes that:

dispositive motions are overused. In discrimination cases, he rarely grants motions for summary judgment that dispose of the entire case. Judge Thompson has been experimenting with pre-argument conferences for dispositive motions. He finds that conferences of this sort encourage discussion regarding the handling of a particular case. He uses the conferences when he sees something in a case that needs to be resolved to move the case forward and promote efficiency. For example, when he receives a motion to amend a complaint he may call in the parties to try to reach an agreement on how to simplify the complaint and then rule orally on the motion. If a motion to dismiss is filed, Judge Thompson may call in the parties for a conference to see if the issues can be resolved by an amended complaint.

 Judge Droney, on the other hand, takes a differing view:

Judge Droney does not require pre-filing conferences. He believes that there has been an increase in the number of dispositive motions because of the nature of the cases filed in federal court. In employment cases, for example, many summary judgment motions and motions to dismiss are being filed. He believes that most of these motions have merit and need to be considered by the court.

(For the record, the chambers practices of other district court judges are silent on this topic.) 

Obviously, each judge considers each case on the merits and practitioners shouldn't read too much into these comments. Lawyers have long known which judges might be more receptive to summary judgment motions than others. 

But for employment law practitioners, this example confirms that even in a small state like Connecticut, judges comes from different perspectives when deciding such cases.  For clients with cases in the courts, finding lawyers who are familiar with the judges' perspectives can help shape the strategy of the case as well.

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Since many employment law cases are tried in federal courts, intimate knowledge of the way the Court works is one way for practitioners and clients to overcome potential hurdles. Looking at the District Court of Connecticut's website did not provide many answers and thus, those who practiced in federal court frequently often had the upper hand on those who didn't. Indeed, the District Court's website felt like a throwback to the early days of the Internet.  

But lo and behold, just a few days ago, the Court launched a brand new site.  I've only just begun to explore and I like what I've seen so far.  In terms of information sharing, it has finally leveled the playing field, even for those who only practice infrequently in federal courts.

Most impressive and helpful is that on each judge's website page, there is a link to that judge's chambers practices.  Why is this so important? Because until now, there was not a publicly available resource for such information on the Internet to know what each judge's preferences were for pretrial procedures, and trials. (I should note that the CBA did publish a book on it but charged $35 for CBA members and was only current through May 2004). 

You now can learn, for example, that Judge Robert Chatigny:

[I]s concerned when motions for extensions of the discovery deadline date established pursuant to the Rule 26(D) Report continue to be filed by some counsel on a regular basis, despite the purpose and intent of the applicable rules. According to Judge Chatigny, the purpose of the Rule 26(F) Report is to provide a schedule established pursuant to the parties' case management plan that is not to be modified except in unusual circumstances. Counsel are encouraged to propose a realistic discovery deadline date and then commence discovery without delay so that modifications of the discovery deadline date will be unnecessary.

Thus, experienced counsel in Connecticut will not seek an extension of time lightly when before Judge Chatigny.  Among the other topics that are discussed in the Chambers Practices:

• Oral Argument on Motions
• Referral to Magistrate Judges/Special Masters
• 26(f) Reports
• Sur-reply Briefs
• Letter Briefs
• Chambers' Copies
• Lawyer Affidavits
• Hours of Day for Trial
• Days of Week for Trial
• Opening Statements/Closing Arguments
• Jury Profiles
• Jury Selection
  

Again, this is a great resource.  I expect to explore this site more in the upcoming days and will post any further items of interest to those who practice employment law.

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