Opinions of the United
2000 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


7-18-2000

Zubi v. AT&T Corp.
Precedential or Non-Precedential:

Docket 99-5206




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Filed July 18, 2000

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

NO. 99-5206

MADHAT ZUBI
Appellant

v.

AT&T CORP.

On Appeal From the United States District Court
For the District of New Jersey
(D.C. Civil Action No. 98-cv-03424)
District Judge: Honorable Katharine S. Hayden

Argued November 17, 1999

BEFORE: ALITO and STAPLETON, Circuit Judges,
and FEIKENS,* District Judge

(Opinion Filed: July 18, 2000)

Louis A. Zayas (Argued)
440 60th Street - Suite 106
West New York, NJ 07093

 Attorney for Appellant



_________________________________________________________________
* Honorable John Feikens, Senior United States District Judge for the
Eastern District of Michigan, sitting by designation.
       Christopher Walsh (Argued)
       Christopher H. Mills
       Collier, Jacob & Mills
       580 Howard Avenue
       Corporate Park III
       Somerset, NJ 08873

        Attorneys for Appellee

OPINION OF THE COURT

STAPLETON, Circuit Judge:

Plaintiff-Appellant Madhat Zubi filed this civil action
against AT&T Corporation, alleging that he was discharged
because of his race in violation of 42 U.S.C. S 1981. The
District Court dismissed the complaint, pursuant to Federal
Rule of Civil Procedure 12(b)(6), as barred by a two-year
statute of limitations. Zubi argues that the District Court
erred in applying a two-year statute of limitations instead of
the four-year limitations period prescribed by 28 U.S.C.
S 1658. We will affirm the judgment of the District Court.

I.

Mr. Zubi filed the complaint in this case on July 30,
1998, in the United States District Court for the District of
New Jersey. It alleges that Zubi was discharged by AT&T
because of his race on September 28, 1995. The District
Court, applying the teachings of Wilson v. Garcia, 

(1985), and its progeny, "borrowed" New Jersey's two-
year statute of limitations for personal injury cases and
found Zubi's claim time barred.

Zubi's claim arises under 42 U.S.C. S 1981, which
provides, in pertinent part, that "[a]ll persons within the
jurisdiction of the United States shall have the same right
in every State and Territory to make and enforce contracts
. . . as is enjoyed by white citizens . . . ." In Patterson v.
McLean Credit Union, 

, 185 (1989), the
Supreme Court held that the "make and enforce contracts"
language of section 1981 proscribed discriminatory hiring
but not discriminatory termination of employment.

                                 2
Congress responded to the Patterson decision in the Civil
Rights Act of 1991 by amending section 1981. The
amendments, inter alia, made the preexisting language of
section 1981, quoted above, subsection (a) and added a
subsection (b) to section 1981 which defined the phrase
"make and enforce contracts" as "the making, performance,
modification, and termination of contracts and the
enjoyment of all benefits, privileges, terms and conditions of
the contractual relationship." Civil Rights Act of 1991, Pub.
L. No. 102-166, S 101, 105 Stat. 1071 (codified at 42 U.S.C.
S 1981(b)) (emphasis added). Following the 1991
amendments, section 1981 "clearly prohibits discriminatory
conduct that occurs both before and after the
establishment of the contractual relationship." Perry v.
Woodward, 

, 1132 (10th Cir. 1999)
(emphasis added). Thus, the 1991 amendment to section
1981 "creates liabilities that had no legal existence before
the Act was passed." Rivers v. Roadway Express, Inc., 

, 313 (1994).

The issue presented to us is a purely legal one, which we
review de novo. See Hotel Employees & Restaurant
Employees Int'l Union Local 54 v. Elsinore Shore Assocs.,

, 181 (3d Cir. 1999). Zubi argues that the
District Court erred in "borrowing" New Jersey's two-year
statute of limitations for personal injury cases. Zubi bases
his argument on 28 U.S.C. S 1658, which provides as
follows:

       Except as otherwise provided by law, a civil action
       arising under an Act of Congress enacted after the date
       of the enactment of this section may not be
       commenced later than 4 years after the cause of action
       accrues.

Section 1658 was enacted on December 1, 1990. See The
Judicial Improvement Act of 1990, Pub. L. No. 101-650,
Title III, S 313(a), 104 Stat. 5114. Zubi maintains that, by
virtue of the 1991 amendments to section 1981, his lawsuit
against AT&T is "a civil action arising under an Act of
Congress enacted after [December 1, 1990]" and that
section 1658's four-year limitation period governs.

Zubi's cause of action for discriminatory termination of
employment is based on statutory language that has

                               3
existed unchanged since its original enactment in 1870.
See Act of May 31, 1870, ch. 114, S 16, 16 Stat. 144. At the
same time, it is clear that a person in his position could not
have successfully pursued that claim prior to the 1991
amendments to the Civil Rights Act. We must decide
whether, for purposes of section 1658, Zubi's claim arises
under the preexisting statutory language on which his
claim is based or under the 1991 amendments. As we will
explain, we hold that Zubi's claim arises under the
preexisting statutory language, now codified in 42 U.S.C.
S 1981(a), and, therefore, that the District Court properly
applied New Jersey's two-year statute of limitations for
personal injury claims.

