Sides et al v. Macon County Greyhound Park, Inc.
MEMORANDUM OPINION AND ORDER directing: (1) plaintiffs' 44 MOTION for Partial Summary Judgment as to WARN Act liability and as to MCGP's "unforeseeable business circumstances" defense is GRANTED; (2) defendant MCGP's [7 3] MOTION for Summary Judgment is DENIED; (3) plaintiffs' 43 MOTIONS to Strike are DENIED; (4) the pretrial hearing and trial in this case, scheduled for 7/24/2012, and 8/20/2012, respectively, are CANCELLED; and (5) the case, subject to the above observations on interlocutory appeals, will proceed on WARN Act damages, as further set out in order. Signed by Honorable Judge Mark E. Fuller on 7/6/12. (Attachments: # 1 civil appeals checklist)(djy, )
IN THE UNITED STATES DISTRICT COURT FOR
THE MIDDLE DISTRICT OF ALABAMA
JUDY WEEKES-WALKER, et al.,
MACON COUNTY GREYHOUND
PARK, INC., a/k/a VictoryLand,
CASE NO. 3:10-cv-895-MEF
[WO – Publish]
MEMORANDUM OPINION AND ORDER
This Rule 23(b)(3) class action brought by former employees of Defendant Macon
County Greyhound Park, Inc. (“MCGP”), pursuant to the Worker Adjustment and Retraining
Act of 1988 (“WARN”), 29 U.S.C. §§ 2101 et seq., alleges that MCGP – on three separate
occasions in 2010 – violated the WARN Act’s requirement to give sixty days notice to
affected employees prior to a plant closing or mass layoff, as defined in the statute. The class
action is now before the Court on Plaintiff’s motions to strike affirmative defenses and for
partial summary judgment on liability (Docs. # 43, 44) and Defendant’s motion for summary
judgment (Doc. # 73). After careful consideration of the arguments of counsel and the
relevant law, the Court finds that Plaintiff’s motion for partial summary judgment on liability
is due to be GRANTED and Defendant’s motion for summary judgment is due to be
I. JURISDICTION AND VENUE
Subject matter jurisdiction is exercised pursuant to 28 U.S.C. § 1331 (federal
question) and 29 U.S.C. § 2104(a)(5) (WARN Act may be enforced in federal district court).
The parties do not contest personal jurisdiction or venue, and there are adequate allegations
in support of both.
II. STANDARD OF REVIEW
“Summary judgment is appropriate if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any, show there is no
genuine issue of material fact and that the moving party is entitled to judgment as a matter
of law.” Greenberg v. BellSouth Telecomms., Inc., 498 F.3d 1258, 1263 (11th Cir. 2007)
(citation and internal quotation marks omitted); see also Fed. R. Civ. P. 56(a) (“The court
shall grant summary judgment if the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law.” ).
“[A] party seeking summary judgment always bears the initial responsibility of
informing the district court of the basis for its motion, and identifying those portions of [the
record] which it believes demonstrate the absence of a genuine issue of material fact.”
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quotation omitted). The movant can
meet this burden by presenting evidence showing there is no dispute of material fact, or by
showing the non-moving party has failed to present evidence in support of some element of
its case on which it bears the ultimate burden of proof. Id. at 322-23.
If the movant satisfies its evidentiary burden, the non-moving party must then
establish, with evidence beyond the pleadings, that a genuine issue material to each of its
claims for relief exists. Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991);
Fed. R. Civ. P. 56(c). What is material is determined by the substantive law applicable to the
case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); see also Lofton v. Sec’y of
the Dep’t of Children & Family Servs., 358 F.3d 804, 809 (11th Cir. 2004) (“Only factual
disputes that are material under the substantive law governing the case will preclude entry
of summary judgment.”). Furthermore, “[t]he mere existence of some factual dispute will
not defeat summary judgment unless that factual dispute is material to an issue affecting the
outcome of the case.” McCormick v. City of Ft. Lauderdale, 333 F.3d 1234, 1243 (11th Cir.
2003) (citation and internal quotation marks omitted).
A genuine dispute as to a material fact can be found only “if the evidence is such that
a reasonable jury could return a verdict for the nonmoving party.” Anderson, 477 U.S. at
248; see also Greenberg, 498 F.3d at 1263. However, if the evidence on which the
nonmoving party relies “is merely colorable, or is not significantly probative, summary
judgment may be granted.” Anderson, 477 U.S. at 242 (citations omitted). Likewise, “[a]
mere scintilla of evidence in support of the nonmoving party will not suffice to overcome a
motion for summary judgment[,]” Young v. City of Palm Bay, 358 F.3d 859, 860 (11th Cir.
2004), and the nonmoving party “must do more than simply show that there is some
metaphysical doubt as to the material facts,” Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586 (1986). Furthermore, a nonmoving party’s “conclusory allegations
. . . in the absence of supporting evidence, are insufficient to withstand summary judgment.”
Holifield v. Reno, 115 F.3d 1555, 1564 n.6 (11th Cir. 1997); see also Cordoba v. Dillard’s,
Inc., 419 F.3d 1169, 1181 (11th Cir. 2005) (“Speculation does not create a genuine issue of
fact . . . .”) (emphasis in original).
When a nonmovant fails to set forth specific facts supported by appropriate evidence
sufficient to establish the existence of an element essential to his case and on which the
nonmovant will bear the burden of proof at trial, summary judgment is due to be granted in
favor of the moving party. Celotex Corp., 477 U.S. at 323 (“[F]ailure of proof concerning
an essential element of the nonmoving party’s case necessarily renders all other facts
On the South side of I-85 North (which traverses Alabama mostly from West to East,
or latitudinally) sits the mostly1 vacant but still imposing collection of structures and parking
decks that made up Macon County Greyhound Park, Inc., more commonly referred to as
VictoryLand. Once a small-scale greyhound track in rural Alabama, then a multi-multi
million dollar casino offering electronic bingo, the site now stands as a mausoleum to a short
period of Alabama history when vast profits were made (legally or illegally) off of a game
which its sponsors held out as electronic charity bingo.
VictoryLand has since suspended live greyhound racing, but still offers simulcast sessions
This case is between MCGP and its former employees, and mostly concerns the last
year or so of MCGP’s existence. The beginning of the end for electronic charity bingo at
MCGP can be traced back to December 30, 2008, when then-Governor Bob Riley issued
Executive Order No. 44, which created the Governor’s Task Force on Illegal Gambling.
Seizures of electronic bingo machines at other Alabama establishments offering the game
known as electronic charity bingo resulted in litigation, and on November 13, 2009, the
Alabama Supreme Court issued a decision in Barber v. Cornerstone Comm’y Outreach, Inc.,
42 So. 3d 65 (Ala. 2009). Construing the term “bingo” in Lowndes County’s Local
Amendment No. 674 authorizing charity bingo in Lowndes County (which is nearly identical
to Macon County’s Amendment No. 744), the Supreme Court of Alabama engaged in a
comprehensive discussion of the definition of “bingo” and, based upon its arrived at
definition, dissolved a lower court’s preliminary injunction against the Task Force, reasoning
that the gaming operators “failed to introduce substantial evidence from which the trial court
reasonably could have concluded that [the respondent gaming operators] had a ‘reasonable
likelihood of success’ in proving that the electronic gaming machines seized . . . constituted
the game of bingo.” Id. at 86.
