EMMET G. SULLIVAN, District Judge.
Plaintiffs, thirty-one civilian government contractor employees (and/or their surviving relatives), bring this purported class action against twenty-three defendants, which include United States government contractors (the "Contractor Defendants") and their insurance carriers (the "Insurer Defendants") (collectively, "Defendants").
The Defense Base Act ("DBA"), 42 U.S.C. § 1651 et seq., establishes a uniform, federal compensation scheme for civilian contractors and their employees for injuries sustained while providing functions under contracts with the United States outside its borders. The DBA applies "the provisions of the Longshore and Harbor Workers' Compensation Act [33 U.S.C. § 901 et seq. (the "LHWCA" or the "Longshore Act")] ... in respect to the injury or death of any employee engaged in any employment ... under a contract entered into with the United States ... where such contract is to be performed outside the continental United States...." 42 U.S.C. § 1651(a)(4). As Plaintiffs note at the outset of their Complaint, "[the] DBA system is administered according to statute by the United States Department of Labor (DOL), in the administrative Office of Workers' Compensation Programs (OWCP), subject to hearing and decision in contested cases by the Office of Administrative Law Judges (OALJ) of the DOL, and administrative appeal to the Benefits Review Board. If a matter works its way through the OWCP, OALJ, and Board, only then can a party appeal into the federal courts." Second Am. Compl. ("SAC") ¶ 2 (citing 33 U.S.C. §§ 919, 921(b)(3)).
The DBA includes a provision that makes an employer's liability under the statutory scheme exclusive:
42 U.S.C. § 1651(c); see also 33 U.S.C. § 905(a) ("The liability of an employer prescribed in section 4 [of the LHWCA, 33 U.S.C. § 904] shall be exclusive and in place of all other liability of such employer to the employee, his legal representative, husband or wife, parents, dependents, next of kin, and anyone otherwise entitled to
The DBA incorporates the LHWCA's detailed administrative procedures for the filing, adjudication, and payment of workers' compensation claims. An injured employee or decedent is required to give written notice of injury or death within thirty days after either the date of the injury or death, or the date the employee or beneficiary becomes aware or should have been aware of the injury or death. See 33 U.S.C. § 912; 20 C.F.R. § 702.212. A claimant then has one year within which to file a claim for compensation on account of that injury or death. See 33 U.S.C. § 913(a). Within ten days of learning that an employee has been injured, an employer must send a report to the Department of Labor "District Director." See 33 U.S.C. § 930(a); 20 C.F.R. § 702.201. Unless the employer is self-insured, the employer's DBA insurance carrier is responsible for processing and payment of an injured employee's claim. See 33 U.S.C. § 935; 20 C.F.R. § 703.115. The District Director must be notified when payments commence and if payment is suspended for any reason. See 20 C.F.R. § 702.234. If the right to compensation is controverted by the employer, 33 U.S.C. § 914(d); 20 C.F.R. § 702.251, no benefits are due until a compensation award is made by the District Director. Upon receiving a notice of controversion or an employee's challenge to reduction, suspension, or termination of benefits, the District Director commences adjudication proceedings. See 20 C.F.R. §§ 702.252, 702.261-262. There is a mandatory three-tier process for adjudicating claims: (1) informal mediation before the District Director; (2) formal hearings and fact-finding proceedings before an Administrative Law Judge; and (3) appellate review by the Department of Labor Benefits Review Board, which is subject to further appellate review by a court of competent jurisdiction. See 33 U.S.C. § 921; 20 C.F.R. §§ 702.311-319 ("Action by District Directors"); 702.331-351 ("Formal Hearings"); 702.371-373 ("Interlocutory Matters"); 702.391-394 ("Appeals"); see also 42 U.S.C. § 1653(b). An employee who successfully prosecutes a controverted claim is entitled to attorneys' fees. See 33 U.S.C. § 928; 20 C.F.R. § 702.134.