II.

Like virtually all of the courts that have preceded us in
addressing the same issue, we find the text ofS 1658
ambiguous; it can be, and has been, reasonably read in a
number of different ways. See generally Boyd A. Byers,
Adventures in Topsy-Turvy Land: Are Civil Rights Claims
Arising Under 42 U.S.C. S 1981 Governed by the Federal
Four-Year "Catch-All" Statute of Limitations, 28 U.S.C.
S 1658?, 38 WASHBURN L.J. 509 (1999) (detailing the various
approaches courts have taken). Three distinct approaches
are recognized in the existing case law:

       1. When an Act of Congress passed after December 1,
       1990, creates a claim that did not previously exist, that
       claim "arises under an Act of Congress enacted after"
       December 1, 1990, even though the new statute
       creates the new claim by amending a previously
       existing statute. This view of S 1658, when applied in
       the context of S 1981 of the Civil Rights Act of 1870, as
       amended by the Civil Rights Act of 1991, results in
       S 1981 claims based on the discriminatory termination
       of contracts being governed by the four-year federal
       limitations period, and all other claims based on
       S 1981 being governed by the state statute for personal
       injury claims.1
_________________________________________________________________

1. See, e.g., Miller v. Federal Express Corp., 

, 965
(W.D. Tenn. 1999).

                               4
       2. When an Act of Congress passed after December 1,
       1990, amends a statute existing before that date in a
       manner that substantially alters its meaning, all claims
       accruing after the passage of the new statute "arise
       under an Act of Congress enacted after" December 1,
       1990, without regard to whether an identical claim
       arising earlier could have been successfully pursued
       under the prior statute. This view of S 1658, when
       applied in the context of S 1981 of the Civil Rights Act
       of 1870, as amended by the Civil Rights Act of 1991,
       results in all S 1981 claims arising after the 1991
       amendment being governed by the four year federal
       limitations period.2

       3. When an Act of Congress passed after December 1,
       1990, amends a statute existing before that date, as
       opposed to creating new law without reference to
       previously existing statutory language, all claims
       accruing after the passage of the amendment arise
       under an Act of Congress enacted before December 1,
       1990, without regard to whether an identical claim
       arising earlier could have been successfully pursued
       under the prior statute. This view, when applied in the
       context of S 1981 of the Civil Rights Act of 1870, as
       amended by the Civil Rights Act of 1991, results in all
       S 1981 claims accruing after the passage of the 1991
       amendments being governed by the state limitations
       period for personal injury claims.3

Each of the foregoing interpretations is textually plausible.4
_________________________________________________________________

2. See, e.g., Alexander v. Precision Machining, Inc., 

(D.
Kan. 1997).
3. See, e.g., Lane v. Ogden Entertainment, Inc., 

(M.D.
Ala. 1998).

4. It is true, as some courts have stressed, that statutory amendments
become law only when an "Act" is enacted by Congress and that the
phrase "Act of Congress" can reasonably be read to include any
legislative measure that amends preexisting statutory text. On the other
hand, treating every amendment to an existing statute as a new Act of
Congress is not required by the text of S 1658. It is common parlance to
refer to legislation like the Civil Rights Act of 1870 as an "Act of
Congress" and to refer to causes of action as arising thereunder even
though based on statutory provisions that have later been amended in
some way.

                               5
Given that ambiguity, we turn to the rationale behind
S 1658, as reflected in its text and legislative history, and
seek to determine which reading of the statute will be most
consistent with that rationale.5

Congress enacted S 1658 in response to calls for a new,
nationally uniform statute of limitations for federal causes
of action not having their own explicit limitations period. It
did not, however, establish a new, nationally uniform
federal statute of limitation for all federal causes of action.
Congress could have provided that S 1658 would be
applicable to all causes of action that accrued after the
effective date of the Act, but it did not. It did not because
_________________________________________________________________

5. We thus respectfully disagree with the dissent's position that the
"plain meaning" rule dictates the resolution of the issue before us. As
the
dissent points out, it is clear that Congress' authority under Article III
of
the Constitution to bestow jurisdiction on the federal courts includes
what is referred to as "federal ingredient" jurisdiction -- jurisdiction
over
cases where the plaintiff 's claim is not created by federal law but where
a federal question is an "ingredient" of the action. Osbourn v. Bank of
the
United States, 9 Wheat 734 (1824). It is equally clear, however, that
"arising under" federal law in 28 U.S.C. S 1331, which grants federal
question jurisdiction to the federal courts, has a narrower meaning than
"arising under" federal law in Article III of the Constitution.
Specifically,
S 1331 "arising under" jurisdiction does not include "federal ingredient"
jurisdiction where Congress has determined that there should be no
private cause of action for violation of the federal law. Merrell Dow
Pharmeceuticals, Inc. v. Thompson, 

