Opinion
No. TH00-0216-C-M/H
April 3, 2001
Michael C. Kendall, Kendall Law Office, Indianapolis, IN
Paul H Sinclair, Ice Miller, Indianapolis, IN
ORDER ON MOTION TO DISMISS BASED ON THE PLEADINGS
This matter comes before the Court on a Rule 12(b)(6) motion by the defendant CGM Group, Inc., d/b/a Hardee's (hereinafter "Hardee's") requesting that the Court dismiss the employment discrimination claim of plaintiff Ida Jane Koch (hereinafter "Koch") because she did not file her charges with the Equal Employment Opportunity Commission (hereinafter "EEOC") in a timely fashion. Hardee's asserts that Koch's pleadings before this Court unequivocally show that: (1) Koch's discrimination claims had accrued by July 30, 1998, when she was allegedly constructively discharged by Hardee's; and (2) she failed to file her discrimination charge with the EEOC until June 10, 1999. Thus, according to Hardee's, Koch exceeded the maximum 300-day time limit for filing with the EEOC. Koch counters by arguing that her discrimination claim did not accrue until August 14, 1998, her last day of work. Thus, according to Koch, her claim was properly filed with the EEOC within the 300-day time limit. Further, Koch argues that even if her claim did accrue on July 30, the statutory requirement of 300 days should be tolled for two weeks because she, quite understandably, did not recognize the legal significance that attached to her resignation letter, and therefore she could not have known that her claim was untimely. The Court has considered fully the parties' arguments and, for the reasons discussed below, finds that Koch's filing with the EEOC was not timely. The Court also finds that the facts alleged in the pleading do not justify and are not consistent with Koch's argument that the statute of limitations should be equitably tolled. Therefore, the Court GRANTS Hardee's motion to dismiss Koch's complaint for failure to state a claim upon which relief can be granted. This complaint is dismissed with prejudice.
I. FACTUAL AND PROCEDURAL BACKGROUND
For the purpose of this Rule 12(b)(6) motion, the Court will assume that all facts alleged or implied in the pleadings are true. In addition, the Court will take judicial notice of certain facts in the plaintiff's brief which illuminate the facts alleged in the pleadings. The Court also will take judicial notice of the EEOC charge filed by the plaintiff and offered by the defendant as evidence in support of its motion to dismiss. The facts in the light most favorable to the plaintiff are these:
Koch worked for Hardee's at a franchise restaurant in Vincennes, Indiana, from May 1986 until August 1998. Koch's Complaint §§ 10, 13, 26. In March 1990, she was promoted to restaurant manager. Koch's Complaint § 12. Until Truman Hedrick (hereinafter "Hedrick") became the district manager in charge of Koch's store in June of 1995, Koch's performance had been considered to be entirely satisfactory. Koch's Complaint §§ 14-15, 21.
Hedrick took an immediate disliking to Koch for no apparent reason. Koch's Complaint § 16. He subjected her to a series of humiliating, harassing, and intimidating acts. In particular, he told her that he did not like the way she looked, and he did not like her body language. Id. He also called her stupid in front of the crew, and he berated her in front of customers. Id.
Koch complained about Hedrick's offensive behavior, but Hardee's management did nothing about it. Koch's Complaint §§ 17-18. In fact, Hedrick began to treat her with even more hostility after she complained. Koch's Complaint § 19. Hardee's ultimately demoted her from restaurant manager to assistant manager on or about March 16, 1998. Koch's Complaint § 20.
The hostile acts continued even after Koch was demoted. Koch's Complaint § 24. Koch made further complaints about discrimination, but these complaints had no effect. Koch's Complaint § 25. Eventually, the acts of harassment, discrimination, and retaliation became intolerable to Koch, and she decided to resign. Koch's Complaint § 26. She submitted a resignation letter on July 30, 1998, giving Hardee's two weeks' notice. Id. She quit work on August 14, 1998. Id. At all times until the day she finally left work on August 14, Koch's primary objective was to put an end to the harassment and continue to work at Hardee's. Koch's Response Brief at 4.
