Rusis v. Int'l Bus. Machs. Corp.

529 F.Supp.3d 178

Edvin RUSIS, Henry Gerrits, Phil McGonegal, and David Ho Eng, individually and on behalf of all other similarly situated individuals, Plaintiffs,

v.INTERNATIONAL BUSINESS MACHINES CORP., Defendant.

18-CV-8434 (VEC)

United States District Court, S.D. New York.

Signed March 26, 2021

Thomas Fowler, Pro Hac Vice, Zachary L. Rubin, Shannon Liss-Riordan, Lichten & Liss-Riordan, P.C., Boston, MA, for Plaintiffs.

Matthew Willis Lampe, Ira Handa, James M. Jones, Kristina Ann Yost, Jones Day, New York, NY, Alison B. Marshall, Pro Hac Vice, Jones Day, Washington, DC, Craig Friedman, Jones Day, Atlanta, GA, for Defendant.

OPINION AND ORDER

VALERIE CAPRONI, United States District Judge:

In this putative class and collective action, Plaintiffs assert claims under the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. §§ 621 et seq. , and related state claims against their former employer, International Business Machines Corporation ("IBM"). See First Amended Complaint ("FAC") ¶ 1, Dkt. 11. IBM has filed three separate motions for partial judgment on the pleadings, one of which also seeks to compel arbitration, pursuing the dismissal of certain individual former IBM employees who have consented to opt-in to this action (the "opt-ins") and two Named Plaintiffs, or, at the very least, a Court ruling that certain subsets of former IBM employees may not participate in this action. See Notices of Mtns., Dkt. 120; Dkt. 123; Dkt. 129. In debating IBM's motions, the parties wage a fervent battle over the proper contours of a judicially-created exception to the ADEA's administrative exhaustion requirement known as the single-filing rule or "piggybacking" doctrine, pursuant to which individuals who themselves did not file an administrative charge of discrimination, and thereby failed to exhaust their ADEA claims, may "piggyback" onto another's properly filed administrative charge to advance claims in litigation. On one side, Plaintiffs present the doctrine as a shield that ensures that any former IBM employee, 40 years and older, who wishes to challenge the termination of his or her IBM employment can participate in this case, regardless of the circumstances or timing of the person's departure from IBM. On the other side stands IBM, which wields the piggybacking doctrine as a sword with which it can surgically remove from this case batches of putative plaintiffs who did not file their own timely administrative charges. Although Plaintiffs contend that their interpretation best accords with the purpose of the ADEA's administrative exhaustion requirement, in reality, Plaintiffs push the Court to adopt an interpretation that no court before has endorsed and that would seemingly leave the piggybacking doctrine less an exception to administrative exhaustion and more a reduction of the exhaustion requirement to a requirement in name only. That notwithstanding, IBM at times flagrantly attempts to use the piggybacking doctrine as a means to delimit the scope of Plaintiffs’ case, in contravention of the generally lenient interpretation of the doctrine that governs in this circuit. Accordingly, for the reasons stated below, IBM's motions are GRANTED in part and DENIED in part.

BACKGROUND¹

Named Plaintiffs and those they seek to represent are all former IBM employees who separated from the company at age 40 or older. Plaintiffs allege that, in an attempt to reframe its public image and to shift into fields such as cloud services, big data analytics, mobile, and social media, IBM heavily recruited younger workers while systematically pushing out older employees. FAC ¶¶ 1, 15. Relying on reporting by ProPublica and IBM's own publications, Plaintiffs allege that IBM has engaged in a nationwide, companywide policy of eliminating employees ages 40 and older to better position itself to compete with new technology companies. Id. ¶¶ 15–18.

According to Plaintiffs, motivated by an overarching goal of reducing its headcount of older employees, IBM employed a number of different methods to achieve its goal: (1) engaging in "reductions in force or layoffs," known at IBM as "Resource Actions"; (2) terminating older employees for pretextual reasons; (3) constructively discharging older employees; and (4) conditioning older employees’ employment on "untenable choices they [were] unlikely to accept, such as relocation."² Id. ¶ 19. Further, after selecting older employees for inclusion in a Resource Action, IBM allegedly thereafter refused to hire those older employees for open positions through IBM's internal hiring platform, regardless of their qualifications. Id. ¶ 25.