(1986) ("a complaint
alleging a violation of a federal statute as an element of a state cause
of
action, when Congress has determined that there should be no private,
federal cause of action for the violation, does not state a claim `arising
under the Constitution, laws, or treaties of the United States.' 28 U.S.C.
S 1331.") "Arising under" thus does not have a single "plain meaning"
even where used solely in the context of federal court jurisdiction. More
importantly, Article III and S 1331, even if they did embody the same
concept of "arising under," would not provide an apt analogy to S 1658.
Article III and S 1331 primarily distinguish between cases arising under
federal law and cases arising under state or foreign law for the purpose
of describing judicial jurisdiction. Section 1658 seeks to distinguish
between cases arising under certain Acts of Congress from cases arising
under other Acts of Congress for the purpose of preserving existing
statute of limitations case law. Because of these disparate purposes, we
think it doubtful that Congress had the notion of federal ingredient
jurisdiction in mind when it enacted S 1658.
6
it valued the avoidance of frustrated expectations more
highly than national uniformity. It realized that there was
an existing body of caselaw establishing limitations periods
for causes of action arising under federal statutes already
in existence, and it decided to preserve that body of law in
the interest of avoiding the disruption of parties' settled
expectations. See H.R. Rep. No. 101-734,S 111, at 24
(1990) (recognizing that "with respect to many statutes that
have no explicit limitations provision, the relevant
limitations period has long since been resolved by judicial
decision . . . [and that] retroactively imposing a four year
statute of limitations . . . would threaten to disrupt the
settled expectations of a great many parties."). Congress
implemented this decision by stipulating that the new four-
year statute of limitations would not be applicable to any
"civil action arising under an Act of Congress enacted"
before December 1, 1990.

Given the preeminent value placed by Congress on the
avoidance of disappointed expectations, we conclude that
the choice between the three proposed readings ofS 1658
should be made on the basis of which will provide the
greatest certainty in application. Whatever alternative is
chosen, some line drawing on a case-by-case basis will be
unavoidable, but every effort should be made to minimize
the opportunities for debate.

The first alternative is the one urged by Zubi. Atfirst
blush, it seems to promise a fair degree of certainty in
application. Did the new statute create a cause of action
that did not previously exist? If so, S 1658 applies; if not,
state law applies. But that promise, upon reflection, seems
to us illusory. First, as we have pointed out, Zubi's
interpretation results in different statutes of limitations
being applied to plaintiffs suing under the same statute
depending on the particular facts of their claims. Thus, for
example, plaintiffs who invoke S 1981 because they have
been victims of discrimination in hiring will have their
claims governed by one statute of limitations, while
plaintiffs who invoke the same statute because they are
victims of a discriminatory discharge will have their claims
governed by another. Adoption of such an interpretation
would seem to us to generate exactly the kind of confusion
and unfairness that Congress sought to avoid.

                                7
Recognition of two classes of plaintiffs under S 1981,
when applied in a state with a statute of limitations for
S 1981 claims larger than four years, is likely to result in
unsuspecting plaintiffs who have relied on established
precedent finding themselves barred from relief. Conversely,
recognizing two classes, when applied in a state with a
statute for S 1981 claims shorter than four years, is likely
to result in defendants finding themselves faced with
potential liability on claims they believed extinguished.

More importantly, determining what is a "new" claim,
created by an amendment, is a task fraught with
uncertainty. Amendments vary in their purpose, and the
line between an amendment that modifies an existing right
and one that creates a new right is often difficult to draw.
This is well illustrated by other amendments effected by the
Civil Rights Act of 1991.

Amendments frequently are intended to clarify the law
when there has been a difference of opinion regarding the
interpretation of an existing statute. In such situations,
conflicting views on whether the clarifying amendment
created new rights or merely codified the preexisting
caselaw are what occasion the amendment. Congress in its
deliberations over the Civil Rights Act of 1991, for example,
concluded that the Supreme Court in Price Waterhouse v.
Hopkins, 

(1989), had suggested that no
violation of Title VII occurred when discriminatory animus
is a factor in, but not a but-for cause of, an adverse
employment action. See H.R. Rep. No. 102-40(I), S 203, at
45 (1991). In response, it adopted an amendment to the
Civil Rights Act of 1964 "clarifying" that"an unlawful
employment practice is established when the complaining
party demonstrates that race, color, religion, sex, or
national origin was a motivating factor for any employment
practice, even though other factors also motivated the
practice." Civil Rights Act of 1991, Pub. L. No. 102-166,
S 107(a), 105 Stat. 1071, 1076. Adoption of Zubi's
interpretation of S 1658 would surely lead to litigation over
whether a plaintiff alleging that race was a motivating
factor in his discharge asserts a newly-created claim or an
old one based on the 1964 Act. See Miller v. CIGNA Corp.,

(3d Cir. 1995) (discussing the conflicting views

                               8
of the Price Waterhouse opinions on the nature of the
required showing of causal nexus).