Koch, in conjunction with her counsel, completed an EEOC employment discrimination complaint and had it notarized on May 19, 1999. Hardee's Brief, Ex. A; Koch's Response Brief at 6. Koch mailed the complaint to the EEOC by certified mail on June 7, 1999. Koch's Response Brief at 4. The EEOC file-stamped the complaint on June 10, 1999. Id.
Koch did not understand that there might be some legal significance to the date she submitted her resignation letter, apart from her actual last day of work. Koch's Response Brief at 6. As a result, she neglected to inform her attorney about the resignation letter until he reviewed the EEOC document with her. Id. Prior to that time, both Koch, who was ignorant of the law, and her attorney, who was ignorant of the fact, thought that the period for filing the EEOC complaint had not begun to run until her last day of work, which was August 14, 1998.
II. STANDARDS
A. FAILURE TO STATE A VIABLE CLAIM
Federal Rule of Civil Procedure 12(b)(6) permits a defendant to move for dismissal based solely upon the pleadings of the plaintiff if those pleadings "fail to state a claim upon which relief can be granted." When ruling on a 12(b)(6) motion, the Court must accept as true all well-pleaded allegations in the complaint and all reasonable inferences in favor of the plaintiff. Gastineau v. Fleet Mortgage Corp., 137 F.3d 490, 493 (7th Cir. 1998). Dismissal is appropriate only if it appears beyond doubt that the plaintiff can prove no set of facts, consistent with the allegations, that would entitle him or her to relief. Hentosh v. Herman M. Finch Univ. or Health Sciences, 167 F.3d 1170, 1173 (7th Cir. 1999). The issue before the Court is a narrow one — not whether the plaintiff is likely to prevail, but only whether the plaintiff's complaint is sufficient to entitle him or her to move the case forward and offer evidence in support of the claims. Scheuer v. Rhodes, 416 U.S. 2323 (1974). In moving for dismissal, the defendant cannot challenge the factual basis for the plaintiff's allegations. Rather, the defendant must show that, even if true, the allegations have no legal consequence. Gomez v. Illinois State Bd. of Ed., 811 F.2d 1030, 1039 (7th Cir. 1987).
Rule 12(b)(6) further provides: "If . . . matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56." This is not discretionary. If the defendant submits and the Court chooses to consider documents that are not properly part of the plaintiff's pleadings, then the defendant's 12(b)(6) motion must be converted into one for summary judgment and the plaintiff must be given the opportunity to submit additional evidentiary material as well. Venture Associates Corp. v. Zenith Data Systems Corp., 987 F.2d 429, 431 (7th Cir. 1993) (citing Carter v. Stanton, 405 U.S. 669, 671 (1972)). However, this rule must be read in conjunction with Federal Rule of Civil Procedure 10(c) which provides that "any written instrument which is an exhibit to a pleading is a part thereof for all purposes." Because Rule 10(c) does not mandate that the plaintiff attach such exhibits when pleading, the defendant has the option to attach them when filing to dismiss. Documents attached by the defendant to a Rule 12(b)(6) motion should be considered part of the pleadings "if they are referred to in the plaintiff's complaint and are central to [his or] her claim." Venture 987 F.2d at 431.
B. TITLE VII FILING REQUIREMENTS — TIME LIMITS
Title VII provides an elaborate scheme for the timely filing of an employment discrimination claim. In relevant part, it requires that:
A charge under this section shall be filed within one hundred and eighty days after the alleged unlawful employment practice occurred . . . except that in a case of unlawful employment practice with respect to which the person aggrieved has initially instituted proceedings with a State or local agency with authority to grant or seek relief from such practice . . . such charge shall be filed by or on behalf of the person aggrieved within three hundred days after the alleged unlawful employment practice occurred or within thirty days after receiving notice that the State or local agency has terminated the proceedings . . . whichever is earlier.42 U.S.C. § 2000e-5(e).
