ANTHONY W. ISHII, Senior District Judge.
The U.S. Equal Opportunity Commission ("Plaintiff") brought this action for violations of Title VII of the Civil Rights Act of 1964 ("Title VII") and Title I of the Civil Rights Act of 1991 against Defendant Farmers Insurance Company ("Defendant") to seek relief for charging parties Chia Xiong ("Xiong"), Jason Lowry ("Lowry"), and other similarly situated individuals
Xiong, Lowry, and John Yang ("Yang") were all employed by Defendant. See Doc. 1, Complaint ("Compl.") at ¶¶ 13-14. On or about October 31, 2005, Xiong was hired as a claims representative for Defendant. Defendant's Request for Judicial Notice ("RJN"), Exhibit 1 at ¶ 1. Plaintiff alleges that, prior to 2009, Xiong and other employees in Defendant's Fresno, California office were instructed by their supervisor, Tim Cavanaugh, and Office Training Specialist, Brian Ponte, to code payments as partial payments to avoid negative customer service surveys. See Compl. at 12; RJN, Exh. 1 at ¶ 1. In 2009, Defendant conducted an audit regarding the issuance of partial payments. Compl. at ¶ 13. During this audit Defendant interviewed several claims representative relating to the coding of partial payments. Compl. at ¶ 13. Xiong, Yang, and Lowry were among those interviewed. Compl. at ¶ 13.
After the employee interviews concluded Defendants terminated the employment of Xiong and Yang (both Asian) while retaining similarly situated non-Asian employees who had also coded cases as partial payments. Compl. at ¶ 14.
On June 24, 2009, Xiong filed a charge of discrimination with the E.E.O.C. Compl. at ¶ 15; RJN, Exh. 1. On or about May 24, 2012, the E.E.O.C. interviewed Lowry in connection with its investigation. Compl. at ¶ 16. On or about June 5, 2012, Lowry was questioned by Defendant about his interview with the E.E.O.C. Compl. at ¶ 17. The following day Lowry was placed on administrative leave. Plaintiff alleges that, on or about July 18, 2012, Lowry was terminated due to his participation in the E.E.O.C. investigation.
Xiong filed a charge of discrimination with the E.E.O.C. alleging that he was subject to racial discrimination at Farmers in violation of Title VII of the Civil Rights Act of 1964. Compl. at ¶ 8. Plaintiff thereafter attempted to eliminate the allegedly unlawful employment practices that it found and to effect voluntary compliance with Title VII through informal methods of conciliation, conference and persuasion. Compl. at ¶ 9.
Plaintiff alleges that all conditions precedent to institution of this lawsuit have been fulfilled. Compl. at ¶ 11.
On September 30, 2013, the E.E.O.C. filed suit on behalf of Chia Xiong, Jason Lowry, and other similarly situated individuals alleging violation of Title VII of the Civil Rights Act of 1964 as well as of Title I of the Civil Rights Act of 1991. Doc. 1. Defendant filed a motion to dismiss on January 28, 2014. Plaintiff filed an opposition on February 24, 2014, and Defendant filed its reply on March 3, 2014.
Federal courts are of limited jurisdiction, having subject matter jurisdiction only over matters authorized by the Constitution and Congress. See, e.g. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994); A-Z Intern. v. Phillips, 323 F.3d 1141, 1145 (9th Cir.2003). For federal question jurisdiction to exist, the requirements of 28 U.S.C. Section 1331, which gives federal courts jurisdiction only to those cases which arise under federal law, must also be met. 28 U.S.C. § 1331. The question of whether a procedural rule is jurisdictional "is not merely semantic but one of considerable practical importance for judges and litigants." Henderson v. Shinseki, 562 U.S. 428, _____, 131 S.Ct. 1197, 1202, 179 L.Ed.2d 159 (2011). Branding a rule as going to a court's subject-matter jurisdiction alters the normal operation of our adversarial system. Id. Rule 12(b)(1) allows a party to seek dismissal of an action where federal subject matter jurisdiction is lacking. Fed.R.Civ.P. 12(b)(1). When subject matter jurisdiction is challenged, the burden of establishing federal subject-matter jurisdiction always rests with the party who invokes the Court's jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992).