Amendments are also frequently designed to ease the
plaintiff 's burden of demonstrating a violation of an
existing statute by eliminating an element of his prima facie
case or providing a way around an affirmative defense.
Congress, for example, understood the Supreme Court
decision in Wards Cove Packing Co. v. Atonio, 

(1989), to stand for the proposition that a plaintiff in a
disparate-impact case established no violation of Title VII in
the absence of an allegation and proof that the challenged
employment practice was not a business necessity.
See H.R. Rep. No. 102-40(I), SS 201-02, at 23-45 (1991). It
also understood Wards Cove to eliminate the preexisting
rule that such a plaintiff could prevail, even in the face of
a showing of business necessity, by showing an alternative
practice with less disparate impact. See 

Congress in 1991 amended the Civil Rights Act of 1964 to
stipulate that a violation of Title VII is established with a
showing of disparate impact and to restore the alternative-
practice theory of recovery. See Civil Rights Act of 1991,
Pub. L. No. 102-166, S 105, 105 Stat. 1071, 1074. In each
of these situations, there will be plaintiffs situated so that
they will be able to recover under the amended statute but
would not have been able to do so under the preexisting
one. Are plaintiffs who are so situated asserting newly-
created claims that did not previously exist so as to come
within the scope of S 1658?

Finally, we note that the Civil Rights Act of 1991 also
amended Title VII of the Civil Rights Act of 1964 and the
Americans with Disabilities Act of 1990 to authorize, for the
first time, the award of compensatory and punitive damages
for intentional discrimination. See Civil Rights Act of 1991,
Pub. L. No. 102-166, S 102, 105 Stat. 1071, 1072-74. Is a
suit brought solely to recover such damages governed by
the federal limitations period on the theory that these
amendments created new claims or by the state statutes on
the theory that they provide only an additional remedy for
an existing cause of action?

These amendments effected by the Civil Rights Act of
1991 illustrate the many categories of amendments that

                               9
would raise litigable issues under S 1658 if Zubi's
interpretation of that section were adopted. Because of the
resulting uncertainties of application, we conclude that
embracing that interpretation would be inconsistent with
Congress' wish to avoid unnecessary uncertainty.

We reach the same conclusion with respect to the second
suggested reading of S 1658. Under that reading,
application of S 1658 requires differentiating amendments
that effect only technical changes from amendments that
"substantially alter" the meaning of the preexisting statute,
a task that is imprecise at best. Moreover, while this
reading avoids the confusion that would be created by
claims under the same statutory section being governed by
different statutes of limitations, it would be a source of even
greater confusion because claims accruing after the
amendment would be governed by S 1658 even though the
identical claim could have been pursued under the
preexisting statute and would have been governed by state
law. Thus, even though S 1658 purports on its face to
preserve existing limitations law, a claim underS 1981, as
amended, for discrimination in hiring would be governed by
a different limitations statute than an identicalS 1981
claim that accrued prior to the 1991 amendment. We
believe such a result would directly conflict with Congress'
express desire to give S 1658 only prospective effect.

It is the third alternative that seems to us to promise the
least uncertainty of application. The underlying rationale of
that reading is that when Congress amends a preexisting
statute it does not create a "new act," and claims arising
under the statute as amended continue to arise under the
preexisting statute. It is, thus, only when Congress
establishes a new cause of action without reference to
preexisting law that S 1658 applies. Thus, when
determining whether Congress has amended a preexisting
statute or created a "new act," how Congress characterizes
its own action should be determinative. We conclude that
this is the closest thing to a bright line that can be drawn
while remaining faithful to the statutory text and its
legislative history.

We realize that our approach will not provide an

                               10
indisputable answer in all situations.6 We believe that it will
provide such an answer in the vast majority of situations,
however, and clearly it provides such an answer here. As
we explained earlier, Congress here chose to build upon a
statutory text that has existed since 1870. Accordingly, we
hold that Zubi's civil action arises under an Act of Congress
enacted before December 1, 1990, and is governed by New
Jersey's two year statute of limitations.7

III.

At oral argument in this case, it was suggested that 42
U.S.C. S 1988 specifically provides a statute of limitations
for civil rights actions and, therefore, that section 1658,
even assuming that Zubi's case arises under the 1991
amendments, is inapplicable. See 28 U.S.C.S 1658 ("Except
as otherwise provided by law, a civil action arising under
an Act of Congress enacted after the date of the enactment
of this section may not be commenced later than 4 years
after the cause of action accrues.") (emphasis added). We
instructed the parties to brief the issue, and we now hold
that section 1988 does not provide a statute of limitations
_________________________________________________________________

6. Congress casts its legislation in a myriad of different ways, and we do
not mean to endorse an inflexible standard predicated solely on the
terminology utilized by Congress. At times, for example, Congress
"amends" "Parts" of the Code by deleting them in their entirety and
substituting an entirely different text. We do not suggest that such
"amendments" be treated as anything other than a new act of Congress.
We believe in most instances potential litigants will be able to identify
situations in which Congress is building on a preexisting act and
situations in which it is creating a new act.