States which have local agencies with the authority to review discrimination claims are known as "deferral states." The Act provides that when a claim is filed with the appropriate state or local agency first, that agency shall have sixty days of exclusive jurisdiction during which no charge may be filed with the EEOC, unless the state or local agency chooses to terminate its proceedings sooner. 42 U.S.C. § 2000e- 5(c); Mohasco Corp. v. Silver, 447 U.S. 807, 814, n. 16, (1980). Thus, on its face, compliance with the Act would seem to require that a plaintiff who wishes to take advantage of the deferral state option must file a charge with the appropriate state or local agency within 240 days of the alleged unlawful employment practice in order to ensure that the subsequent EEOC charge can be filed within the mandated 300 days. However, under its authority to promote "effective enforcement" of the Act, 42 U.S.C. § 2000e-8 (b), the EEOC has negotiated work sharing agreements with most of the state and local agencies authorized to grant or seek relief for employment discrimination. Equal Employment Opportunity Commission v. Commercial Office Products, 486 U.S. 107, 112 (1988). These work sharing agreements typically identify categories of charges to be processed and divide them up between the local agencies and the EEOC, with the state or local agency then agreeing to waive the 60-day deferral period for claims properly filed with the EEOC. Id. As a result, in a deferral state with a work sharing agreement, a plaintiff alleging employment discrimination will have a full 300 days in which to file his or her complaint. 29 C.F.R. § 1601.13(a)(4)(ii)(A).
The time limit for filing with the EEOC under Title VII operates as a statute of limitations, rather than a statute of repose. Zipes v. Trans World Airlines, Inc., 455 U.S. 385, 393-4 (1982). In particular, it is subject to the discovery rule, with regard to when the statutory period begins, and to equitable principles such as waiver, estoppel, and tolling, with regard to when the statutory period ends. See Cada v. Baxter HealthCare Corp., 920 F.2d 446, 450-1 (7th Cir. 1990) (cert denied 501 U.S. 1261 (1991)) (citing Delaware State College v. Ricks, 449 U.S. 250 for the implicit holding that the discovery rule is applicable in Title VII lawsuits) and Zipes 455 U.S. at 394 (holding that statutory time limits applicable to Title VII lawsuits against private employers are subject to equitable tolling principles). Once an employee discovers (or reasonably should have discovered) that he or she might have been the victim of a discriminatory employment practice, the cause of action "accrues" and the statutory clock begins to run. Ricks 449 U.S. at 258 (citing Abramson v. University of Hawaii, 594 F.2d 202, 209 (9th Cir. 1979) for the proposition that "[t]he proper focus is upon the time of the discriminatory acts, not upon the time at which the consequences of the acts became most painful."). If the employee then fails to file a complaint with the EEOC in a timely fashion, any subsequent lawsuit based on that complaint will also be time-barred, unless the employee can present a compelling reason why the statutory time limit should have been tolled.
III. DISCUSSION
For purposes of this motion, Hardee's does not dispute that the alleged hostile employment acts occurred, or that the hostility was motivated by a discriminatory animus towards women (or women in managerial positions). Hardee's motion is simply based on the fact that Koch was not diligent in asserting her rights. According to Hardee's, she did not file her complaint with the EEOC in a timely fashion. As a result, her right to litigate this matter should be time barred.
