Scott Stouffer v. Union Railroad Co ( 2023 )

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
______________
No. 22-1680
______________
SCOTT STOUFFER, Individually and on
Behalf of All Others Similarly Situated,
Appellant
v.
UNION RAILROAD COMPANY, LLC; TRANSTAR LLC;
UNITED STATES STEEL CORPORATION;
SMART TRANSPORTATION DIVISION
______________
On Appeal from the United States District Court
for the Western District of Pennsylvania
(D.C. No. 2:20-cv-00133)
District Judge: Honorable Robert J. Colville
_________
Argued January 23, 2023
Before: BIBAS, NYGAARD, and FUENTES, Circuit Judges
(Filed: October 26, 2023)
Mark A. Grace
Cohen & Grace
105 Braunlich Drive
Suite 300
Pittsburgh, PA 15237
Sammy Y. Sugiura [ARGUED]
Mooney Green Saindon Murphy & Welch
1920 L Street NW
Suite 400
Washington, DC 20036
Counsel for Appellant
Courtney C. Brennan
Thomas M. Pohl [ARGUED]
Mary-Jo Rebelo
Burns White
48 26th Street
Burns White Center
Pittsburgh, PA 15222
Counsel for Appellees
______________
OPINION OF THE COURT
______________
FUENTES, Circuit Judge.
Plaintiff-Appellant Scott Stouffer appeals from the
dismissal of his complaint alleging age-based discrimination.
We will affirm the District Court’s order.
2
FACTS AND PROCEDURAL HISTORY
Scott Stouffer alleges claims for age discrimination
under the Age Discrimination in Employment Act, 29 U.S.C. §
621, et seq. (“ADEA”) on behalf of himself and others
similarly situated. As alleged in the operative complaint,
Stouffer worked for Union Railroad Company, LLC
(“Railroad”) for over eight years until he was terminated at the
age of 41.1
Stouffer alleges that, facing financial difficulty, the
Railroad launched the “Carnegie Way” plan to promote cost-
cutting measures. As part of this plan, the Railroad allegedly
engaged in a scheme to discriminate against employees older
than 40. The scheme involved targeting senior employees with
sham workplace violations and forcing them to sign last chance
agreements. Under a last chance agreement, an employee
waives formal disciplinary proceedings in exchange for
continued employment during a probationary period.
When Stouffer was 39 years old, he called a superior a
“jagoff” under his breath.2 The next week, Stouffer had a
meeting with Railroad management and his union
representative. He was told he could either sign a last chance
agreement or go to a hearing and be fired. Feeling he had no
1
The Defendant-Appellees are three separate entities: Union
Railroad Company, LLC; United States Steel Corporation; and
Transtar, LLC. Stouffer was an employee of Union Railroad
Company. The parties dispute whether the other two entities
can be liable as joint employers, but this Court need not decide
that issue.
2
Appx. 52 ¶ 85.
3
other choice, Stouffer signed a three-year last chance
agreement. He was also assessed with 60 demerits for the
incident. After this incident, Stouffer alleges that he was
subject to micromanagement, surreptitious surveillance, the
denial of meal periods and headlamp batteries, and shifts that
were not properly staffed. He alleges that younger employees
were not treated in a similar way.
In 2018, Stouffer was working on a train driven by a
younger driver when the train ran through a switch. Stouffer
was charged with multiple violations and immediately
terminated. The younger driver—who Stouffer alleges was
principally responsible for the incident—was given fewer
demerits and was not terminated. When pressed for an
explanation of this ostensible discrepancy, the Railroad cited
Stouffer’s last chance agreement. Stouffer was 41 when he was
terminated.
Stouffer sued the Railroad for age discrimination under
the ADEA on behalf of himself and others similarly situated.3
The Railroad moved to dismiss the operative complaint. The
District Court held that Stouffer had failed to allege facts
supporting the existence of a scheme which could constitute a
policy hiding age-based discrimination. It also held that
Stouffer had not alleged any facts showing that the policy
3
The initial complaint in this matter was filed by a plaintiff
named Charles Marsh. Stouffer was the plaintiff on the first
amended complaint. Appellees have forfeited the argument
that this substitution was improper because their brief
mentioned it only in passing, in a footnote, in an undeveloped
sentence. See Ethypharm S.A. Fr. v. Abbott Lab’ys, 707 F.3d
223, 231 n.13 (3d Cir. 2013).