7. The dissent reads "action" to mean "civil lawsuit," "Act of Congress"
to
include anything published in the United States Statutes at Large, and
"arising under" to mean having "an ingredient" supplied by a post-1991
Act. If "ingredient" here means essential ingredient, then the dissent's
approach is the functional equivalent of the "new claim" approach that
Zubi urges and is subject to the uncertainties we have discussed. If
"ingredient" means something less, then the dissent's approach seems to
us likely to result in the four-year limitations period applying to any
civil
lawsuit containing a claim based on a statute that has been amended in
any way after December 1, 1991. We believe that result would be
inconsistent with the intent to preserve settled limitations law.

                               11
for civil actions arising under acts of Congress enacted after
December 1, 1990, so as to preclude application of section
1658.

Section 1988 provides that the civil rights laws:

       shall be exercised and enforced in conformity with the
       laws of the United States, so far as such laws are
       suitable to carry the same into effect; but in all cases
       where they are not adapted to the object, or are
       deficient in the provisions necessary to furnish suitable
       remedies and punish offenses against law, the common
       law, as modified and changed by the constitution and
       statutes of the State wherein the court have
       jurisdiction of such civil or criminal cause is held, so
       far as the same is not inconsistent with the
       Constitution and laws of the United States, shall be
       extended to and govern the said courts in the trial and
       disposition of the cause . . . .

42 U.S.C. S 1988(a).

Section 1658 specifies a four-year statute of limitations
for a class of claims (i.e., those claims arising under
statutes enacted after December 1, 1990). It excludes from
that class only those claims with respect to which another
statute provides a different limitations period. Section 1988
does not provide a specific limitations period for claims that
would otherwise be governed by S 1658; it provides only for
the borrowing of state rules when there are no federal rules
suitable to carry the civil rights laws into effect. Because we
see no reason why S 1658 is not suitable to effectuate the
civil rights laws with respect to the class of claims to which
it applies, S 1988 provides no authority for borrowing a
state statute of limitations for such claims.

Indeed, reading S 1988 as one of the exceptions to the
scope of S 1658 would produce a result that Congress
clearly did not intend. Section 1988 reflects a congressional
preference for federal law when it may be appropriately
applied. Nothing in S 1658 conflicts with this preference,
and as we have indicated, it provides a limitations period
that can appropriately be applied. Accordingly, we decline
to read these statutory provisions in a way that would
result in the application of state limitations law to a claim

                               12
within the scope of S 1658 (i.e., a claim arising under a
federal statute enacted after December 1, 1990).

IV.

For the reasons stated herein, we will affirm the
judgment of the District Court.

                               13
ALITO, Circuit Judge, dissenting:

I disagree with the majority's interpretation of 28 U.S.C.
S 1658 and with the result that it reaches in the case before
us. The majority does not heed the established meaning of
the terms employed in S 1658. Instead, the majority relies
on a snippet of legislative history and its own opinion
regarding the rule that "seems . . . to promise the least
uncertainty of application." Maj. Op. at p. 10. This is not
the method that we are supposed to use in interpreting
statutes, and it is doubtful that the majority's
interpretation will provide the certainty of application that
the majority seeks. Accordingly, I respectfully dissent.

I.

Before December 1, 1990, claims under 42 U.S.C.S 1981
were subject to the most analogous state statute of
limitations. See Wilson v. Garcia, 

, 279 (1985).
On December 1, 1990, however, the Judicial Improvement
Act of 1990, Pub. L. No. 101-650, 104 Stat. 5114, became
law. Section 313(a) of this Act, which is codified at 28
U.S.C. S 1658, created a new, four-year statute of
limitations for "an action arising under an Act of Congress
enacted after the date of enactment of this section
[December 1, 1990]." Our task here is to construe this
language.

As the Supreme Court and our Court have repeated
many times, in interpreting a statute, "[w]e begin by looking
to the language of the Act. . . . When we find the terms of
a statute unambiguous, judicial inquiry is complete, except
in rare and exceptional circumstances." Rubin v. United
States, 

, 429-30 (1981) (internal quotations
omitted). See also, e.g., Estate of Cowart v. Niklos Drilling
Co., 

, 475 (1992); Demarest v. Manspeaker,

, 190 (1991); Bread Political Action Committee
v. FEC, 

, 580 (1982); In re Unisys Sav. Plan
Litig., 

, 444 (3d Cir. 1996) ("As with any inquiry
of statutory construction, we start with the text of the
statute," and thus "where Congress' will has been
expressed in reasonably plain terms, that language must
ordinarily be regarded as conclusive.") (internal citations

                               14
omitted). If a statute uses legal terms of art, we must
"presume Congress intended to adopt the term's ordinary
legal meaning." Omnipoint Corp. v. Zoning Hearing Bd., 

, 407 (3d Cir. 1999) (citing McDermitt Intern., Inc.
v. Wilander, 

, 342 (1991)). See also Morissette
v. United States, 

, 263 (1952); Felix
Frankfurter, Some Reflections on the Reading of Statutes,
47 Colum. L. Rev. 527, 537 (1947) ("[I]f a word is obviously
transported from another legal source, whether the
common law or other legislation, it brings its soil with it.").