The ramifications of the Alabama Supreme Court’s decision in Cornerstone traveled
up I-85 well in excess of the posted 70 mile per hour speed limit, and MCGP would soon
commence its own litigation in an ultimately futile effort to keep Governor Riley’s Task
Force at bay.
In the interim, on January 5, 2010, MCGP laid off 68 employees because of planned
renovations to the facility’s North Gaming Section.2 (Pls.’ Mot. 9 (Doc. # 44); Def.’s Br. in
Support 3 (Doc. # 74); Def.’s Resp. 3 (Doc. # 56).) The layoffs were expected to be
temporary in nature and MCGP admits that “it did not provide WARN notices to those
employees . . . .” (Def.’s Resp. 3; (Doc. # 106, at 2).) Moreover, MCGP avers that it “did
not have any knowledge that the Governor’s Task Force on Gambling would attempt to raid
its facility one month later.” (Def.’s Resp. 4.)
Meanwhile, the Supreme Court of Alabama denied rehearing in the Cornerstone case
on January 29, 2010. That very day, John M. Tyson, Jr., the task force commander and
special prosecutor for the Governor’s Task Force, arrived at MCGP for the purpose of
seizing MCGP’s bingo machines. Fortunately, it appears that MCGP was prepared for such
an event, because it had a complaint ready to be filed that very morning. Macon Cnty.
Greyhound Park, Inc. d/b/a VictoryLand v. John M. Tyson, Jr., No. 10cv9 (Cir. Ct. Macon
Cnty. Jan. 29, 2010) (Alacourt summary). The litigation effort against the Governor’s Task
Force started well enough, when the Circuit Court of Macon County entered a temporary
restraining order. Tyson v. Macon Cnty. Greyhound Park, Inc., d/b/a VictoryLand, 43 So.
3d 587, 589 (Ala. Feb. 4, 2010). Tyson countered with an emergency motion in the Alabama
Supreme Court to vacate the restraining order, arguing that the Alabama courts lacked
The parties have stipulated (Doc. # 106) that MCGP is a “single site of employment” as
that term is used in the WARN Act and defined in the regulations, see 20 C.F.R. 639.3(i), and case
law, Int’l Union, United Mine Workers, 6 F.3d at 722 (11th Cir. 1993).
subject matter jurisdiction to enjoin criminal prosecutions and investigations. The Alabama
Supreme Court agreed, issuing its opinion on February 4, 2010. Id.
Knowing that a raid was imminent, MCGP closed its doors on February 4, 2010,3 the
day that the Alabama Supreme Court dissolved the Macon County Circuit Court’s temporary
restraining order. It is undisputed that MCGP laid off all of its remaining employees (most
were hired back in March) and admits and stipulates that “[n]o formal letter was sent to
MCGP’s employees pertaining to the layoff . . . .” (Br. in Support 4; Benefield Aff. ¶ 9;
(Doc. # 106, at 3).) However, MCGP notes that it was “entirely obvious” to MCGP’s
employees what was taking place due to both the events on the ground (the appearance of
hundreds of state troopers prepared to seize the bingo machines) and the extensive media
coverage of MCGP’s stand off with the Task Force. After shutting its doors on February 4,
2010, MCGP arranged a meeting to discuss unemployment issues with its employees, and
posted on its website and interstate billboards that it was closed due to the Task Force’s
actions. It is undisputed that none of these communications, either verbal, electronic, in
print, or in large print (on billboards), contained any discussion of or reference to the WARN
Act or MCGP’s reasons for not complying with the WARN Act’s sixty day notice
Plaintiffs had advanced arguments in their briefing that MCGP closed on February 2, 2010,
but has since stipulated that “[t]here was a temporary shutdown of Defendant MCGP on February
4, 2010[.]” (Doc. # 106.)
On March 5, 2010, several Macon County officials and citizens filed another lawsuit
in Macon County Circuit Court alleging, in essence, that the Governor’s Task Force either
lacked authority to investigate and prosecute crimes in Macon County or that it had displaced
the authority vested in Macon County’s duly elected officials. Tyson v. Jones, 60 So. 3d 831,
837 (Ala. 2010) (specifically, a “quo warranto” action). Again, the litigation started well
enough for MCGP. On the same day that the complaint was filed, the Macon County Circuit
Court entered another temporary restraining order in favor of the Macon County plaintiffs.
Id. It appears that MCGP was prepared for good news. The effective time of the order was
12:45 p.m., and MCGP had resumed operations within fifteen minutes. Id. The Macon
County Circuit Court turned the temporary restraining order into a preliminary injunction,
id. at 840, from which the Task Force defendants appealed to the Alabama Supreme Court.
On July 30, 2010, the Alabama Supreme Court returned a unanimous opinion reversing the
Macon County Circuit Court, which dissolved the injunction that effectively allowed MCGP
continue its operations unmolested by the Governor’s Task Force.
On August 9, 2010, only days after the Alabama Supreme Court’s negative ruling in
Tyson, the Task Force was again preparing to raid MCGP’s facilities, and MCGP again shut
its doors to electronic bingo for the final time. As with the February closing, it is undisputed
and stipulated that MCGP did not provide to its employees any formal letter pertaining to the
layoff. (Def.’s Br. in Support 6 (“MCGP notified its employees and customers of the reasons
for this closing via internet and other media . . . that its electronic bingo operations, including
the restaurants and hotels dependant on the operation of electronic bingo, would be closed
until further notice.”); Pl.’s Mot. for Partial Summ. J. (“Again, without WARN notice to
employees, [MCGP] closed its plant and laid off 600 employees on August 9, 2010.”); (Doc.
# 106, at 3).)
This litigation commenced in October 2010, when Plaintiffs filed their Complaint.
(Doc. # 1.) The Court certified the case as a Rule 23(b)(3) class action with three sub-classes
based upon the dates of termination (January, February, or August 2010), and class notice
has been issued. (Docs. # 66, 100.) Plaintiffs seek partial summary judgment on liability
under the WARN Act for all three alleged WARN Act incidents, and Defendants seek
summary judgment generally, arguing that the January 2010 layoff or plant closing was not
a covered WARN Act incident and that the February and August 2010 layoffs or plant
closings are subject to the WARN Act’s “unforeseeable business circumstances” and/or
“good faith” defenses.
The WARN Act
In a nutshell, the WARN Act “requires that an employer provide sixty days notice to
workers before ordering a [plant closing or] mass layoff.” Int’l Union, United Mine Workers
v. Jim Walter Res., Inc., 6 F.3d 722, 724 (11th Cir. 1993) (citing 29 U.S.C. § 2102(a)). The
WARN Act’s legislative purpose is to secure for workers ample notice that their employment
will be terminated so that they can better prepare themselves for reentry into the job market.
The Third Circuit has placed the WARN Act in context and summarized its purpose:
The WARN Act was adopted in response to the extensive worker dislocation
that occurred in the 1970s and 1980s. As companies were merged, acquired,
or closed, many employees lost their jobs, often without notice. In some
circumstances, the projected closing was concealed from the employees.