4
disparately impacted workers over the age of 40. The District
Court therefore granted the Railroad’s motion to dismiss.
Stouffer appeals that decision.
DISCUSSION
This Court’s review is plenary where it assesses the
subject matter jurisdiction of the federal courts and where it
reviews a district court’s decision granting a party’s motion to
dismiss.4 When examining subject matter jurisdiction, we may
consider facts outside the pleadings.5
A.
Before turning to the merits of Stouffer’s claims, we
must first address the Railway Labor Act, 45 U.S.C. § 151, et
seq. (“RLA”). Union employees at the Railroad are subject to
a Collective Bargaining Agreement (“CBA”), which
establishes the terms and conditions of their employment. The
RLA establishes arbitration boards which have exclusive
jurisdiction to resolve disputes over the interpretation or
application of CBAs in the railroad industry. We therefore
must determine whether Stouffer’s claims are precluded by the
RLA.6
4
Gould Elecs. Inc. v. United States, 220 F.3d 169, 176 (3d Cir.
2000); Buck v. Hampton Twp. Sch. Dist., 452 F.3d 256, 260
(3d Cir. 2006).
5
See Gotha v. United States, 115 F.3d 176, 178–79 (3d Cir.
1997).
6
We need not decide whether the RLA’s mandatory arbitration
provision is jurisdictional. Our sister circuits have gone
opposite ways on this issue. Compare Oakey v. U.S. Airways
5
The RLA is intended to “promote stability in labor-
management relations by providing a comprehensive
framework for resolving labor disputes.”7 The RLA
“establishes a mandatory arbitral mechanism for the prompt
and orderly settlement of two classes of disputes”—major and
minor.8 Major disputes relate to the formation of CBAs and
are not relevant to this case.9 Minor disputes are those growing
out of “the interpretation or application” of existing CBAs.10
Minor disputes involve “controversies over the meaning of an
existing [CBA] in a particular fact situation.”11 In other words,
“major disputes seek to create contractual rights, minor
disputes to enforce them.”12 This Court must determine
whether Stouffer’s claims constitute a minor dispute, in which
case the RLA’s arbitral mechanism applies.
Pilots Disability Income Plan, 723 F.3d 227, 237 (D.C. Cir.
2013) (holding that the RLA’s arbitration provision is
jurisdictional), with Emswiler v. CSX Transp., Inc., 691 F.3d
782, 790 (6th Cir. 2012) (holding the opposite). “Instead, we
assume without deciding that the provision is jurisdictional and
address only whether preclusion applies here.” Giles v. Nat’l
R.R. Passenger Corp., 59 F.4th 696, 702 n.3 (4th Cir. 2023).
7
Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 252 (1994)
(citing Atchison, Topeka & Santa Fe Ry. Co. v. Buell, 480 U.S.
557, 562 n.9 (1987)).
8
Norris, 512 U.S. at 252 (internal quotation marks and citation
omitted).
9
Id.10
Consol. Rail Corp. v. Ry. Lab. Execs.’ Ass’n, 491 U.S. 299,
303 (1989).
11
Norris, 512 U.S. at 252 (quoting Bhd. of R.R. Trainmen v.
Chi. River & Ind. R.R. Co., 353 U.S. 30, 33 (1957)).
12
Id. at 253 (quoting Consol. Rail Corp., 491 U.S. at 302).
6
In Hawaiian Airlines, Inc. v. Norris, the Supreme Court
held that a plaintiff’s state law claim for wrongful discharge
was not preempted by the RLA where the right existed
independent of the CBA.13 First, the Court explained that the
CBA was not the “only source” of plaintiff’s asserted “right
not to be discharged wrongfully.”14 In contrast, minor disputes
“involve duties and rights created or defined by the CBA.”15
The Court adopted a “contract-dependent standard,” holding
that “where the resolution of a state-law claim depends on an
interpretation of the CBA, the claim is preempted.”16
“Generally, the RLA will not bar a plaintiff from
bringing a claim under an independent federal statute in
court.”17 “But a federal claim that depends for its resolution
on the interpretation of a CBA lacks independence from the
CBA, and the RLA precludes it.”18
So when does a federal claim depend on interpretation
of a CBA? We agree with our sister circuits applying Norris
that for the RLA to apply, the CBA must be more than
“relevant” to a plaintiff’s claim.19 The “distinguishing feature”
13
Id. at 266.
