U.S. Equal Employment Opportunity Commission v. Timeless Investments, Inc. et al

Filing 53

ORDER GRANTING Plaintiff's 32 Motion for Summary Judgment as to First, Second, Fourth, Fifth, Sixth, Seventh, Eighth, and Ninth Affirmative Defenses; DENYING Plaintiff's Third Affirmative Defense; DENYING Defendant's 31 Motion for Summary Judgment on the issue of conciliation, regarding Rule 25(a), regarding Carlbergs damages, regarding Plaintiffs ADEA claim, regarding laches and Carlberg; GRANTING Defendants motion for summary judgment regarding laches and Rex, signed by Chief Judge Anthony W. Ishii on 8/13/2010. (Marrujo, C)

1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT FOR THE 7 EASTERN DISTRICT OF CALIFORNIA 8 9 10 11 12 13 14 15 16 17 18 19 This is a suit brought under 29 U.S.C. § 621 et seq., the Age Discrimination in 20 Employment Act ("ADEA"), by the Equal Employment Opportunity Commission ("EEOC") 21 against Defendant Timeless Investments, Inc. ("Timeless"). The EEOC brings this suit on behalf 22 of two charging parties, James Rex ("Rex") and Larry Carlberg ("Carlberg"), who unsuccessfully 23 applied for employment with Timeless. The EEOC seeks injunctive relief for the public interest 24 and seeks compensatory and liquidated damages for Rex and Carlberg. Both parties move for 25 summary judgment ­ Timeless on the claims against it and the EEOC on various affirmative 26 defenses. For the reasons that follow, the motions will be granted in part and denied in part. 27 28 EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, ) ) ) Plaintiff, ) ) v. ) ) TIMELESS INVESTMENTS, INC. dba ) EZ TRIP GOLDEN STATE ) CONVENIENCE AND AUTO/TRUCK ) PLAZA, and DOES 1-5, inclusive, ) ) Defendant. ) ) ____________________________________) 1:08-cv-1469 AWI SMS ORDER ON DEFENDANT'S AND PLAINTIFF'S RESPECTIVE MOTIONS FOR SUMMARY JUDGMENT

(Doc. Nos. 31, 32)

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BACKGROUND1 Timeless operates Klein's Truck and Auto Plaza, which is located in Fresno, California, and consists of a convenience store and gas station ("EZ Trip"), a fuel desk or plaza ("the Plaza"), a truck repair shop, and a restaurant. See PUF 1.1. In July 2004, Timeless had an opening for cashier positions because at least four cashiers had ended their employment. See PUF 1.2,2 11.6, 11.7. Specifically, four cashiers separated from Timeless on June 21, 2004, and a fifth separated on July 19, 2004. See PUF 11.6. Sometime in the summer of 2004, Timeless placed an advertisement in the Fresno Bee confirming that they were looking for a cashier. PUF 1.8. The advertisement read: "CASHIER STOCKING: Up to $10/hr., apply in person, see manager @ - - - - N. Golden State Blvd., near Herndon." Plaintiff's Ex. 169; see also PUF 7.1. Timeless received over 160 applications in response to this add. See DUF 37; see also PUF 11.2. Insurance benefits were not provided for the cashier positions. See Shiralian Dec. ¶ 11. In July 2004, Timeless's president Shawn Shiralian ("Shiralian") was responsible for hiring management level employees, and former general manager, Harry Rafayelyan ("Rafayelyan") was responsible for hiring non-management employees, including cashiers. See PUF 1.3, 3.14, 13.7; DRPUF 1.3; Plaintiff's Ex. 230. Rex saw the add in the Fresno Bee. See Defense Ex. B. On July 5, 2004, Rex filled out an application with Timeless. PUF 3.1. Rex was told by "Alicia" to write his age on the application because the manager wanted to know the applicant's age.3 Id.;4 see also DUF 11.
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" P U F " refers to Plaintiff's Undisputed Material Facts, and "DUF" refer's to Defendant's Undisputed M a te r ia l Facts. T im e le s s disputes this PUF. However, Timeless does not dispute PUF 11.6, which identifies five cashiers w h o separated from Timeless in June and July 2004, or PUF 11.7, which identifies four cashiers hired in July 2004. PUF 1.2 is not genuinely disputed. Alicia Corona has declared that she never asked an applicant write down their age on an application. See C o r o n a Dec. ¶ 3. This is a material dispute. Since Timeless moves for summary judgment, the Court must take the fa c ts in favor of the EEOC. For purposes of this motion only, Alicia asked Rex to write down his age. T im e le s s objects that the statements of "Alicia" are hearsay. However, Rafayelyan testified that clerks d is tr ib u te and accept applications, see Rafayelyan Depo. at 54:21-55:8, 57:24-58:3; PUMF 3.3, time records indicate th a t Alicia Corona was working on July 5, see PUMF 3.5, and Rafayelyan confirmed that one of Timeless's cashiers a c c e p te d both Rex and Carlberg's applications. See PUMF 3.7. The indication is that "Alicia" was Alicia Corona a n d that speaking about the application was within the course and scope of her duties as a clerk. Under these c ir c u m s ta n c e s , Alicia's statements are admissible as admissions of a party opponent. See Fed. R. Ev. 801(d)(2)(D).
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Rex wrote his age on the application. See Defense Ex. B. Rex was 60 years old in July 2004. See PUF 3.9. Rex's application indicates that he was currently employed at a Mobil gas station as a cashier, he had been employed as a cashier since March 15, 2004, he was also currently employed as a caterer, he was a high school and trade school graduate, he requested a salary of $9.00/hour, and he could start work on July 20, 2004, i.e. in roughly two weeks. See Defense Ex. B; see also PUF 5.2; DUF 3. Rex was neither interviewed nor hired by Timeless. PUF 6.1. Carlberg saw Timeless's advertisement in the Fresno Bee and went to the identified location to apply on July 6, 2004. See PUF 2.2; Defense Ex. C. When Carlberg submitted his application, he was asked by a female clerk to write his age on the upper right hand corner of the application. PUF 2.3; see also DUF 11. Carlberg questioned the clerk's request. See id. Carlberg told the clerk, "I thought you were not supposed to ask me my age." PUF 2.4. The clerk told him that it might be to his advantage to write down his age because the younger men who had been hired did not show up for work. See Carlberg Depo. 27:1-3. Carlberg wrote his age in the upper right hand corner of his application. See Defense Ex. C. Carlberg was 62 years old in July 2004. PUMF 2.1. Carlberg's application indicated that he was employed part time, he was employed as a "driver" making $8.00/hour, he was a high school graduate, he desired a wage of $10.00/hour, he could start the next day (July 7, 2004), and that his previous jobs were as a tree trimmer/greens keeper. See Defense Ex. C. Carlberg's application does not indicate that he had any cashier experience. See id. At some point while speaking with the clerk, the manager was referenced, the clerk pointed out the manager, and the manager looked at Carlberg and told Carlberg that he would call him. See Carlberg Depo. 32:23-33:9.5 Carlberg was neither interviewed nor hired by Timeless. PUF 6.1. On July 14, 2004, Timeless hired Paul H., who was 30 years old, as a cashier. See PUF 6.2, 11.7, 12.20; Plaintiff's Ex. 168; Court's Docket Doc. No. 32 at p. 6 & No. 39 at 5. On July 15, 2004, Timeless hired Marisela G., who was 18 years old, as a cashier. See id. On July 22, 2004, Timeless hired Jessica G., who was 21 years old, as a cashier. See id.; PUF 10.10. On
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T h e EEOC contends that Carlberg returned to the store some other day and spoke to the manager. H o w e v e r , as Timeless correctly points out, Carlberg unambiguously testified that he never returned and that the c o n v e r s a tio n with the manager occurred on the day he submitted his application. See Carlberg Depo. 32:18-33:9.