In order to understand S 1658, we must interpret three
terms -- "action," "Act of Congress," and "arising under"--
each of which has a commonly understood legal meaning.
The term "action" refers to a civil lawsuit. See Fed. R. Civ.
Proc. 3; Black's Law Dictionary 28-29 (7th ed. 1999).

The term "Act of Congress" means a law enacted in one
of the ways prescribed by Article I, S 7 of the Constitution.
Acts of Congress are published in the United States
Statutes at Large, which constitute "legal evidence" of what
the law provides. 1 U.S.C. S 112.

The phrase "arising under" is of course familiar in the
field of federal jurisdiction. Article III, S 2 of the
Constitution provides that "[t]he judicial Power shall extend
to all Cases, in Law and Equity, arising under the
Constitution, the Laws of the United States, and Treaties
made, or which shall be made, under their Authority." In
Osborn v. Bank of the United States, 22 U.S. (9 Wheat.) 738
(1824), the Supreme Court, speaking through Chief Justice
Marshall, interpreted this provision broadly, stating that a
claim falls within the federal judicial power if federal law
"forms an ingredient of the original cause." 

See
also Franchise Tax Bd. v. Construction Laborers Vacation
Trust, 

, 27-28 (1982); Verlinden B.V. v. Central
Bank of Nigeria, 

, 491-92 (1983); Gully v. First
National Bank in Meridian, 

, 112 (1936).

Congress employed the phrase "arising under" in 1875
when it enacted the predecessor of current 28 U.S.C.S 1331,8
which gives the district courts subject matter jurisdiction
_________________________________________________________________

8. See Act of March 3, 1875, 18 Stat. 470.

                               15
over causes of action "arising under the Constitution, laws,
or treaties of the United States." The Supreme Court has
"long construed the statutory grant of federal question
jurisdiction as conferring a more limited power" than Article
III, S 2. Merrell Dow Pharmaceuticals Inc. v. Thompson, 

, 807 (1986). With respect to the statutory
provision, the Court has observed:

       The most familiar definition of the statutory"arising
       under" limitation is Justice Holmes' statement,"A suit
       arises under the law that creates the cause of action."
       American Well Works Co. v. Layne & Bowler Co. , 

, 260 (1916). However, it is well settled that
       Justice Holmes' test is more useful for describing the
       vast majority of cases that come within the district
       courts' original jurisdiction than it is for describing
       which cases are beyond district court jurisdiction. We
       have often held that a case "arose under" federal law
       where the vindication of a right under state law
       necessarily turned on some construction of federal law,
       see, e.g., Smith v. Kansas City Title & Trust Co., 

(1921); Hopkins v. Walker, 

       (1917), and even the most ardent proponent of the
       Holmes test has admitted that it has been rejected as
       an exclusionary principle, see Flournoy v. Wiener, 

, 270-272 (1944) (Frankfurter, J., dissenting).
       See also T.B. Harms Co. v. Eliscu, 

, 827
       (CA2 1964) (Friendly, J.). Leading commentators have
       suggested that for purposes of S 1331 an action "arises
       under" federal law "if in order for the plaintiff to secure
       the relief sought he will be obliged to establish both the
       correctness and the applicability to his case of a
       proposition of federal law." P. Bator, P. Mishkin, D.
       Shapiro & H. Wechsler, Hart & Wechsler's The Federal
       Courts and the Federal System 889 (2d ed. 1973) . . . ;
       cf. T.B. Harms 

("a case may `arise under' a
       law of the United States if the complaint discloses a
       need for determining the meaning or application of
       such a law").

Franchise Tax 

(parallel citations to S.
Ct. Rep. and L. Ed. omitted).

                               16
In interpreting the meaning of the phrase "arising   under"
in 28 U.S.C. S 1658, we must presume that Congress   had
in mind the well known interpretations of the same   phrase
in Article III, S 2 of the Constitution and/or the   federal
question statute.

II.

With these interpretations of the relevant statutory terms
in mind, I turn to the particular claim at issue in this case.
In September 1995, Madhat Zubi was terminated from his
job at AT&T. On July 30, 1998, he commenced an action in
federal court in New Jersey, claiming that he was
discharged because of his race, in violation of 42 U.S.C.
S 1981.

Title 42 United States Code S1981, in its current form,
provides as follows:

       (a) Statement of equal rights

        All persons within the jurisdiction of the United
       States shall have the same right in every State and
       Territory to make and enforce contracts, to sue, be
       parties, give evidence, and to the full and equal benefit
       of all laws and proceedings for the security of persons
       and property as is enjoyed by white citizens, and shall
       be subject to like punishment, pains, penalties, taxes,
       licenses, and exactions of every kind, and to no other.

       (b) "Make and enforce contracts" defined

        For purposes of this section, the term "make and
       enforce contracts" includes the making, performance,
       modification, and termination of contracts, and the
       enjoyment of all benefits, privileges, terms, and
       conditions of the contractual relationship.

       (c) Protection against impairment

        The rights protected by this section are protected
       against impairment by nongovernmental discrimination
       and impairment under color of State law.

