James Phillips v. Ford Motor Company

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No. 95-2381
____________
James Phillips; *
Regina M. Phillips, *
*
Appellants, *
* Appeal from the United States
v. * District Court for the
* Western District of Missouri
Ford Motor Company, *
*
Appellee. *
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Submitted: November 13, 1995
Filed: May 8, 1996
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Before McMILLIAN and LOKEN, Circuit Judges, and DUPLANTIER,*
District Judge.
____________
McMILLIAN, Circuit Judge.
James Phillips (hereinafter Phillips) and his wife, Regina Phillips
(together plaintiffs), appeal from a final order entered in the United
States District Court1 for the Western District of Missouri dismissing
their state law claims against Ford Motor Company (Ford), including
Phillips' claim pursuant to Mo. Rev. Stat. § 287.780 that Ford unlawfully
discriminated against him for exercising his rights under the Missouri
Workers' Compensation Law, Mo. Rev. Stat. § 287.010-.975. Phillips v. Ford
Motor Co., No. 94-
*The Honorable Adrian G. Duplantier, United States
District Judge for the Eastern District of
Louisiana, sitting by designation.
1
The Honorable Fernando J. Gaitan, Jr., United States District
Judge for the Western District of Missouri.
0632-CV-W-2 (W.D. Mo. May 1, 1995) (order granting motion to dismiss). For
reversal, plaintiffs argue that the district court erred in dismissing the
complaint and, alternatively, Mo. Rev. Stat. § 287.780, as applied by the
district court, violates either the United States Constitution or the
Missouri state constitution. For the reasons stated below, we modify the
district court's order and affirm the order as modified.
Background
Phillips was diagnosed in 1985 with carpal tunnel syndrome resulting
from repetitive work performed in his employment with Ford. He had
corrective surgery in 1986. Ford provided workers' compensation coverage
for Phillips' surgery and a disability settlement. Phillips continued to
work for Ford.
In early 1993, Phillips began experiencing pain similar to that which
he suffered in 1985. On February 19, 1993, he went to the Ford company
doctor, who referred him to a specialist, Dr. William Benson. Dr. Benson
diagnosed Phillips with arthritis and recommended fusion surgery. Dr.
Benson also opined that the injury was work-related. Dr. Benson forwarded
his diagnosis and recommendation in writing to Ford. Ford placed Phillips
on medical leave. Phillips then filed a workers' compensation claim for
payment of medical treatment, including the surgery recommended by Dr.
Benson. Ford refused to pay for the treatment on grounds that the injury
was not work-related.
Dr. Benson performed the fusion surgery in March 1993. The surgery
was partially covered by Phillips' personal medical insurance carrier, with
the uncovered portion charged to Phillips personally. In August 1993,
Phillips was released to perform light duty work. Ford refused to pay
workers' compensation temporary total disability benefits for the interim
period of March 1993 to August 1993. Phillips applied to have Ford's
denial of workers'
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compensation benefits reviewed by an administrative law judge of the
division of workers' compensation (the Division), which is within the
department of labor and industrial relations of the state of Missouri.2
See Mo. Rev. Stat. §§ 286.110, 287.450-.490.
While continuing to pursue administrative review of his workers'
compensation claim, Phillips, along with his wife, Regina Phillips, filed
the present lawsuit in Missouri state court on May 25, 1994. Their
complaint sets forth the following three counts: (Count I) Phillips' claim
of retaliation and discrimination pursuant to Mo. Rev. Stat. § 287.780,
alleging severe economic hardship, emotional and mental distress, and
aggravation of his injuries; (Count II) Phillips' request for punitive
damages; and (Count III) Regina Phillips' claim of loss of consortium.