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July 29, 2004, Timeless hired Dominque C., who was 27 years old, as a cashier. See id. On October 20, 2004, Timeless hired Steve F., who was 21 years old, as a cashier. See id. Marisela G's application and Steve F.'s application do not indicate any prior cashier experience. See PUF 6.3, 6.4, 9.1; Plaintiff's Exs. 131, 133. Rafayelyan declared that he does not recall receiving Rex and Carlberg's applications, does not recall interviewing anyone within a week of July 4 because he would have been too busy to do so, and generally reviews the most recent applications unless there are no qualified individuals among the most recent applications. See Rafayelyan Dec. ¶ 9. With respect to the reasons for not hiring Rex and Carlberg, Rafayelyan declares: Assuming I did review their applications, I would not have interviewed them in any event. That is because Mr. Rex was working two other jobs and not immediately available, and Mr. Carlberg [] had no experience as a cashier. With 160 applications for a single position, I had the luxury of being very `picky' and would skip over the application of any candidate who was less than perfect who had immediate availability. Neither claimant fit the need I had at the time. If a candidate was not available to work immediately I did not consider them, as I did not want to wait for the candidate to give the customary two weeks notice to the other employer. When hiring, I usually needed to fill a position quickly and did not have two weeks to spare for any candidate, no matter how qualified. Mr. Rex was not immediately available. Id. at ¶¶ 10, 11; see also DUF's 24- 27, 32.

17 On or about July 29, 2004, Rex filed a charge of age discrimination against Timeless. 18 PUF 8.1. Under the "particulars" section of the charge, Rex indicated, "On July 5, 2004, I filled 19 out an application for employment with [Timeless]. When I submitted the application, 20 [Timeless] told me to write my age on the upper right-hand corner of the application. I was not 21 selected for the position. [Timeless]'s employee Alicia (LNU) told me that her manager liked to 22 know the age of each applicant. I believe I was discriminated against because of my age." 23 Defense Ex. H. 24 On or about November 23, 2004, Carlberg filed a charge of discrimination against 25 Timeless. PUF 8.2. The "particulars" section of the charge generally follows, and is consistent 26 with, Carlberg's deposition testimony ­ a female clerk asked for his age, Carlberg stated that he 27 did not think that this could be asked, and the clerk responded that it might be to his advantage 28 4

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because the younger hires had caused trouble. See Defense Ex. J.6 On October 4, 2004, and December 3, 2004, Timeless sent the EEOC various documents and information. See Defense Exs. E, F. On September 28, 2006, the EEOC sent Timeless a letter of determination. See PUMF 8.9. On January 24, 2008, the EEOC a letter to Timeless and offered to conciliate. See Plaintiff's Exs. 179, 180. On February 29, 2008, the parties had a conciliation meeting. See Plaintiff's Ex. 206. On September 29, 2008, the EEOC filed this lawsuit. PUMF 8.15. Sometime in December 2008, Rex died. See Nostrant Depo. 51:23-25.

SUMMARY JUDGMENT FRAMEWORK Summary judgment is appropriate when it is demonstrated that there exists no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970); Fortyune v. American Multi-Cinema, Inc., 364 F.3d 1075, 1080 (9th Cir. 2004). The party seeking summary judgment bears the initial burden of informing the court of the basis for its motion and of identifying the portions of the declarations (if any), pleadings, and discovery that demonstrate an absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). A fact is "material" if it might affect the outcome of the suit under the governing law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986); Thrifty Oil Co. v. Bank of America Nat'l Trust & Savings Assn, 322 F.3d 1039, 1046 (9th Cir. 2002). A dispute is "genuine" as to a material fact if there is sufficient evidence for a reasonable jury to return a verdict for the non-moving party. Anderson, 477 U.S. at 248; Long v. County of Los Angeles, 442 F.3d 1178, 1185 (9th Cir. 2006). Where the moving party will have the burden of proof on an issue at trial, the movant must affirmatively demonstrate that no reasonable trier of fact could find other than for the movant. Soremekun, 509 F.3d at 984. Where the non-moving party will have the burden of
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T h e r e is one significant difference between Carlberg's EEOC charge and his deposition testimony. His c h a r g e indicates that he returned to EZ Trip over two days, and on the second day the manager said he would review C a r lb e r g 's application. See Defense Ex. J. However, Carlberg's deposition testimony states that he did not return to th e EZ Trip. See Carlberg Dep. 32:18-33:9. The Court will credit Carlberg's sworn deposition testimony.

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proof on an issue at trial, the movant may prevail by presenting evidence that negates an essential element of the non-moving party's claim or by merely pointing out that there is an absence of evidence to support an essential element of the non-moving party's claim. See James River Ins. Co. v. Schenk, P.C., 519 F.3d 917, 925 (9th Cir. 2008); Soremekun, 509 F.3d at 984; Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1105-06 (9th Cir. 2000). If a moving party fails to carry its burden of production, then "the non-moving party has no obligation to produce anything, even if the non-moving party would have the ultimate burden of persuasion." Nissan Fire & Marine Ins. Co. v. Fritz Companies, 210 F.3d 1099, 1102-03 (9th Cir. 2000). If the moving party meets its initial burden, the burden then shifts to the opposing party to establish that a genuine issue as to any material fact actually exists. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); Nissan Fire & Marine, 210 F.3d at 1103. The opposing party cannot "`rest upon the mere allegations or denials of [its] pleading' but must instead produce evidence that `sets forth specific facts showing that there is a genuine issue for trial.'" Estate of Tucker v. Interscope Records, 515 F.3d 1019, 1030 (9th Cir. 2008) (quoting Fed. R. Civ. Pro. 56(e)). The evidence of the opposing party is to be believed, and all reasonable inferences that may be drawn from the facts placed before the court must be drawn in favor of the opposing party. See Anderson, 477 U.S. at 255; Matsushita, 475 U.S. at 587; Stegall v. Citadel Broad, Inc., 350 F.3d 1061, 1065 (9th Cir. 2003). Nevertheless, inferences are not drawn out of the air, and it is the opposing party's obligation to produce a factual predicate from which the inference may be drawn. See Sanders v. City of Fresno, 551 F.Supp.2d 1149, 1163 (E.D. Cal. 2008); UMG Recordings, Inc. v. Sinnott, 300 F.Supp.2d 993, 997 (E.D. Cal. 2004). "A genuine issue of material fact does not spring into being simply because a litigant claims that one exists or promises to produce admissible evidence at trial." Del Carmen Guadalupe v. Agosto, 299 F.3d 15, 23 (1st Cir. 2002); see Galen v. County of Los Angeles, 477 F.3d 652, 658 (9th Cir. 2007); Bryant v. Adventist Health System/West, 289 F.3d 1162, 1167 (9th Cir. 2002). Further, a "motion for summary judgment may not be defeated . . . by evidence that is `merely colorable' or `is not significantly probative.'" Anderson, 477 U.S. at 249-50; Hardage v. CBS Broad. Inc., 427 6

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F.3d 1177, 1183 (9th Cir. 2006). Additionally, the court has the discretion in appropriate circumstances to consider materials that are not properly brought to its attention, but the court is not required to examine the entire file for evidence establishing a genuine issue of material fact where the evidence is not set forth in the opposing papers with adequate references. See Southern Cal. Gas Co. v. City of Santa Ana, 336 F.3d 885, 889 (9th Cir. 2003); Carmen v. San Francisco Unified Sch. Dist., 237 F.3d 1026, 1031 (9th Cir. 2001). If the nonmoving party fails to produce evidence sufficient to create a genuine issue of material fact, the moving party is entitled to summary judgment. See Nissan Fire & Marine, 210 F.3d at 1103.

