Flannery, Thomas v. Recording Industry ( 2004 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 03-1591
THOMAS FLANNERY,
Plaintiff-Appellant,
v.
RECORDING INDUSTRY ASSOCIATION OF AMERICA,
Defendant-Appellee.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 02 C 2734—James B. Zagel, Judge.
____________
ARGUED SEPTEMBER 3, 2003—DECIDED JANUARY 6, 2004
____________
Before RIPPLE, ROVNER and DIANE P. WOOD, Circuit Judges.
RIPPLE, Circuit Judge. On October 22, 2001, Thomas
Flannery filed his first charge of discrimination with the
Equal Employment Opportunity Commission (“EEOC”). He
alleged age and disability discrimination by his former
employer, Recording Industry Association of America
(“RIAA”), in violation of the Age Discrimination in
Employment Act (“ADEA”), 29 U.S.C. § 621, et seq., and the
Americans with Disabilities Act (“ADA”), 42 U.S.C. § 12101,
2 No. 03-1591
et seq. At a later date, not clear from the record, Mr.
Flannery filed another charge with the EEOC based
on occurrences after his employment ended.
After the EEOC issued a right to sue notice, Mr. Flannery
filed a complaint in the United States District Court for the
Northern District of Illinois on April 16, 2002, and then an
amended complaint on July 11, 2002. In his amended com-
plaint, he stated four counts against RIAA. Counts I and III,
alleging discriminatory discharge in violation of the ADEA
and ADA, respectively, were based on Mr. Flannery’s claim
that he was fired after twenty-two years of employment
with RIAA because of his age, sixty-three, and because
of his disability, heart disease complicated by sleep apnea.
Counts II and IV, alleging retaliation in violation of the
ADEA and ADA, respectively, were based on Mr.
Flannery’s claim that RIAA had refused to give him con-
sulting work, which it had earlier agreed to provide to him,
after it learned he had filed a charge of discrimination with
the EEOC.
On June 10, 2002, RIAA filed a motion to dismiss under
Federal Rule of Civil Procedure 12(b)(6). On February 4,
2003, the district court granted RIAA’s motion to dismiss as
to all counts and entered judgment in RIAA’s favor. The
district court held the discriminatory discharge claims
(Counts I and III) were time-barred, and the retaliation
claims (Counts II and IV) were not actionable because
retaliation connected to an independent contractor relation-
ship does not have the requisite nexus to an employment
relationship. Mr. Flannery timely appealed both of these
holdings. Because we are in respectful disagreement with
the determinations of the district court, we must reverse its
judgment and remand the case for further proceedings.
No. 03-1591 3
I
BACKGROUND
A. Facts
Mr. Flannery worked for RIAA as an investigator in
RIAA’s Oak Brook, Illinois office. In 1997, Mr. Flannery was
diagnosed with an irregular heartbeat, and, in August of
2000, he was diagnosed with sleep apnea. In his amended
complaint, he maintains that, in a March 2000 meeting, his
supervisors told him that he would have to leave his
employment because his health was bad and he was getting
older. Mr. Flannery responded by telling his supervisors he
did not want to leave. At that point, they told him that they
would keep him on and see how things went.
Mr. Flannery further contends that, on June 14, 2001, he
was told he would be terminated effective October 1, 2001.
On the same day, he received a letter from RIAA’s vice-
president, Frank Walters, explaining the terms of his ter-
mination. Mr. Walters’ letter set forth three benefits that Mr.
Flannery would receive as a result of his departure from
RIAA: (1) severance pay; (2) the possibility of continued
health benefits; and (3) continued work in a consulting
capacity with RIAA. As to the third, the letter explained that
Mr. Flannery could expect that his services would be
utilized in several different RIAA offices and result in
approximately twenty hours of billable work per week. An
August 20, 2001 e-mail from Frank Creighton, another RIAA
official, to Mr. Flannery stated that he should regard the
June 14, 2001 letter as “official notice” of his “current and
future status with RIAA.” Am. Compl., Ex.B.
Consistent with the June 14, 2001 letter, Mr. Flannery’s
employment at RIAA ended on October 1, 2001. At the time
of his departure, he had worked for RIAA for twenty-two
4 No. 03-1591
years and was sixty-three years old. Mr. Flannery filed his
first charge of discrimination with the EEOC on October 22,
2001. He was never contacted regarding the consulting work
promised in the June 14, 2001 letter.