Joint Appendix at 10-15 (petition for damages). On June 30, 1994, Ford
removed the case to the federal district court for the Western District of
Missouri, pursuant to 28 U.S.C. §§ 1441 and 1446, citing diversity of
citizenship as the basis for the district court's original jurisdiction.3
On October 26, 1994, the following documents were filed with the district
court: Ford's motion to dismiss; plaintiffs' opposition to Ford's motion
to dismiss; and Ford's reply to plaintiffs' opposition. On November 17,
1994, Ford filed "supplemental suggestions" in support of its motion to
dismiss.
2
Phillips' application for administrative review of his
workers' compensation claim was pending before the division of
workers' compensation at the time plaintiffs filed their brief in
the present case. Brief for Appellants at 7.
3
Actually, the district court lacked removal jurisdiction by
operation of 28 U.S.C. § 1445(c) (civil action in state court
arising under workers' compensation laws of that state may not be
removed). See Humphrey v. Sequentia, Inc., 58 F.3d 1238, 1244-47
(8th Cir. 1995) (Humphrey). However, plaintiffs failed to timely
move for remand.
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In support of its motion to dismiss, Ford asserted, among other
things, that Phillips had not stated a claim of unlawful discrimination
under Mo. Rev. Stat. § 287.780, even assuming the facts alleged in the
complaint. Section 287.780 provides:
No employer or agent shall discharge or in any way
discriminate against any employee for exercising any of
his [or her] rights under this chapter [the Missouri
Workers' Compensation Law, Mo. Rev. Stat.
§ 287.010-.975]. Any employee who has been discharged
or discriminated against shall have a civil action for
damages against his [or her] employer.
The district court granted Ford's motion to dismiss. Phillips v.
Ford Motor Co., No. 94-0632-CV-W-2 (W.D. Mo. May 1, 1995). The district
court explained:
Plaintiff has cited no legal authority for his
proposition that the denial of medical and disability
benefits constitutes an act of discrimination. The
court finds that to construe the denial of medical
benefits as retaliation or discrimination would open the
door for every claimant who is denied benefits to avoid
the administrative review of such claims required by
Missouri Workers' Compensation Law. Therefore,
plaintiff's claim of retaliation and discrimination must
be dismissed.
Id. at 2. Regarding Phillips' claim of intentional infliction of emotional
4
distress and Regina Phillips' claim of loss of consortium, the district
court further opined:
Because plaintiff's claim is recognized as a claim
under the jurisdiction of the Division of Workers'
Compensation, Missouri courts have held that Missouri
Workers' Compensation law also provides the exclusive
remedy for claims of intentional infliction of emotional
4
Although there is no distinct claim of intentional infliction
of emotional distress set forth in the complaint, the district
court apparently inferred such a separate claim from the
allegations set forth in Counts I and II of the complaint.
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distress attributed to defendant's failure to pay
plaintiff['s] medical expenses. Wood v. Union Elec.
Co., 786 S.W.2d 613, 615 (Mo. Ct. App. 1990).
Accordingly, plaintiff['s] claim of intentional
infliction of emotional distress is also dismissed.
Additionally, plaintiff Regina Phillips' claim of
loss of consortium is dependent upon James Phillips'
claims of retaliation, discrimination, and intentional
infliction of emotional distress. Because these claims
have been dismissed, the loss of consortium claim must
also fail.
Slip op. at 2-3. The district court entered judgment in favor of Ford, and
plaintiffs appealed.5
5
After plaintiffs filed their notice of appeal, Humphrey was
published. In Humphrey, we reversed the district court's denial of
the plaintiff's motion for remand of his claim brought pursuant to
Mo. Rev. Stat. § 287.780, which had been removed by the defendant
under 28 U.S.C. § 1441(b). 58 F.3d at 1239-40, 1247. We held in
Humphrey that the plaintiff's § 287.780 claim arose under
Missouri's workers' compensation laws and therefore, by operation
of 28 U.S.C. § 1445(c), the district court lacked removal
jurisdiction over the case regardless of whether it presented a
federal question or there was diversity of citizenship. Id. at
1244-46 & 1245 n.8. Plaintiffs in the present case thereafter
moved in this court to dismiss this appeal for lack of subject
matter jurisdiction and for remand to state court. In response,
Ford argued that plaintiffs were not entitled to remand at such a
late stage because they had failed to move for remand within 30
days of the removal and thus waived their claim of lack of removal
jurisdiction. Accord Williams v. AC Spark Plugs, 985 F.2d 783 (5th
Cir. 1993) (in case removed from state court to federal district
court, the plaintiff lost on the merits in a bench trial and then
moved for a remand to state court on grounds that the case had been
improperly removed under § 1445(c); her motion for remand was
denied because she had failed to move for remand within 30 days of
the removal and the district court would have had original
jurisdiction based upon diversity of citizenship if the plaintiff
had filed in federal court). On September 22, 1995, this court
denied plaintiffs' motion to dismiss the appeal and for remand to
state court. Phillips v. Ford Motor Co., No. 95-2381 (8th Cir.
