Opinion
Case No. 02-83984-SSM, (Jointly Administered)
March 30, 2004
Aparna B. Joshi, Esquire O'Melveny Myers, LLP, Washington, DC, for the reorganized debtor
Douglas M. Foley, Esquire McGuireWoods, LLP, Norfolk, VA, for the reorganized debtor
Malcolm Mitchell, Esquire Vorys, Sater, Seymour Pease, L.L.P., Alexandria, VA, for the Official Committee of Unsecured Creditors
MEMORANDUM OPINION
Trial was held without a jury on February 19, 2004, on the objection of US Airways, Inc. ("US Airways"), as reorganized debtor, to the employment discrimination claim of Phillip H. Frazier. The debtor was present by counsel. Mr. Frazier was present in person and represented himself. Partial summary judgment was previously granted in favor of the debtor, and the sole remaining issue is whether US Airways violated the American With Disabilities Act ("ADA") by maintaining a "100% healed" policy that caused Mr. Frazier to be placed on unpaid medical leave. This opinion constitutes the court's findings of fact and conclusions of law as required by Federal Rules of Bankruptcy Procedure 7052 and 9014.
The order granting partial summary judgment also reserved a second issue — the alleged failure by US Airways to pay for orthotics prescribed by Mr. Frazier's treating physician — but Mr. Frazier advised the court that the orthotics issue had been resolved. Mr. Frazier did file a motion for reconsideration of the partial summary judgment order. That motion was heard on March 25, 2004, and has been denied by separate order.
Findings of Fact
The factual background relevant to Mr. Frazier's claim is set forth at some length in this court's prior memorandum opinion granting partial summary judgment and will be repeated only to the extent necessary to place the remaining issues in context. See In re US Airways Group, Inc., No. 02-83984 (Bankr. E.D. Va., February 10, 2004).
Mr. Frazier was first employed by US Airways in 1973 in San Jose, California. He transferred later that same year to Los Angeles International Airport ("LAX"). He worked in a variety of positions, but from 1990 until May 21, 2001, when he was placed on unpaid medical leave, he was employed as a fleet service agent in the operations section. His operations duties included performing fuel, weight and balance calculations. From 1990 until mid-1999, he was not required to perform any ramp work. In that year, however, a collective bargaining agreement was entered into between US Airways and the International Association of Machinists which defined the functions of fleet service agents as including ramp service, operations/tower, and central load planning. The agreement permitted the company to establish "[s]eparate duty assignments" for the three fleet service functions but provided that "[e]mployees may be cross-utilized in or between classifications and duty assignments" based on the needs of the company. As permitted by the agreement, Mr. Frazier's assigned duties from approximately June 1999 onward included some ramp work, and, in particular, the unloading of baggage from arriving aircraft.
In July 1999, Mr. Frazier suffered a sprained ankle while unloading baggage. He received medical treatment and returned to work on a light duty assignment for 60 work days. While on light duty, he performed exclusively operations duties and was not asked to do ramp work. In September 1999, he went back to full duty.
On November 28, 2000 — a little over a year later — Mr. Frazier again injured his left ankle. He reported no other injury at the time. He was again placed on light duty in which he did not perform any ramp duties. That period of limited duty ended on May 1, 2001, when Mr. Frazier was placed on unpaid medical leave.
Mr. Frazier testified that in April 2001, he had two meetings with Renee Gilliam-White, who was Station Manager at LAX from August 1999 through July 2001 and with Al Thomas, Fleet Service Manager, about returning to work. According to Mr. Frazier, Ms. Gilliam-White and Mr. Thomas each informed Mr. Frazier that he could not return to work until his injury was 100% healed. Mr Frazier testified that he informed his then-attorney, Lathe S. Gill, of this discussion and that Mr. Gill, at his request, wrote to Ms. Gilliam-White and informed her that a 100% healed policy was against the ADA. Mr. Frazier testified that he wanted to continue working the operations functions but could not perform any of the ramp functions because of his injuries.