B. District Court Proceedings
On February 4, 2003, the district court granted RIAA’s
motion to dismiss in its entirety and entered judgment in
favor of RIAA. First, the district court determined that the
discriminatory discharge claims (Counts I and III) were
time-barred. The court noted that in Illinois an employee
may sue under the ADEA or ADA only if he files a charge
of discrimination with the EEOC within 300 days of the
alleged unlawful employment practice, which in this case
was the unlawful discharge. The court further held that the
limitations period commenced when RIAA supervisors told
Mr. Flannery at the March 2000 meeting that he would have
to leave because of his age and health. Because the clock
began to run in March of 2000 and Mr. Flannery’s first
EEOC charge was not filed until October 22, 2001, over 300
days later, the district court held that the discriminatory
discharge counts were time-barred. Accordingly, these
counts were dismissed.
Next, the district court dismissed the retaliation claims
(Counts II and IV) for failure to state a claim upon which
relief can be granted. The court first held that, in order to be
actionable, retaliation against a former employee must
impinge on future employment prospects or otherwise have
a nexus to employment. The district court then noted that
neither the ADEA nor the ADA generally protects inde-
pendent contractors. Applying these principles, the court
held the alleged retaliation against Mr. Flannery did not
No. 03-1591 5
have a nexus to employment because it affected a potential
independent contractor relationship, an unprotected status,
rather than an employer-employee relationship. Further-
more, the court noted that Mr. Flannery did not allege that
RIAA’s actions affected any other future prospects for work.
Therefore, the retaliation counts failed to state a claim and
were dismissed.
II
DISCUSSION
We review a district court’s grant of a motion to dismiss
de novo. See Marshall-Mosby v. Corporate Receivables, Inc., 205
F.3d 323, 326 (7th Cir. 2003). In performing this analysis, we
are obliged to accept all well-pleaded allegations in the
complaint as true and to draw all reasonable inferences in
favor of the plaintiff. See id. Dismissal under Rule 12(b)(6) is
only appropriate when there is no possible interpretation of
the complaint under which it can state a claim. See Martinez
v. Hooper, 148 F.3d 856, 858 (7th Cir. 1998). Applying these
standards to this case presents us with two questions: First,
is there a reasonable interpretation of Mr. Flannery’s
complaint under which his discriminatory discharge claims
are not time-barred? Second, is there a reasonable interpre-
tation of his complaint under which his retaliation claims
state a claim upon which relief can be granted? We shall
address each of these questions in turn.
A. Discriminatory Discharge Claims (Counts I & III)
In Illinois, an employee may sue under the ADEA or ADA
only if he files a charge of discrimination with the EEOC
within 300 days of the alleged “unlawful employment
practice.” See Hamilton v. Komatsu Dresser Indus., 964 F.2d
600, 603 (7th Cir. 1992). In discriminatory discharge cases,
6 No. 03-1591
two elements are necessary to establish the date on which
the “unlawful employment practice” occurred. First, there
must be a final, ultimate, non-tentative decision to terminate
the employee. See Delaware State Coll. v. Ricks, 449 U.S. 250,
258-59 (1980). However, an employer who communicates a
willingness to later change a final decision of termination, as
through an appeals process, does not render a decision
“tentative” and not final for the purposes of beginning the
limitations period. See id. at 261. Second, the employer must
give the employee “unequivocal” notice of its final termina-
tion decision. See Dvorak v. Mostardi Platt Assocs., Inc., 289
F.3d 479, 486 (7th Cir. 2002). Both of these elements are
necessary to start the limitations period; neither alone is
sufficient. See Ricks, 449 U.S. at 258-59; Dvorak, 289 F.3d at
486.
Each party submits a different date as the point in time on
which these elements were satisfied. RIAA contends that the
March 2000 conversation between Mr. Flannery and his
supervisors constituted a final decision with unequivocal
notice. In its view, under Ricks and Dvorak, the clock began
to run on that date. RIAA suggests that this decision was
perhaps followed by an agreement to reconsider RIAA’s
final discharge decision, but it submits that any such
reconsideration had no effect on the limitations period.
Under this version of events, Mr. Flannery’s claim is time-
barred because his EEOC charge was filed on October 22,
2001, more than 300 days beyond the “unlawful employ-
ment practice.”