Sept. 22, 1995) (order entered by clerk at the directions of the
court).
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Discussion
Dismissal of plaintiffs' claims
Plaintiffs first argue that the district court erred in granting
Ford's motion to dismiss their complaint, focusing particularly on
Phillips' claim that Ford discriminated against him for exercising his
rights under the Workers' Compensation Law, in violation of Mo. Rev. Stat.
§ 287.780. Plaintiffs maintained in their brief and at oral argument that
the issue of whether an employee may bring a discrimination claim under
§ 287.780, based upon his or her employer's denial of workers' compensation
benefits, is an issue of first impression. They argued that no court had
ever specifically ruled out the possibility of recovering damages on such
a theory. However, after the present appeal was briefed and argued, the
Missouri Court of Appeals decided Felts v. Ford Motor Co., 916 S.W.2d 798
(Mo. Ct. App. 1995) (Felts), involving facts and issues which are
strikingly similar to those presented in the case at bar. In Felts, an
employee and his wife sued his employer in Missouri state court alleging
that the employer had violated his rights under Mo. Rev. Stat. § 287.780
by denying workers' compensation benefits and thereby causing, among other
things, aggravation of his injuries, pain and suffering, economic hardship,
mental and emotional distress, and the wife's loss of consortium. Id. at
799-800. The state trial court dismissed the action, noting that the
Division had exclusive original jurisdiction over the plaintiffs' claims.
Id. at 800. On appeal, the plaintiffs argued that the allegations of their
complaint were sufficient to state a cause of action. Id. The Missouri
Court of Appeals disagreed, however, and held that (1) the complaint did
not satisfy all four elements of a discrimination claim under Mo. Rev.
Stat. § 287.780, id. at 802-03, and (2) to the extent the plaintiffs were
seeking a remedy based directly or indirectly upon the employer's denial
of workers' compensation benefits, their claims were subject to the
exclusive rights and
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remedies provided in the state's workers' compensation laws and likewise
were within the exclusive original jurisdiction of the Division, id. at
803.
In the present case, plaintiffs argue that the allegations in their
complaint state a claim under Mo. Rev. Stat. § 287.780 because: (1)
Phillips was an employee of Ford at the time he suffered a work-related
injury; (2) he exercised his rights under the workers' compensation laws
by filing a workers' compensation claim seeking payment for medical
treatment; (3) Ford discriminated against him by denying him those and
other requested benefits; and (4) a causal connection existed between
Phillips' claim for medical coverage and Ford's denial of benefits. While
plaintiffs concede that the Division has exclusive original jurisdiction
to decide whether a particular injury is compensable under the Workers'
Compensation Law, they contend that their claims do not fall within that
category because "Mr. Phillips is making no claim that the on-the-job
injury was itself the cause of the emotional and economic injuries for
which he is seeking compensation under this suit, but rather that those
damages resulted from Ford's post-accident actions." Brief for Appellants
at 14. They further contend that their claims survive because they are not
seeking the workers' compensation benefits themselves, but consequential
damages that flow from Ford's refusal to pay those benefits. Id. at 16.