I. A.

PLAINTIFF'S MOTION

First Affirmative Defense ­ Failure to State a Claim Plaintiff's Argument The EEOC argues that Timeless already filed an unsuccessful Rule 12(b)(6) motion.

Because the issue has previously been briefed and litigated, and because there are no new arguments that would justify dismissal, it is inappropriate for Timeless to raise the argument again as an affirmative defense. Defendant's Response Timeless argues that there is a dispute as to whether the complaint states sufficient facts to state a claim under the ADEA. The only fact alleged is that Rex and Carlberg were requested to give their ages. Such a request is not improper. Further, Rex was working two jobs and worked up until the last two months of his life when illness prevented him from working. The complaint gives rise to a dispute whether the ADEA claim is supported by sufficient facts. Discussion The Court previously denied a Rule 12(b)(6) motion from Timeless and determined that the complaint adequately states a claim under Rule 8 for violation of the ADEA. See Court's Docket Doc. No. 15. Nothing has changed from the time of that ruling. As such, the complaint continues to state a claim. See id. The Court will grant summary judgment on this affirmative

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defense.7 See id.

B.

Second & Eighth Affirmative Defenses ­ Statute of Limitations Plaintiff's Argument The EEOC argues that 29 U.S.C. § 626, as amended by § 115 of the Civil Rights Act of

1991, incorporates the Supreme Court's holding that Title VII imposes no statute of limitations period upon the EEOC. This applies to ADEA claims brought by the EEOC. Thus, these affirmative defenses fail as a matter of law. Defendant's Response Timeless argues that 29 U.S.C. § 626(e) applies to the EEOC and thus, imposes a 90-day statute of limitations on the agency to file suit once it has terminated proceedings. Here, the EEOC told Timeless in February 2008 that a lawsuit was forthcoming, yet no lawsuit was filed until September, well later than 90 days. Discussion In pertinent part, 29 U.S.C. § 626(e) reads: If a charge filed with the [EEOC] under this Act is dismissed or the proceedings of the [EEOC] are otherwise terminated by the [EEOC], the [EEOC] shall notify the person aggrieved. A civil action may be brought under this section by a person defined in section 11(a) [29 USC § 630(a)] against the respondent named in the charge within 90 days after the date of the receipt of such notice. 29 U.S.C. § 626(e). This Court is unaware of a Ninth Circuit opinion that directly addresses the issue of whether § 626(e)'s 90-day limitations period applies to the EEOC. One district court has found that § 626(e)'s 90 day period applies to the EEOC. McConnell v. Thomson Newspapers, 802 F.Supp. 1484, 1499-1500 (E.D. Tex. 1992). However, McConnell appears to be a distinct minority. Most courts find that the § 626(e) limitations period does not apply to lawsuits filed by the EEOC. See EEOC v. Inc. Vill. of Valley Stream, 535 F. Supp.2d 323, 325 (E.D. N.Y. 2008);
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B y granting summary judgment on this affirmative defense, the Court is not precluding arguments r e g a r d in g "mitigation" or "back pay" as to Rex. See Court's Docket Doc. No. 44 at 3:7-10. Furthermore, summary j u d g m e n t on this affirmative defense has no effect on Timeless's ability to argue to the jury that it did not violate the A D E A . See EEOC v. NCL Am., Inc., 536 F.Supp.2d 1216, 1224 (S.D. Cal. 2007).

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EEOC v. Lennar Homes of Ariz., Inc., 2005 U.S. Dist. LEXIS 22305, *10-*11 (D. Ariz. Sept. 30, 2005); EEOC v. Venator Group, Specialty, Inc., 2002 U.S. Dist. LEXIS 1727, *5-*6 (S.D. N.Y. Feb. 5, 2002); EEOC v. AT&T Co., 36 F. Supp. 2d 994, 995-97 (S.D. Ohio 1998); EEOC v. Sara Lee Corp., 923 F.Supp. 994, 999 (W.D. Mich. 1995); Wilkerson v. Martin Marietta Corp., 875 F.Supp. 1456, 1459-60 (D. Colo. 1995). These courts generally rely on the legislative history of § 626(e) specifically, and the ADEA in general, in reaching their conclusion. See, e.g., AT&T Co., 36 F.Supp.2d at 995-97. Timeless does not sufficiently explain why the Court should follow McConnell. In the absence of controlling authority, the Court finds the majority approach persuasive. Because the 90-day limitations period of § 626(e) does not apply to suits by the EEOC, summary judgment on this affirmative defense is appropriate.

C.

Third Affirmative Defense ­ Failure to Mitigate Plaintiff's Argument The EEOC argues that, because it is a government agency, the defense of mitigation has

no application to it. As to mitigation regarding Rex and Carlberg, no facts substantiate this defense. It is undisputed that both Rex and Carlberg continued to seek active employment after Timeless did not hire them. Because they sought employment, they did not fail to mitigate. Defendant's Response Timeless argues that victims of employment discrimination are under a duty to mitigate their losses. Where an employee has failed to mitigate, back pay may be reduced or forfeited. As to Carlberg, the evidence shows that he stopped looking for work about a month after he filed his application. He was on social security disability before he applied, and remains on social security disability to date. Carlberg is not entitled to back pay from 2004 through the present. As to Rex, the evidence adduced is that he worked until illness prevented him from working. There is no proof that he suffered damages and no evidence regarding mitigation efforts. Rex failed to attend the conciliation meeting, and his failure may be viewed as a form of failure to mitigate. As to the EEOC, if they had been more prompt in their efforts, the claims for back pay would have been significantly smaller, such that the case could have resolved. 9

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Discussion As the EEOC's reply memorandum makes clear, the EEOC's argument is that because Rex and Carlberg continued to look for employment, they did not fail to mitigate. See Court's Docket Doc. No. 50 at 4:23-24. The EEOC supports its argument through its proposed undisputed fact that, "Both Rex and Carlberg continued to actively seek employment after 2004." PUF 18. That proposed fact is based on deposition testimony from Carlberg and Adam Nostrant ("Nostrant"), who is Rex's stepson. See id. There are problems with the EEOC's position. First, an ADEA claimant "must attempt to mitigate damages by exercising reasonable care and diligence in seeking reemployment after termination." Cassino v. Reichhold Chem., 817 F.2d 1338, 1345 (9th Cir. 1987); Jackson v. Shell Oil Co., 702 F.2d 197, 201 (9th Cir. 1983). The reasonableness of mitigation efforts depends upon the particular circumstances of the plaintiff/claimant. See EEOC v. Pape Lift, Inc., 115 F.3d 676, 684-85 (9th Cir. 1997). Simply asserting that Rex and Carlberg continued to look for work, without more, does not sufficiently indicate "reasonable care and diligence." See Cassino, 817 F.2d at 1345. Second, the evidence cited by the EEOC does not show that Rex and Carlberg continued to actively seek employment after 2004. With respect to Carlberg, although he testified that he sought employment with two nurseries and a bus company after his application with Timeless,8 see Carlberg Dep. 46:4-23, he also testified that the last time he "looked for jobs" was "probably 2005." See Carlberg Dep. 13:10-16; see also PUF 7.4. In other words, from 2005 to his deposition in 2009, Carlberg did not attempt to find work. The Court cannot find that this testimony shows reasonable care and diligence as a matter of law.9 Summary judgment is inappropriate. As for Rex, the EEOC cites two excerpts from Nostrant's deposition. See PUF 18. Page 24 lines 12 through 25 is a discussion regarding papers in Nostrant's possession that may show

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C a r lb e r g also testified that he did not apply for any cashier positions. See Carlberg Dep. 47:6-8.