The United States Supreme Court in Arbaugh v. Y & H Corp., 546 U.S. 500, 511, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006), in an attempt to curtail "drive-by jurisdictional rulings" advised courts to be cognizant of the "subject-matter jurisdiction / ingredient-of-claim-for-relief" dichotomy so as not to "erroneously conflate[]" subject matter jurisdiction with a plaintiff's need and ability to prove a violation of federal law a merits based determination. To that end, a district court must ensure that a jurisdictional ruling is not made upon a "provision that `does not speak in jurisdictional terms or refer in any way to the jurisdiction of the courts.'" Arbaugh, 546 U.S. at 515, 126 S.Ct. 1235 (quoting Zipes v. Trans World Airlines, Inc., 455 U.S. 385, 394, 102 S.Ct. 1127, 71 L.Ed.2d 234 (1982)).
Under Federal Rule of Civil Procedure 12(b)(6), a claim may be dismissed because of the plaintiff's "failure to state a claim upon which relief can be granted." Fed. R.Civ.P. 12(b)(6). A dismissal under Rule 12(b)(6) may be based on the lack of a cognizable legal theory or on the absence of sufficient facts alleged under a cognizable legal theory. Conservation Force v. Salazar, 646 F.3d 1240, 1242 (9th Cir. 2011); Johnson v. Riverside Healthcare Sys., 534 F.3d 1116, 1121 (9th Cir.2008). In reviewing a complaint under Rule 12(b)(6), all allegations of material fact are taken as true and construed in the light most favorable to the non-moving party. Faulkner v. ADT Sec. Servs., 706 F.3d 1017, 1019 (9th Cir.2013); Johnson, 534 F.3d at 1121. However, the Court is not required "to accept as true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences." Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir.2001); Clegg v. Cult Awareness Network, 18 F.3d 752, 754-55 (9th Cir.1994) (Nor is the Court required to accept "legal conclusions cast in the form of factual allegations if those conclusions cannot reasonably be drawn from the facts alleged.").
In the employment discrimination context, a plaintiff need not plead a prima facie case in order to survive a motion to dismiss pursuant to Rule 12(b)(6). See Swierkiewicz v. Sorema N.A., 534 U.S. 506, 515, 122 S.Ct. 992, 152 L.Ed.2d 1
Accordingly, while a plaintiff need not plead facts constituting all elements of a prima facie employment discrimination case in order to survive a motion to dismiss, courts look to those elements to analyze a motion to dismiss — so as to decide, in light of judicial experience and common sense, whether the challenged complaint contains sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.
The Complaint's causes of action arise under Title VII of the Civil Rights Act of 1964 and Title I of the Civil Rights Act of 1991 codified at 29 U.S.C. Section 791 et seq., a federal statute, and invokes subject matter jurisdiction over the federal question. The Court will discuss 1) whether E.E.O.C. exhaustion of administrative prerequisites is a jurisdictional question, 2) the appropriate scope of the court's inquiry into exhaustion of preconditions to suit, and 3) the appropriate scope of the action before this court, and 4) the sufficiency of Plaintiff's pleading.
The E.E.O.C. must attempt to resolve unlawful employment practices by "informal methods of conference, conciliation, and persuasion before bringing suit." 42 U.S.C. § 2000e-5(b). The E.E.O.C. may bring suit only if it "has been unable to secure from the [employer] a conciliation agreement acceptable to the [E.E.O.C.]." 42 U.S.C. § 2000e-5(f)(1).
Defendant submits to this Court that the requirements of 42 U.S.C. § 2000e-5(b) are jurisdictional. Defendant relies primarily on E.E.O.C. v. Pierce Packing Co., 669 F.2d 605 (9th Cir.1982), for the proposition that E.E.O.C. exhaustion of administrative prerequisites is a jurisdictional
The jurisdictional analysis in determining the legal character of the statutory requirement is discerned by looking to the condition's "text, context, and relevant historical treatment." Castillo v. U.S. IRS, 1:13-cv-0517, 2014 WL 1270548 *4 (E.D.Cal. Mar. 26, 2014) (AWI) (quoting Reed Elsevier Inc. v. Muchnick, 559 U.S. 154, 166, 130 S.Ct. 1237, 176 L.Ed.2d 18 (2010)). In order to determine relevant historical treatment the Court looks at the "type of limitation [the statute] imposes" (i.e. investigation and conciliation) in order to determine whether the requirement is jurisdictional. Reed Elsevier Inc., 559 U.S. at 168, 130 S.Ct. 1237. The Supreme Court has made clear that a statutory requirement is jurisdictional only where
Based on this provision (and despite the fact that it makes specific reference to jurisdiction) the Supreme Court found that the condition was not clearly labeled jurisdictional, was not located in a jurisdiction-granting provision, and had admitted exceptions to the condition, indicating that it was not a jurisdictional bar, as subject matter jurisdiction is not subject to waiver. Reed Elsevier, 559 U.S. at 169, 130 S.Ct. 1237.