In response, Ford argues that plaintiffs failed to state a claim
under Mo. Rev. Stat. § 287.780 because the denial of workers' compensation
benefits is not, as a matter of law, discriminatory conduct. Ford further
argues that the mere allegation of a denial of benefits motivated by
retaliatory intent does not, in and of itself, establish a claim under
§ 287.780. If so, Ford argues, every denial of workers' compensation
benefits could be characterized as retaliatory. Consequently, the workers'
compensation administrative process could be circumvented whenever benefits
are denied, even where the source of the dispute is the
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employee's right to receive benefits under the terms of the Workers'
Compensation Law. Thus, Ford argues, it should not matter how plaintiffs
in this case have characterized their claims; as long as their claims arise
out of the allegation that Ford wrongfully denied workers' compensation
benefits, those claims are subject to the exclusive rights and remedies
provided under the Missouri Workers' Compensation Law. Finally, as a
matter of statutory intent, Ford argues, it could not have been the
Missouri legislature's intent to create parallel remedies and legal avenues
for seeking relief based upon the exact same wrongful conduct (i.e., the
denial of workers' compensation benefits), particularly in light of the
specific language of Mo. Rev. Stat. § 287.120.6 We agree.
We begin our analysis with the observation that the district court's
order does not indicate whether the basis for the dismissal was Fed. R.
Civ. P. 12(b)(1) (lack of subject matter jurisdiction) or Fed. R. Civ. P.
12(b)(6) (failure to state a claim), both of which were asserted by Ford
in the district court. In either case, our review of the dismissal is de
novo. Upon de novo review, we hold that Phillips failed to state a claim
under Mo. Rev. Stat.
6
Section 287.120 provides in pertinent part:
1. Every employer subject to the provisions
of this chapter shall be liable, irrespective of
negligence, to furnish compensation under the
provisions of this chapter for personal injury or
death of the employee by accident arising out of
and in the course of his [or her] employment, and
shall be released from all other liability therefor
whatsoever, whether to the employee or any other
person. . . .
2. The rights and remedies herein granted to
an employee shall exclude all other rights and
remedies of the employee, his wife, her husband,
parents, personal representatives, dependents,
heirs or next kin, at common law or otherwise, on
account of such accidental injury or death, except
such rights and remedies as are not provided for by
this chapter.
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§ 287.780 (Count I of the complaint) and, in all other respects, the
district court lacked subject matter jurisdiction to consider plaintiffs'
claims.
Section 287.780 provides that a civil action for damages may be
brought where an employer discharges or in any way discriminates against
an employee for exercising his or her rights under the Missouri Workers'
Compensation Law. In Hansome v. Northwestern Cooperage Co., 679 S.W.2d
273, 275 (Mo. 1984) (en banc) (Hansome), the Missouri Supreme Court noted
"[t]he action authorized by this statute has four elements: (1) plaintiff's
status as employee of defendant before injury, (2) plaintiff's exercise of
a right granted by Chapter 287, (3) employer's discharge of or
discrimination against plaintiff, and (4) an exclusive causal relationship
between plaintiff's actions and defendant's actions." In the present case,
Phillips did allege that, while employed by Ford, he exercised his rights
under the workers' compensation laws by filing a claim for medical benefits
based upon an apparent work-related injury. He further alleged that Ford
discriminated against him by denying him medical and temporary total
disability benefits, and "requiring" him to use his own medical insurance
to pay for his surgery. He also alleged that Ford engaged in these
purported acts of discrimination "solely because he exercised his rights
under the Missouri Worker's Compensation Law." Joint Appendix at 11-13
(plaintiffs' petition for damages).
We hold, however, that Phillips' allegations are insufficient to
state a cause of action under Mo. Rev. Stat. § 287.780 because an employee
who relies upon his or her claim for workers' compensation benefits to
satisfy the second element under Hansome cannot then rely upon the denial
of that very claim as the basis for alleging "discrimination" to satisfy
the third element. In other words, an employer's denial of workers'
compensation benefits -- even if wrongful -- cannot, as a matter of law,
constitute the type of wrongdoing that the statute was designed to address.