The LHWCA's administrative scheme also provides for a number of penalties, which include, inter alia:
This action arises out of Defense Base Act claims filed by civilian government contractor employees who suffered injuries while working in Afghanistan and Iraq. Plaintiffs, the contractor employees and/or their surviving relatives,
According to the SAC, Defendants, in conspiracy with others, have sought to defeat the rights of American citizens and foreign nationals to receive their lawful compensation under the DBA. SAC ¶ 2. Throughout the two hundred page Complaint, Plaintiffs allege that Defendants:
Plaintiffs further state that the "[c]ontractors and their insurance carriers ... have utilized fear, threats, implied threats, and elaborate ruses to deprive whole classes of... persons injured from effectively obtaining any benefits, have employed devices and artifices to prevent any medical treatment for PTSD, [and have] accus[ed] persons of faking or of malingering...." SAC ¶ 12. According to Plaintiffs, all of these actions exacerbated the harm that Plaintiffs had already suffered based on their DBA-covered injuries and caused additional financial and emotional harm. See, e.g., SAC ¶¶ 52, 88, 126, 166, 182, 206, 217, 228, 245, 256, 268, 278, 283, 292, 320, 344, 394, 403, 412, 439, 463, 476, 523, 534. Plaintiffs emphasize that the damages they seek in this action are not related to what they claimed in their DBA actions. See id.
Plaintiffs filed their initial Complaint in this matter on September 26, 2011. They
On July 13 and 16, 2012, Defendants filed fourteen motions to dismiss, including two joint motions filed by the Contractor Defendants and the Insurer Defendants. See n. 2 supra. The motions are ripe for determination by the Court.
Federal district courts are courts of limited jurisdiction, Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994), and a Rule 12(b)(1) motion for dismissal presents a threshold challenge to a court's jurisdiction, Haase v. Sessions, 835 F.2d 902, 906 (D.C.Cir.1987). On a motion to dismiss for lack of subject matter jurisdiction, the plaintiff bears the burden of establishing that the court has jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). In evaluating such a motion, the Court must "accept as true all of the factual allegations contained in the complaint," Wilson v. Dist. of Columbia, 269 F.R.D. 8, 11 (D.D.C.2010) (citation omitted), and should review the complaint liberally while accepting all inferences favorable to the plaintiff, Barr v. Clinton, 370 F.3d 1196, 1199 (D.C.Cir.2004). Because subject matter jurisdiction focuses on the court's power to hear the claim, however, the court must give the plaintiff's factual allegations closer scrutiny when resolving a Rule 12(b)(1) motion than would be required for a Rule 12(b)(6) motion. Macharia v. United States, 334 F.3d 61, 64, 69 (D.C.Cir. 2003). Thus, to determine whether it has jurisdiction over a claim, the court may consider materials outside the pleadings where necessary to resolve disputed jurisdictional facts. Herbert v. Nat'l Acad, of Scis., 974 F.2d 192, 197 (D.C.Cir.1992).
Faced with motions to dismiss under Rule 12(b)(1) and Rule 12(b)(6), a court should first consider the Rule 12(b)(1) motion because "[o]nce a court `determines that it lacks subject matter jurisdiction, it can proceed no further.'" Sledge v. United States, 723 F.Supp.2d 87, 91 (D.D.C.2010)(quoting Simpkins v. Dist. of Columbia, 108 F.3d 366, 371 (D.C.Cir. 1997)).
A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the complaint. Browning v. Clinton, 292 F.3d 235, 242 (D.C.Cir.2002). A complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief, in order to give the defendant fair notice of what the ... claim is and the grounds upon which it rests." Bell Atl.
