Settlement doesn’t bar workplace bias lawsuit

A binding settlement between an employee and her employer did not bar the employee from later suing over employment practices that allegedly occurred during a brief six-week period in 2013 after she was reinstated, a U.S. magistrate judge in Rhode Island has ruled.

The defendant employer argued that the plaintiff’s complaint relied almost exclusively on pre-settlement facts that could not be the basis for liability. According to the employer, the plaintiff’s post-settlement allegations were insufficient to permit a plausible inference of any adverse employment action based on discriminatory or retaliatory animus.

“I conclude that Plaintiff has stated sufficient non-conclusory factual allegations to permit the Court to draw the plausible inference that she was subjected to discrimination and retaliation after she returned to work at FedEx on June 26, 2013,” Judge Patricia A. Sullivan wrote.

Sullivan’s recommendation that the employer’s motion to dismiss be denied was later adopted by U.S. District Court Judge Mary M. Lisi.

The 11-page decision is Caron v. FedEx Freight, Inc.

The Rhode Island lawyers in the case were Cranston’s Michael D. Pushee and V. Edward Formisano, for the employee, and James A. Ruggieri and John David Freel, both of Providence, for the employer.

Settlement and aftermath

Plaintiff Elaine Caron was hired by defendant FedEx Freight in 1996 as a part-time driver. She transferred to the freight division as a city driver in 2007. Despite her satisfactory performance, she alleged that, since 2007, she consistently was subjected to discriminatory treatment.

The plaintiff claimed that male employees who were younger than she were permitted to bid on routes, vehicles and shifts before she was, despite her seniority.

On April 3, 2012, the defendant terminated the plaintiff while she was on medical leave.

In December 2012, the plaintiff filed a charge of discrimination with the Rhode Island Commission on Human Rights and the Equal Employment Opportunity Commission, alleging that she was terminated because of “her sex, age and/or disability.”

Two months later, the plaintiff and defendant entered into a settlement agreement requiring the defendant to reinstate her with full seniority and to refrain from discriminating or retaliating against her for bringing the complaint. At the time of the signing of the settlement agreement, the plaintiff was still on medical leave, recovering from surgery on her arm.

On June 26, the plaintiff returned to work on light duty and was cleared for full-duty work on July 24.

After she was reinstated and despite having been cleared to work, the plaintiff alleged that the injury to her arm “constituted a disability of which FedEx was aware and/or that FedEx perceived her as being disabled as a result of her arm injury.”

She claimed that the defendant resumed the pattern of discriminatory actions against her, coupled with retaliatory actions based on her prior complaint.

Less than two months after she was reinstated, on Aug. 14, 2013, the plaintiff again “was medically restricted from working” because of her arm injury. She did not return to work thereafter.

‘Dash’ of common sense

Sullivan noted that the standard for reviewing the defendant’s dismissal motion was based on the U.S. Supreme Court’s 2007 ruling in Bell Atlantic Corp. v. Twombly and its 2009 Ashcroft v. Iqbal decision.

The plaintiff contended that the Twombly/Iqbal pleading standard is not applicable to employment discrimination cases, basing her argument on Mayale-Eke v. Merrill Lynch, a 2010 decision from the U.S. District Court in Rhode Island.

“This asseveration misstates the applicable standard of review,” Sullivan said, adding that Mayale-Eke did not reject Twombly/Iqbal for employment cases.

“Thus, even though this is an employment discrimination case, it is beyond cavil that Twombly/Iqbal supplies the applicable standard of review,” Sullivan stated. “The inquiry for this Court is whether the non-conclusory factual allegations in this Complaint state a plausible claim.”

The employer’s principal argument in favor of dismissal focused on the complaint’s “near-exclusive reliance on pre-settlement facts that cannot be the basis for liability,” Sullivan noted.

The employer pointed out the pre-settlement facts consumed three pages and 14 paragraphs of the complaint, while the post-settlement conduct was pleaded on one page in one paragraph.

“Based on the Complaint’s heavy emphasis on pre-settlement events and its skimpy treatment of post-settlement facts, FedEx argues that it conflates pre-settlement conduct with post-settlement conduct,” Sullivan wrote.

The plaintiff explained that she included a relatively lengthy recitation of the pre-settlement facts for three reasons.

“Plaintiff argues, first, that the Complaint properly recounts the pre-settlement events as factual background for the actionable events in the summer of 2013,” Sullivan noted.

“Second, she points out that her pre-settlement complaint of discrimination culminating in the settlement agreement forms the basis of her present claim of retaliation; thus, the pre-settlement facts are squarely germane in the present case,” Sullivan wrote.

“Third, the treatment that Plaintiff complains of after the 2013 settlement is similar to the treatment that triggered her 2012 complaint to the Rhode Island Commission on Human Rights; thus, the prior conduct is a lens through which the potentially actionable conduct may be viewed and understood,” the judge said.

While “FedEx is unquestionably right that the Court must examine the plausibility of the Complaint based on what is alleged to have occurred in the summer of 2013, Plaintiff is right that the task may be performed with the pre-settlement facts as relevant background, including that the Court should consider those facts as the foundation for the claim of retaliation and as a framework that renders plausible the allegation that the treatment to which Plaintiff claims she was subjected in the summer of 2013 was discriminatory and retaliatory,” Sullivan stated.

“The apportionment of most of the text of the Complaint to the pre-settlement background facts does not render the operative allegations insufficient as long as they plausibly state a claim,” the judge said, finding that the plaintiff’s complaint had enough to “‘nudge [the] claims … across the line from conceivable to plausible.’”

At the time of the events that allegedly occurred after the settlement agreement, the plaintiff was over 40 and a woman working in a predominantly male profession, Sullivan pointed out.

The plaintiff had taken two medical leaves, one lasting approximately six months and the other for over two years, for serious injuries to her elbow and arm. That provided threshold plausibility to her allegations of a disability known to her employer and to her contention that FedEx perceived her as disabled, the judge said.

“And she certainly has plausibly asserted that she had previously undertaken ‘protected conduct’ sufficient to support her claim that her treatment during the post-settlement period — so similar in kind to the pre-settlement treatment — was in retaliation for the successful prosecution of the claim of discrimination before the Rhode Island Commission for Human Rights,” Sullivan wrote.

“Plaintiff’s explanation for how this Court should interpret her Complaint, ‘[a]pplying common sense and reading [it] holistically,’ is consistent with the light touch required at the Rule 12(b)(6) phase,” the judge stated.

Sullivan concluded that when the complaint “is read holistically, with a dash of common sense and with the pre-settlement facts as backdrop, these post-settlement facts clear the bar.”