Mr. Flannery disputes this characterization of the March
2000 conversation. He claims that RIAA’s decision at the
March meeting was tentative and non-final. Furthermore, he
submits that, even assuming a final decision was made at
that time, the conversation that took place provided him
with only equivocal notice. Cast this way, the March 2000
No. 03-1591 7
meeting did not start the clock under Ricks or Dvorak. Mr.
Flannery points instead to June 14, 2001, as the date of the
final decision and unequivocal notice. His amended com-
plaint explains that, on or about this date, he was informed
of RIAA’s final decision to terminate him. June 14, 2001 is
also the date of Mr. Flannery’s termination letter, which an-
other RIAA official later deemed as Mr. Flannery’s “official
notice” of his “current and future status with RIAA.” If June
14, 2001 is the appropriate date, it is within 300 days of
October 22, 2001, and his claims are not time-barred.
1.
As a threshold matter, RIAA submits that Mr. Flannery’s
original EEOC charge establishes, as a matter of law, its
version of events. As RIAA notes, this court has long held
that, when a document contradicts a complaint to which it
is attached, the document’s facts or allegations trump those
1
in the complaint. See Thompson v. Illinois Dep’t of Prof. Reg.,
1
RIAA’s argument focuses on the EEOC charge as an attachment
to the complaint. It does not argue, at least with any force, that
Mr. Flannery’s allegations within his original complaint estop
him from claiming in his amended complaint that March 2000
was not the date of the “unlawful employment action.” It is
axiomatic that an amended complaint supersedes an original
complaint and renders the original complaint void. See Fuhrer v.
Fuhrer, 292 F.2d 140, 144 (7th Cir. 1961) (rejecting the argument
that “the original complaint contained admissions which estop
plaintiffs from maintaining their alleged action set forth in the
amended complaint”); 6 Charles Alan Wright et al., Federal
Practice and Procedure § 1476 (2d ed. 1990). Because the EEOC
charge and original complaint contain similar factual descrip-
(continued...)
8 No. 03-1591
300 F.3d 750, 754 (7th Cir. 2002). This principle is a sister
doctrine of our rule applied in the summary judgment con-
text that a party cannot create a genuine issue of material
fact by contradicting prior sworn testimony. See Bank of
Illinois v. Allied Signal Safety Restraint Sys., 75 F.3d 1162,
1168-72 (7th Cir. 1996). Both of these doctrines serve an im-
portant purpose of weeding out non-meritorious claims for
which a trial is not necessary. See id. at 1170.
These doctrines, however, must be applied with caution.
As we said in Bank of Illinois, “[a] definite distinction must
be made between discrepancies which create transparent
shams and discrepancies which create an issue of credibility
or go to the weight of the evidence.” Id. at 1169-70 (quoting
Tippens v. Celotex Corp., 805 F.2d 949, 953 (11th Cir. 1986)).
Credibility and weight are issues of fact for the jury, and we
must be careful not to usurp the jury’s role. Id. at 1170. For
this reason, these doctrines are only triggered upon a
threshold determination of a “contradiction,” which only
exists when the statements are “inherently inconsistent,” id.
at 1169 n.10; not when the later statement merely clarifies an
earlier statement which is ambiguous or confusing on a
particular issue, id. at 1171-72.
Mr. Flannery’s EEOC charge, in a section entitled “DATE
DISCRIMINATION TOOK PLACE,” describes the “EARLI-
EST” date of discrimination as “March 2000” and the “LAT-
EST” date as “Oct. 2001.” The attached explanation of the
“PARTICULARS” of the alleged discrimination explains in
relevant part:
1
(...continued)
tions, however, we shall discuss them together, even though the
original complaint is not relevant to the doctrine on which RIAA
bases its argument.
No. 03-1591 9
In March 2000, my supervisors, Frank Creighton and
Frank Walters, told me that I would have to leave my
employment because my health was bad and I was
getting older. Frank Creighton told me that he would
keep me on for a period of time so that I could train new
hires. In August 2000, I was diagnosed with sleep
apnea. I was discharged from my employment effective
October 1, 2001.
Original Compl., Ex.A. Mr. Flannery’s original complaint
contained a similar account of the March 2000 meeting. See
Original Compl. ¶ 5. In his amended complaint, Mr.
Flannery sets forth the following version of events:
In March 2000, plaintiff’s supervisors told him that
he would have to leave his employment because his
health was bad and because he was getting older.