Ordinarily, a statute of limitations defense involves factual determinations that are better handled in a motion for summary judgment under Rule 56 rather than in a motion to dismiss under Rule 12(b)(6). A plaintiff is not required to plead facts showing that his or her complaint is timely. Tregenza v. Great Am. Communications Co., 12 F.3d 718 (7th Cir. 1993) ("The statute of limitations is an affirmative defense, and a plaintiff is not required to negate an affirmative defense in his complaint.") (cert denied 511 U.S. 1085 (1994).). Therefore, a defendant has no basis for challenging a complaint that fails to so plead. However, when a plaintiff does plead facts which show unequivocally that the complaint was not filed in a timely fashion, the defendant has every right to move for dismissal based on the facts pled. Id. In her complaint, Koch makes two distinct charges of illegal discrimination: (1) District supervisor Hedrick created a hostile environment which became so intolerable that she was ultimately forced to resign; and (2) Hardee's demoted her in retaliation for her having complained about the discriminatory hostile environment. Because Indiana is a deferral state with a work sharing agreement, Koch had a full 300 days from the date that each of the "alleged unlawful employment practice[s] occurred" in which to make a timely filing of her complaint with the EEOC. Russell v. Delco Remy Div. of General Motors Corp., 51 F.3d 746, 750-1 (7th Cir. 1995) (In Indiana, filing with the EEOC has the effect of simultaneously initiating and terminating state proceedings.); 42 U.S.C. § 2000e-5(e); 29 C.F.R. § 1601.13(a)(4)(ii)(A). Hardee's alleged retaliation was a discrete act which occurred on March 16, 1998. Even taking into account the discovery rule, Koch's cause of action for retaliation clearly accrued on that date. Koch was aware of the fact that she had been demoted, and she was aware of the fact that this demotion followed on the heels of her complaints about Hedrick's discriminatory treatment of her. The discovery rule does not require that a plaintiff such as Koch know for certain that her legal rights have been violated. Cada v. Baxter HealthCare Corp., 920 F.2d 446, 451 (7th Cir. 1990). Otherwise, no one would ever "discover" that they had been discriminated against until after a formal trial has been completed. Id. It is enough that a reasonable plaintiff in Koch's position would have been put on notice, when she was demoted on March 16, that her rights may have been violated. Id. Therefore, the statutory clock began to run on March 16. In order to preserve her right to sue Hardee's for unlawful retaliation, Koch would have had to submit her EEOC retaliation charge by no later than January of 1999. Her complaint makes clear that she did not meet (or even come close to meeting) this deadline.
Unlike her retaliation claim, however, Koch's hostile environment claim is based on a series of discriminatory acts. These acts did not end on March 16 when she was demoted. Indeed, the Court hypothesizes, though neither the complaint nor Koch's brief say so, that some deprecatory or offensive acts may have continued to occur even after July 30 when Koch submitted her letter of resignation. But the proper question before the Court is: when did Koch's cause of action for a hostile work environment accrue.
At the latest, Koch knew that she had been subjected to a discriminatory and hostile environment by July 30, when she submitted her resignation letter. At that point, as Koch herself asserts, the working conditions had become so intolerable that her resignation amounted to a constructive discharge. The heart of Koch's complaint is that, by fostering such a hostile environment, Hardee's in effect wrongfully terminated her from her job.
The Supreme Court made clear, in Delaware State College v. Ricks, that an employee's cause of action for wrongful termination under the Civil Rights Act accrues on the date that the employee is notified of the wrongful decision to terminate, not on the employee's actual last day of work. 449 U.S. 250 (1980). The employee, Ricks, alleged that he was denied tenure and a permanent teaching position at Delaware State College for discriminatory reasons. According to standard academic practice, he was then given a final one-year contract to teach at Delaware State while he sought other employment. Id. at 253. During his terminal year, he continued to appeal the tenure decision, hoping that the College would reconsider. Id. at 252. Ricks therefore argued that his cause of action should not have accrued until he was actually discharged, or at least until he knew for sure that all his tenure appeals had been denied, because prior to that he had not actually been harmed. Id. at 260-1. But the Court held that the unlawful discriminatory act occurred, in the sense intended by the Civil Rights Act, when Ricks was first denied tenure. Id. at 261-2. According to Rick's own complaint, it was the decision to deny him tenure that was motivated by an unlawful discriminatory intent. Id. at 257. Therefore, when that decision was communicated to him, the statutory clock began to run. Id. at 258.
This case presents the same issue, except that Koch did not receive a notice of termination from Hardee's. Instead, she submitted a letter of resignation herself. However, the Court presumes, as Koch in fact asserts, that Hardee's, by its inaction in the face of her repeated complaints, effectively forced her to resign. The date upon which this constructive discharge became definite, rather than merely contemplated, was July 30, the day she submitted her resignation letter.