14
Id. at 258.
15
Id.
16
Id. at 261–63.
17
Giles, 59 F.4th at 702–03 (internal quotation marks and
citation omitted).
18
Id.
19
Rabe v. United Air Lines, Inc., 636 F.3d 866, 873 (7th Cir.
2011) (concluding that ADEA and other discrimination claims
were not precluded by the RLA where a CBA was “relevant”
to the plaintiff’s claims, but her claims did “not call the policy
7
of a minor dispute is that it “may be conclusively resolved by
interpreting the existing agreement.”20 And, “purely factual
questions about an employee’s conduct or an employer’s
conduct and motives do not require a court to interpret any term
of a [CBA].”21
The Railroad argues that Stouffer’s claims are precluded
by the RLA because litigating his allegations of discrimination
“may require both reference to and interpretation of the
CBA.”22 The Railroad provides examples of how the CBA
may be implicated: Stouffer alleges that he was subjected to
discrimination by having to work shifts that were not properly
staffed. In response, the Railroad points to sections of the CBA
that address staffing work shifts, including one section that
defines a “standard crew” as consisting of “a conductor and
two brakemen,” and another that places the decision of whether
itself into dispute”); Giles, 59 F.4th at 703 (holding that even
where CBA provisions might be relevant, the “mere need to
consult a [CBA] does not require preemption”) (quoting Rabe,
636 F.3d at 873).
20
Consol. Rail Corp., 491 U.S. at 305; Felt v. Atchison, Topeka
& Santa Fe Ry. Co., 60 F.3d 1416, 1420 (9th Cir. 1995)
(explaining that the RLA does not preclude litigation where the
merits of a litigant’s federal claim cannot be “conclusively
resolved merely by consulting the CBA”). As the Court
explained in Norris, “to say that a minor dispute can be
‘conclusively resolved’ by interpreting the CBA is another way
of saying that the dispute does not involve rights that exist
independent of the CBA.” Norris, 512 U.S. at 265.
21
Norris, 512 U.S. at 261 (internal quotation marks and
citation omitted).
22
Appellee’s Supp. Br. 4.
8
to have a second brakeman in the discretion of the railroad.23
Stouffer also alleges that another worker was principally
responsible for the incident that ultimately led to his
termination. The Railroad argues that the CBA “may be
relevant” to determining responsibility and defending against
that allegation.24
Further, Stouffer’s complaint alleges that the last chance
agreements were intended only for substance abuse cases, but
that instead, they were used to target senior employees. The
Railroad argues that litigating this allegation will require
“litigating the existence, scope, and terms of any collectively-
bargained-for agreements” between the union and Railroad
concerning “when and how” last chance agreements may be
used.25
In evaluating the Railroad’s arguments, a recent Fourth
Circuit case is instructive. In Giles v. National Railroad
Passenger Corp., a plaintiff brought a federal discrimination
claim, alleging that he “faced more severe discipline than a
white employee who allegedly committed similar
insubordinate behavior.”26 The employer argued that the
23
Id. at 4–5
24
Id. at 6.
25
Id. at 8.
26
Giles, 59 F.4th at 703. The Fourth Circuit recently held in a
separate case that a plaintiff’s Title VII claim was a minor
dispute where the “thrust” of the claim was that her employer
“deviated from its policies when dealing with her.” Polk v.
Amtrak Nat’l R.R. Passenger Corp., 66 F.4th 500, 507 (4th Cir.
2023). In that case, the plaintiff relied on her interpretation of
CBA provisions “as a stand-in for allegations about Amtrak’s
9
plaintiff’s theory of the case depended on an interpretation and
application of the CBA which has specific provisions
discussing performance issues and disciplinary procedures.27
The Fourth Circuit explained that even where CBA provisions
“might be relevant” to understanding how an employer defines
and punishes insubordination, the “mere need to consult a
collective bargaining agreement does not require
preemption.”28
The same is true here, and we agree with the District
Court that Stouffer’s claims are not precluded by the RLA.