Plaintiff told his supervisors that he did not want to
leave. Plaintiff’s supervisors told him that they would
keep him on and see how things went. They also told
him that he would be responsible for training new hires.
In August 2000, plaintiff was diagnosed with sleep
apnea. On or about June 14, 2001, plaintiff was informed
by his supervisor that he would be terminated effective
October 1, 2001. See Exhibit A hereto. Plaintiff was told
that this would serve as official notice of his termina-
tion. See Exhibit B hereto.
Am. Compl. ¶¶ 5-7. Exhibit A is the June 14, 2001 letter
from Mr. Walters to Mr. Flannery, which begins: “Per our
discussions, please see the proposed severance package
offered to you by the RIAA. Your final day of employment
will be October 1, 2001.” Exhibit B is the subsequent e-mail
from Mr. Creighton, which states in relevant part: “I
instructed Frank [Walters] to send you the attached notice.
As your current supervisor, it was appropriate that it come
from him. I reviewed and approved the document before it
10 No. 03-1591
was sent, therefore it stands as official notice of your current
and future status with RIAA.”
Applying these principles to the EEOC charge and orig-
inal complaint as well as to the amended complaint, we
must conclude that the documents’ respective version of
events are not so “inherently inconsistent” as to necessitate
judgment in RIAA’s favor. Neither the EEOC rules gov-
erning charge forms nor the notice pleading requirements
mandate a detailed elaboration of the events underlying the
plaintiff’s claim. See 29 C.F.R. § 1601.12(a)-(b) (An EEOC
charge should state a “clear and concise statement of the
facts, including pertinent dates” but is valid if it is “suffi-
ciently precise to identify the parties, and to describe
generally the action or practices complained of.”); Higgs v.
Carver, 286 F.3d 437, 439 (7th Cir. 2002) (“All that need be
specified [in a plaintiff’s complaint] is the bare minimum
facts necessary to put the defendant on notice of the claim
so that he can file an answer.”). In his EEOC charge and
complaint, Mr. Flannery set forth a terse explanation of the
March 2000 meeting, which was all he was required to do.
A description of that meeting in particular was necessary
not because it was the date on which RIAA had made the
final decision to fire him, but because, at that meeting, RIAA
officials had identified specifically his age and health as the
reasons for his dismissal. These factors were, of course, the
essential elements of his discrimination claims. Notably, the
description of the March 2000 meeting is provided in the
section of the EEOC charge form for “PARTICULARS” of
the alleged discrimination. In the section of the charge form
entitled “DATE DISCRIMINATION TOOK PLACE,” on the
other hand, “March 2000” is identified as the “EARLIEST”
date and “Oct. 2001” as the “LATEST.” The amended
complaint, in turn, elaborates and clarifies that, in the March
2000 meeting, Mr. Flannery had responded to his supervi-
No. 03-1591 11
sors’ statement that he would “have to leave” by informing
them he did not want to leave, and his supervisors had
responded by agreeing to keep him on to see how things
went. It also provides a very plausible account as to why the
final termination decision and unequivocal notice were not
accomplished until June 14, 2001.
The statements at issue could be read differently and infer
an inconsistency, but the mere necessity of making that
inference confirms that the inconsistency is not inherent. As
was noted at oral argument, RIAA may utilize both the
EEOC charge and the original complaint as impeaching
evidence at trial, and a jury might be persuaded that the
statements in the EEOC charge and the original complaint
about the March 2000 meeting foreclose Mr. Flannery’s
elaboration in his amended complaint. See, e.g., Fuhrer
v. Fuhrer, 292 F.2d 140, 144 (7th Cir. 1961) (noting the
defendants could enter a superseded complaint into evi-
dence at trial but the plaintiffs could also explain alleged
admissions in the superseded complaint); White v. ARCO/
Polymers, Inc., 720 F.2d 1391, 1396 n.5 (5th Cir. 1983)
(“Admissions made in superseded pleadings are as a gen-
eral rule considered to lose their binding force, and to have
value only as evidentiary admissions.”); 30B Michael H.
Graham, Federal Practice and Procedure § 7026 (interim
ed. 2000) (explaining that statements in superseded or
withdrawn pleadings constitute “evidentiary,” as opposed
to “judicial,” admissions, which “may be controverted or
explained by the party”); cf. Phillips v. Union Carbide, 2003
WL 1873086, at *2 (E.D. La. 2003) (“This more recent answer
in 2003, contradicts Plaintiff’s earlier admissions in her
EEOC charge and her deposition testimony discussed
above, and creates a disputed issue of fact.”). However, we
do not believe the documents are so inconsistent so as to
foreclose Mr. Flannery’s claims at this early stage.