All of the Defendants argue that the Second Amended Complaint should be dismissed in its entirety because the Defense Base Act provides the exclusive process and forum to resolve Plaintiffs' claims. See, e.g., Contractor Defs.' Joint Mem. at 10-22; Insurer Defs.' Joint Mem. at 7-21; Khudairi Group's Mem. at 13-17. Defendants further argue that Plaintiffs fail to state a claim under RICO, the ADA, or any of their common law causes of action. See, e.g., Contractor Defs.' Joint Mem. at 23-37; Insurer Defs.' Joint Mem. at 21-36. Finally, several Defendants argue (1) that this Court lacks personal jurisdiction over them and that venue is improper, see Global Linguist Solutions' Mem. at 4-11; AECOM and CSA's Mem. at 4-7; USIS International's Mem. at 3-4, 9; CNA Financial's Mem. at 8-9; (2) that they are not proper parties to this action because there are no claims alleged directly against them, see Northrop Grumman's Mem. at 10-11; CNA Financial's Mem. at 5-8; Khudairi Group's Mem. at 17-22; and (3) that they were improperly named in the Complaint because they settled all claims with the relevant plaintiff (and counsel of record in this action) months before the initial Complaint was filed, see Exelis Systems' Mem. at 10-11. As discussed in more detail below, the Court concludes that the Defense Base Act preempts all of Plaintiffs' state law claims, as well as Plaintiffs' RICO and retaliatory discharge claims. The Court further concludes that Plaintiffs fail to state a claim under the ADA. The Court therefore does not reach the Defendants' alternative arguments.
The D.C. Circuit has held that the LHWCA, which is incorporated into the DBA, "provides a comprehensive scheme for compensating employees who are injured or killed in the course of employment." Hall v. C & P Tel. Co., 809 F.2d 924, 926 (D.C.Cir.1987) [Hall II] (emphasis in original). In Hall, the plaintiff alleged that his employer had wrongfully delayed and denied his benefits under the D.C. Workers' Compensation Act, which at the time incorporated the LHWCA's statutory framework. The plaintiff filed suit for intentional infliction of emotional distress and bad-faith refusal to make timely workers' compensation benefits payments. See Hall v. C&P Tel. Co., 793 F.2d 1354, 1355 (D.C.Cir.1986) [Hall I]. On rehearing, the D.C. Circuit stated that the plaintiff, "[u]nsatisfied with the [LHWCA's] statutory quid pro quo ... contend[ed] that employees should be permitted to
Courts in several other circuits have likewise found this exclusive remedy scheme to bar state tort claims like those alleged here. See Barnard v. Zapata Haynie Corp., 975 F.2d 919, 920 (1st Cir. 1992) (holding that the LHWCA preempts state tort claims for intentional failure to make timely compensation payments, as well as willful and malicious refusal to pay); Atkinson v. Gates, McDonald & Co., 838 F.2d 808, 809-12 (5th Cir.1988) (same); Sample v. Johnson, 771 F.2d 1335, 1344-47 (9th Cir.1985) (same); Nauert v. Ace Prop. & Cas. Ins. Co., No. 04-cv-2547, 2005 WL 2085544, at *3-5 (D.Colo. Aug. 27, 2005) (dismissing claims for bad faith failure to pay compensation based on exclusivity of DBA and LHWCA); see also Brown v. Gen. Servs. Admin., 425 U.S. 820, 834-35, 96 S.Ct. 1961, 48 L.Ed.2d 402 (1976) ("We have consistently held that a narrowly tailored employee compensation scheme preempts the more general tort recovery statutes.").
In addition, the LHWCA precludes state tort claims alleging "false statement[s] or representation[s] for the purpose of reducing, denying, or terminating" a claimant's benefits. Tipton v. Northrop Grumman Corp., No. 08-1267, 2008 WL 5378129, at *4 (E.D.La. Dec. 22, 2008). As several courts have recognized, Section 931(c) of the LHWCA, as incorporated by the DBA, establishes an employer's exclusive liability for such alleged conduct in the form of criminal penalties and liability. See Barnard, 975 F.2d at 921 n. 4; Atkinson, 838 F.2d at 811. Further, courts have found that the exclusive remedies and adjudication processes in the LWHCA preempt claims of retaliation or discrimination in connection with a claim for benefits. See LeSassier v. Chevron USA, Inc., 776 F.2d 506, 509-10 (5th Cir.1985)(holding that exclusive administrative remedy 33 U.S.C. § 948a preempted state law retaliatory discharge claim); Ravencraft v. Sundowner Offshore Servs., No. 97-3572, 1998 WL 246699, *2 (E.D.La. May 14, 1998) (same).