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I n fact, the testimony as it stands indicates that from sometime in 2005 to the present, Carlberg exercised n o diligence in seeking employment.

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Rex's damages, and a statement that Nostrant has W2's from 2004 through 2007.10 However, there is no discussion as to what exactly those W2's reflect. See Nostrant Dep. 24:24-25. More importantly, the fact that W2's may exist for most of the relevant time period alone says nothing about the reasonableness of mitigation efforts, it merely shows that some income was earned. Cf. Pape Lift, 115 F.3d at 684-85; Cassino, 817 F.2d at 1345. The second excerpt runs from page 30 line 8, to page 32 line 24. That section deals with whether Rex was working in the years 2006, 2007, and 2008. See id. at 30:8-32:24. Those sections establish that Nostrant thought that Rex was working in those years, but he does not know where Rex worked, he does not know if Rex was working full or part time, he does not know if Rex was working throughout those years, he would see Rex around 3 or 4 times a month from 2005 through 2007, and he testified with respect to 2005, "I wasn't the keeper of his hours. I don't know." Id. at 30:14-33:12. Nostrant's testimony is far from certain. The testimony states a general belief as to whether Rex worked and includes a significant number of "I don't know" answers. There is a distinct lack of particulars and specific information. A generalized belief that Rex worked, without more, does not show reasonable care and diligence as a matter of law. The deposition excerpts are not a sufficient basis for the Court to grant summary judgment in the EEOC's favor. Cf. Cassino, 817 F.2d at 1345. Finally, Timeless's opposition argues that the EEOC's failure to promptly prosecute this case increased the amount of backpay that is potentially at issue. It is true that the failure of an employee/applicant to mitigate his damages will limit the EEOC's ability to recover damages for that employee/applicant under the ADEA. See Waffle House, 534 U.S. at 296-97. However, the Court is aware of no authority that supports Timeless's argument that the EEOC itself must mitigate. Timeless cites no authority that supports its argument, and it is the defendant's burden to establish mitigation. See Cassino, 817 F.2d at 1345. Timeless has not adequately developed this theory. In the absence of authority, the Court will grant summary judgment in favor of the

A s part of Timeless's motion for summary judgment, Timeless states that the EEOC "could not produce" R e x 's W 2 's for 2006, 2007, and 2008. See Court's Docket Doc. No. 31-2 at 13 & n.8. Only W 2 's from 2004 and 2 0 0 5 have been submitted in connection with the parties' respective motions.

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EEOC, to the extent that Timeless attempts to argue that the EEOC's failure to prosecute this case in a prompter fashion constitutes a failure to mitigate.

D.

Fourth Affirmative Defense ­ Conditions Precedent Plaintiff's Argument11 The EEOC argues that it issued letters of determination that stated that relief was sought

for Rex and Carlberg. The EEOC offered to conciliate. The parties held a conciliation conference on February 29, 2008. Timeless rejected the EEOC's offer. The evidence is undisputed that a conciliation effort was attempted, and suit was filed after the conciliation efforts failed. Further, as supplemental briefing shows, additional conciliation/settlement efforts were made after February 29, 2008. Finally, in response to supplemental briefing, the EEOC states that, given the position of the parties and the efforts that have been made, staying the action for further conciliation would be futile. Defendant's Opposition Timeless argues that the EEOC's conciliation efforts were to wait almost four years, hand Timeless and its new attorney a "draconian agreement," fail to work with Timeless, and then to file suit. Specifically, Timeless was shown a typed agreement with blank spaces for dollar amounts. Timeless was told that there was no room to negotiate liability, the only reason for conciliation was to determine how much money the EEOC was willing to accept, and no negotiation regarding other aspects of settlement would occur. Other aspects of the settlement included requiring Timeless to hire a consultant to oversee its operation, frequent reports to the EEOC, and opening all of its books to the EEOC. Further, Timeless was not allowed to take the conciliation agreement out of the EEOC office unless it was signed, and was told that if the agreement was not signed, the EEOC would ensure that the cost of litigation would exceed the

T h e EEOC identifies four conditions precedent and argues that it has met all four conditions. Timeless o n ly responds to the conciliation condition. Because Timeless did not address three of the conditions in its o p p o s itio n , summary judgment is appropriate as to the EEOC's receipt of the charges, investigation of the charges, a n d reasonable cause determination. See Shakur v. Schriro, 514 F.3d 878, 892 (9th Cir. 2008); Jenkins v. Cty. of R iv e r s id e , 398 F.3d 1093, 1095 n. 4 (9th Cir. 2005).

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cost of settlement. Additionally, in supplemental briefing, Timeless states that it is not amenable to the Court staying the matter for further conciliation. Conciliation/Settlement Efforts On January 24, 2008, the EEOC sent letters to Timeless offering the opportunity to conciliate the claims of Rex and Carlberg. See PUF 8.10; Plaintiff's Exs. 179, 180. On February 29, 2008, an unsuccessful conciliation conference occurred. See Plaintiff's Ex. 206; see also Shiralian Dec. ¶ 12. On the same day, the EEOC sent a letter to Timeless offering to conciliate one more time. See Plaintiff's Ex. 206. In pertinent part, the letter: (1) made note of all parties' obligation to conciliate in good faith; (2) gave Timeless until March 14, 2008, in which to agree to further conciliation; and (3) recounted that, at conciliation the EEOC had explained that it was seeking back pay and non-monetary relief for Rex and Carlberg under the ADEA because they had not been hired due to their ages, the EEOC had shown several applications that referenced age, and the EEOC indicated that a number of other applications included dates of birth or comments regarding age. Id. On March 3, 2008, Timeless's counsel sent a letter in response. See Garcia-Bautista Dec. Ex. 6. The letter indicates that: (1) the EEOC refused to share findings and essentially wanted Timeless to take its word that discrimination occurred; (2) no evidence was presented that indicated age discrimination, and the EEOC refused to identify the name of Timeless's employee who allegedly mentioned age; (3) conclusory allegations of discrimination are insufficient; and (4) because of the "incredulous atmosphere" at the conciliation, another conciliation meeting would not be fruitful. See id. The letter concludes by stating that unless more information is provided, there is nothing further to discuss. See id. Between March 4, 2008, and August 17, 2008, it appears that some negotiations between the parties occurred.12 However, it is unknown what amount of contact occurred or what form the contact took. On August 18, 2008, the EEOC sent a letter to Timeless's counsel. See Garcia-Bautista
12

I t also appears that from March 4 to September 9, Timeless negotiated with a different EEOC attorney th a n the one who appeared at conciliation.