This provision is not itself an Act of Congress; rather, it
is a codification of two prior Acts.9 Subsection (a) of S 1981
_________________________________________________________________

9. Thus, it is not itself the law but only "prima facie" evidence of the
law,
1 U.S.C. S 204 (a). See United States National Bank of Oregon v.
17
is a codification of Section 1977 of the Revised Statutes of
1874.10 Until 1989, it was unsettled whether the phrase
"make and enforce contracts" in this provision reached the
discriminatory termination of a contractual relationship,
but in Patterson v. McLean Credit Union, 

(1989), the Supreme Court held that this language did not
apply to conduct occurring after the formation of a
contract. "[T]he Patterson opinionfinally decided what
S 1981 had always meant." Rivers v. Roadway Express, 

, 313 n.12 (1994).

In 1991, shortly after enacting 28 U.S.C. S 1658,
Congress broadened the scope of this provision. Section
101 of the Civil Rights Act of 1991, Pub. L. No. 102-166,
105 Stat. 1071, amended Section 1977 of the Revised
Statutes and defined the phrase "make and enforce
contracts" to include the "termination of contracts and the
enjoyment of all benefits, privileges, terms and conditions of
the contractual relationship." This new provision is codified
as 42 U.S.C. S 1981(b). Thus, as a result of the 1991 Act,
a plaintiff may now sue under S 1981 for discriminatory
_________________________________________________________________

Independent Insurance Agents of America, Inc., 

, 449 & n.4
(1993).

10. Subsection (a) may be traced to Section 16 of the Civil Rights Act of
1870, Act of May 31, 1870, ch. 114, S 16, 16 Stat. 144, and Section 1
of the Civil Rights Act of 1866, Act of 1866, 14 Stat. 27. In 1874,
however, Congress enacted into law the Revised Statutes of 1874, "a
massive revision, reorganization, and reenactment of all statutes in
effect
at the time, accompanied by a simultaneous repeal of all prior ones."
United States National Bank of 

. The relevant
sections of the Civil Rights Acts of 1866 and 1870 were thus repealed
and then re-enacted as section 1977 of the Revised Statutes of 1874. See
Runyon v. McCrary, 

, 168 n.8 (1976).

When the U.S. Code was compiled, the provisions of Rev. Stat S 1977
were codified at 42 U.S.C. S 1981. In 1991, when Rev. Stat S 1977 was
amended, the amendments were also, of course, reflected in 42 U.S.C.
S 1981. Section 1981 of the United States Code has never itself been
enacted as positive law, though, and it is thus only"prima facie"
evidence of the provisions of Rev. Stat. S 1977 as amended by the Civil
Rights Act of 1991. See 1 U.S.C. S 204 (a). Cf. United States National
Bank of Oregon v. Independent Insurance Agents of America, Inc., 

, 448-449 & n.4 (1993).

                               18
termination of employment -- and that is precisely what
Zubi did here.

Zubi filed his complaint more than two years, but less
than four years, after his claim accrued. If his complaint is
governed by S 1658, it was filed within the statute of
limitations. On the other hand, if it is not governed by
S 1658, it is subject to the most analogous New Jersey
statute of limitations, which the District Court found to be
New Jersey's two-year statute for personal injury actions.
See Genty v. Resolution Trust Corp., 

, 919 (3d
Cir. 1991)(two-year statute applies to S 1983 actions in New
Jersey). In my view, Zubi's claim arose under the Civil
Rights Act of 1991, as well as under Section 1977 of the
Revised Statutes, and his complaint was thus filed in time.

It is beyond dispute that the Civil Rights Act of 1991
qualifies as an "Act of Congress" in the sense in which that
term is invariably used. We would have to interpret the
term "Act of Congress" in S 1658 in an entirely idiosyncratic
way in order to reach a contrary conclusion. It is also clear
that Zubi's claim of discriminatory termination arose under
Section 101 of that Act under any of the accepted
interpretations of the phrase "arising under." As noted,
Section 101 of the Civil Rights Act of 1991 substantially
expanded the scope of S 1981 by prospectively defining the
phrase "make and enforce contracts" to include the
termination of contracts. This new definition was
indisputably an "ingredient" of Zubi's claim. American Well
Works 

. Indeed, it was an indispensable
ingredient. For this same reason, in any realistic sense,
Section 101 of the 1991 Act "create[d] the cause of action"
for racially discriminatory termination of employment that
Zubi asserted. American Well Works 

.
Furthermore, "in order for [Zubi] to secure the relief sought
he will be obliged to establish both the correctness and the
applicability to his case of [the proposition, established by
the 1991 Act, that a plaintiff may sue under S 1981 for
racially discriminatory termination of employment]." P.
Bator, P. Mishkin, D. Shapiro & H. Wechsler, Hart &
Wechsler's The Federal Courts and the Federal System 889
(2d ed. 1973). Consequently, I would hold that Zubi's claim
is governed by the four-year statute of 28 U.S.C.S 1658
and was not properly dismissed.