Congress enacted WARN to protect workers and their families from these
situations. WARN’s notice period was designed to allow workers ‘to adjust
to the prospective loss of employment, to seek and obtain retraining that will
allow [them] to successfully compete in the job market.’ [20 C.F.R. §
639.1(a)]. The thrust of WARN is to give fair warning in advance of
prospective plant closings [or mass layoffs].
Hotel Emps. Local 54 v. Elsinore Shore Assoc., 173 F.3d 175, 182 (3d Cir. 1999).
The Court briefly addresses the elements of Plaintiffs’ WARN Act cause of action.
A WARN Act claim requires that the plaintiff show that: (1) the closing or layoff was a
covered event (i.e., a mass layoff or plant closing, as those terms are defined in the statute);
(2) that the defendant was an “employer” as defined in the statute; and (3) that the plaintiffs
are “affected employees” as defined in the statute. See Bradley v. Sequoyah Fuels Corp., 847
F. Supp. 863, 867-68 (E.D. Okla. 1994); Allen v. Sybase, Inc., 468 F.3d 642, 654-55 (10th
First, it is undisputed and the parties have stipulated that MCGP was an “employer”
during the relevant time periods as that term is defined in 29 U.S.C. § 2101(a)(1) (business
enterprise that employs 100 or more employees, excluding part-time employees).
Second, Plaintiffs must show that the January, February, and August 2010 layoff and
closings were covered events. A “plant closing” is defined as:
the permanent or temporary shutdown of a single site of employment, or one
or more facilities within a single site of employment, if the shutdown results
in an employment loss at the single site of employment during any 30-day
period for 50 or more employees excluding any part-time employees.
A “mass layoff” is defined as:
a reduction in force which . . . (A) is not the result of a plant closing; and (B)
results in an employment loss at the single site of employment during any 30day period for . . . (i)(I) at least 33 percent of the employees (excluding any
part-time employees); and (II) at least 50 employees (excluding any part-time
employees); or (ii) at least 500 employees (excluding part-time employees)[.]
§ 2102 (a)(3).
The January and February 2010 Layoff and Plant Closing
The January 5, 2010 Layoff is Not a Covered Event
With respect to the January 5, 2010 layoffs, the parties have agreed to the following
relevant stipulations. First, the parties have agreed that 68 full time “affected employees”
suffered an “employment loss” on January 5, 2010. (Doc. # 106, at 1.) The parties have
further stipulated that the number of full time employees at MCGP as of November 6, 2009
(60 days prior, as per 20 C.F.R. § 639.5(a)(2)) was 865 (Doc. # 106, at 2). As a result of
A few more terms appearing within this definition need explanation. First, an
“employment loss” “means (A) an employment termination, other than a discharge for cause,
voluntary departure, or retirement, (B) a layoff exceeding 6 months, or (C) a reduction in hours of
work of more than 50 percent during each month of any 6-month period.” § 2101(a)(6). Second,
“the term ‘part-time employee’ means an employee who is employed for an average of fewer than
20 hours per week or who has been employed for fewer than 6 of the 12 months preceding the date
on which notice is required.” § 2101(a)(8). In calculating the average hours, “[t]he [relevant] period
. . . is the shorter of the actual time the worker has been employed or the most recent 90 days.” 20
C.F.R. § 639.3.
these agreed-upon numbers, the parties have also stipulated that the number of layoffs
constituted less that 33% of MCGP’s full time employees.
Essentially, the parties have agreed that, standing alone, the January 5, 2010 layoff
was not a covered event under WARN. MCGP is a “single site of employment,” supra n.2,
which prevents Plaintiffs from asserting that the January 5, 2010 layoff was a “plant closing”
based upon the temporary shutdown of the North Gaming Section. Since it cannot be a plant
closing, the January 2010 layoff is either a “mass layoff” or not a covered event at all. As
stated above, for this layoff of 68 full time employees to be considered a “mass layoff” under
WARN, the layoff must constitute at least 33 percent of the total number of employees. As
of November 6, 2009 (sixty days prior to January 5, 2010), MCGP employed 865 full time
employees. Thus, the January 5, 2010 layoff constituted approximately 7.8% of MCGP’s full
Having determined as much, the January 5, 2010 sub-class of Plaintiffs must rest their
hopes on being able to aggregate their numbers with the February 4, 2010 plant closing.
The February 4, 2010 Closing is a “Plant Closing”
With respect to the February 4, 2010 closing, the parties have agreed to the following
relevant stipulations. Concerning the number of full time employees who suffered an
employment loss, the parties have stipulated that “[m]ore than 50 full time ‘affected
employees’ at Defendant MCGP suffered an ‘employment loss,’ as that term is defined in the
WARN Act at 29 U.S.C. § 2101(a)(6), at [MCGP] during a 30 day period.” (Doc. # 106, at
2.) In fact, the parties have agreed that 249 full time employees suffered an “employment
loss” as a result of the February 4, 2010 plant closing. Furthermore, the parties have agreed
that “less than 33% of the full time ‘affected employees’ at Defendant MCGP that were
employed as of December 6, 2009 [864 employees] suffered an ‘employment loss’ as a result
of the February shutdown.” (Doc. # 106, at 2.) The parties have also agreed that there
occurred a “temporary shutdown” at MCGP on February 4, 2010.
In order to enter partial summary judgment for Plaintiffs on liability as to the February
4, 2010 closings, the Court must be satisfied that there is no genuine issue of material fact
that either a “mass layoff” or “plant closing” actually occurred. As an initial matter, the
definitions section of WARN makes clear that if an event could be considered both a “mass
layoff” or “plant closing,” then a “plant closing” occurred. See § 2101(a)(3)(A) (defining a
“mass layoff” as a “reduction in force which . . . is not the result of a plant closing”).
MCGP rests its argument that the February 4, 2010 closing was not a “plant closing”
on the fact that MCGP re-opened in less than six months. Acknowledging that no precedent
exists in support of its proposition, MCGP argues “[i]t is illogical to claim that the alleged
February ‘plant closing’ was the cause of any ‘employment loss’ when in fact the alleged
‘plant closing’ lasted less than 6 months.” (Def.’s Br. in Support 17 & n.10.) Essentially,
MCGP urges the Court to re-write Congress’s definition of “plant closing” so as to include
a six-month limitation because of its claimed illogicality if the Court did not do so. MCGP’s
argument is to be rejected for two reasons.
First, this Court’s commission is to interpret the law as passed by Congress, not to
attempt to re-write it. The federal judiciary does not stand as a legislative super-committee.
Nat. Fed’n of Indep. Bus. v. Sebelius, Nos. 11-393, 398, 400, 2012 WL 2427810, at *6 (June
28, 2012) (Roberts, C.J.) (“[The federal judiciary] does not consider whether [acts of
Congress] embody sounds policies. That judgment is entrusted to the Nation’s elected
leaders.”); Eldred v. Ashcroft, 537 U.S. 186, 222 (2003) (“The wisdom of Congress’ action,
however, is not within our province to second-guess.”); Pavelic & LeFlore v. Marvel Entm’t
Grp., Div. of Cadence Indus. Corp., 493 U.S. 120, 126 (1989) (“Our task is to apply the text,
not to improve upon it.”). To the contrary, Congress’s intent is found in the words it has
chosen to employ in a particular statute. See W. Va. Univ. Hosps., Inc. v. Casey, 499 U.S.