Plaintiffs do not address or acknowledge this Circuit's binding precedent set forth in Hall. Instead, they make several arguments in an attempt to avoid the exclusivity of the DBA. None of these arguments are persuasive.
First, Plaintiffs rely on a purported exception recognized in Martin v. Travelers Insurance Co., 497 F.2d 329 (1st Cir.1974). See Pls.' Opp'n to Contractor Defs.' Joint Mem. at 9-11; Pls.' Opp'n to Insurer Defs.' Joint Mem. at 24-26. There, after the defendant insurer had issued a benefits check to the plaintiff, and the plaintiff had deposited and substantially drawn on the check, the defendant stopped payment without warning. The First Circuit held that this constituted an independent
Even were the Court persuaded that Martin provided an exception to Hall — which does not appear to be the case —
As Plaintiffs reaffirm in their own Opposition briefs, the crux of their Complaint is that "Defendants' failure to make the proper compensation payments resulted in the infliction of harm on Plaintiffs, which Defendants could have reasonably anticipated.... Defendants' delay, termination, and/or minimization of compensation have aggravated Plaintiffs' injuries." Pls.' Opp'n to Contractor Defs.' Joint Mem. at 16; see also Pls.' Opp'n to Insurer Defs.' Joint Mem. at 16. Plaintiffs claim that Defendants, in conspiracy with each other, refused to pay for Plaintiffs' medical benefits, terminated their medical benefits, repeatedly lied and made misrepresentations to DOL regarding payments for medical treatment, wrongfully terminated certain Plaintiffs, and provided inadequate care. See Pls.' Opp'n to Contractor Defs.' Joint Mem. at 20-22. Although Plaintiffs allege that these actions exacerbated their underlying employment-related injuries and/or that the claims process itself caused them undue stress and financial hardship, it is clear that Plaintiffs' state law causes of action all arise out of their underlying claims to DBA benefits and thus are barred by the exclusive scheme set forth in the DBA and LHWCA.
Plaintiffs also argue that the exclusive remedy bar only exists as to damages "on
838 F.2d at 811 (internal citation omitted).
Alternatively, Plaintiffs argue that Defendants' "failure to secure payment of compensation," through false statements and representations estops them from asserting preemption. Pls.' Opp'n to Contractor Defs.' Joint Mem. at 11; see also Pls.' Opp'n to Insurer Defs.' Joint Mem. at 26-27.
Finally, Plaintiffs argue quite perplexingly that the exclusive remedy provision of the DBA does not apply to them because they are independent contractors, not employees, and thus are not covered by the DBA. They also assert that they are suing certain Defendants who were not their actual employers or insurers. See Pls.' Opp'n to Contractor Defs.' Joint Mem. at 24-25; Pls.' Opp'n to Insurer Defs.' Joint Mem. at 28-29. These arguments undermine the premise of the claims set forth in the Complaint, all of which allege that Plaintiffs were harmed by Defendants' refusal or failure to timely provide the DBA benefits to which Plaintiffs were entitled.
The allegations in the Complaint are extremely serious and deeply disturbing. However, Congress has expressly set forth its intention that employers' liability under the DBA "shall be exclusive and in place of all other liability." 42 U.S.C. § 1651(c);
Defendants further argue that Plaintiffs' federal claims are barred. As the D.C. Circuit and several others have recognized, federal enabling statutes that provide exclusive administrative remedies bar RICO actions for alleged violations of those schemes. See Danielsen v. Burnside-Ott Aviation Training Ctr., Inc., 941 F.2d 1220 (D.C.Cir.1991) (affirming dismissal of RICO claims as barred by exclusive statutory remedies under the Federal Services Contract Act); Bridges v. Blue Cross & Blue Shield Ass'n, 935 F.Supp. 37, 43 (D.D.C.1996) (finding that the Federal Employees Health Benefits Act's administrative remedy bars RICO claims); see also, e.g., Ayres v. Gen. Motors Corp., 234 F.3d 514, 522-25 (11th Cir.2000) Bodimetric Health Servs., Inc. v. Aetna Life & Cas., 903 F.2d 480, 486-87 (7th Cir.1990); Norman v. Niagara Mohawk Power Corp., 873 F.2d 634, 637-38 (2d Cir.1989); cf. Brown v. Cassens Transport Co., 675 F.3d 946, 954-55 (6th Cir.2012) (noting that federal courts "have held RICO inapplicable to claims that should have been raised before federal agencies that had exclusive-remedy clauses in their enabling statutes," but finding that state statute did not preempt RICO claim).