Looking first to the source of the asserted right, Stouffer’s
claims stem from a federal statute, not the CBA itself. Stouffer
has not argued that any provision of the CBA is discriminatory,
that the Railroad violated the CBA, or that the CBA was
improperly applied to him. The Railroad’s argument that
interpretation of the CBA may be required falls short. It is not
enough to point to sections of the CBA that may be relevant.
Most of the Railroad’s argument boils down to asserting that
its actions were permitted by the CBA. But a claim is not
barred simply because “the action challenged by the plaintiff is
‘arguably justified’ by the terms of the CBA.”29 Neither party
has pointed to a provision of the CBA that they disagree on
how to apply. Instead, we are asked to look at “purely factual
factual treatment of her similarly situated colleagues.” Id. We
agree with the Fourth Circuit that a federal claim can at times
constitute a minor dispute, but that is not the case here.
27
Giles, 59 F.4th at 703.
28
Id. (quoting Rabe, 636 F.3d at 873).
29
Carlson v. CSX Transp., Inc., 758 F.3d 819, 833 (7th Cir.
2014) (quoting Brown, 254 F.3d at 668).
10
questions” about the employees’ actions and the Railroad’s
conduct.30
Put simply, we do not need to interpret the CBA to
resolve the merits of this case. Thus, even assuming that the
RLA’s arbitration provision is jurisdictional, the RLA does not
preclude us from considering Stouffer’s discrimination claim.
B.
Having addressed the RLA, we turn to Stouffer’s claim
of age discrimination. Stouffer argues that the District Court
erred in dismissing his disparate-impact claim under the
ADEA.31
The ADEA makes it unlawful for an employer to
“discharge any individual or otherwise discriminate against
any individual with respect to his compensation, terms,
conditions, or privileges of employment, because of such
individual's age.”32 To establish a prima facie case of age
discrimination based on disparate impact, a plaintiff must “(1)
identify a specific, facially neutral policy, and (2) proffer
statistical evidence that the policy caused a significant age-
based disparity.”33
30
Norris, 512 U.S. at 261 (quoting Lingle v. Norge Div. of
Magic Chef, Inc., 486 U.S. 399, 407 (1988)).
31
Stouffer has not argued that the District Court erred in
dismissing Count I (unlawful disparate treatment under the
ADEA). Thus, we do not address that claim.
32
29 U.S.C. § 623(a)(1).
33
Karlo v. Pittsburgh Glass Works, LLC, 849 F.3d 61, 69 (3d
Cir. 2017).
11
Stouffer’s complaint lacks the necessary factual
allegations as to statistical disparities. Paragraph 121 of the
complaint alleges that there was a “statistically significant”
impact. This allegation is conclusory and properly
discounted.34 Nowhere in the complaint does Stouffer support
that statement with factual allegations. The District Court
therefore properly dismissed Stouffer’s disparate-impact
claim.
Stouffer also objects to the District Court’s citation of
cases that were decided at the summary judgment stage,
arguing that the District Court misapplied the
motion-to-dismiss standard. We disagree. The District Court
articulated and applied the correct standard, even while looking
to cases decided in a different procedural posture for guidance.
Finally, the District Court did not abuse its discretion in
dismissing the complaint with prejudice.35 The complaint had
already been amended twice, and Stouffer did not seek leave
before the District Court to amend again.36
CONCLUSION
For the foregoing reasons, we will affirm the decision
of the District Court.
34
See Connelly v. Lane Constr. Corp., 809 F.3d 780, 789 (3d
Cir. 2016) (“Twombly and Iqbal distinguish between legal
conclusions, which are discounted in the analysis, and
allegations of historical fact . . . .”).
35
Ramsgate Ct. Townhome Ass’n v. W. Chester Borough, 313
F.3d 157, 161 (3d Cir. 2002) (reviewing for abuse of
discretion).
36
Appx. 14 n.3.
12