83, 89 (1991) (“The best evidence of [Congress’s] purpose is the statutory text adopted by
both Houses of Congress and submitted to the President.”).
With respect to the WARN Act, Congress specifically stated that a “plant closing”
may be either permanent or temporary. § 2101(a)(2). Webster’s Third defines “temporary”
as “existing or continuing for a limited time.” Webster’s Third New International Dictionary
2353 (1986). Thus, Congress plainly intended for closings that only last for a limited time
to fit within the definition of a “plant closing.” The Court sees no reason to read into the
statute an arbitrary limitation such as a bright line cut-off point of six months. Washington
v. Aircap Indus. Corp., 831 F. Supp. 1292 (D.S.C. 1993) (“‘WARN is a remedial statute and
must be construed broadly.’” (citing and quoting cases)). Furthermore, even if the Court
were to read in a minimum time limitation for an event to qualify as a “plant closing,” the
duration of the shutdown at MCGP was approximately one month, which the Court considers
to fit within Congress’s intended meaning of “temporary shutdown” under § 2101(a)(2).
Second, WARN provides an outlet for employers who order a plant closing but then
quickly re-open and re-hire most of their employees. A “plant closing” requires at least 50
full time employees to suffer an “employment loss” at the single site of employment. As
stated above, a layoff of less than or equal to 6 months does not constitute an “employment
loss.” § 2101(a)(6). Thus, for example, if an employer orders a shutdown and then re-opens
two weeks thereafter and re-hires all but thirty of its employees, no “plant closing” has
occurred because there was not the requisite employment loss. See 20 C.F.R. § 639.3(b) (“A
‘temporary shutdown’ triggers the notice requirement [for a plant closing] only if there are
a sufficient number of terminations, layoffs exceeding 6 months, or reductions in hours of
work as specified under the definition of ‘employment loss.’”).
Having rejected MCGP’s proposed construction of “temporary shutdown,” the Court
concludes that the parties have essentially stipulated to a February 4, 2010 “plant closing”
and WARN Act violation. MCGP is an employer; there was a “temporary shutdown” at
MCGP on February 4, 2010; as a result thereof, 249 full time employees were “affected
employees” and suffered an employment loss; and MCGP “never mailed or personally served
an individual written WARN Act notice to any ‘afffected employee’ before, at the time of,
or after any ‘affected employee’ suffered an ‘employment loss’ at Defendant MCGP on
February 4, 2010.” (Doc. # 106, at 3.)
The January 5, 2010 Layoff and February 4, 2010 Plant Closing Can Be
As concluded above, by itself, the January 5, 2010 layoff does not meet the WARN
Act’s definition of either a “mass layoff” or “plant closing.” On the other hand, the February
4, 2010 temporary shutdown constituted a “plant closing” within the meaning of WARN.
Since the February 4, 2010 shutdown was a “plant closing,” WARN provides that any full
time employees who suffered an “employment loss” “during any 30-day period” are entitled
to count themselves as “affected employees” of the “plant closing.” § 2101(a)(2) (emphasis
Although Plaintiffs had initially argued that the February closing occurred on February
2, 2010, they now have stipulated that it occurred on February 4, 2010. (Doc. # 106, at 2.)
It just so happens that, if one counts dates exclusively, exactly thirty days elapsed (counting
backwards from the day before the date of the “plant closing”) between February 3, 2010 and
January 5, 2010. However, if one counts inclusively, then thirty-one days elapsed. Thus, the
Court must determine which of these two methods of date-counting the statute contemplates.
The Court begins with Federal Rule of Civil Procedure 6, which states that it
“appl[ies] in computing any time period specified . . . in any statute that does not specify a
method of computing time.” Fed. R. Civ. P. 6(a) (emphasis added). The Eleventh Circuit
endorses a “general policy of finding a legislative intent to apply Rule 6(a) to all federal
statutes enacted or amended subsequent to Rule 6(a)’s promulgation.” Maahs v. United
States, 840 F.2d 863, 867 (11th Cir. 1988); see also Lee v. United States, 977 F.2d 551, 552
(11th Cir. 1992). For computing a period stated in days, Rule 6 opts for the exclusive method
When the period is stated in days . . . exclude the day of the event that triggers
the period; count every day, including intermediate Saturdays, Sundays, and
legal holidays; and include the last day of the period, but if the last day is a
Saturday, Sunday, or legal holiday, the period continues to run until the end of
the next day that is not a Saturday, Sunday, or legal holiday.
Fed R. Civ. P. 6(a)(1)(A)-(C) (emphasis added). Thus, if one employs the exclusive method
of date-counting put forth in the Federal Rules of Civil Procedure, exactly thirty days elapsed
between Wednesday, February 3, 2010 (excluding the “triggering date” of February 4, as per
Fed. R. Civ. P. 6(a)(1)(A)) and Wednesday, January 5, 2010. In such case, the January 2010
layoffs may be aggregated with the February “plant closing.”
The question then becomes whether WARN “specif[ies] a method of computing time”
for its thirty-day period that would displace the exclusive method of Rule 6. Although it is
a close question, the Court finds that the statute does not sufficiently elaborate a specific
method of computing time so as to effectuate an ouster of Rule 6’s exclusive method.
MCGP hangs its hat on Congress’s use of the word “during.” Webster’s Third defines
“during” as “at some point in the course of.” Webster’s Third New International Dictionary
703 (1986). A “course,” in turn, is “the act or action of moving in a particular path from
point to point.”5 Webster’s Third at 522. Importantly, these definitions do not carry much
significance or instruction with regard to where the “points” should be placed. For example,
if one person tells another that a fur seal was in the lead during a race with Usain Bolt, it
would not give the listener much instruction on where the starting and ending points of the
race were located. The race could be in the water (a most likely scenario) or on land or a
combination of both. So it is with Congress’s use of the phrase “during any 30-day period.”
§ 2101(a)(2). The phrase does not offer anything in the way of instructions on where the
starting and ending points for the thirty day period should be placed. In the absence of such
instructions, the Court must defer to Rule 6(a)’s exclusive method of computing time.6
Furthermore, the Advisory Committee Notes regarding the 2009 Amendments to Rule
6 state that “[s]ubdivision (a) does not apply when computing a time period set by a statute
if the statute specifies a method of computing time. See, e.g., 2 U.S.C. § 394 (specifying
This definition of “course” is typically applied to a physical course, such as a race course.
However, the Court views it as the most appropriate definition for “course” in this context because,
as with a race course, in a specific course of days there is both a definite start (a point) and end (a
In fact, the regulations appear to specify a method of computing time that is consistent with
Rule 6(a). 20 C.F.R. § 639.5(a)(1)(i) instructs employers to “[l]ook ahead 30 days and behind 30
days to determine . . . the aggregate for any 30-day period . . . .” Id. (emphasis added). Again,
consulting the dictionary, “ahead” is defined as “at or toward a point of time before another.”