12 No. 03-1591
2.
We therefore return to the question of the proper date of
the “unlawful employment practice” with our focus solely
on the amended complaint. Two principles guide our de-
termination on this question. First, it bears repeating that,
because this case comes to us on a motion to dismiss, we
must consider all the alleged facts in the amended com-
plaint as true, draw all reasonable inferences in favor of Mr.
Flannery, and ask “whether there is any possible interpreta-
tion of the complaint under which it can state a claim.”
Martinez v. Hooper, 148 F.3d 856, 858 (7th Cir. 1998). Second,
our cases hold that the date on which an unlawful employ-
ment practice occurs—in this case, when a termination
decision is final and when unequivocal notice is given—is
a question of fact. See Lever v. Northwestern Univ., 979 F.2d
552, 557 (7th Cir. 1992).
Taking these two principles together, the amended
complaint alleges that, at the March 2000 meeting, RIAA
officials initially told Mr. Flannery he would “have to
leave,” but that, by the end of the meeting, they had agreed,
at Mr. Flannery’s request, to keep him on and see how
things went. Under these facts, a plausible interpretation of
the March 2000 decision is that any decision was “tenta-
tive,” Ricks, 449 U.S. at 261, not a “concrete act [which]
smack[ed] of finality,” Lever, 979 F.2d at 554. It also is at
least as plausible that the other date presented to us by Mr.
Flannery, June 14, 2001, was the date of the final termination
decision. According to his allegations, on or about June 14,
2001, Mr. Flannery was told that he would be terminated
effective October 1, 2001. The letter from Mr. Walters de-
scribing the benefits he would receive upon his termination
was also dated June 14, 2001. Finally, that letter was subse-
quently identified by Mr. Creighton as Mr. Flannery’s
“official notice” of his “current and future status with
No. 03-1591 13
RIAA.” Am. Compl., Ex.B. We do not mean to imply that
Ricks and Lever necessarily require that a definitive termina-
tion date must be given, or that the termination decision
must be memorialized in an “official” communication, in
order for the employer’s decision to be “final.” See Ricks, 449
U.S. at 257 (“Mere continuity of employment, without more,
is insufficient to prolong the life of a cause of action for
employment discrimination.”); Mull v. ARCO Durethene
Plastics, Inc., 784 F.2d 284, 288 (7th Cir. 1986). Our only
holding is that these facts, taken together, and assumed to
be true, permit the conclusion that the final termination
decision was not made until June 14, 2001.
Furthermore, even assuming that a final decision was
made at the March 2000 meeting, the tentativeness of RIAA
officials at that meeting permit an interpretation that, at that
time, RIAA failed to give Mr. Flannery the requisite un-
equivocal notice. As we have previously noted, notice to the
employee is only sufficient if it provides a “clear intention to
dispense with the employee’s services.” Dvorak, 289 F.3d at
486 (emphasis added). Requiring employees like Mr.
Flannery to file EEOC charges on the basis of ambiguous
conversations regarding termination would cause a flood of
false charges; litigants would be forced to file a charge at
every hint of termination in order to preserve their claims.
See Stewart v. Booker T. Washington Ins., 232 F.3d 844, 849
(11th Cir. 2000). The concomitant burden upon the EEOC
would impact significantly the enforcement function of the
agency.
In sum, according to the amended complaint, on or about
June 14, 2001, Mr. Flannery was first told of RIAA’s final
decision to terminate him. At the same time, he received
a termination letter later deemed an “official notice” of his
future status with RIAA. Assuming these facts are true, the
first date on which Mr. Flannery received unequivocal
14 No. 03-1591
notice is a close call as between March of 2000 and June 14,
2001. It certainly cannot be decided at this early stage of the
litigation. Again, we do not mean to suggest that for a notice
to be operable it must necessarily be written or “official”;
however, it must be “unequivocal.” See Mull, 784 F.2d at 288(“[U]nder Ricks and its progeny unequivocal notice of
termination is all that is required to start the limitations
period running; it is not necessary for such notice to be in
writing.”). We hold only that the facts in the amended
complaint permit the conclusion that the first date of une-
quivocal notice of termination, like the date of the final
termination decision, was June 14, 2001. We must therefore
reverse the district court’s holding that Mr. Flannery’s
discriminatory discharge claims are time-barred.