Ms. Gilliam-White, by contrast, testified that US Airways does not have a 100% healed policy and she denied telling Mr. Frazier that he had to be 100% healed in order to return to work. She testified that it was common for employees to return to work even though they were not 100% healed. Rachel Teipe, Assistant General Counsel in US Airways Legal Department, corroborated Ms. Gilliam-White's testimony and denied telling Mr. Frazier that he had to be 100% healed before returning to work. According to Ms. Teipe, Mr. Frazier simply had to provide documentation from his doctor that he could perform all functions of his job, including ramp duties. She conceded that if Mr. Frazier had a lifting limitation that prevented him from performing ramp service work, then he would not be allowed to return to work.
US Airways and six affiliates filed their chapter 11 petition in this court on August 11, 2002. Approximately two months later — and 17 months after Mr. Frazier was placed on unpaid medical leave — he amended his pending workers compensation claim to assert that the ankle injury "has caused new and further disability, that being lower back pain often times severe . . . [and] limited body movement." His stated theory at that time was that the back pain resulted from the failure by US Airways, through its workers compensation administrator, to pay for orthotics to treat the ankle injury. At trial, however, his testimony seemed to be that the injury to his back occurred on November 28, 2000 — the date of the second ankle injury — and that he had simply not remembered or been aware of that fact until recently. Mr. Frazier timely filed Claim No. 3956 in the amount of $126,377.88. Subsequent to the claims bar date Mr. Frazier submitted amended proofs of claim (Claim No. 5821 and 5827) in the amount of $24 million.
Although one is hand-written and the other typed, the amended claims are otherwise identical. Accordingly Claim No. 5827 will be treated as duplicative of 5821.
Conclusions of Law and Discussion I.
An objection to a proof of claim is a core proceeding over which this court has subject-matter jurisdiction under 28 U.S.C. § 1334 and 157 and the general order of reference from the U.S. District Court for the Eastern District of Virginia dated August 15, 1984. A proof of claim executed and filed in accordance with the Bankruptcy Rules "constitute[s] prima facie evidence of the validity and amount of the claim." F.R.Bankr.P. 3001(f). For that reason, the party objecting to a claim has the initial burden of presenting sufficient probative evidence to overcome such prima facie effect. See In re C-4 Media Cable South, L.P., 150 B.R. 374, 377 (Bankr. E.D. Va. 1992). Once the objecting party has done so, however, the burden of proof then shifts to the creditor to establish the validity and amount of his claim. Id.
II.
Before reaching the evidentiary issues, it is necessary to resolve a threshold issue raised by US Airways, which is whether Mr. Frazier even has standing to assert a violation of the ADA. Mr. Frazier alleges that US Airways maintained a "100% healed" policy under which he had to be completely healed before being allowed to return to work. The parties do not dispute that a 100% healed policy is a per se violation of the ADA. See McGregor v. Nat'l Railroad Passenger Corp., 187 F.3d 1113 (9th Cir. 1999); Heise v. Genuine Parts Co., 900 F. Supp. 1137, 1154 (D. Minn. 1995). Although the ADA does not explicitly prohibit a 100% healed policy, the courts considering the issue have uniformly held that a 100% healed policy is contrary to the employer's duty under the ADA to conduct an individualized assessment "whether the employee is able to perform the essential functions of his job with or without reasonable accommodation." McGregor, 187 F.3d 1116.
US Airways contends, however, that the reported cases first require an employee to be "disabled" within the meaning of the ADA before his or her challenge to an alleged 100% healed policy is heard. As noted in this court's prior opinion, the ADA prohibits an employer from discriminating against " a qualified individual with a disability because of the disability of such individual in regard to . . . [the] advancement, or discharge of employees, . . . and other terms, conditions, and privileges of employment." 42 U.S.C. § 12112(a) (emphasis added). A "qualified individual with a disability" is defined as
an individual with a disability, who, with or without reasonable accommodation, can perform the essential functions of the employment position that such individual holds.