Webster’s Third at 44 (emphasis added). Therefore, if something is “ahead” of another thing, it is
not in a position equal to that thing; it is before that thing. In other words, counting 30 days “ahead”
means counting 30 days, all of which are ahead of the triggering date. It is the same for “behind,”
which the dictionary defines as “in the past” or “gone by.” Webster’s Third at 199. The regulation
instructs employers to count 30 days “in the past” or 30 days “gone by.” The date of the triggering
event itself is not a date “gone by” or “in the past” of the triggering event. In other words, the
regulations tell employers to start counting the thirty days at [triggering event + 1] or [triggering
event – 1].
method for computing time periods prescribed by certain statutory provisions relating to
contested elections to the House of Representatives).” Thus, 2 U.S.C. § 394 stands as an
example of what a statute substantively must convey in order to set out its own methods for
computing time. Its comprehensiveness is in direct contradistinction to the five word phrase
employed in § 2102(a)(2).
In light of the non-specificity of § 2102, the Court reverts to the “general policy” of
applying Rule 6(a)’s method of computing time and defers to its exclusive method of date
counting. Accordingly, the Court finds that the January 5, 2010 layoffs may be aggregated
with the February 4, 2010 plant closing.7
The August 2010 “Plant Closing”
Finally, with respect to the August 9, 2010 closing, the parties have stipulated that a
“‘plant closing’ and/or ‘mass layoff’ occurred at Defendant MCGP as those terms are defined
under the WARN Act at 29 U.S.C. § 2102(a)(2).” (Doc. # 106, at 3.) The parties further
stipulate that “Defendant MCGP never mailed or personally served an individual written
WARN Act notice to any ‘affected employee’ before, at the time of, or after any ‘affected
employee’ suffered an ‘employment loss’ at Defendant MCGP on August 9, 2010.” (Doc.
# 106, at 3.) Thus, the parties have effectively stipulated that a “plant closing” occurred on
August 9, 2010, and that there was a WARN Act violation.
Thus, even if the February 4, 2010 closing is not a “plant closing,” as MCGP has argued,
it is nevertheless a “mass layoff” in the aggregate because more than 33 percent of MCGP’s
employees were laid off during the thirty day period.
MCGP asserts two statutory defenses as a basis for either elimination or reduction of
its liability. The Court addresses and rejects both defenses in turn.
Unforeseeable Business Circumstances
In imposing the sixty day notice requirement, Congress remained sensitive to the fact
that there might exist scenarios where providing such advanced notice is impossible or
impracticable. Section 2102(b) is entitled “Reduction of notification period[,]” and provides
employers with several enumerated defenses. One of these defenses is commonly referred
to as the “unforeseeable business circumstances” defense: “An employer may order a plant
closing or mass layoff before the conclusion of the 60-day period if the closing or mass layoff
is caused by business circumstances that were not reasonably foreseeable as of the time that
notice would have been required.” § 2102(b)(2)(A).
Before turning to the merits of such a defense (a fact issue typically reserved for a
jury, see, e.g, Pena v. Am. Meat Packing Corp., 362 F.3d 418 (7th Cir. 2004)), a court must
satisfy itself that the defendant employer can properly avail itself of the defense. WARN
imposes two requirements (both found in § 2102(b)(3)) of employers who seek the shelter
of the “unforeseeable business circumstances” defense: “An employer relying on this
subsection shall give as much notice as is practicable and at that time shall give a brief
statement of the basis for reducing the notification period.” § 2102(b)(3). Federal courts
have interpreted § 2102(b)(3) as imposing a condition precedent to reliance on the
“unforeseeable business circumstances” defense. See, e.g., Alarcon v. Keller Indus., Inc., 27
F.3d 386, 388-89 (9th Cir. 1994) (“When the notice period is shortened pursuant to [the
“unforeseeable business circumstances” exception], the employer must give as much notice
as is practicable, and ‘at the time notice actually is given, [the employer must] provide a brief
statement of the reason for reducing the notice period, in addition to the other elements [of
proper notice] set out in [20 C.F.R.] § 639.7.’” (quoting 20 C.F.R. § 639.9) (emphasis
added)); Grimmer v. Lord Day & Lord, 937 F. Supp. 255, 258 (S.D.N.Y. 1996) (rejecting
defendant employer’s argument that non-compliance with § 2102(b)(3) “should have no
consequences” because “[a]dopting this position would . . . treat Congress’ language in §
2102(b)(3) as meaningless”); In re Quantegy, Inc., 343 B.R. 689, 696 (Bankr. M.D. Ala.
2006) (Williams, B.J.) (awarding plaintiff summary judgment on defendant’s WARN Act
defenses because notice provided by defendant employer was inadequate under §
2102(b)(3)); Organogenesis, Inc. v. Andrews, 331 B.R. 500, 502 (D. Mass. 2005) (“An
employer who wants to reduce the notification period must comply with the clear statutory
requirement that the termination notice contain an explanation for the shortened time.”);
Acevedo v. Heinemann’s Bakeries, Inc., 619 F. Supp. 2d 529, 536 (N.D. Ill. 2008).
Therefore, prior to addressing the merits of MCGP’s unforeseeable business
circumstances defenses as to the aggregated January and February 2010 and August 2010
closings, the Court must satisfy itself that MCGP both (1) “[gave] as much notice as [was]
practicable[,]” and (2) “at that time . . . [gave] a brief statement of the basis for reducing the
notification period.” § 2102(b)(3). The Court readily concludes that MCGP did not comply
with § 2102(b)(3) and, therefore, may not rely on any of the defenses listed in § 2102(b),
including the unforeseeable business circumstances defense.
It may be argued that WARN contemplates and makes room for a scenario where the
giving of § 2102(b)(3) notice can be excused altogether and the employer can nevertheless
rely on one of the defenses listed in § 2102(b)(1)-(2). The Court does not read the statute in
this fashion. The availability of an impossibility of notice argument hinges on the meaning
of “as much notice as is practicable[,]” as that phrase is employed in § 2102(b)(3). The
phrase can be interpreted in one of two ways. First, it could mean something similar to “as
advanced notice as is practicable.” Under this construction, the adjective “much” refers to
the timing of the notice. Second, “much” could refer to the substantiveness of the notice.
Under such a reading, “as much notice as is practicable” could arguably contemplate no
notice at all.
For several reasons, the Court reaches the conclusion that the first reading is the one
that Congress intended. As an initial matter, in a setting such as the WARN Act – a statute
concerned almost exclusively with time intervals – the first reading (“as advanced notice as
is practicable”) is a more natural reading in this context. Furthermore, this reading is
reinforced by the words immediately following: “shall give as much notice as is practicable
and at that time . . . .” § 2102(b)(3) (emphasis added). Congress’s “at that time” language
refers back to the “as much notice as is practicable” phrase, and demonstrably indicates that
Congress’s concern in that clause was timing, not substance.8
In addition, § 2102(b)(3) imposes two requirements, the second of which concerns the
substantiveness of the notice: “and . . . shall give a brief statement of the basis for reducing
the notification period.” Id. To read the first portion of this conjunctive statutory subsection
substantively would result in a redundant and potentially contradictory statute. As to
redundancy, such a construction of § 2102(b)(3) would impose both a general and a specific
directive regarding the notice. In other words, the statute would read, “give as much
substantive notice as is practicable, but also give a brief statement of the basis for reducing
the notification period.” The more general directive would be eviscerated by the specific
As to the contradiction inherent in such a reading, the statute would arguably make
room for no notice at all, while at the same time requiring a brief statement for reducing the
notification period. How could an employer comply with the brief statement requirement
when it is not required to give notice at all?