B. Retaliation Claims (Counts II & IV)
Both the ADEA and the ADA prohibit retaliation against
an employee for having filed a charge of discrimination. See
29 U.S.C. § 623(d) (ADEA); 42 U.S.C. § 12203(a) (ADA). Mr.
Flannery alleged in his amended complaint that RIAA had
retaliated against him for filing a charge of discrimination
with the EEOC by refusing to give him consulting or inde-
pendent contractor work that had been promised to him
before he left RIAA. The June 14, 2001 letter, which set forth
three benefits that Mr. Flannery would or could receive
upon his termination, memorialized the third benefit, the
consulting agreement, as follows:
As we discussed, after October 1, 2001, the RIAA would
utilize your services as an Investigative Consultant.
Your fee would be $60.00 an hour and .40 per miles for
personal vehicle use. You would be compensated for
attendance at any court hearings, trials on other matters
relating to cases currently pending and for cases you
No. 03-1591 15
generate after October 1, 2001. We would anticipate that
your services will be utilized by a number of RIAA
offices and result in approximately 20 hours of billable
work per week.
Am. Compl., Ex.A.
Both parties agree that the ADEA and ADA only protect
“employees” and not independent contractors. See Aberman
v. J. Abouchar & Sons, Inc., 160 F.3d 1148, 1150 (7th Cir. 1998).
Thus, independent contractors do not have standing to sue
under these statutes. See Vakharia v. Swedish Covenant Hosp.,
190 F.3d 799, 805 (7th Cir. 1999). However, Mr. Flannery is
not suing as an independent contractor, but as a former
employee of RIAA. As we said in Veprinsky v. Fluor Daniel,
Inc., 87 F.3d 881 (7th Cir. 1996), “former employees, in so far
as they are complaining of retaliation that impinges on their
future employment prospects or otherwise has a nexus to
employment, do have the right to sue their former employ-
2
ers.” Id. at 891. RIAA argues, consistent with the district
court, that Mr. Flannery’s claim is nevertheless barred
because retaliation with respect to an independent contract-
ing agreement lacks an employment nexus, even if that
agreement flows from an employer-employee relationship.
3
We respectfully disagree.
2
Veprinsky was addressing Title VII, but its principle governs in
the ADEA and ADA context as well. See, e.g., Nawrot v. CPC Int’l,
277 F.3d 896 (7th Cir. 2002) (addressing discrimination and
retaliation claims brought by a former employee under the ADEA
and ADA).
3
Mr. Flannery also argues that his retaliation claims are action-
able even if the alleged retaliatory actions taken by RIAA lack a
nexus to employment. This circuit has not been entirely clear on
whether an employment nexus is necessary to state a retaliation
(continued...)
16 No. 03-1591
It is unquestionable that Mr. Flannery’s consulting ar-
rangement grew out of his employment relationship with
RIAA. The cases on which Mr. Flannery was to work as an
investigative consultant after his employment ended were
some of the same cases he was working on as an employee.
More importantly, the independent contracting arrangement
was one part of his severance package from RIAA. The June
14, 2001 letter from Mr. Walters set forth three benefits Mr.
Flannery would or could receive upon his separation from
RIAA: (1) severance pay; (2) the possibility of health
benefits; and (3) the consulting arrangement. Because this
package grew out of his employment with RIAA, denial as
to any part of the package would satisfy the employment
nexus. See, e.g., Jones v. Ryder Servs. Corp., 1997 WL 158329,
at *5 (N.D. Ill. 1997) (holding that withdrawing a workers’
compensation settlement offer constituted actionable
retaliation). The mere fact that part of the severance package
was a consulting arrangement does not destroy the preexist-
ing employer-employee nexus.
3
(...continued)
claim. Compare Johnson v. Cambridge Indus., 325 F.3d 892, 902 (7th
Cir. 2003) (Adverse action “will not always be employment-
related” but the employee must show “real harm.”) with Ajayi v.
Aramark Bus. Servs., Inc., 336 F.3d 520, 533 (7th Cir. 2003) (To state
a claim for retaliation, the plaintiff must allege an “adverse
employment reaction.”). Other circuits are split on the matter. See
Ray v. Henderson, 217 F.3d 1234, 1240-43 (9th Cir. 2000) (discuss-
ing the split in circuits). Because we hold the retaliatory acts Mr.