42 U.S.C. § 12111(8). A "disability," in turn, is defined as
(A) a physical or mental impairment that substantially limits one or more of the major life activities of such individual;
(B) a record of such an impairment; or
(C) being regarded as having such an impairment.
42 U.S.C. § 12102(2). This court's prior opinion held that Mr. Frazier was not a qualified individual with a disability within the meaning of the ADA because "Mr. Frazier does not have the type of injury that substantially limits a major life activity" and because "US Airways did not regard Mr. Frazier as having an impairment that limited a major life activity."
Since Mr. Frazier is not a qualified individual with a disability, it follows that the ADA was not designed to protect him. As the Supreme Court has explained, in order to have constitutional standing, "[a] plaintiff must allege personal injury fairly traceable to the defendant's conduct and [that the injury is] likely to be redressed by the requested relief." Allen v. Wright, 468 U.S. 737, 751, 104 S.Ct. 3315, 3324, 82 L.Ed.2d 556 (1984). In other words, the plaintiff has the burden of proving (1) injury in fact, (2) traceability, and (3) redressibility. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 111 S.Ct. 2130, 2136, 119 L.Ed.2d 351 (1992). In this case, even if Mr. Frazier could carry his burden of showing that he was not allowed to return to work because US Airways improperly maintained a 100% healed policy, there is no relief to which he would be entitled under the ADA because he does not fall within the class of persons the ADA was intended to protect. See McGregor, 187 F.3d at 1116 ("A `100% healed' . . . policy discriminates against qualified individuals with disabilities[.]") (emphasis added); Hoover v. West Virginia Dep't of Health and Human Resources, 984 F. Supp. 978, 979 (S.D. W. Va. 1997) ("Plaintiff . . . is without standing to raise any claim whatsoever under the [ADA] since she is not a `qualified individual with a disability' within the meaning of the ADA."); Hutchinson v. United Parcel Serv., Inc., 883 F. Supp. 379, 398 (N.D. Iowa 1995) (holding that a plaintiff who is not a qualified individual with a disability does not have standing and cannot assert a claim under the ADA alleging a 100% healed policy). Accordingly, the court agrees with US Airways that even if the evidence fairly established that US Airways improperly maintained a 100% healed policy, Mr. Frazier does not have standing to allege such a violation because he cannot satisfy the redressibility requirement of the standing inquiry.
III.
Given Mr. Frazier's lack of standing, the court need not reach the issue of whether US Airways actually maintained a 100% healed policy. Mindful, however, that an appellate court may disagree with this court's analysis of the standing issue, discussion of that issue is nevertheless appropriate. US Airways, as the party objecting to Mr. Frazier's claim, had the initial burden of presenting sufficient evidence to overcome the prima facie effect of the filed proof of claim. It has done so through the testimony of Ms. Gilliam-White and Ms. Teipe. Accordingly, Mr. Frazier now has the ultimate burden of proof.
The testimony of Mr. Frazier as to what he was told by Ms. Gilliam-White is directly contradicted by her testimony. There are no compelling reasons to disbelieve either witness. Mr. Lathe's letter to Ms. Gilliam-White is not competent evidence as to what was said, either in that meeting or (if such a conversation occurred) in any separate discussion he and Ms. Gilliam-White may have had. Nor are Mr. Frazier's personal notes, even if made, as he represents, immediately after the meeting. Although Ms. Gilliam-White's memory of the episode appears to be less vivid than that of Mr. Frazier, his personal interests are more directly at stake. Ms. Gilliam-White did not strike the court as harboring any animus toward Mr. Frazier nor did she appear to have any reason to misrepresent what was said.