In Danielsen, the D.C. Circuit held that the plaintiffs' claims against their government contractor employer were precluded by the comprehensive statutory scheme under the Service Contract Act, 41 U.S.C. § 351 et seq. There, the plaintiff-employees alleged that the defendants had entered into contracts with the government using improper wage classifications (in violation of the Service Contract Act), and had repeatedly used the mails to further the contracts, thus constituting to mail fraud under RICO. See 941 F.2d at 1225-26. However, the court held that because the Act provided "an extensive series of regulations governing the wage determination process, including procedures for enforcement and review," the administrative remedies available under the Service Contract Act were "exclusive" and did not give rise to a separate cause of action under RICO. See id. at 1226-29. This Court later applied the holding in Danielsen to the Federal Employee Health Benefits Act ("FEHBA"), 5 U.S.C. § 8901 et seq., which authorizes the U.S. Office of Personnel Management "to procure and administer health benefits plans for federal workers by contracting with private health insurance carriers." Bridges, 935 F.Supp. at 39. The court stated, "[a]lthough the governing statute in this case is different [from that in Danielsen], the underlying principles are the same, and the claims cannot stand." Id. at 40 (citing Danielsen, 941 F.2d 1220). Because the FEHBA created a "comprehensive administrative enforcement mechanism for review of disputed claims," the court found that the RICO claims were precluded and must be dismissed. See id. at 41-43 ("The FEHBA leaves no room for a remedy under RICO; the broad enforcement and oversight powers of the OPM established in the statute indicate that the exclusive remedy for an action cognizable under the FEHBA lies under the FEHBA, not under another federal statute.").
Plaintiffs do not respond to this argument or this authority whatsoever. For this reason alone, the Court could treat this argument as conceded and dismiss all of the federal claims. See Hopkins v. Women's Div., Gen. Bd. of Global Ministries, 284 F.Supp.2d 15, 25 (D.D.C.2003),
The allegations that form the basis of Plaintiffs' RICO claim (Count II) are directly addressed by the comprehensive administrative procedures and remedies available under the DBA. For example, Plaintiffs claim that Defendants conspired to "[make] misrepresent[ations] to injured parties and the DOL and commit crimes under the DBA by denying claims using fraud...." SAC ¶ 573. However, Section 931(c) of the LHWCA, which is incorporated in the DBA, provides specific criminal penalties against any "employer, his duly authorized agent, or an employee of an insurance carrier who knowingly and willfully makes a false statement or representation for the purpose of reducing, denying, or terminating benefits to an injured employee...." 33 U.S.C. § 931(c). Likewise, Plaintiffs' allegation that Defendants committed "various forms of wire and mail fraud" to "delay payments to providers or to claimants" is addressed in Sections 914(e) and (f) of the LHWCA, as incorporated by the DBA, which provide financial penalties for delays in compensation. See 33 U.S.C. §§ 914(e), (f); 20 C.F.R. §§ 702.233, 702.350. Based upon the reasoning of Danielsen and Bridges, the Court concludes that to permit Plaintiffs to convert non-compliance with the DBA — a statute with its own comprehensive administrative remedies — into mail and wire fraud and thereby maintain a civil RICO action would contradict the purpose and intent of the DBA.
Furthermore, Count I, which alleges a violation of the LHWCA's anti-retaliation and discrimination provision, 33 U.S.C. § 948a, is also barred.