Flannery has alleged have a nexus to employment, it is not
necessary for us to definitively resolve this issue in this case.
Therefore, for purposes of our analysis, we proceed under the
assumption that an employment nexus is required for a valid
retaliation claim under the ADEA and ADA.
No. 03-1591 17
The very purpose of the retaliation provisions is to pre-
vent employers from deterring employees from exercising
their rights, including the right to file a charge of discrim-
ination. See EEOC v. Bd. of Governors of State Colls. and
Univs., 957 F.2d 424, 431 (7th Cir. 1992). An employer’s
withdrawal of part of an employee’s severance package,
occurring at a time when the departing employee is most
vulnerable, undoubtedly would make other employees
think twice before filing a discriminatory termination
charge. Our holding is further supported by the only case
cited to us that is directly on point, Elliot v. British Tourist
Auth., 172 F. Supp. 2d 395 (S.D.N.Y. 2001). In Elliot, the
plaintiff alleged that, as retaliation for filing a charge of
age discrimination, his employer had withdrawn its pre-
termination offer of consulting work to him. Id. at 403.
Although the court ultimately ruled his retaliation claims
were not actionable for other reasons, it held that an em-
ployer’s failure to give a former employee consulting work
which it promised he would get before he was terminated
stated “a prima facie case of retaliation that would survive
a motion to dismiss under Rule 12(b).” Id. at 404. We agree
with Elliot and hold that Mr. Flannery’s retaliation claims
have the requisite nexus to employment and are thus
actionable.
Mr. Flannery further submits that the denial of consulting
work will affect his future employment prospects by
denying him potential contacts in the industry which in turn
4
could produce other employment. See Veprinsky, 87 F.3d at4
RIAA argues that this aspect of Mr. Flannery’s retaliation claim
is waived because he failed to present it to the district court. See
Datamatic Servs., Inc. v. United States, 909 F.2d 1029, 1034 (7th Cir.
1990). Mr. Flannery’s brief in opposition to RIAA’s motion to
(continued...)
18 No. 03-1591
891 (“[F]ormer employees, in so far as they are complaining
of retaliation that impinges on their future employment pros-
pects or otherwise has a nexus to employment do have the
right to sue their former employers.” (emphasis added)).
RIAA correctly notes that retaliation claims must be based
on facts, and not on speculative theories. See Sauzek v. Exxon
Coal USA, Inc., 202 F.3d 913, 919 (7th Cir. 2000) (“Specula-
tion based on suspicious timing alone, however, does not
support a reasonable inference of retaliation; instead,
plaintiffs must produce facts which somehow tie the
adverse decision to the plaintiffs’ protected actions.”).
However, Mr. Flannery has set forth sufficient facts to
permit the inference that the consulting contract is a signifi-
cant bridge to his future career prospects. Under the con-
sulting arrangement, Mr. Flannery was to receive approxi-
mately twenty hours per week of consulting work at various
RIAA offices. At this stage of the proceedings, we cannot
say that such an opportunity is not a sufficient amount of
professional activity to have a significant effect on his future
employment prospects.
In sum, then, we hold that the denial of promised con-
sulting work arising out of Mr. Flannery’s employment has
4
(...continued)
dismiss does not specifically allege that the denial of consulting
will affect his future employment prospects. See R.5 at 5-7. In its
order, the district court also stated: “Mr. Flannery does not allege
that RIAA’s actions affected any other future prospects.” See R.7.
However, the issue of whether Mr. Flannery’s retaliation claims
have a sufficient nexus to employment was clearly before the
district court. Because, in the context presented by this complaint,
this aspect of Mr. Flannery’s retaliation claim is part and parcel
of that same issue, we conclude it is not waived for purposes of
this appeal.
No. 03-1591 19
a nexus to his employment and also could have an effect on
future employment prospects. For these reasons, we must
reverse the district court’s dismissal of his retaliation claims
for failure to state a claim upon which relief can be granted.
Conclusion
For the foregoing reasons, we reverse the judgment of the
district court, and the case is remanded to the district court
for proceedings consistent with this opinion. Mr. Flannery
may recover his costs in this court.
REVERSED and REMANDED
A true Copy:
Teste:
_____________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—1-6-04