Part of the difficulty is that Ms. Gilliam-White may have used language which was close to, or strongly suggestive of, a 100% healed policy without having actually uttered those precise words. Clearly, she did tell Mr. Frazier that he had to be sufficiently healed to perform all the duties of his position, including ramp duties as required. Mr. Frazier could easily have equated such language with the concept of "100% healed." And there is no question that Mr. Frazier never took the position that he was capable of performing ramp duties; quite the contrary. In any event, the weight of the evidence as to whether Mr. Gilliam-White used the phrase "100% healed" is at best in equipoise. When evidence is in equipoise, the party having the burden of proof — in this case Mr. Frazier — cannot prevail. Accordingly, the court concludes that Mr. Frazier has not carried his burden of showing that US Airways maintained a 100% healed policy in violation of the ADA.
IV.
Because Mr. Frazier has not carried his burden of proving a violation of the ADA, the court also need not reach the issue of whether the amended proof of claim filed after the claims bar date is properly before the court. As a general proposition, courts have permitted amendment, after the bar date has passed, of a timely-filed proof of claim to cure a defect in the claim as filed or to describe the claim with greater particularity, so long as the amendment would not cause undue prejudice to the debtor or to other creditors. See Sambo's Restaurants, Inc. v. Wheeler (In re Sambo's Restaurants, Inc.), 754 F.2d 811 (9th Cir. 1985); Unioil v. Elledge (In re Unioil, Inc.), 962 F.2d 988 (10th Cir. 1992) (allowing amendment of defective claim filed by individual to show trust as true creditor); Newcomb v. United States (In re Newcomb), 60 B.R. 520 (Bankr. W.D. Va. 1986) (allowing amendment of IRS claim to add omitted quarter where chapter 13 plan had sufficient funds to pay amended claim); Gens v. Resolution Trust Corp., 112 F.3d 569 (1st Cir. 1997) (claim filed by RTC contractor in its own name could be amended to name RTC as holder of note). But see United States v. Vlavianos (In re Vlavianos), 71 B.R. 789, 793-94 (Bankr. W.D. Va. 1986) (disallowing amendment of IRS proof of claim after debtor completed payments under chapter 13 plan in reliance on filed claim). However, a new and different claim may not, in the guise of an "amendment" to an existing claim, be asserted after the bar date has passed. United States v. Int'l Horizons, Inc. (In re Int'l Horizons, Inc.), 751 F.2d 1213 (11th Cir. 1985); In re Stavriotis, 977 F.2d 1202 (7th Cir. 1992).
In the present case, the amended proof of claim asserts damages approximately 190 times greater than those set forth in the timely-filed claim. This is a case in which unsecured claims are not being paid at 100 cents on the dollar, but instead are being heavily compromised and are being paid in the form of a pro rata distribution from a pool of stock in the reorganized debtor. Creditors, when voting whether to accept or reject the plan, had the right to rely on the timely-filed claims as establishing the outer limit of the claims that would compete with their own for distribution from the pool of stock. No showing has been made that the amended claim filed by Mr. Frazier sets forth damages that could not have been known or fairly anticipated at the time the original proof of claim was filed. The court has previously held, in passing on another claim filed in this case, that the creditor would be limited to the amount set forth in the timely-filed proof of claim. In re US Airways, Inc., 303 B.R. 784, 787 n. 2 (Bankr. E.D. Va. 2003) (limiting claim of Pension Benefit Guaranty Corporation to amount set forth in the proof of claim). Given the prejudice to other creditors, the court can discern no reason to reach a different result with respect to Mr. Frazier's claim. Accordingly, even if the court were to find that Mr. Frazier had established a violation of his rights under the ADA, the claim would be limited to the amount set forth in the original proof of claim.
Conclusion
For the reasons stated, the court concludes that Mr. Frazier does not have standing to challenge the alleged 100% healed policy. But even if he did have standing, he has not carried his burden of proving, as a factual matter, that US Airways maintained such a policy. A separate order will be entered disallowing his claim.