Koch argues that she still hoped, even after submitting her resignation letter, that Hardee's would correct the problem. But this is no different than Rick's argument that he was still hoping the College would reverse its decision not to give him tenure. Ricks, 450 U.S. at 260. The cause of action accrues when the employee discovers that the allegedly discriminatory acts have occurred, not when the employer refuses to change its mind or otherwise correct them. Id. at 260-1. See also Soignier v. American Bd. Of Plastic Surgery, 92 F.3d 547, 551-2 (7th Cir. 1996). Clearly, Koch believed that the working conditions had become so intolerable and the possibility of correcting them had become so remote that she had little choice but to submit her resignation. This means that the harm, for which Koch seeks relief, had already occurred by July 30. Moreover, her resignation letter shows that she was fully aware of the fact that such harm had occurred. It is not unusual for a series of discriminatory acts to accumulate in a constructive discharge case. But once the victim knows that the acts were discriminatory and that they have harmed her, as must have been true if she was constructively discharged, her cause of action accrues and the statutory clock begins to run. Moskowitz v. Trustees of Purdue University, 5 F.3d 279, 281-2 (7th Cir. 1993). See also Davidson v. Indiana-American Water Works, 953 F.2d 1058, 1059-60 (7th Cir. 1992) (rejecting the argument that sexual harassment victim, by walking off the job on last day of work, gave present effect to past discrimination). The mere possibility that Hardee's might have changed its mind after she submitted her resignation is simply too speculative to give rise to a new cause of action. It follows that the deadline for Koch to file her hostile environment and constructive discharge complaint with the EEOC was May 26, 1999. In her complaint, Koch states that she filed her discrimination charge with the EEOC on or about May 19. Koch Complaint § 28. However, Hardee's correctly points out that this is not a "well-pleaded" fact. Hardee's Brief at 9. Although the EEOC charge, which Hardee's has attached as Exhibit A, was signed and notarized on May 19, that does not mean that it was "filed" on that date, in the legally required sense. A charge is not considered to be filed with the EEOC until the EEOC receives the charge and stamps it with the appropriate date. 42 U.S.C. § 2000e-5 (e)(1) (Charges "shall be filed . . . in such form as the [EEOC] requires."); 29 C.F.R. § 1601.13(a)(4)(ii)(A) (The timeliness of the filing is determined by the date on which the charge is received by the EEOC.). Koch's EEOC charge is stamped, acknowledging receipt on June 10, 1999. Hardee's Brief, Ex. A. Therefore, the filing of the EEOC charge was untimely.
In relying on the file stamp, the Court is taking judicial notice of a document, the EEOC complaint, which is not literally part of the pleadings. However, Koch's complaint specifically references the EEOC document, asserting that it was filed on May 19. And, the EEOC document is clearly central to Koch's pleadings before this Court. Therefore, the Court has exercised its legitimate discretion in treating the EEOC document as part of the pleadings. Venture Associates Corp. v. Zenith Data Systems Corp., 987 F.2d 429, 431 (7th Cir. 1993). Furthermore, in her brief, Koch concedes that the complaint was not mailed until June 7th and not received by the EEOC until June 10th. It would serve no purpose to treat May 19 as the date of filing simply because Koch, for whatever reason, incorrectly asserted that this was so in her complaint.
Because her EEOC charges were not filed in time, Koch's suit against Hardee's must also be time- barred, unless her tardiness can be excused based on some equitable principle. Koch does not propose a waiver or estoppel theory. She does not allege that Hardee's did anything to mislead or confuse her about her rights; therefore, she does not argue that Hardee's should be prevented by its own unclean hands from asserting a statute of limitations defense. However, Koch does argue that the statute of limitations should be tolled because: (a) she did not know that her resignation letter of July 30th was legally significant; and (b) Hardee's was not prejudiced by the two-week delay in her filing of the EEOC charges.