In fact, § 2102(b) in entitled “Reduction of notification period.” Congress’s choice of title
for this statutory subsection reveals both Congress’s concern for timing (with its emphasis on the
“period”) and Congress’s intention that § 2102(b)(3) impose a condition precedent for providing
notice at some point in order to invoked one of the listed defenses (or else the subsection would have
been more appropriately titled “Reduction or elimination of notification period”).
Moreover, the regulations lend themselves to a temporal reading of “as much notice
as practicable.” 20 C.F.R. § 639.9, discussing the relevant clause of § 2102(b)(3), states: “If
[the unforeseeable business circumstances defense] is applicable, the employer must give as
much notice as is practicable . . . and this may, in some circumstances, be notice after the
fact.” Id. This regulation is instructive because it reveals that the Department of Labor
interprets the “as much notice as is practicable” language as imposing a time, and not a
substance, requirement on employers regarding the § 2102(b)(3) notice. See also 29 U.S.C.
§ 2107 (delegating to the Department of Labor the power to “prescribe such regulations as
may be necessary to carry out [WARN]”). “[A]s required by Chevron, U.S.A., Inc. v. Natural
Res. Def. Counsel, Inc., 467 U.S. 837, 844 (1984), [this Court] accords significant weight to
the statutory interpretation of the executive agency charged with implementing the statute
being construed, particularly where, as here, that interpretation is incorporated in a formally
published regulation.” Martinez-Mendoza v. Champion Intern. Corp., 340 F.3d 1200, 1208
n.25 (11th Cir. 2003) (citing Caro-Galvan v. Curtis Richardson, Inc., 993 F.2d 1500, 1507
(11th Cir. 1993)); see also Hotel Emps. & Rest. Emps. Int’l Union Local 54 v. Elsinore Shore
Assocs., 173 F.3d 175, 183 (3d Cir. 1999) (stating that Department of Labor regulations
published pursuant to authority under WARN Act are subject to Chevron deference).
Finally, the case law, as far as this Court is able to discern, is unanimous in its support
of the view that § 2102(b)(3) imposes a firm requirement of notice prior to being able to rely
on one of the defenses listed in § 2102(b)(1)-(2). As discussed above, the cases that are
directly on point view § 2102(b)(3) as setting a condition precedent. Even the appellate cases
concerning the unforeseeable business circumstances that do not directly tackle § 2102(b)(3)
are instructive to a degree. For example, in Pena v. American Meat Packing Corporation,
the Seventh Circuit considered the merits of the unforeseeable business circumstances
defense. 362 F.3d 418 (7th Cir. 2004). In that case, prior to reaching the merits of the
defense, the court obligatorily stated that WARN “notice was sent to [the] employees . . . .”
Id. at 420. The content of that notice will be discussed below. The Third Circuit also noted
that a notice was given in the Elsinore case. 173 F.3d at 178.
Accordingly, the case law, the regulations, and the unambiguous statutory language
in § 2102(b)(3) support the Court’s conclusion that § 2102(b)(3) imposes a condition
precedent: an employer who seeks to reduce or eliminate the 60 day notice period pursuant
to the unforeseeable circumstances defense must issue a notice pursuant to and that complies
with § 2102(b)(3). This is an affirmative requirement that cannot be excused.
As to the actual “giving” of notice, it is undisputed that no formal notice was delivered
to any of the affected employees prior to or after the February or August 2010 plant closings.
(Doc. # 62-1, at 8-9.) However, MCGP argues that no formal notice need have been given
because, for both incidents, it was obvious what was occurring. There was intense media
coverage surrounding MCGP’s closings, and MCGP issued press releases and
billboard/internet notifications concerning the events. (Def.’s Resp. 4-6; Benefield Aff. ¶ 15;
Def.’s Interrog. Resps (Doc. # 62-1).) Clearly, this is not the “giv[ing] . . . notice” that §
2102(b)(3) or the regulations interpreting it contemplated. 20 C.F.R. § 639.8 is entitled
“How is the notice served?” and states that “[a]ny reasonable method of delivery to the
parties listed under § 639.6 [the affected employees themselves or their representative, if
there is one] . . . which is designed to ensure receipt of the notice . . . is acceptable[.]” §
639.8 (emphasis added).
Thus, the benchmark for proper notice is the level of certainty regarding the
employees’ actual receipt of it. In understanding what this means, the regulation concerning
delivery of notice continues by listing some examples of proper or improper notice. Proper
notice includes first class mail, personal delivery with optional signed receipt, or potentially,
insertion of the notice directly into the affected employees’ pay envelopes. Id. One example
of improper notice is a preprinted notice regularly included in each employee’s pay check or
pay envelope. Id.
Applying these principles to MCGP’s arguments, it is abundantly clear, as an initial
matter, that assumptions of the employees’ knowledge of the circumstances does not displace
WARN’s notice requirement.9 Second, internet postings and billboard advertisements are
likewise insufficient because they do not ensure with any certainty that the affected
employees actually received such notice. § 639.8. The statute, § 2102(b)(3), and the
regulation, § 639.8, employ verbs such as “give” or “serve” and nouns such as “delivery” and
This is so not only because there is a lack of delivery of any notice, but also because the
complete omission of notice necessarily means that the employer did not provide a “brief statement
of the basis for reducing the notification period.” § 2102(b)(3). This will be discussed infra.
“receipt.” All of these words contemplate some sort of physically translative action. In
contrast, a “display” on a billboard or internet site plainly does not fit within this category
of verbiage because there is no ensured physical transfer of information from employer to
employee. Accordingly, the Court finds that, as a matter of law, no notice was given of the
February and August 2010 closings.
Furthermore, even if the Court did conclude that MCGP’s displays on billboards and
internet sites constituted notice, that notice would be wholly inadequate as failing to provide
a “brief statement of the basis for reducing the notification period.” § 2102(b)(3). In
Alarcon, the Ninth Circuit “conclude[d] that Congress’ purpose in requiring a brief statement
must have been to provide employees with information that would assist them in determining
whether the notice period was properly shortened.” 27 F.3d at 389. The Southern District
of New York provided an additional employer-oriented rationale: to “focus[ ] employers on
the statutory conditions that must be met to reduce the notice period by prohibiting employers
from relying on a vague justification for giving shortened notice.” Grimmer, 937 F. Supp.
2d at 257. To those two persuasive rationales, this Court adds one more: to prohibit
employers who have failed to provide the requisite 60-day notice from asserting litigationconvenient but factually post hoc justifications for their actions.
