Unpublished Disposition, 930 F.2d 27 (9th Cir. 1987)

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U.S. Court of Appeals for the Ninth Circuit - 930 F.2d 27 (9th Cir. 1987)

John COSTELLO, Plaintiff-Appellant,v.BOY SCOUTS OF AMERICA; Boy Scouts of America, Los AngelesArea Council, Inc.; Edward C. Jacobs,Defendants-Appellants.

No. 89-55446.

United States Court of Appeals, Ninth Circuit.

Submitted April 1, 1991.* Decided April 4, 1991.



John Costello appeals from the entry of summary judgment and a directed verdict against him in a suit arising from his termination by the Los Angeles Area Council of the Boy Scouts of America ("the Council"). The district court had jurisdiction under 28 U.S.C. §§ 1331 and 1332. We have jurisdiction over this timely appeal under 28 U.S.C. § 1291. We affirm.

* Costello was fired from his position as Assistant to the Scout Executive for the Council on November 12, 1985. He had been employed by the Council since March 15, 1979, and had been a professional administrator with various local Boy Scout councils since 1958. He concedes that his position was eliminated for budgetary reasons.

On September 30, 1987, Costello brought suit in federal court against the Council, Boy Scouts of America ("BSA"), and Edward Jacobs, the Scout Executive for the Council (collectively, "Appellees"). Costello charged all defendants with age discrimination under federal and state law. Against BSA and the Council, he alleged breach of contract and breach of the covenant of good faith and fair dealing. He charged all defendants with related torts: intentional infliction of emotional distress, fraud and deceit, and conspiracy to induce breach of contract. Finally, he charged Jacobs with inducement of breach of contract.

Appellees moved for summary judgment on Costello's age discrimination claims and moved to dismiss the remaining state law claims. The district court denied the motion to dismiss but granted summary judgment in favor of Appellees on the age discrimination claims. The court, sua sponte, granted summary judgment against Costello on his tort claims, holding that they were barred by the California Supreme Court's decision in Foley v. Interactive Data Corp., 47 Cal. 3d 654, 765 P.2d 373, 254 Cal. Rptr. 211 (1988). The case then went to trial on Costello's breach of contract claim. After Costello put on his case, the court granted a directed verdict in favor of Appellees. Costello timely appealed.


We hold that the district court properly entered summary judgment against Costello on his age discrimination and tort claims.

* To bring a civil action under the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C.A. Secs. 621-634 (West 1985 & Supp.1990), a plaintiff must file an unlawful discrimination charge with the Equal Employment Opportunity Commission (EEOC) within 300 days of the alleged discriminatory act, id. Sec. 626(d) (2). "The limitations period of section 626(d) (2) may be modified through: (1) equitable tolling, which focuses on the plaintiff's excusable ignorance of the limitations period; or (2) equitable estoppel, which focuses on the defendant's actions." Funk v. Sperry Corp., 842 F.2d 1129, 1134 (9th Cir. 1988) (citing Naton v. Bank of California, 649 F.2d 691, 696 (9th Cir. 1981)). Costello concedes that he failed to comply with section 626(d) (2), but argues that the district court erred in refusing to invoke the doctrines of equitable tolling or equitable estoppel to save his claim. We disagree.

As to equitable tolling, he asserts that summary judgment was improper because a material question of fact existed as to whether Appellees had posted a written notice of the limitations period as required by the ADEA, or whether he was aware of the requirement. By his own admission, however, Costello consulted an attorney during the limitations period. He "therefore gained the means of knowledge of [his] rights and can be charged with constructive knowledge of the law's requirements." Stallcop v. Kaiser Foundation Hospitals, 820 F.2d 1044, 1050 (9th Cir.), cert. denied, 484 U.S. 986 (1987). In addition, he testified at his deposition that he was familiar with internal BSA memoranda which stated that age discrimination was against the law. An ADEA plaintiff has actual knowledge of his ADEA rights "even if he becomes only generally aware of the fact that there is a statute outlawing age discrimination and providing relief therefor." Kale v. Combined Ins. Co. America, 861 F.2d 746, 753 (1st Cir. 1988). Once "the court finds that the plaintiff knew, actually or constructively, of his ADEA rights, ordinarily there could be no equitable tolling based on excusable ignorance." Id.

Costello also argues that Appellees should have been equitably estopped from relying on the limitations period because BSA assisted him in his search for alternative employment with another local council. An employer's assistance in helping a terminated employee find another job does not, however, estop the employer from pleading the limitations bar. See English v. Whitfield, 858 F.2d 957, 963 (4th Cir. 1988) (holding that an employer was not equitably estopped for making "repeated reassurances that permanent placement was being sought elsewhere in the company"), rev'd on other grounds, 110 S. Ct. 2270 (1990). Moreover, there is no evidence in the record of Costello's reliance or Appellees' improper purpose, both of which are required before estoppel may be invoked. Funk, 842 F.2d at 1134; Naton, 649 F.2d at 696.