This Court has recently recognized that the requirement that federal employees exhaust administrative remedies is not a jurisdictional requirement. Porter v. Mabus, 1:07-cv-0825, 2014 WL 797981, *3 (E.D.Cal. Feb. 27, 2014) (AWI). In Porter the statute in question was 42 U.S.C. § 2000e-16(c), which reads, in relevant part, as follows:
The language used by Congress in Section 2000e-5(f)(1) is couched in largely the same terms:
The text of Section 2000e-5(f)(1) does not speak in clearly jurisdictional terms. Where the Ninth Circuit had occasion to examine Section 2000e-5(f)(1) it referred to only Section 2000e-5(f)(3) as "Title VII's jurisdictional grant." Porter v. Winter 603 F.3d 1113, 1118 (9th Cir.2010).
This Court has recognized exceptions to the requirement that the E.E.O.C. attempt to conciliate prior to bringing suit. See E.E.O.C. v. Timeless Investments, 734 F.Supp.2d 1035, 1052 (E.D.Cal.2010) (citing, inter alia, E.E.O.C. v. Asplundh Tree Expert Co., 340 F.3d 1256, 1261 (11th Cir.
Historically, the Ninth Circuit has treated the conciliation requirement of Title VII as jurisdictional. See E.E.O.C. v. Pierce Packing, 669 F.2d at 608; E.E.O.C. v. Bruno's Restaurant, 13 F.3d 285, 288 (9th Cir.1993) ("Conciliation is a `jurisdictional condition precedent to suit by the E.E.O.C.'"). However, "there is no long line of Supreme Court precedent holding that conciliation is the type of requirement that has historically been treated as jurisdictional in nature." E.E.O.C. v. Alia Corp., 842 F.Supp.2d at 1254 (citing Union Pacific Railroad Co. v. Brotherhood of Locomotive Engineers and Trainmen General Comm. of Adjustment, 558 U.S. 67, 130 S.Ct. 584, 175 L.Ed.2d 428 (2009) (emphasis added) (requirement under the Railway Labor Act that parties must attempt "settlement in conference" to resolve minor disputes before resorting to arbitration before the National Railroad Adjustment Board is not jurisdictional)). Nor is there any indication that Congress itself has historically treated conciliation as jurisdictional. Even where the Supreme Court found that the historical treatment a statute has been as a jurisdictional requirement it has found that this factor is not dispositive. Reed Elsevier, 559 U.S. at 169, 130 S.Ct. 1237.
Based on the above application of the Reed Elsevier factors, the Agro Distribution and Adamov decisions from the Fifth and Sixth Circuits, respectively, and the court's reasoning in E.E.O.C. v. Alia Corp., this Court now concludes that the preconditions to suit imposed by Section 2000e-5(f)(1) are not jurisdictional in nature. Defendant's motion to dismiss for lack of subject matter jurisdiction will therefore be denied.
It is undisputed that the EEOC is charged "with the responsibility of investigating claims of employment discrimination, [making a reasonable cause determination,] and settling disputes, if possible, in an informal, noncoercive fashion.... [T]he EEOC is required by law to refrain from commencing a civil action until it has discharged its administrative duties." Occidental Life Ins. Co. of Cal. v. E.E.O.C., 432 U.S. 355, 368, 97 S.Ct. 2447, 53 L.Ed.2d 402 (1977); Arizona ex rel. Goddard v. GEO Grp., Inc., 10-cv-1995, 2012 WL 8667598, *6 (D.Ariz. Apr. 17, 2012).