13

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Dec. Ex. 7. The letter states that it would provide copies, without the customary charge, of documents that Timeless had initially produced. See id. The letter also stated that Timeless's counsel would be communicating with Timeless about a settlement, but counsel had agreed in principal to settle with a consent decree. See id. Included in the decree would be efforts to recruit employees who are over 40, record keeping, age discrimination training, posting, and reporting to the EEOC regarding progress. See id. The letter states that there is an agreement to continue discussions once the attorneys had contacted the charging parties and corporate officers regarding a monetary settlement. See id. On September 3, 2008, the EEOC sent a letter to Timeless's counsel that purports to be a follow up to an August 25, 2008, telephone conversation. See Garcia-Bautista Dec. Ex. 8. The letter states that: (1) Timeless's counsel had agreed to injunctive relief and had offered to pay $5,000; (2) the sum of $5,000 was too small and that, excluding benefits and liquidated damages, lost wages totaled about $63,000;13 (3) Timeless was willing to settle up to $7,500; (4) Timeless invited EEOC to seek headquarter approval for filing a suit; (5) before filing suit, the EEOC wanted to ensure that Timeless understood the EEOC's offer and explanation of settlement; and (6) "the EEOC's sole purpose at this point is to resolve this matter before proceeding to litigation." Id. The letter explains the injunctive relief sought as recruitment of 40-plus-year-old employees, training on age discrimination, reviewing and ensuring that Timeless has policies against age discrimination, a notice posting, and standardized hiring procedures. Id. The letter explains that damages totaling $150,000 may occur, other persons who have been discriminated against may be sought, and this would exceed a purported $20,000 in defense expenses. Id. The letter further explains that if bankruptcy concerns are at issue, the EEOC is willing to look at financial records in order to "reach a different income sensitive amount." Id. Finally, the letter provides a counter-offer of $48,000. Id. On September 9, 2008, Timeless's counsel sent a reply letter. See Garcia-Bautista Dec. Ex. 9. The letter stated that the EEOC's proposal was not acceptable, but did agree that the
13

T h e EEOC stated that this figure was based on lost wages from July 2004 to December 2006, at a wage of $ 1 0 /h o u r . See Garcia-Bautista Dec. Ex. 8. The figure also included interest, and subtracted other income. See id.

14

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mutual purpose was to avoid litigation. See id. The letter described confusion since Timeless employs many employees over the age of 40, but concluded by saying, "none of the injunctive requests burden my client, as you are essentially requiring him to continue the status quo." Id. The letter discusses liability and damages, and then concludes by stating that $7,500 is the bottom line. See id. On September 29, 2008, the EEOC filed this lawsuit. See Court's Docket Doc. No. 1. Legal Standard The ADEA mandates that the EEOC notify potential employer-defendants and seek to eliminate alleged unlawful practices through "informal methods of conciliation, conference, and persuasion." 29 U.S.C. § 626(d); EEOC v. Pan American World Airways, Inc., 897 F.2d 1499, 1505 n.5 (9th Cir. 1990). One court has characterized conciliation as "notably an assignment to be played by ear for it requires flexibility and responsiveness to the attitudes of the other participants and to the developing positions taken by them in conversations." Brennan v. Ace Hardware Corp., 495 F.2d 368, 376 (8th Cir. 1974). "Conciliation is a jurisdictional condition precedent to suit by the EEOC." EEOC v. Bruno's Restaurant, 13 F.3d 285, 288 (9th Cir. 1992); EEOC v. Pierce Packing Co., 669 F.2d 605, 608 (9th Cir. 1982). The EEOC must conciliate in good faith. EEOC v. Prudential Fed. Savs. & Loan Assn., 763 F.2d 1166, 1169 (10th Cir. 1985). When the EEOC fails to conciliate in good faith, a court may stay the proceedings to allow for conciliation or dismiss the case. See EEOC v. Asplundh Tree Expert Co., 340 F.3d 1256, 1261 (11th Cir. 2003); Pierce Packing, 669 F.2d at 608-09; Brennan, 495 F.2d at 376. If an employer is "unwilling to engage in any discussion regarding [a] charge" following invitations to conciliate, the obligation to attempt a good faith conciliation will be satisfied. See Bruno's, 13 F.3d at 289; Prudential Fed., 763 F.2d at 1169; Marshall v. Sun Oil Co. (Delaware), 605 F.2d 1331, 1337 (5th Cir. 1979). Discussion There is a split among the circuits regarding the proper standard for reviewing whether the EEOC has attempted to conciliate in good faith. See EEOC v. Supervalu, Inc., 674 F. Supp. 2d 1007, 1008 n.1 (N.D. Ill. 2009). One approach is highly deferential and focuses on whether 15

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the EEOC attempted to conciliate, the "form and substance of the EEOC's conciliation proposals are within the discretion of the EEOC and are not subject to judicial second-guessing." EEOC v. Keco Indus., Inc., 748 F.2d 1097, 1102 (6th Cir. 1984); EEOC v. Paramount Staffing, Inc., 601 F.Supp.2d 986, 990 (W.D. Tenn. 2009). The other approach posits that the EEOC must meet three requirements to fulfill its conciliation duty: (1) outline to the employer the reasonable cause for its belief that the ADEA has been violated; (2) offer an opportunity for voluntary compliance; and (3) respond in a reasonable and flexible manner to the reasonable attitudes of the employer. See EEOC v. Asplundh Tree Expert Co., 340 F.3d 1256, 1259 (11th Cir. 2003); EEOC v. Johnson & Higgins, Inc., 91 F.3d 1529, 1534 (2d Cir. 1996); EEOC v. Klingler Electric Corp., 636 F.2d 104, 107 (5th Cir. 1981). To the Court's knowledge, the Ninth Circuit has not addressed this issue, and some courts within the Ninth Circuit have adopted the Keco approach, e.g. EEOC v. California Psychiatric Transitions, Inc., 644 F.Supp.2d 1249, 1273 (E.D. Cal. 2009), while others are in line with Klingler.14 E.g. EEOC v. Arizona, 824 F.Supp. 898, 901 (D. Ariz. 1991). Based on the evidence presented to the Court, the result of this motion will not change, irrespective of the approach utilized. Therefore, the Court will not choose which standard to adopt. Under the Keco approach, there is no doubt that the EEOC met that standard. There is no dispute that a face to face conciliation meeting occurred on February 29, 2008. Further, in the follow up letter sent by the EEOC to Timeless, the EEOC offered to continue to conciliate and stated that all parties are to conciliate in good faith. See Plaintiff's Ex. 206. The evidence shows that the parties continued to negotiate into September 2008. This evidence is sufficient to establish a good faith conciliation under Keco. See Keco, 748 F.2d at 1102. Under the Klingler approach, the Court would be compelled to conclude that no good faith conciliation occurred on February 29, 2008. It appears that the first and second Klingler

T h e approach of the Tenth Circuit is not clear. One case is in line with Keco, see EEOC v. Zia Co., 582 F .2 d 527 (10th Cir. 1978), while the Second Circuit in Johnson & Higgins characterized EEOC v. Prudential Fed. S a v s . & Loan Assn., 763 F.2d 1166 (10th Cir. 1985) as consistent with its approach. Prudential Fed. Savs. stated th a t conciliation involved two parties, and that the EEOC's conciliation efforts would be sufficient "so long as [the E E O C ] makes a sincere and reasonable effort to negotiate by providing the defendant an adequate opportunity to r e s p o n d to all charges and negotiate possible settlements." Prudential Fed., 763 F.2d at 1169.