Three individual Plaintiffs, Merlin Clark, Harbee Kreesha, and Mohsen Alsaleh, bring claims for violation of the ADA against their employers, Ronco Consulting (as to Clark) and Global Linguist Solutions (as to Kreesha and Alsaleh). See SAC ¶¶ 111, 113, 203, 215, 608-618. Specifically, Plaintiffs allege that they were fired after they became disabled, and that their disabilities "were motivating factors in the decisions of Defendant contractors not to offer jobs with accommodations, or to fire persons who were ... being treated for DBA injuries, or to rehire but fail to accommodate restrictions or disabilities reasonably." SAC ¶¶ 611-13. The Court interprets these allegations as including two
The ADA prohibits an employer from discriminating against an "individual with a disability" who can perform the essential functions of his job with "reasonable accommodations." 42 U.S.C. § 12112(a)-(b). As relevant here, to "`discriminate' is defined to include `not making reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual with a disability ..., unless [the employer] demonstrates that the accommodation would impose an undue hardship on the operation of the business....'" Woodruff v. Peters, 482 F.3d 521, 527 (D.C.Cir.2007) (quoting 42 U.S.C. § 12112(b)(5)(A)). A "qualified individual" is "an individual who, with or without reasonable accommodation, can perform the essential functions of the employment position that such individual holds or desires." 42 U.S.C. § 12111(8). The ADA defines "disability" as "a physical or mental impairment that substantially limits one or more of the major life activities of" an individual. 42 U.S.C. § 12102(2)(A).
To establish a prima facie case of unlawful discrimination based on a failure to accommodate under the ADA, a plaintiff must show that: "(1) he is a qualified individual with a disability within the meaning of the ADA; (2) that the employer had notice of his disability; (3) there was some reasonable accommodation denied to him; and (4) such accommodation would have enabled him to perform the essential functions of this job." Saunders v. Galliher & Huguely Assocs., Inc., 741 F.Supp.2d 245, 248 (D.D.C.2010) (citing Duncan v. Wash. Metro. Area Transit Auth., 240 F.3d 1110, 1114 (D.C.Cir.2001)). The employee bears the burden of proving that he is qualified. Miller v. Hersman, 759 F.Supp.2d 1, 10 (D.D.C.2010). In addition, "[a]n underlying assumption of any reasonable accommodation claim is that the plaintiff-employee has requested an accommodation which the defendant-employer has denied." Flemmings v. Howard Univ., 198 F.3d 857, 861 (D.C.Cir.1999); Saunders, 741 F.Supp.2d at 249 ("It is the employee's burden to identify reasonable accommodations which would allow him to perform the essential functions of the job....").
A disability discrimination claim under the ADA is subject to the familiar burden-shifting framework of McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). First, the plaintiff must establish a prima facie case of discrimination under the ADA by showing that he: (1) had a disability; (2) was qualified for the position with or without a reasonable accommodation; and (3) suffered an adverse employment action because of the disability. Swanks v. Wash. Metro. Area Transit Auth., 179 F.3d 929, 933-34 (D.C.Cir.1999). If the plaintiff does so, the burden shifts back to the employer to articulate a "legitimate non-discriminatory reason for its action," leaving the plaintiff an opportunity to prove that the employer's proffered justification was not the true reason, but a pretext for discrimination. Id. (citing Aka v. Wash. Hosp. Ctr., 156 F.3d 1284, 1289 (D.C.Cir. 1998) (en banc)).
Plaintiffs have failed to state the essential elements of a claim for either failure to accommodate or disability discrimination under the ADA. First, Plaintiffs make only conclusory allegations regarding each individual Plaintiff's status as a "qualified individual" under the ADA. Plaintiff Kreesha alleges that he has Post-Traumatic Stress Disorder, and that this "substantially limits his major life activities." Pls.' Opp'n to Contractor Defs.' Joint Mem. at 42; see also SAC ¶¶ 193-95. Plaintiff Clark alleges that he suffered numerous
Accordingly, Plaintiffs' ADA claims (Count VI) are
For the foregoing reasons, the Court concludes that the exclusive remedies in the DBA preclude Plaintiffs' state law claims, their RICO claim, and their claim under Section 948a of the LHWCA and must therefore be dismissed pursuant to Rule 12(b)(1). The Court further concludes that Plaintiffs' ADA claims fail to state a claim for relief under Rule 12(b)(6). Accordingly, Defendants' Motions to Dismiss are hereby