The parties disagree as to the appropriate scope of district court review of the preconditions to suit imposed by Section 2000e-5(f)(1). Since this Court now only evaluates whether Plaintiff has failed to state a claim, this Court will restrict its focus to what Plaintiff must plead. The investigation, statement of reasonable cause, and conciliation attempt required of the E.E.O.C. by Title VII — although not jurisdictional — are conditions precedent to filing of suit. See E.E.O.C. v. Service Temps Inc., 679 F.3d 323, 333 (5th Cir.2012); E.E.O.C. v. Pierce Packing, 669 F.2d at 608. Federal Rule of Civil Procedure 9(c) permits a plaintiff in its pleadings
Once the E.E.O.C. has received a charge from an aggrieved employee it must investigate the claim and may bring a civil action in the district court against private employers reasonably suspected of violating Title VII. Gen. Tel. Co. of the Northwest v. E.E.O.C., 446 U.S. 318, 325, 100 S.Ct. 1698, 64 L.Ed.2d 319 (1980). The E.E.O.C may expand the scope of its complaint to any matter that could reasonably be expected to grow out of the allegations of the initial E.E.O.C. charge. Paige v. State of California, 102 F.3d 1035, 1042 (9th Cir.1996) (citing E.E.O.C. v. Farmer Bros. Co., 31 F.3d 891, 899 (9th Cir.1994)). The Paige court specifically addressed the situation where a charging party did not bring class allegations but the E.E.O.C. expanded the scope of its complaint based on information gained from examination of the role, if any, that race played in the alleged discriminatory practices. Paige, 102 F.3d at 1042. The court determined that where the class claims could reasonably have been expected to result from the charging party's claim of discrimination that a class action was permissible. Paige,
Defendant also seeks to have the Court impose a "forward scope" — beyond which no facts can provide the basis for any recovery — at June 24, 2009, the date upon which Mr. Xiong filed his E.E.O.C. charge. Defendant relies on Sheffield v. United Parcel Service, 403 Fed.Appx. 452 (11th Cir.2010), and Arizona ex rel. Goddard for the proposition that the forward scope can be so limited. The notion that the forward scope of an E.E.O.C. civil claim filed with the district court must be limited to events occurring prior to the filing of a charge with the E.E.O.C. by an aggrieved party is incompatible with the requirement that the E.E.O.C. investigate the claim and — if a reasonable cause determination is made — file suit "for any discrimination stated in the charge itself or discovered in the course of a reasonable investigation of that charge." Arizona ex rel. Goddard v. GEO Group Inc., 2012 WL 8667598, at *8 (quoting E.E.O.C. v. Hearst Corp., 553 F.2d 579, 580 (9th Cir.1977)); see also E.E.O.C. v. Delight Wholesale, 973 F.2d 664, 668 (8th Cir.1992) ("The original charge is sufficient to support EEOC action... for any discrimination stated in the charge or developed during a reasonable investigation of the charge, so long as the additional allegations of discrimination are included in the reasonable cause determination and subject to a conciliation proceeding."); E.E.O.C. v. General Electric Co., 532 F.2d 359, 366 (4th Cir.1976) ("evidence (developed in the investigation) concerning employment practices other than those specifically charged by complainants may properly be considered by the Commission in framing a remedy."). The scope of a civil suit under Section 706 of Title VII is confined to conduct which was: 1) alleged in the initial E.E.O.C. charge or discovered from reasonable investigation thereof, 2) contained in the statement of reasonable cause, and 3) the subject of the conciliation attempt. The Court does not have any information regarding the scope of the E.E.O.C. investigation, the content of the statement of reasonable cause, or subject of the conciliation attempt by the E.E.O.C. As such, this Court cannot make the determination as to the forward scope of this litigation beyond indicating that no conduct that took place after the E.E.O.C. rendered its statement of reasonable cause can be the basis of recovery. However, this Court will not categorically preclude the E.E.O.C. from recovering for conduct by Defendant that allegedly took place after the filing of Mr. Xiong's E.E.O.C. charge but before the statement of reasonable cause.
Defendant also seeks to limit the "rearward date" — before which no facts can provide the basis for any recovery — at August 28, 2008, 300 days prior to Mr. Xiong having filed his charge with the E.E.O.C. The E.E.O.C. does not oppose this portion of Defendant's motion. Doc. 16 at 22. The E.E.O.C. points out only that by the terms of the complaint it only seeks to remedy disparate treatment "since at least 2009." Compl. at ¶ 11. Further, Mr. Xiong's E.E.O.C. charge indicates that the discriminatory conduct of which he complains took place from January 1, 2009 at
Title VII of the Civil Rights Act of 1964 provides that employers may not "discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's race, color, religion, sex, or national origin." 42 U.S.C. § 2000e-2(a)(1). A plaintiff may prove unlawful discrimination by producing "direct or circumstantial evidence demonstrating that a discriminatory reason more likely than not motivated the employer." Metoyer v. Chassman, 504 F.3d 919, 930 (9th Cir.2007). If direct evidence of discrimination is not available, a plaintiff may rely upon the burden-shifting framework to prove discrimination, as set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973).