14

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considerations were met, either through the conciliation meeting or the same-day follow up letter, albeit not to the satisfaction of Timeless. The EEOC explained that it believed that Rex and Carlberg did not get hired because of age discrimination, the EEOC showed Timeless applications that had notations regarding age, and the EEOC indicated that a number of applications had comments regarding age. Cf. EEOC v. Hibbing Taconite Co., 266 F.R.D. 260, 274 (D. Minn. 2009) (following Klingler approach and holding that conciliation "does not necessitate that the EEOC disclose all of the underlying evidence or information to the employer," rather conciliation "requires that the EEOC provide the employer with sufficient information to assure that the employer knows the basis of the charge, and is able to participate in the conciliation process fully."). The EEOC then gave Timeless the opportunity to sign settlement agreements. However, the problem is the third Klingler consideration. The uncontradicted declarations of Timeless's officer and attorney indicate an inexplicable rigidity, an unwillingness to materially discuss the substantive allegations, and unreasonable demands by the EEOC ­ the antithesis of a good faith conciliation is reflected. See Shiralian Dec. ¶¶ 12-14; Kharazi Motion Dec. ¶¶ 17-18; Kharazi Opposition Dec. ¶¶ 10-13. In other words, Timeless's declarations show that the EEOC failed to respond to Timeless at the conciliation "in a reasonable and flexible manner to the reasonable attitudes of the employer." Klingler, 636 F.2d at 107. Nevertheless, the conciliation session in February 2008 was not the only attempt to discuss and settle this dispute. From the evidence submitted, it is apparent that the parties continued to discuss possible resolutions for Rex and Carlberg's respective charges. See Garcia-Bautista Dec. Exs. 7, 8, 9. Of particular importance are the September 3, 2008, letter from the EEOC and Timeless's September 9, 2008, reply. As outlined above, these correspondences show that negotiations had been partially successful in that the parties were in agreement about injunctive relief. See id. at Exs. 8, 9. The only "hitch" appears to have been the dollar amount that Rex and Carlberg were to receive as compensatory damages. The EEOC explained its position on the dollar amount, stated that if bankruptcy was a concern that a more "sensitive amount" could be reached, and then lowered their demand by $15,000, or roughly 24%. See id. at Ex. 8. The EEOC explained 17

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that it was continuing the negotiation efforts, despite Timeless stating that the EEOC should receive headquarters's approval for a lawsuit, in order to avoid litigation. See id. Timeless did not accept the EEOC's counter-offer, did not offer further explanation regarding its offer of $7,500, and did not specifically critique either the $63,000 offer or the $48,000 counteroffer. Once Timeless reiterated that $7,500 was "the bottom line and no more," id. at Ex. 9, the EEOC was under no obligation to make further conciliation efforts. See Bruno's, 13 F.3d at 289; Prudential Fed., 763 F.2d at 1169; Marshall, 605 F.2d at 1337. With the September 3, 2008, letter, the EEOC responded to Timeless "in a reasonable and flexible manner to the reasonable attitudes of the employer." Klingler, 636 F.2d at 107. That a dollar amount could not be agreed upon is not fatal. The EEOC has met its burden of showing good faith conciliation efforts. Summary judgment in favor of the EEOC is appropriate.

E.

Fifth Affirmative Defense ­ Misconduct The EEOC argues that "misconduct" is not a cognizable affirmative defense under the

ADEA. Further, there is no evidence to support any culpability. Defendant's Response Timeless argues that Rex and Carlberg's application "included incorrect and somewhat misleading information." Court's Docket Doc. No. 44 at p.7:2-3. Rex did not fully disclose that he was employed full time by another gas station. Carlberg failed to disclose that he had been laid off from his truck driving job. Carlberg also failed to disclose that he had applied for and was receiving social security disability payments, which would have precluded him from working. Finally, the EEOC refused to discuss the merits of the case at conciliation and waited four years to bring suit. Discussion It is not clear to the Court that Timeless has alleged a valid defense. Timeless cites no authority that acknowledges such a defense or discusses the parameters of a "misconduct" defense in an ADEA setting. In fact, no cases or authority of any kind are cited in the pertinent 18

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section of Timeless's opposition. With respect to the EEOC, the argument raised by Timeless rests entirely on conciliation. Attempting to characterize the EEOC's conduct during conciliation as "misconduct" is a minor variation of Timeless's prior arguments, and the Court has already addressed conciliation. With respect to Rex, it is not clear that Rex failed to disclose that he worked "full time" because no evidence is cited in support of this assertion.15 Assuming that Rex worked "full time," the Court does not see how an alleged failure by Rex to disclose that information is a defense to anything. Rex's failure to disclose does not affect whether Timeless engaged in age discrimination, nor does his failure to disclose his complete employment status affect the damages available.16 With respect to Carlberg's social security benefits/disability status, the Court sees the same problems as with Rex. Carlberg's failure to disclose does not affect whether Timeless engaged in age discrimination, nor does his failure to disclose his social security status effect the damages available.17 As for Carlberg's failure to disclose being laid off from his truck driving position, the evidence does not support Timeless's assertion. Carlberg testified that he "quit" that position, not that he was "laid off." See Carlberg Dep. at 10:9-25. However, even if Carlberg was "laid off," how that information is relevant, or how the failure to disclose that information is relevant, is nowhere explained by Timeless. Timeless has failed to adequately explain its "misconduct" defense, both in the general context of the ADEA and the specific factual setting of this case. Summary judgment in favor of the EEOC is appropriate.18

15

24
16

R e x 's application reads that he was currently employed as a cashier at a gas station. See Defense Ex. B.

25 26 27 28

R e x 's actual employment status might be relevant to the amount of damages suffered and/or mitigation. H o w e v e r , the failure to disclose to Timeless his employment status would be irrelevant to the damages issue. Assuming that Carblerg's actual social security status might affect the damages available, the failure to d is c lo s e that information to Timeless would be irrelevant to the damages issue. Summary judgment on this affirmative defense is based on the alleged "failure to disclose" certain in fo r m a tio n . The grant of summary judgment on the "misconduct" defense is not intended as a grant of summary j u d g m e n t on the issue of mitigation or whether particular types of damages are unavailable as a matter of law.
18 17

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F.

Sixth Affirmative Defense ­ Impossibility The EEOC argues that the defense of "impossibility" is in the nature of a contract defense

and has no application to this case. Timeless responds that it has determined that this affirmative defense does not apply in this case. See Court's Docket Doc. No. 44 at 7:15-17. In light of Timeless's concession, the Court will grant summary judgment.

G.

Seventh Affirmative Defense ­ In Pari Delicto The EEOC argues that the defense of in pari delicto is a contractual defense that has no

application to this case. Timeless responds that it has determined that this affirmative defense does not apply in this case. See Court's Docket Doc. No. 44 at 7:19-21. In light of Timeless's concession, the Court will grant summary judgment.

H.

Ninth Affirmative Defense ­ Reservation of Affirmative Defenses Plaintiff's Argument The EEOC argues that the reservation of affirmative defenses is not supportable under

Rule 8(a)(2) and fails to give notice under Rule 8(a). Other courts have granted summary judgment on identical reservations/defenses.19 Defendant's Response Timeless responds that the ninth affirmative defense is simply a reservation that informs the parties that other affirmative defenses may be available as discovery progresses. Discussion A "reservation of affirmative defenses" is not an affirmative defense. In light of Rule 15, the Court does not see the propriety of Timeless's reservation. Rule 15 is the procedural mechanism that parties must follow in order to amend their pleadings,20 and Rule 15 does not

T h e EEOC also makes an argument against the defense of laches under this section. The issue of laches is r a is e d in defendant's summary judgment motion, and the EEOC's argument in its own summary judgment motion is id e n tic a l to the argument it raised in opposition to Timeless's motion. Because laches is not pled under this a ffir m a tiv e defense, the Court will address laches in its discussion of Timeless's motion.
20

19

An answer to a complaint is a "pleading." See Fed. R. Civ. Pro. 7(a)(2).