See
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Felts, 916 S.W.2d at 802-03. It would be illogical to construe Mo. Rev.
Stat. § 287.780 in a manner that would allow every claimant who has been
denied workers' compensation benefits the right to bring a civil action in
state court. Such a construction would undo the effect of Mo. Rev. Stat.
§ 287.120, which provides that the rights and remedies granted by the
Missouri's Workers' Compensation Law exclude all other rights and remedies
of the employee, and it would render meaningless the Division's exclusive
original jurisdiction. We therefore hold that Phillips failed to state a
claim under § 287.780 and the district court therefore did not err in
dismissing that claim.7
In all other respects, this case is nothing more than an effort to
obtain compensatory and punitive damages arising, albeit indirectly, out
of Ford's denial of workers' compensation benefits. Therefore, plaintiffs'
remaining claims are within the exclusive original jurisdiction of the
Division. See State ex rel. Standard Register Co. v. Mummert, 880 S.W.2d
925, 926-27 (Mo. Ct. App. 1994) (employee alleged, pursuant to § 287.780,
that his employer's improper delay in authorizing surgery prevented him
from meeting the employer's guidelines and he was discharged for exercising
his rights under the Workers' Compensation Law; the Missouri Court of
Appeals held that the trial court erred in failing to dismiss the action
because the case necessarily required adjudication of an issue under the
Workers' Compensation Law and was within the exclusive jurisdiction of the
Division); Wiley v. Shank & Flattery, Inc., 848 S.W.2d 2, 4 (Mo. Ct. App.
1992) (workers' compensation
7
Ford also argues that Regina Phillips cannot assert a loss of
consortium claim pursuant to Mo. Rev. Stat. § 287.780 because that
provision only refers to claims by an "employee" against his or her
employer. We note that Regina Phillips' loss of consortium claim
was not brought pursuant to Mo. Rev. Stat. § 287.780, but if it
were, it would fail for the same reasons that Phillips' § 287.780
claim fails. Thus, we need not consider Ford's suggestion that an
injured employee's spouse can never bring a claim under Mo. Rev.
Stat. § 287.780.
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laws provide exclusive remedy for claims arising out of alleged wrongful
refusal to provide workers' compensation coverage for surgery).
Specifically, as to Phillips' claim of intentional infliction of emotional
distress, the question of original jurisdiction was addressed and decided
in Wood v. Union Elec. Co., 786 S.W.2d 613, 614-15 (Mo. Ct. App. 1990)
(Wood). In Wood, the plaintiff sued his employer in Missouri state court,
claiming intentional infliction of emotional distress resulting from a
denial of workers' compensation benefits. In affirming the trial court's
dismissal for lack of subject matter jurisdiction, the Missouri Court of
Appeals explained "[s]ince exclusive jurisdiction over the underlying work-
related injury claim is vested in the Division of Workers' Compensation,
§ 287.510 affords plaintiff a remedy to resolve any dispute over
defendant's alleged failure to pay the medical expenses." Id. at 615;
accord Houston v. Aetna Cas. & Sur. Co., 701 S.W.2d 207, 208 (Mo. Ct. App.
1985) (affirming dismissal of claim of intentional infliction of emotional
distress on grounds of both lack of subject matter jurisdiction and failure
to state a claim). As to Regina Phillips' loss of consortium claim, she
is also bound by the jurisdictional constraints imposed by § 287.120 ("The
rights and remedies herein granted to an employee shall exclude all other
rights and remedies of the employee [and] his wife . . . at common law or
otherwise, on account of such accidental injury or death, except such
rights and remedies as are not provided for by this chapter." (Emphasis
added.)). See Felts, 916 S.W.2d at 803 ("The loss of consortium claim also
fails. . . . Just as Mr. Felts' claim falls within the scope of the
[Workers' Compensation Law], it follows that Mrs. Felts['] claim must
too.").