Defendant contends that, to support its discrimination claim, the E.E.O.C. is required to plead the elements of a prima facie case and has failed to do so. Specifically, Defendant alleges that the E.E.O.C. failed to allege discriminatory animus on the part of Farmers. Defendant recites the requirements for a prima facie case as articulated by McDonnell Douglas Corp v. Green: claimants 1) belonged to a protected class; 2) were qualified for the job and performed satisfactorily; 3) experienced an adverse employment action; and 4) the adverse employment action was taken because of claimants' membership in a protected class. McDonnell Douglas, 411 U.S. at 802, 93 S.Ct. 1817; Hawn v. Executive Jet Management Inc., 615 F.3d 1151, 1156 (9th Cir. 2010). Defendant is reminded that the prima facie case under McDonnell Douglas is an evidentiary standard, not a pleading requirement. Swierkiewicz v. Sorema N.A., 534 U.S. at 515, 122 S.Ct. 992 (holding that "an employment discrimination plaintiff need not plead a prima facie case of discrimination ... to survive respondent's motion to dismiss."). As such, the failure to allege facts sufficient to meet the McDonnell Douglas test does not warrant dismissal of a complaint. Corbins v. United Airlines, Inc., 10-cv-2312, 2011 WL 109078, at *2 (N.D.Cal. Jan. 12, 2011) (denying motion to dismiss). Rather, in order to survive a motion to dismiss pursuant to Rule 12(b)(6) a complaint must only contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. at 678, 129 S.Ct. 1937; see Bell Atl. Corp. v. Twombly, 550 U.S. at 555, 570, 127 S.Ct. 1955. A complaint containing allegations and factual statements that clearly put the defendant on notice that the instant action is based on the defendant's alleged discrimination on a particular protected basis against the charging party and other similarly situated employees beginning at a specific point in time is sufficient to survive a motion to dismiss. E.E.O.C. v. Pioneer Hotel, Inc., 2:11-cv-1588, 2013 WL 3716447, *3 (D.Nev. July 15, 2013); (citing E.E.O.C. v. Family Dollar, Inc., 07-cv-6996, 2008 WL 687284, *2 (N.D.Ill. Mar. 12, 2008); E.E.O.C. v. Man Mar, Inc., No. 09-60761-CIV, 2009 WL 3462217, at *2 (S.D.Fla. Oct. 22, 2009)). In Pioneer the court looked at class allegations made by the E.E.O.C. and found that it stated a claim where it alleged specific discriminatory conduct by defendant, identified a branch and department of the defendant corporation where the alleged discrimination took place, alleged a
Here, the E.E.O.C. has alleged that Mr. "Xiong and other employees in Defendant's Fresno, CA office were instructed... to code payments as partial payments..." (Compl. at ¶ 12), that an audit of this practice took place by Defendant (Compl. at ¶ 13), and that "Defendant[] terminated the employment of its Asian employees ( [complaining party] Chia Xiong and [named class member] John Yang) while retaining similarly situated non-Asian employees..." (i.e. employees who had also coded partial payments) (Compl. at ¶ 14). Although not all of the elements of the prima facie case are fully pled, Plaintiff has alleged sufficient factual material to state a claim that is plausible on its face as to the complaining party and at least one member of the allegedly aggrieved class.
Defendant's motion to dismiss for failure to state a claim will therefore be denied.
Based on the foregoing, IT IS HEREBY ORDERED that:
IT IS SO ORDERED.
"The Ninth Circuit has not weighed-in on the issue. However, district courts in this circuit have generally tilted toward the approach taken by the Sixth and Tenth Circuits, affording the E.E.O.C. wide deference in discharging its duty to conciliate." Alia Corp., 842 F.Supp.2d at 1255 (collecting cases); Arizona ex rel. Goddard v. GEO Group, Inc., 2012 WL 8667598, *9.