20

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require a defendant to "expressly reserve" unnamed affirmative defenses in its answer. See Fed. R. Civ. Pro. 15. It is not clear that Timeless's reservation has any effect on this case. Nevertheless, because it is the subject of a summary judgment motion and was pled in the answer, the Court will grant summary judgment in favor of the EEOC.21 Cf. EEOC v. NCL Am., Inc., 536 F.Supp.2d 1216, 1226 (S.D. Cal. 2007) (granting summary judgment on the affirmative defense of "reservation of affirmative defenses" because the defense was vague, not pled in accordance with Rule 8, and sufficient time for discovery had elapsed).

II. A. Conciliation

DEFENDANT'S MOTION

Timeless moves for summary judgment on the issue of good faith conciliation. However, as discussed above, the EEOC met its obligation to conciliate in good faith, albeit over a course of months and through a series of telephone calls and written correspondences. Summary judgment in favor of Timeless is not appropriate.

B.

Rule 25 In Relation To James Rex Defendant's Argument Timeless argues that all claims regarding Rex should be dismissed because Rex died in

December 2008, yet no one has sought to substitute in his place. Rule 25 provides for 90 days in which to file a motion for substitution. Rule 25 also provides that the failure to file such a substitution requires dismissal of the decedent's claims. Plaintiff's Opposition The EEOC argues that it is bringing suit on behalf of Rex and to vindicate the public interest. In age discrimination cases, once the EEOC files suit, individuals such as Rex may no longer file their own lawsuits. The EEOC states that it may continue to represent Rex. Because the ADEA is remedial in nature, an ADEA claim survives a claimant's death.
21

The Court emphasizes that its ruling on this "affirmative defense" is intended to have no effect on the c u r r e n tly pending motion to amend, nor does it have any effect on the affirmative defense of laches. Rule 15, not the o u tc o m e of the EEOC's motion on the "reservation affirmative defense," governs Timeless's motion to amend.

21

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Legal Standards Rule 25(a) reads in part: If a party dies and the claim is not extinguished, the court may order substitution of the proper party. A motion for substitution may be made by any party or by the decedent's successor or representative. If the motion is not made within 90 days after service of a statement noting the death, the action by or against the decedent must be dismissed. ... A motion to substitute, together with a notice of hearing, must be served on the parties as provided in Rule 5 and on nonparties as provided in Rule 4. A statement noting death must be served in the same manner. Service may be made in any judicial district. Fed. R. Civ. Pro. 25(a)(1), (3). The Ninth Circuit has explained that Rule 25(a)(1) requires two affirmative steps in order to trigger the running of the 90 day time period: (1) a party must formally suggest the death of the other party upon the record; and (2) the suggesting party must serve other parties and nonparty successors or representatives of the deceased with a suggestion of death. Barlow v. Ground, 39 F.3d 231, 233 (9th Cir. 1994); Barrett v. Negrete, 2009 U.S. Dist. LEXIS 106733, *2 (S.D. Cal. Nov. 16, 2009); Colon v. Home Depot U.S.A., Inc., 2009 U.S. Dist. LEXIS 40914, *2-*3 (E.D. Cal. May 13, 2009). The 90 day time period is not triggered "unless a formal suggestion of death is made on the record, regardless of whether the parties have knowledge of a party's death," and the "mere reference to a party's death in court proceedings or pleadings is not sufficient . . . ." Grandbouche v. Lovell, 913 F.2d 835, 836 (10th Cir. 1990); Colon, 2009 U.S. Dist. LEXIS 40914 at *3; see also Younts v. Fremont County, 370 F.3d 748, 752 (8th Cir. 2004); Barlow, 39 F.3d at 233 (citing with approval Grandbouche). Also, in the absence of an express contrary intent, federal common law determines whether a federal claim/cause of action survives the death of a claimant. See United States v. NEC Corp., 11 F.3d 136, 137 (11th Cir. 1993); Smith v. Department of Human Servs., 876 F.2d 832, 834 (10th Cir. 1989); Heikkila v. Barber, 308 F.2d 558, 561 (9th Cir. 1962). Under federal common law, claims that are remedial in nature survive the claimant's death, while claims that are penal in nature do not survive. See NEC, 11 F.3d at 1137; Smith, 876 F.2d at 835; United States ex rel Harrington v. Sisters of Providence in Ore., 209 F.Supp.2d 1085, 1087 (D. Or. 2002). Claims under the ADEA for "reinstatement, back-pay, and other benefits" are "remedial 22

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in nature and thus, survive the claimant's death." Smith, 876 F.2d at 835-37; Kettner v. Compass Group USA, Inc., 2008 U.S. Dist. LEXIS 106990, *31 (D. Minn. July 8, 2008); Kulling v. Grinders for Indus., 115 F.Supp.2d 828, 849-50 ( E.D. Mich. 2000). However, claims for ADEA "liquidated damages" are considered "penal" or "punitive" in nature and thus, do not survive the claimant's death. See Smith, 876 F.2d at 835-37; Kettner, 2008 U.S. Dist. LEXIS 106990 at *31; Kulling, 115 F.Supp.2d at 845-46, 850; Hawes v. Johnson & Johnson, 940 F.Supp. 697, 702-03 (D. N.J. 1996). Discussion The EEOC brought this lawsuit on behalf of Rex and Carlberg, as well as the public interest. See EEOC v. Hacienda Hotel, 881 F.2d 1504, 1519 (9th Cir. 1989). "An individual's right to sue [under the ADEA] is extinguished . . . if the EEOC institutes an action against the employer." Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 27 (1991) (citing 29 U.S.C. 626(c)(1)); see Vines v. Univ. of La., 398 F.3d 700, 707 (5th Cir. 2005); EEOC v. Pan Am. World Airways, Inc., 897 F.2d 1499, 1505-07 (9th Cir. 1990). When the EEOC filed suit, it terminated Rex's ability to bring his own suit. See id. Further, although the EEOC is suing in part to obtain relief on behalf of Rex, Rex is not a plaintiff in this action. Under these circumstances, it would appear that Rule 25 has no application since Rex was not a plaintiff and Rule 25 applies "when a party dies." Fed. R. Civ. Pro. 25(a)(1). Assuming that Rule 25 may have some application, there has been no formal "suggestion of death" filed on the docket by any party. Because a formal "suggestion of death" must be filed with the Court before the 90 day time period is triggered, the 90 day time period never commenced in this case. See Barlow, 39 F.3d at 233; Grandbouche, 913 F.2d at 836; Barrett, 2009 U.S. Dist. LEXIS 106733 at *2. Summary judgment on all claims regarding Rex and Rule 25(a)(1) is inappropriate. However, the EEOC seeks liquidated damages on behalf of Rex. Rex's death means the termination of his claim for liquidated damages. See Smith, 876 F.2d at 835-37; Kulling, 115 F.Supp.2d at 845-46, 850. Since the EEOC is suing in a representative capacity, see Vines, 398 F.3d at 707, the Court sees no grounds for allowing the EEOC to obtain liquidated damages on 23

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behalf of the deceased Rex, when Rex's death would otherwise terminate his/his estate's ability to obtain ADEA liquidated damages. See Smith, 876 F.2d at 835-37; Kulling, 115 F.Supp.2d at 845-46, 850; cf. EEOC v. Waffle House, Inc., 534 U.S. 279, 296-97 (2002) ("If, for example, [Baker] had failed to mitigate his damages, or had accepted a monetary settlement, any recovery by the EEOC would be limited accordingly."). The Court will grant summary judgment in favor of Timeless with respect liquidated damages on behalf of Rex. See Smith, 876 F.2d at 835-37; Kulling, 115 F.Supp.2d at 845-46, 850; Kettner, 2008 U.S. Dist. LEXIS 106990 at *31; Hawes, 940 F.Supp. at 702-03.

C.