Plaintiffs provide minimal detail on the Named Plaintiffs’ respective separations from IBM other than the timing of their departures; thus, on the face of the FAC, it is not entirely clear pursuant to which method of termination each departed from IBM. In March 2018, Named Plaintiffs Edvin Rusis and Henry Gerrits each received notice that he would be "laid off," effective June 27, 2018.³ Id. ¶¶ 21–22. After receiving notice of their separations but before leaving IBM, both Rusis and Gerrits applied for open positions on IBM's internal hiring platform, but neither received a response to any application. Id. Named Plaintiff David Ho Eng was "let go" by IBM on March 31, 2018. Id. ¶ 24. Although a hiring manager sought to hire Eng after he applied for an open position through IBM's internal system, Eng ultimately did not receive the job because his former manager prevented his hiring. Id. Finally, Named Plaintiff Phil McGonegal was "let go" by IBM on June 30, 2018. Id. ¶ 23.

Before 2014, IBM provided to any employee who had been laid off a list that disclosed the age and position of all employees within a business unit who had and had not been laid off; IBM ceased this practice in 2014. Id. ¶ 20. Starting in 2014, however, as part of its separation agreements with terminated employees, IBM began requiring employees to agree to binding individual arbitration of any ADEA claims in exchange for a severance payment. Id. Each of the Named Plaintiffs rejected the separation agreements and therefore did not sign arbitration agreements. Id.

On March 10, 2020, the Court denied Plaintiff's’ motion for court-facilitated notice to potential opt-in members of their proposed ADEA collective. See Rusis v. Int'l Bus. Machs. Corp. , No. 18-CV-8434, 2020 WL 1151322, at *1 (S.D.N.Y. Mar. 10, 2020). The Court held that, having "made no showing, beyond conjecture and the individual affiants’ beliefs, that a unifying scheme at IBM links the potential members of the collective to one another despite vast differences in their jobs, locations, and circumstances surrounding their departure from IBM," Plaintiffs failed to meet their burden of tying all former IBM employees over the age of 40, nationwide, to a common policy or plan executed by IBM. Id. at *6. Despite the Court's refusal to facilitate notice to potential opt-ins, more than 100 former IBM employees have now consented to opt in to this action.

IBM has filed three motions for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). See Dkt. 120; Dkt. 123; Dkt. 129. The first such motion also seeks to compel to arbitration the subset of opt-ins who signed binding arbitration agreements with IBM and have not yet arbitrated their ADEA claims. See Dkt. 120.

DISCUSSION

I. Legal Standards

A. Legal Standard on a Rule 12(c) Motion for Judgment on the Pleadings

"The standard for granting a Rule 12(c) motion for judgment on the pleadings is identical to that of a Rule 12(b)(6) motion for failure to state a claim." Patel v. Contemp. Classics of Beverly Hills , 259 F.3d 123, 126 (2d Cir. 2001) ; see also Ashley v. Gonzalez , No. 19-CV-6282, 2020 WL 7027501, at *2 (S.D.N.Y. Nov. 30, 2020) ("The difference between a Rule 12(b)(6) and Rule 12(c) motions is largely academic because the standard under Rule 12(c) is the same as the standard under Rule 12(b)(6)." (cleaned up)). The Court must accept as true all material factual allegations in the complaint and draw all reasonable inferences in the plaintiff's favor. Johnson v. Rowley , 569 F.3d 40, 43 (2d Cir. 2009). To survive a Rule 12(c) motion, the complaint "must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ " Id. at 44 (quoting Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ). To satisfy the "plausibility" requirement, a complaint must do more than make "[t]hreadbare recitals of the elements of a cause of action."

Iqbal , 556 U.S. at 678, 129 S.Ct. 1937. Rather, the elements of the cause of action must be supported by well-pleaded facts that permit the Court to infer "that the pleader is entitled to relief." Id. at 679, 129 S.Ct. 1937 (quoting Fed. R. Civ. P. 8(a)(2) ).

"On a [ Rule] 12(c) motion, the court considers the complaint, the answer, any written documents attached to them, and any matter of which the court can take judicial notice for the factual background of the case." L-7 Designs, Inc. v. Old Navy LLC , 647 F.3d 419, 422 (2d Cir. 2011) (cleaned up). "A complaint is [also] deemed to include any written instrument attached to it as an exhibit, materials incorporated in it by reference, and documents that, although not incorporated by reference, are ‘integral’ to the complaint." Id. (quoting Sira v. Morton , 380 F.3d 57, 67 (2d Cir. 2004) ). For a document to be "integral" to the complaint, the complaint must "rel[y] heavily upon its terms and effect." Chambers v. Time Warner, Inc. , 282 F.3d 147, 153 (2d Cir. 2002) (quoting Int'l Audiotext Network, Inc. v. Am. Tel. & Tel. Co. , 62 F.3d 69, 72 (2d Cir. 1995) ). "[A] plaintiff's reliance on the terms and effect of a document in drafting the complaint is a necessary prerequisite to the court's consideration of the document on a dismissal motion; mere notice or possession is not enough." Id. at 153.

Pursuant to Rule 12(d), when a party...