In a claim brought under California's age discrimination law, Cal.Gov't Code Sec. 12941 (West Supp.1991), once the defendant has put forward a nondiscriminatory reason for terminating an employee, the plaintiff must "produce [ ] sufficiently probative evidence that [the employer's] proffered reason was a pretext to conceal age discrimination." Sorosky v. Burroughs Corp., 826 F.2d 794, 803 (9th Cir. 1987). Here, Appellees put forward a nondiscriminatory reason for Costello's termination: the Council was in dire financial straits and had to reduce its overhead by eliminating two positions. Costello does not dispute that the Council's financial problems were real. He claims, however, that because certain procedures were not complied with, his termination raises an inference of discrimination. This is clearly insufficient to meet his burden of proof that the explanation offered by Appellees was a pretext and not legitimate. He presented no evidence to suggest that age was even a factor in his termination. Summary judgment was therefore properly entered against him. Rose v. Wells Fargo & Co., 902 F.2d 1417, 1425 (9th Cir. 1990); Sorosky, 826 F.2d at 804.


Costello claims that the district court committed error by dismissing all of his tort claims under Foley v. Interactive Data Corp., 47 Cal. 3d 654, 765 P.2d 373, 254 Cal. Rptr. 211 (1988). The court held that after Foley, " [t]here is no tort action in a discrimination case or contract case." Costello argues that Foley eliminated only the tort cause of action for breach of the covenant of good faith and fair dealing, not his related tort causes of action. Without commenting on the district court's interpretation of the scope of Foley, we hold that Costello is barred under Foley from bringing his tort causes of action relating to his breach of contract claim. See Fidler v. Hollywood Park Operating Co., 223 Cal. App. 3d 483, 487, 272 Cal. Rptr. 895, 898 (1990) (After Foley, "neither compensatory damages for emotional distress nor punitive damages [for fraud] are recoverable in a wrongful discharge action."). Accordingly, we hold that the district court's dismissal of Costello's remaining tort claims was proper.


The district court properly entered a directed verdict against Costello on his breach of contract action.

* Costello concedes that he had a written employment agreement with the Council which provided that his employment with the Council,

will be understood to be continuous but may be terminated at any time by you or by the council upon a 30-day written notice by either party to the other, such notice to state the reason for such action.

He also concedes that he was given a thirty-day written notice which stated the reason for his termination. Citing Sherman v. Mutual Benefit Life Insurance Co., 633 F.2d 782, 784 (9th Cir. 1980), he argues that the phrase "may be terminated" could reasonably be interpreted as including a prerequisite of good cause. Thus, he contends that the district court erred in refusing his proffer of parol evidence either to interpret the phrase as requiring good cause or to establish the existence of a separate agreement to that effect.

Assuming, arguendo, that parol evidence was admissible and that it was actually proffered, we find no error in the district court's grant of a directed verdict against Costello. Even if Costello's contract may be read to require good cause for his termination, such cause was present here. Appellees established, and Costello conceded, that his termination was the result of the Council's fiscal crisis. Where an employee is dismissed because his position has been eliminated as a result of bona fide economic circumstances, his termination is not without good cause. See Funk, 842 F.2d at 1132 n. 2; Gianaculas v. Trans World Airlines, Inc., 761 F.2d 1391, 1385 (9th Cir. 1985); Clutterham v. Coachmen Indus., Inc., 169 Cal. App. 3d 1223, 1227, 215 Cal. Rptr. 795, 797 (1985). Costello presented no evidence that the economic grounds for his termination were pretextual. Rather, he sought to introduce evidence that after his termination the Council failed to hire him for entirely different positions within the Council. This evidence does not defeat Appellee's good cause for his termination.

Since we find that the Council did not breach its contract with Costello, we need not address his efforts to impose liability on BSA as a joint employer.


Costello argues in the alternative that, by failing to find him another job after he was terminated by the Council, BSA breached an implied-in-fact contract that he would be employed so long as he performed his job satisfactorily. He relies on Foley and other California cases recognizing a cause of action for breach of an implied-in-fact employment contract. Foley, 47 Cal. 3d at 675-682, 254 Cal.Rptr at 221-227, 765 P.2d 373. We affirm the grant of a directed verdict in favor of BSA.

Costello failed to introduce any evidence of an employment relationship with BSA sufficient to engender liability under Foley. It is undisputed that throughout his career as a Boy Scout professional, Costello had separate employment contracts with the various local councils that had employed him. While BSA provided placement services for scouting professionals who were "in transition" from one local council position to another, Costello proffered no evidence of a separate contractual relationship with BSA that continued beyond the individual contracts with the local councils.


For the foregoing reasons, we AFFIRM the judgment entered by the district court.


The panel finds this case appropriate for submission without oral argument pursuant to Ninth Circuit Rule 34-4 and Fed. R. App. P. 34(a)


This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3