Charging Parties' Damages Defendant's Argument Timeless argues that an essential element of an ADEA claim is damages. However, Rex

worked until the day his illness disabled him from doing so. Rex made about $8,300 in 2004, and about $10,300 in 2005. Although income for subsequent years is unknown because the EEOC could not produce Rex's W2 forms, it appears that, at minimum wage (which is about what Timeless was offering to pay), Rex could not have made more than he already made at his other jobs. As for Carlberg, he filed for SSI benefits well before he applied for his job. As part of his SSI benefits, he claimed to be unable to work. Carlberg cannot claim disability on one hand, and loss of opportunity to work on the other. The charging parties suffered no damages. Plaintiff's Opposition The EEOC argues that whether Rex and Carlberg suffered damages is irrelevant to the public interest aspect of this case. The EEOC seeks injunctive remedies as a result of Timeless's practices. Timeless's president has admitted that Timeless does not do training regarding age discrimination and does not have written discrimination policies, and former manager Rafayelyan confirmed he was unaware of discrimination policies and received no training. With respect to Carlberg, he was unemployed and continued to seek employment until 2005. Even if he received social security benefits, such benefits cannot be set off against backpay awards. With respect to Rex, he did not make as much as a full time cashier with Timeless (which would have been 24

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$8.00/hour or $16,000/year)22 because in 2004, he earned roughly $8,000. At the least, these facts establish a question of fact as to damages. Discussion 1. Rex

With respect to Rex, there is no dispute that Rex worked until mid to late 2008, see PUF 7.5, Rex's 2004 W2 form indicates income of about $8,300.00, see DUF 34; PUF 7.6, Rex's 2005 W2 form indicates income of about $10,300.00, see DUF 35; PUF 7.7, and cashiers at Timeless earned between $8.00 and $8.50 per hour in 2004. See Rafayelyan Dep. Vol. I at 78:14. The EEOC is correct that a wage of $8.00 per hour, assuming a working year of 2000 hours, yields a yearly wage of $16,000 per year. Obviously, $16,000 is more than Rex's 2004 income and 2005 income.23 Timeless's reply memorandum does not address the issue of damages, including the propriety of assuming an $8.00 per hour wage or an annual income of $16,000 under that wage. Because $16,000 is greater than the incomes earned by Rex in 2004 and 2005, summary judgment on this issue is not appropriate. 2. Carlberg

The same wage analysis is true of Carlberg, except the point is starker. It appears that Carlberg did not work from the time of his application with Timeless to the present. Any amount of wages that would have been earned by Carlberg at Timeless would be greater than $0. However, resolution of Timeless's argument that Carlberg had filed for social security disability benefits and claimed to be disabled is not as straightforward. A person is entitled to

T h e Court notes that the $8.00/hour wage urged by the EEOC in this motion (which is consistent with R a fa y e ly a n 's testimony, see Rafayelyan Dep. Vol. I at 78:1-4) is less than the $10.00/hour wage urged by the EEOC in the August/September 2008 negotiations with Timeless. T o the extent that Timeless is arguing that Rex and Carlberg would have made minimum wage, the result w o u ld not change. From 2004 through 2006, the minimum wage in California was $6.75/hour. 8 Cal. Code. Reg. § 1 1 0 4 0 ( 4 ) ; Solis v. Best Medical Grp., 2010 U.S. Dist. LEXIS 45780, *40-*41 & n.14 (E.D. Cal. May 3, 2010); M e d e p a lli v. Maximus, Inc., 2008 U.S. Dist. LEXIS 28509, *14 (E.D. Cal. April 8, 2008). A wage of $6.75/hour, a g a in assuming a working year of 2000 hours, yields a yearly wage of $13,500. Obviously, $13,500 is more then R e x 's 2004 income and 2005 income. Additionally, Timeless has not submitted evidence that $6.75 was the wage fo r cashiers in 2004.
23

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social security disability benefits if the "disability"24 is "of such severity that he is not only unable to do his previous work but cannot, considering his age, education, and work experience, engage in any other kind of gainful work which exists in the national economy . . . ."25 42 U.S.C. § 423(d)(2)(A). The EEOC has cited portions of Carlberg's deposition in which Carlberg indicates that he received disability benefits from the social security administration from 2004 through 2007, but from 2007 to the present he received "straight social security." See Carlberg Dep. at pp. 28, 43, 45. Carlberg states that it was his belief that he could work part time despite receiving disability benefits. See id. at 43:23-44:6. Carlberg also testified that he cannot remember whether he received social security disability benefits before or after he applied with Timeless. See id. at 45:8-10. Carlberg's testimony is significant. The general rule is that "an employer is not liable for backpay during periods that an improperly discharged employee is unavailable for work due to a disability." Canova v. NLRB, 708 F.2d 1498, 1505 (9th Cir. 1983); see Lathem v. Department of Children & Youth Servs., 172 F.3d 786, 794 (11th Cir. 1999); Starceski v. Westinghouse Elec. Corp., 54 F.3d 1089, 1101 (3d Cir. 1995); Saulpaugh v. Monroe Cmty. Hosp., 4 F.3d 134, 145 (2d Cir. 1993); McKenna v. City of Philadelphia, 636 F. Supp. 2d 446, 465 (E.D. Pa. 2009); Shomide v. ILC Dover, Inc., 521 F. Supp. 2d 324, 334-35 (D. Del. 2007). However, where the defendant's discriminatory conduct caused the disability, back pay is available. Lathem, 172 F.3d at 794; McKenna, 636 F.Supp.2d at 465. "The rationale behind this rule is that, because back pay is a compensatory remedy intended to restore the plaintiff to the position that he would have been in had he not been discriminated against, a plaintiff should not be able to receive back pay for a period when he was unable to work for reasons unrelated to the defendant's conduct." McKenna, 636 F.Supp.2d at 465; see also Saulpaugh, 4 F.3d at 145.
24

The Social Security Act defines "disability" as "an inability to engage in any substantial gainful activity b y reason of any medically determinable physical or mental impairment which can be expected to result in death or w h ic h has lasted or can be expected to last for a continuous period of not less than 12 months." 42 U.S.C. § 4 2 3 (d )(1 )(A ). The Social Security Act clarifies that "`work which exists in the national economy' means work which e x is ts in significant numbers either in the region where such individual lives or in several regions of the country." 42 U .S .C . § 423(d)(2)(A).
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Here, that Carlberg collected social security disability benefits shows that he has successfully contended and shown that he has a "disability" and that his disability was so severe that he could not perform work in the national economy.26 See 42 U.S.C. § 423(d)(2)(A). Although it is unknown how or why Carlberg was (or is) disabled, it is unclear how his disability could have been caused by Timeless's failure to hire him. The evidence suggests that the availability of back pay from 2004 to 2007 should be limited.27 See Lathem., 172 F.3d at 794; Starceski, 54 F.3d at 1101; Saulpaugh, 4 F.3d at 145; Canova, 708 F.2d at 1505; McKenna, 636 F.Supp.2d at 465; Shomide, 521 F.Supp.2d at 334-35. However, Carlberg stated that he could not recall if he received disability benefits prior to or after his July 2004 application with Timeless. If Carlberg received the benefits after his July 2004 application with Timeless, then back pay would be available at least from July 2004 to whatever later month in 2004 he began receiving disability payments. Even if Carlberg received disability benefits prior to his July 2004 application, the Court is not convinced at this point that no back pay would be available. The Social Security Act "clearly permits individuals to receive benefits while engaged in a period of paid `trial work.'" Mohammed v. Marriot Int'l, 944 F.Supp. 277, 283 (