                               19
III.

I now turn to the majority's interpretation of the statute.
The majority pays little attention to the language of S 1658.
Instead, after noting that district courts have adopted a
variety of interpretations of this provision, the majority
quickly concludes that the statute is ambiguous. See Maj.
Op. at p. 4-6. The majority then lists three "distinct
approaches" contained in these district court decisions,
Maj. Op. at p. 4-5, and selects from among them based on
what it finds to be "the rationale behind S 1658," which it
identifies, based on a snippet of legislative history, to be the
avoidance of disruptions of " `the settled expectations of a
great many parties.' " Maj. Op. at p. 7 (quoting H.R. Rep.
No. 101-734, S 111, at 24 (1990)), reprinted in 1990
U.S.C.C.A.N. at 6870. This analysis leads the majority to
the conclusion that it is "only when Congress establishes a
new cause of action without reference to preexisting law
that S 1658 applies." Maj. Op. at p. 10. According to the
majority, an Act of Congress that amends a prior Act
(generally) does not qualify as an Act of Congress within the
meaning of S 1658, see Maj. Op. at footnote 5, p. 6.11

This interpretation cannot be squared with the language
of S 1658, which, as noted, states that a four-year statute
of limitations applies to "an action arising under an Act of
Congress enacted after [December 1, 1990]." Under the
majority's reading, however, the four-year statute is
restricted to actions arising under some Acts of Congress
enacted after December 1, 1990 -- namely those Acts of
Congress that "establish[ ] a new cause of action without
reference to preexisting law." According to the majority, an
Act of Congress that establishes a new cause of action but
refers to "preexisting law" in doing so does not qualify as
"an Act of Congress" within the meaning ofS 1658. This
interpretation of the term "Act of Congress" is not
consistent with any known usage of the term.
_________________________________________________________________

11. This approach seems to have been inspired by a recent article. See,
Boyd A. Byers, "Adventures in Topsy-Turvy Land: Are Civil Rights Claims
Arising Under 42 U.S.C. S 1981 Governed by the Federal Four-Year
"Catch-All" Statute of Limitations, 28 U.S.C.S 1658?, 38 Washburn L.J.
509 (1999).

                               20
In defense of its interpretation, the majority cites the
previously mentioned statement in the legislative history to
the effect that Congress did not want to disturb"the settled
expectations of a great many parties." This very general
sentiment, however, does not support the interpretation of
S 1658 that the majority adopts--as the current case
illustrates. Before the enactment of the Civil Rights Act of
1991, no employer in New Jersey could have had a settled
expectation that an action for discriminatory discharge
brought under S1981 would be subject to the state's two
year statute of limitations for personal injury actions, since
prior to that time, S 1981 did not authorize such an action
at all. It was not until the 1991 Act that such an action was
possible, and by that point S 1658 had been enacted. In
light of the clarity of the language of S 1658, when
interpreted in accordance with standard canons of
construction, it is not apparent that resort to the legislative
history is appropriate. See Darby v. Cisneros , 

,
147, (1993) ("Recourse to the legislative history. . . is
unnecessary in light of the plain meaning of the statutory
text."). But even if the legislative history is considered, the
single, general statement cited by the majority cannot bear
the weight of the majority's interpretation.

The principal basis for that interpretation, it appears, is
the majority's belief that its interpretation "promise[s] the
least uncertainty of application" and is "the closest thing to
a bright line." Maj. Op. at p. 10. In interpreting a statute,
however, we are not free to disregard Congress's approach
in favor of one that seems better to us. "It is by now
axiomatic that `the judiciary may not sit as a
superlegislature to judge the wisdom or desirability of
legislative policy determinations made in areas that neither
affect fundamental rights nor proceed along suspect lines.'
Absent ambiguity in the statute, we cannot allow policy to
guide our analysis." Sea-Land Serv., Inc. v. Barry, 

, 909 (3d Cir. 1994) (internal citations omitted) (quoting
City of New Orleans v. Dukes, 

, 303 (1976));
see also, Blue Chip Stamps v. Manor Drug Stores, 

, 748 (1975). In framing S 1658, Congress plainly
passed up alternative, simpler approaches. To take just one
example that is much simpler than either S 1658 itself or
the majority's rule, Congress could have made the new,

                               21
four-year statute applicable to any claim accruing after
December 1, 1990. Such an approach definitely would have
provided a very "bright line rule," but Congress obviously
thought that interests other than clarity and ease of
application also had to be served to at least some degree.

Finally, I note that the majority's interpretation may not
provide the clarity and certainty of application that the
majority seeks. Under the majority's approach, most Acts of
Congress that amend prior Acts of Congress do not qualify
as Acts of Congress under S 1658. In footnote 5, however,
the majority says that not all enactments styled as
amendments are real amendments, and thus some
amendments may count as Acts of Congress under S 1658.
See Maj. Op., footnote 5. The majority may regard this as
"the closest thing to a bright line rule." I do not.

I would hold that Zubi's claim is governed by the four-
year statute of S 1658, and I would therefore reverse and
remand.

A True Copy:
Teste:

       Clerk of the United States Court of Appeals
       for the Third Circuit

                                22