Doyle et al v. City of Medford et al, No. 1:2006cv03058 - Document 149 (D. Or. 2011)
Court Description: OPINION & ORDER: Denying Plaintiffs' Motion for Summary Judgment 118 & Motion to Strike 135 . Granting defendants' Motion for Summary Judgment 122 . Ordered & Signed on 10/13/11 by Judge Owen M. Panner. (kf) Modified to add opinion on 10/13/2011 (kf).
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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF OREGON RONALD DOYLE, ROBERT DEUEL, BENEDICT MILLER, and CHARLES STEINBERG, No. 1:06-cv-03058-PA Plaintiffs, v. OPINION AND ORDER CITY OF MEDFORD, and MICHAEL DYAL, Defendants. PANNER, J. Four retired employees of t City of Medford aim the olated the Age Discrimination in Employment Act (ADEA) by failing to provi health insurance after retirement. parties now file cross-motions for summary judgment. The I deny City's motion. aintiffs' motion and grant BACKGROUND In 1990, the City negotiated with the C officers' union to purchase Teamsters Emplo lth insurance through the Oregon rs Trust (OTET). 1 - OPINION AND ORDER y's police OTET's health insurance plan ty d not allow retired officers to continue coverage. Until 2002, the City provided hea management emp h insurance for yees that allowed retirees to continue coverage. The City then contracted with OTET to provide health insurance for management employees. OTET's monthly premiums were several hundred dollars less than the previous premiums, but OTET did not cover retirees. Plaintiffs Charles Steinberg and Benedict Miller were police icers and union members. reti in 2003. PIa Miller was born in 1950 and ret in 2006. iffs Ron Doyle and Robert Deuel were management employees. Doyle was the City Attorney. in 2005. reti Steinberg was born in 1950 and and reti Deuel was a City engineer. He was born in 1949 in 2003. The City re ed to provide plainti after their retirements. for age He was born in 1949 and scr s wi hea h insurance In 2006, plaintiffs brought nation under state and federal law, s action olation of federal due process rights, breach of contract, and violation of a state statute. ~udgment I granted defendants' motion for summary on plaintiffs' ADEA and federal due process claims. Doyle v. City of Medford, 2007 WL 2248161 (D. Or. 2007). appeal, t Ninth Circuit rever discovery on the ADEA claims. Appx. 702 (9th Cir. 2009). 2 - OPINION AND ORDER On and remanded to allow further Doyle v. City of Medford, 327 Fed. The Ninth Circuit affirmed summary judgment for defendants on the due process claims. of Medford, 606 F.3d 667 Doyle v. City (9th Cir. 2010). I dismissed without prejudice plaintiffs' state law claims. Plaintiffs then filed the state law claims in Jackson County Circuit Court. After trial, the state court issued judgment all four plaintiffs on their claims for violations of Or. Rev. Stat. § 243.303 1 and breach of contract, and for Doyle and Miller on their claims for age discrimination based on disparate impact. The state court awarded Doyle $111,142; Deuel, $54,586; Miller, $79,866; and Steinberg, $37,208. That judgment is on appeal. STANDARDS The court must grant summary judgment if there are no genuine issues of mater 1 fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). moving party shows there are no genuine issues of mater If the 1 fact, the nonmoving party must go beyond the pleadings and designate facts showing an issue for t a l . Celotex CorD. v. Catrett, 477 U.S. 317, 322-23 (1986). DISCUSSION I. Issue Preclusion A. Standards for Issue Preclusion The "full faith and credit n statute, 28 U.S.C. § 1738, - The statute requires that local governments provide their retired employees same health insurance coverage as active employees, "insofar as and to the extent possible." 3 - OPINION AND ORDER requires federal courts to give a state court judgment the same judgment would have clusive effect t r state law. Engquist v. Or. Dep't of Agriculture, 478 F.3d 985, 1007 (9th r. 2007), aff'd, 553 U.S. 591 (2008). issue preclusion here. Oregon law determines Although the state trial court judgment is on appeal, the judgment has sive effect . Skeen v. Dep't of Human Resources, 171 Or. . 