The Seventh Circuit has stated that "[e]quitable tolling applies when a plaintiff, despite the exercise of due diligence and through no fault of his own, cannot determine information essential to bringing a complaint." Soigner v. American Bd. Of Plastic Surgery, 92 F.3d 547, 553-4 (7th Cir. 1996). (citing Thelen v. Marc's Big Boy Corp., 64 F.3d 264, 268 (7th Cir. 1995)).
Because tolling is an equitable principle, the hardship (or prejudice) to the defendant should also be considered. Baldwin County Welcome Center v. Brown, 406 U.S. 147 (1984). But a lack of prejudice alone will not justify tolling. Id. Otherwise, every case would be subject to tolling, and the 300- day time limit would cease to mean anything.
In her brief Koch asserts that the combination of "excusable ignorance" together with lack of prejudice to the defendant is sufficient to meet the equitable tolling standard. Pl. Brief at 5. This argument fails because, in the first place, Koch's ignorance was not excusable, and, in the second place, even if her ignorance were excusable, that would not suffice to show that she had exercised due diligence in the pursuit of information needed to advance her case. It is her lateness that must be excusable, not just her ignorance.
Koch's ignorance was not excusable. When a plaintiff files a discrimination suit pro se, the Court will make allowances for certain procedural deficiencies involving the complaint in order to promote the public policy of preventing discrimination. But when a plaintiff has counsel, the knowledge of the counsel with regard to the law is imputed to the plaintiff. Keyse v. California Texas Oil Corp., 590 F.2d 45, 47 (2nd Cir. 1978). Therefore, Koch cannot claim that her ignorance was excusable. The fact that her lawyer did not know to inform her about the correct deadline for filing because she failed to inform him about her resignation letter is not enough to justify this kind of ignorance. It is the lawyer's duty to ask the appropriate questions and discover such obviously relevant facts.
Moreover, equitable tolling will be justified only to the extent that, after making a diligent effort, plaintiff was unable to determine information essential to making her claim. There was no essential information that the lawyer and Koch did not have access to. Koch knew that she had been discriminated against on the day she resigned. She even knew the particulars of who had discriminated against her and how that discrimination had been accomplished. As far as the Court can tell, the only thing that she did not know was that the statutory clock began to run on July 30 rather than August 14. This is not the type of essential information that is encompassed by the equitable tolling rule. Besides, it would not have taken much diligence to discover, together with counsel, what the appropriate date should be. Public policy supports prompt filing with the EEOC so that discrimination complaints can be resolved quickly and efficiently. Cada v. Baxter HealthCare Corp., 920 F.2d 453 (7th Cir. 1990) (cert denied 501 U.S. 1261 (1991)). Yet, Koch delayed in filing her charge until what she thought was the last possible day. She offers no reason why she was not prudent enough to file the complaint a few weeks early just to be safe. Indeed, her EEOC charge was notarized on May 19. At that point, she obviously had whatever essential information she needed in order to file. All she had to do was put her complaint in the mail, and it would have arrived at the EEOC in time. Therefore, Koch's failure to file her EEOC charge on time was not excusable. Equitable tolling is not justified.
IV. CONCLUSION
Having fully considered the parties' arguments, and for the reasons discussed above, the Court concludes that Koch's pleadings demonstrate that her charge of discrimination was not filed on time with the EEOC. Even assuming that she was unsure about when her cause of action had accrued, she had plenty of time to file her EEOC charges, but failed to do so. Moreover, her pleadings, together with her EEOC charge, clearly indicate that she was not diligent in pursuing her rights. It follows that her tardiness in filing the EEOC charge is not excusable. No matter what facts she may be able to put forward to prove her claim of discrimination, that claim will be barred by the 300-day statute of limitations that applies in employment discrimination cases.
Therefore, the Court GRANTS Hardee's motion to dismiss Koch's complaint for failure to state a claim upon which relief can be granted. This complaint is dismissed with prejudice.