These inquiries into Congress’s objectives for the notice requirement of § 2102(b)(3)
shed light on what the notice substantively must convey. All of these rationales focus on the
validity of the defense that will be asserted if sued under the WARN Act. Accordingly, the
Grimmer court’s statement that an employer must provide “reasonably specific facts[,]” 937
F. Supp. at 257, is to be interpreted as “reasonably specific facts [that would put the
employees on notice of the WARN Act, of the defense, and of the facts in support of the
defense.]” Again, the statutory language of giving “a brief statement of the basis for
reducing the notification period” makes this plain. The brief statement requirement is not
satisfied when an employer states in general terms the basis for its actions, see In re
Quantegy, 343 B.R. at 696 (explaining that notices referring to “financial restructuring” and
“financial issues” “[do] not explain a reduced notice period”), because there is no reference
to WARN, to the defense, or to the reasons for reducing the notification period. In fact,
several courts have decided that a notice that actually does reference the statute and the
defense is not enough to satisfy § 2102(b)(3). See Grimmer, 937 F. Supp. 2d at 257 (“By
providing that an employer must give a brief statement of the basis for the shortened notice,
Congress indicated that it intended something more than a citation to the statute or a
conclusory statement summarizing the statutory provision. If an employer could comply with
§ 2102(b)(3) by simply parroting a statutory exception, this section of the statute would serve
no purpose.”); Alarcon, 27 F.3d at 390 (stating that “reference to the statute alone would not
have constituted a sufficient brief statement”). Although by itself not sufficient, a reference
to the statute, however, is essential to proper notice because it provides the affected
employees with the framework for evaluating the validity of the defense. One cannot assess
the propriety of a legal defense without first having knowledge of the existence of the law.
Thus, having assumed that MCGP’s press releases/billboards constitute a “notice”
within the meaning of WARN, the Court turns to the content of those messages. One such
document pertaining to the August 2010 closing is entitled “VictoryLand Schedule” and is
attached to Dr. Benefield’s affidavit. After listing MCGP’s scheduled hours, the document
enters into what can be classically described as a rant:
On Monday, August 9, 2010, VictoryLand Greyhound Park was faced with
being illegally raided b [. . .] illegal gambling task force. One can simply type
our name into any popular search engine and fo [. . .] shenanigans and threats
by the state’s self-appointed Czar. The Alabama Supreme Court ruled t [. . .]
Governor’s office was based simply and solely on the “opinion” of the
Governor. Without going in [. . .] madness; VictoryLand, along with other
facilities, have been forced to either close or reduce open [. . .] effective with
the reopening on Thursday, August 12 2010 VictoryLand is currently operating
as [. . .] facility with live greyhound wagering along with simulcast greyhound
and thoroughbred wagering [. . .] throughout America. During this period,
Quincy’s Triple Seven Charity Bingo, the SportsBook, the Oasis Buffet,
Luigi’s [. . .] Oasis Hotel remain closed until further notice.
(Benefield Aff., Ex. A.)10
This statement comes nowhere close to satisfying § 2102(b)(3)’s “brief statement”
requirement. Nowhere is the WARN Act mentioned; nowhere is the “unforeseeable business
circumstances” defense mentioned; and there are scant facts in support of such a defense.
A second “notice” appears to be two screen shots of internet pages, which contain
VictoryLand’s and/or Quincy’s 777’s logo. The e-poster thanks VictoryLand’s employees
for their support and states in large letters that VictoryLand is “temporarily closed due to Bob
The Attachment cuts off a portion of the lines, which is reflected in the Court’s block
Riley’s attempt to destroy VictoryLand.” (Benefield Aff., Ex. A.) The “notice” urges the
employees to contact their legislator and ends with this exclamatory phrase: “Let the people
Again, there is no reference to the WARN Act; no reference to the
“unforeseeable business circumstances” defense; and scant facts to support such a defense.
Furthermore, there is no date on the notice, and no way for the Court to tell when it was
issued and to which plant closing it might apply.
A third “notice” is an unsigned and unattributed memorandum titled “News Release”
and was issued on February 5, 2010. The body of the statement reads in full:
Shorter, Ala. – Due to its temporary closing, VictoryLand announced
that it will distribute employee paychecks at the Macon County Courthouse on
Saturday, February 6, 2010, from 8:00 a.m. to 1:00 p.m. The offsite payroll
distribution, according to VictoryLand officials, was necessary because of
Governor Riley’s ongoing efforts to close bingo facilities around the state.
The payroll distribution will take place on the 2nd floor of the Macon
County Courthouse at 101 Rosa Parks Avenue in Tuskegee.
“This is the unfortunate result of the governor’s politically motivated
anti-bingo campaign,” said VictoryLand Chief Operating Officer Lewis T.
Benefield. “Governor Riley has caused thousands of good, hardworking
people to be displaced from their jobs at a time when decent-paying jobs are
difficult to find.”
“The Governor might like to pat himself on the back for bringing big
industries, with tax-free incentives, to the state, but he brings them to
Alabama’s more prosperous counties. What about the forgotten counties like
Macon? The people here need jobs too, and VictoryLand has been proud to
supply them despite the governor’s relentless war against us,” said Benefield.
Benefield vowed that the fight to re-open VictoryLand, Macon
County’s largest employer, and enable its more than 1,200 employees to return
to work, will continue full force. He also expressed deep thanks to Macon
County for opening its offices for VictoryLand’s payroll distribution on
(Benefield Aff., Ex. A.)
As stated above, the document is unsigned and there is no way the Court can attribute
it to MCGP. It is beyond argument that MCGP cannot ride the coattails of another entity’s
document to satisfy its notice requirements under WARN. Furthermore, like the two
previous “notices,” there is no reference to the WARN Act; no reference to the
“unforeseeable business circumstances” defense; and scant facts in support of such a defense.
In toto, these documents suggest that MCGP was more concerned with its public
relations campaign than with apprising its employees of their legal rights. None of these
three items, individually or collectively, come anywhere close to satisfying MCGP’s
obligation to give notice prior to relying on one of the defenses in § 2102. Therefore,
assuming that these documents do qualify as a “notice,” they do not substantively convey
enough information “of the basis for reducing the notification period” to be considered
adequate under WARN. § 2102(b)(3). Again, the Seventh Circuit’s Pena case is instructive
on this point. The following notice was issued by the employer in that case and was not
challenged by the plaintiffs under § 2102(b)(3) either at the district court or at the Seventh
Based on unforeseeable business circumstances, i.e., the United States
Department of Agriculture’s sudden, dramatic, and unexpected suspension of
inspection at our Normal Avenue plant on November 2, 2001, and the
implications that this unforeseeable closing has for AMPAC’s ability to
continue operating the plant in the future, AMPAC has decided to permanently
close the plant on November 16, 2001. As a result, your employment with
AMPAC will be permanently terminated on November 16, 2011.
This notice is given to you pursuant to the Worker Adjustment and
Retraining Notification Act, which requires employers to give notice to
employees who will lose their jobs due to a plant closing. Because this step
was based upon the USDA’s sudden and unforeseeable decision to suspend
inspection at this plant, we were unable to provide you with greater advance
Pena v. Am. Meat Packing Corp., 258 F. Supp. 2d 864, 870 (N.D. Ill. 2003). The notice in
Pena stated both the statute and the defense, and provided a brief statement as to the basis
for the reduction in the notification period. This Court is reasonably confident that such a
notice, if challenged, would have been found sufficient under § 2102(b)(3). Contrasting the
(likely) § 2102(b)(3) compliant notice in Pena to the “notices” in this case is illustrative of
just how deficient MCGP’s messages are in complying with § 2102(b)(3)’s “brief statement”
To summarize, MCGP provided no notice to be able to avail itself of the
unforeseeable business circumstances defense, as is required under § 2102(b)(3).