557, 560 n.3, 17 P.3d 526, 528 n.3 (2000). Under Oregon law, issue preclusion issue in the two is identical; actually litigat ies when (1) the (2) the issue was a determination of t to a final decision on the merits in the issue was essenti ior proceeding; (3) the party sought to be precluded had a 1 and fair opportunity to be party to be precluded was a on the issue; (4) y or in privity with a proceeding; and (5) prior proceeding was proceeding to which court will give rty to the prior type of lusive effect. Nelson v. Emerald People's Utility District, 318 Or. 99, 104, 8 P.2d 1293, 1296-97 (1993). the issues are identi B. Here, only the first element, whether , is in dispute. Discussion 1. Issue Preclusion Bars the Disparate Treatment Claims Under both law and state law, intiffs' disparate treatment claims is t 4 - OPINION AND ORDER issue in same: whether the City stopped providing health insurance for retired employees because of their age. Compare 2 9 u. S. C. § 623 (a) (1 ) (prohibiting employers from discriminating "against any individual with respect to s compensation, terms, conditions, or privileges of employment, because of such individual's age"); Gross v. FBL Fin. Servs. ( Inc., 129 S. Ct. 2343, 2350 (2009) (issue is whether "age was the 'but-for' cause of the employer's adverse with Or. Rev. Stat. § 65 .030(1) (a) (prohibiting discriminating "because of an individual's. ision"), employers from age"); Christianson v. State, 239 Or. App. 451, 455, 244 P.3d 904, 906 (2010) ("the u imate factual question. . is whether the plaintiff has proved that the defendant intentionally discriminated against the plaintiff, that is, whether the defendant treated the plaintiff because of fferently, and adversely, rage"), review denied, 350 Or. 297, 255 P.3d 489 (2011) . Here, the state court concluded pla iffs did not prove that the age of the retirees was a motivating factor the City's determination to move the management group to OTET coverage in the 11 of 2001 nor to continue the OTET coverage already in place for other employees. Nor is there anything else in the record to persuade the Court that the defendant's decisions were actually motivated by plaintiffs' age, or were made liberately and intentionally to discriminate against retirees because of their age. Defendant dealt with these plaintiffs their status as retirees, not because of the age of these plaintiffs. 5 - OPINION AND ORDER Defs.' Ex. 618, at 35 (0 ginal emphasis). court judgment resolved the issue present preclusion bars Because state here, issue intiffs' ADEA disparate treatment claim. 2. Issue Preclusion Does Not Apply to the Disparate Impact Claims The state court ruled for Doyle and Miller on their sparate impact claims. Because the Oregon age discrimination statute protects employees age 18 or older, while the ADEA protects employees only age 40 or 01 r, issue preclusion does not apply to the state court's disparate impact ruling. Or. Rev. Stat. § 659A.030(1) (a) of age or older"), with 29 Compare (protecting employees "18 years u. S. C. § 631 (a) (protecting employees who are at least age 40). In ruling for plaintif on the sparate impact claims, the state court concluded "the policy affects employees over the age 18 at a significantly higher rate than emplo of 18." enthus Defs.' Ex. 618, at 37-38. sm es under the age The state court showed 1 r its ruling: application of the BOLl [Bureau of Labor and Industries] rule in the context of Oregon's unusual age discrimination statute produces a result, such as the one in this case, that makes little sense. It is not even ar that Medford has any employees under the age 18 (the unprotected class), whi means any time there is any action of any kind that lies to all of the employees regardless of their age (i.e., whether they are 18 or 76 years old), there arguably is a disparate impact and a violation of ORS 659A.030. This court has serious doubts that the legislature intended to create such a strange construct for measuring disparate impact, but it is not this Court's place to 6 - OPINION AND ORDER Ie rewrite either the statute or the BOLl ru Id. at 39 (original emphasis). Because of the significant difference between the Oregon age discrimination statute and the ADEA, the state court's ruling on the disparate impact claims has no issue preclusive effect here. II. The Merits of Plaintiffs' Disparate Impact Claim I conclude that the City is entitled to summary judgment on plaintiffs' disparate impact claims. impact To establish a disparate aim, a plaintiff must: "(1) show a significant disparate impact on a protected class or group; (2) identify the specif employment practices or selection criteria at issue; and (3) show a causal relationship between the challenged practices or criteria and the disparate impact." 285 F.3d 1174, 1190 (9th A. Hemmings v. Tidyman's Inc., r. 2002). Plaintiffs Have Not Shown Disparate Impact I agree with the City that it did not violate the ADEA by failing to provide health insurance for retired employees. Although almost all of the City's retired employees are over 40, here "retired" means that the employee no longer works for the City, not necessarily that the employee is no longer working for any employer. See Defts. Reply at 4. The City provides health insurance for all current employees regardless of age. It distinguishes between retired employees and current employees, not between employees under 40 and over 7 - OPINION AND ORDER 40. According to plaintiffs, more than half of the City's current employees are over 40. The City does not provide health insurance for retired employees, regardless of age, if they were covered by OTET insurance while working Plaintiffs c the City. e EEOC v. Local 350, Plumbers and Pipefitters, 998 F.2d 641 (9th Cir. 1993). There, a union prohibited retired members from seeking employment through the union hall if the retiree was receiving pension benefits. Because union members could not retire until they were age 55, there was "very close connection between age and the factor on which discrimination is based." 