In sum, to the extent plaintiffs have asserted any viable claims in
this action, their rights and remedies must derive exclusively from the
Missouri Workers' Compensation Law and are within the exclusive original
jurisdiction of the Division. See id. at 802-03. The district court
therefore did not err in
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dismissing Phillips' claim of intentional infliction of emotional distress
and Regina Phillips' claim of loss of consortium, insofar as the dismissal
was without prejudice, because the district court lacked subject matter
jurisdiction to consider those claims.
Constitutionality of the statute
Plaintiffs also argue, in the alternative, that § 287.780, as applied
by the district court violates their state and federal constitutional
rights. They first rely on the so-called "open courts provision" of the
Missouri Constitution, Art. I, § 14, which provides that "the courts of
justice shall be open to every person, and certain remedy afforded for
every injury to person, property or character, and that right and justice
shall be administered without sale, denial or delay." This provision has
been interpreted to guarantee Missouri citizens "the ``right to pursue in
the courts the causes of action the substantive law recognizes.'" Powell
v. American Motors Corp., 834 S.W.2d 184, 191 (Mo. 1992) (en banc) (quoting
Mahoney v. Doerhoff Surgical Servs., 807 S.W.2d 503, 510 (Mo. 1991) (en
banc)).
We hold that plaintiffs have not established a violation of the open
courts provision because, to the extent they may have a cause of action
recognized by the substantive law, their right to obtain a remedy is
adequately protected by the administrative review and appeals process
available under the Workers' Compensation Law. See Goodrum v. Asplundh
Tree Expert Co., 824 S.W.2d 6, 9-10 (Mo. 1992) (en banc) (Goodrum) (cited
in Felts, 916 S.W.2d 798, 803).
Plaintiffs also contend that their federal and state constitutional
right to procedural due process has been violated because the district
court "depriv[ed] them of their opportunity to be heard at trial on the
merits of their claim against Ford under
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§ 287.780, and the opportunity to make a submissible case on that claim."
Brief for Appellants at 36.
Plaintiffs' due process argument is without merit. Phillips is not
being deprived of the opportunity to be heard on his § 287.780 claim; that
opportunity has been afforded in the present case. The right of due
process does not mean that every claim must proceed to trial. Moreover,
to the extent that plaintiffs have raised claims in this civil action which
should have been raised in their administrative action before the Division,
they have not been denied an opportunity to be heard. "``Due process does
not necessarily mean judicial process.'" Goodrum, 824 S.W.2d at 10
(quoting Percy Kent Bag Co. v. Missouri Comm'n on Human Rights, 632 S.W.2d
480, 485 (Mo. 1982) (en banc)).
Finally, plaintiffs argue that their federal and state constitutional
right to equal protection has been violated because they have been forced
to bear "economic and emotional costs" as a result of Ford's alleged
systematic and wrongful denial of workers' compensation benefits. We
disagree.
To begin, Ford's private actions are not subject to equal protection
scrutiny. Medical Inst. of Minn. v. National Ass'n of Trade & Tech. Schs.,
817 F.2d 1310, 1312 (8th Cir. 1987) (private action, no matter how
egregious, cannot violate the equal protection guarantee of the United
States Constitution). To the extent plaintiffs' equal protection argument
is directed at the administration of Missouri's Workers' Compensation Law,
plaintiffs have not shown that they are members of a constitutionally-
protected suspect or quasi-suspect class (they merely identify with a group
of individuals who have been denied benefits). Nor have they alleged that
a fundamental right has been infringed. Accordingly, because plaintiffs
have failed to assert any legal or factual basis for finding Missouri's
workers' compensation scheme
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unreasonable in light of the state's legitimate legislative goals, their
equal protection argument is meritless.
Conclusion
The order of the district court is modified to provide that the
dismissal of the complaint, except for Phillips' § 287.780 claim, is
without prejudice; otherwise, for the reasons stated above, the district
court's order is affirmed.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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