Furthermore, even if MCGP’s submitted documents can be called notices, they are
inadequate under § 2102(b)(3)’s brief statement requirement as a matter of law. Thus,
Plaintiffs are entitled to summary judgment on MCGP’s “unforeseeable business
circumstances” defense as it pertains to the February and August 2010 closings.11
Assuming, arguendo, that the Court arrived at the merits of MCGP’s unforeseeable
business circumstances defense – a fact issue – MCGP bears the burden of proving to the jury that
the “business circumstances were not reasonably foreseeable.” § 2102(b)(2)(A). The Cornerstone
case arguably put MCGP on notice as of late 2009 that its electronic charity bingo was, in fact, illegal
gambling. That MCGP would be subject to a criminal investigation for illegal conduct seems quite
reasonably foreseeable. It appears doubly reasonably foreseeable as of August 2010, when MCGP
had already been threatened with raids once. Thus, the Court would be inclined to deny MCGP’s
The Good Faith Defense
Section 2104(a)(4) provides that the Court may reduce a WARN Act defendant’s
liability in certain circumstances:
If an employer which has violated this chapter proves to the satisfaction of the
court that the act or omission that violated this chapter was in good faith and
that the employer had reasonable grounds for believing that the act or omission
was not a violation of this chapter, the court may, in its discretion, reduce the
amount of the liability or penalty provided for in this section.
29 U.S.C. § 2104(a)(4).
“The ‘good faith’ defense requires proof of the employer’s subjective intent to comply
with the [WARN] Act, as well as evidence of objective reasonableness in the employer’s
application of the Act.” Castro v. Chicago Hous. Auth., 360 F.3d 721, 730 (7th Cir. 2004)
(citing cases); see also Frymire v. Ampex Corp., 61 F.3d 757, 767-68 (10th Cir. 1995) (citing
cases). As the employer, MCGP bears the burden of proof on both elements of this
mitigation defense. Id. Moreover, because WARN is a remedial statute, the good faith
defense “must be narrowly construed.” Id. For example, “[m]ere ignorance of the WARN
Act is not enough to establish the good faith exception.” Childress v. Darby Lumber, Inc.,
357 F.3d 1000, 1008 (9th Cir. 2004). Finally, this Court enjoys a substantial amount of
discretion with regard to this defense. See Saxion v. Titan-C-Mf’g, Inc., 86 F.3d 553, 561-62
(6th Cir. 1996) (stating that “even where good faith is manifest, . . . the decision to reduce
the amount of damages is within the discretion of the district court”).
summary judgment motion on the merits of the defense.
MCGP has failed to meet its summary judgment burden with respect to the good faith
defense. First, MCGP has submitted no temporally relevant evidence of its subjective intent
to comply with the WARN Act.12 Affidavits prepared for ongoing WARN Act litigation reek
of self-service and cannot suffice for the subjective component of this narrowly construed
defense. See Frymire, 61 F.3d at 768-69 (considering evidence from time of WARN Act
violation and finding subjective component satisfied). See Washington v. Aircap Indus., Inc.,
860 F. Supp. 307, 318 (D.S.C. 1994) (considering evidence of employer’s meeting with
counsel at time of WARN Act violation but nevertheless rejecting good faith defense because
of employer’s “cavalier[ ]” treatment of the situation).
Moreover, MCGP has failed to demonstrate that it satisfies the objective component
of the good faith defense. Assuming that MCGP had a subjective intent to comply with the
Act, its complete failure to provide any kind of notice before, at the time of, or after the
February or August 2010 plant closings, even when it became obvious that notice would be
required,13 likely precludes MCGP from obtaining any reduction in damages based upon the
good faith defense.
The Court considers “temporally relevant” evidence to be evidence from the time of the
WARN Act violation.
Indeed, as discussed above, MCGP has essentially stipulated that plant closings occurred
in February 2010 and August 2010.
The Court, in its discretion, will decline to grant MCGP’s summary judgment motion
as it relates to the “good faith” defense. However, MCGP may re-argue the defense, along
with any additional evidence it may have, as the case progresses on damages.
Plaintiff’s Motions to Strike
As an initial matter, Plaintiffs’ motion to strike MCGP’s affirmative defenses (Doc.
# 43) is partially mooted. Second, despite the fact that judges enjoy discretion to strike
pleadings pursuant to Rule 12(f), “striking a party’s pleading . . . is an extreme and
disfavored measure.” See BJC Health Sys. v. Columbia Cas. Co., 478 F.3d 908, 917 (8th Cir.
2007); Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.3d 1045,
1057 (5th Cir. 1982) (stating that “motions to strike a defense are generally disfavored”); see
also 5C C. Wright & A. Miller, Federal Practice and Procedure 3d § 1380 (2004) (stating
that “motions under Rule 12(f) are viewed with disfavor by the federal courts and are
infrequently granted”). Third, this Court has joined the growing minority of courts to have
held that the plausibility pleading standards of Twombly/Iqbal do not apply to affirmative
defenses. See Equal Emp’t Opp. Comm’n v. Joe Ryan Enter., Inc., No. 3:10cv795, 2012 WL
_____ (M.D. Ala. _____) (Fuller, J.) (published). For these reasons, the Court will deny
Plaintiffs’ motion to strike affirmative defenses (Doc. # 43).
Plaintiffs’ motion to strike a portion of MCGP’s summary judgment brief (Doc. # 84)
is also mooted by the stipulations entered into between the parties (Doc. # 106) and by
MCGP’s withdrawal of the offending employee roster.
In arriving at the disposition outlined above and ordered below, the Court is mindful
that this case involves “controlling question[s] of law as to which there is substantial ground
for difference of opinion.” 28 U.S.C. § 1292(b). Moreover, despite the disposition of the
liability phase of this case, resolving WARN Act damages will involve significant
expenditures of time and labor on the part of the parties and the Court. In fact, yet to be
decided upon is the procedure to be used for this monumental task. Given the posture of this
case and the questions involved, an interlocutory appeal would “materially advance the
ultimate termination of the litigation.” Id. Accordingly, the Court certifies this case as
appropriate for interlocutory appeal pursuant to 28 U.S.C. § 1292(b). Although the Court
will not stay further proceedings at this juncture, it will entertain any such motion if an
interlocutory appeal is both pursued and taken up by the Eleventh Circuit.
Accordingly, it is ORDERED:
Plaintiffs’ Motion for Partial Summary Judgment as to WARN Act liability
and as to MCGP’s “unforeseeable business circumstances” defense (Doc. #
44) is GRANTED;
Defendant MCGP’s Motion for Summary Judgment (Doc. # 73) is DENIED;
Plaintiffs’ Motions to Strike (Docs. # 43, 84) are DENIED;
The pretrial hearing and trial in this case, scheduled for July 24, 2012, and
August 20, 2012, respectively, are CANCELLED; and,
The case, subject to the above observations on interlocutory appeals, will
proceed on WARN Act damages.
DONE this 6th day of July, 2012.
/s/ Mark E. Fuller
UNITED STATES DISTRICT JUDGE
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