998 F.2d at 646; cf. Hazen Paper Co. v. Biggins, 507 U.S. 604, 611 (1993) (termination of employee because of pension status does not necessa status is "corre ly violate the ADEA, although pension ed with age"). Here, a City employee may retire, that is, stop working r the City, at any age, so retirement status and age, while correlat ,are not as clos age were Local 350. y connected as pension benefits and The City may distinguish between retired and current employees without olating the ADEA. County Retirees Ass'n v. County of Erie, 220 F.3d 193, 216 n.14 (3d Cir. 2000) (dicta) (when an employer "treat[s] retirees differently than active employees with respect to the provision of bene ts it would seem difficult to contend that such a distinction would be based on any 'individual's age,' as it would 8 - OPINION AND ORDER be predicated instead on the individual's employment status" (internal citations omitted)). The ADEA does not require that the City provide retired employees with the same health care benef s as current employees. B. The City Has Shown Its Decision Was Based on Reasonable Factors Other Than Age Even if plaintiffs could establish a prima fac under a disparate impact theory, the C to summary judgment. purchase hea ADEA claim y would still be entitled The City has shown that it decided to h insurance from OTET based on reasonable factors other than age. 29 U.S.C. § 623(f) (1) (employers may take "otherwise prohibited" actions if "based on reasonable ors other than age"); Smith v. City of Jackson, 544 U.S. 228, 239 (2005) (plurality opinion) ("the RFOA [reasonab factors other than age] provision plays its principal role by precluding liability if the adverse impact was attributable to a nonage factor that was 'reasonable'''). The City presents evidence that switching health insurance coverage to OTET saved hundreds of thousands of dollars and reduced the premiums paid by management employees. As in Smith, "While there may have been other reasonable ways for the City to achieve its goals, the one selected was not unreasonable. Unlike the business necessity test [applicable in Title VII discrimination cases,] which asks whether there are other ways for the employer to achieve its goals that do not result in a disparate impact on a protected 9 - OPINION AND ORDER class, the reasonableness inquiry includes no such requirement." 544 U.S. at 243. Plaintiffs argue that the y could have purchased health insurance that covered retired employees "at the same or lesser rates than those provided by OTET." City must show Under the ADEA, however, the s decision to purchase health insurance from OTET was reasonable, not that it was the only avail III. Statute of L~itations Moreover, I conclude the ADEA claims are not timely. Steinberg and Deuel Before bringing an ADEA claim, a plaintiff must file a charge with BOLl within 300 days discrimination. Ie option. the alleged unlawful 29 U.S.C. § 626(d); see Pejic v. Hughes Helicopters, Inc., 840 F.2d 667, 674 75 (9th Cir. 1988) (ADEA's notice requirement is equivalent to a statute of limitations). Employment discrimination claims accrue "upon awareness of the actual inj , i.e., the adverse employment action, and not when the plaintiff suspects a legal wrong." Lukovsky v. City and County of San Francisco, 535 F.3d 1044, 1049 (9th Cir. 2008). Here, adverse employment action was the City's final refusal to provide continued health insurance, whi date of retirement. was 60 days after the See Doyle v. City of Medford, 565 F.3d 536, 539 n.1 (9th Cir. 2009) (plaintiffs' civil rights claims accrued 60 days after retirement). notices more than 300 days a 10- OPINION AND ORDER Steinberg and Deuel filed tort claim er their claims accrued, so their claims are not timely. Plainti move to strike defendants' arguments on t statute of limitations. Defendants raised the affirmative defense in their answer, however, so it should not have surprised plaintif I deny plaintiffs' motion to strike. CONCLUSION Plaintiffs' motions for summary judgment (#118) and to strike (#135) are denied. Defendants' motion for summary judgment (#122) is granted. IT IS SO ORDERED. DATED this ~ day of October, 2011. OWEN M. PANNER U.S. DISTRICT JUDGE f 11 - ORDER I [
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