Steele v. Stallion Oilfield Services Ltd.

Filing 62

ORDER that Plaintiffs Objections Doc. # 59 are OVERRULED. It is FURTHER ORDERED that the Recommendation of United States Magistrate Judge Wang Doc. # 58 is AFFIRMED and ADOPTED as an order of this Court. Pursuant to the Recommendation, it is FU RTHER ORDERED that Defendants Motion to Dismiss for Failure to State a Claim Doc. # 19 is GRANTED. It is FURTHER ORDERED that Plaintiffs claims are DISMISSED WITHOUT PREJUDICE and that this case is DISMISSED in its entirety. It is FURTHER ORDERED that the Joint Motion to Stay Remaining Discovery Pending Ruling on Recommendation of United States Magistrate Judge Regarding Defendants Motion to Dismiss Doc. # 61 is DENIED as moot, by Judge Christine M. Arguello on 5/26/2015.(evana, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Christine M. Arguello
Civil Action No. 14-cv-02376-CMA-BNB
ROBERT STEELE,
Plaintiff,
v.
STALLION ROCKIES LTD,
STALLION OILFIELD SERVICES LTD,
Defendants.
_____________________________________________________________________
ORDER ADOPTING AND AFFIRMING MAY 7, 2015 RECOMMENDATION OF
UNITED STATES MAGISTRATE JUDGE
______________________________________________________________________
This employment discrimination case was referred to United States Magistrate
Judge Nina Y. Wang pursuant to 28 U.S.C. § 636. On May 7, 2015, Magistrate Judge
Wang issued a Report and Recommendation concerning Stallion Rockies, Ltd.’s and
Stallion Oilfield Services Ltd.’s (“Defendants’” or “Stallion’s”) Motion to Dismiss (Doc.
# 58.) Judge Wang recommended that all claims be dismissed with prejudice. (See id.)
I. BACKGROUND
The factual and procedural background of this matter is set out at length in
Magistrate Judge Wang’s thorough Recommendation, and the Court incorporates that
recitation herein. As such, this Court provides only a brief overview of the facts and
procedural history and will expand on them, when necessary, within the analysis.
Plaintiff Robert Steele worked as a truck driver at Stallion’s facility in Rifle,
Colorado, driving a company truck between various work sites and performing

maintenance work. (Doc. #4, ¶ 15.) He was 47 years old at the time of his termination,
and suffered from diagnosed Lumbar Degenerative disease. (Id., ¶¶ 12, 17.) He
alleges that Stallion was aware of his back condition and also aware that he utilized
medical marijuana and was listed in the Colorado Medical Marijuana Registry. (Id.)
In March of 2013, Stallion hired a third-party company to administer “across-theboard” drug tests at its Rifle facility, and the results of Plaintiff’s test were indeterminate
due to a malfunctioning in the testing mechanism. (Id., ¶¶ 25-27.) Stallion maintains a
Drug and Alcohol Policy in its Handbook prohibiting the off-the-job use of controlled
substances interfering with job performance and testing positive for such substances at
work. (Id., ¶ 37.) Plaintiff was asked to retake the test “wherein he would be observed,”
whereas a management employee whose test results were similarly indeterminate was
asked to retake the test at a later time. (Id., ¶¶ 29-30.) Plaintiff entered the Operation
Manager’s office to retake his drug test and informed Anderson, a Regional Safety
Manager for Stallion who did not work at the Rifle facility, that “he was a Medical
Marijuana Participant and had been since before his employment with Stallion.” (Id.,
¶ 31.) Anderson responded by telling Plaintiff that his employment was terminated for
his violation of the drug and alcohol policy. (Id., ¶¶ 39, 43.) Plaintiff alleges that he
was terminated “for reminding Stallion Management of his status as a registered
member in the Colorado Medical Marijuana Registry” or “because of his possession of a
medical marijuana card.” (Id.)
Plaintiff filed this lawsuit in the District Court, City and County of Denver, on
August 4, 2014, asserting state and federal claims of employment discrimination under
the Age Discrimination in Employment Act (“ADEA”), the Americans with Disabilities Act
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(“ADA”), and the Colorado Anti-Discrimination Act (“CADA”). (Doc. # 4.) Plaintiff’s
Complaint also asserted a claim that Plaintiff styled “Wrongful Termination for Breach of
Implied Contract.”1 (Id.) Defendants removed the action to this Court (Doc. # 1) and
filed the instant Motion to Dismiss (Doc. # 19.)
In her recommendation, Magistrate Judge Wang found that Plaintiff failed to
plead facts to plausibly establish that Defendants were liable for age or disability
discrimination, under either federal or Colorado state law. (Doc. # 58 at 8-13.) She
recommended that these claims be dismissed with prejudice. (Id.) Likewise, she found
that Plaintiff failed to state a breach of contract claim, and made the same
recommendation with respect to that claim. (Id. at 14-17.) On May 14, 2015, Plaintiff
filed timely objections to several aspects of the Recommendation. (Doc. # 59.)
II. STANDARD OF REVIEW
When a magistrate judge issues a recommendation on a dispositive matter,
Federal Rule of Civil Procedure 72(b)(3) requires that the district court judge “determine
de novo any part of the magistrate judge's [recommendation] that has been properly
objected to.” Fed. R. Civ. P. 72(b)(3). In conducting its review, “[t]he district court judge
may accept, reject, or modify the recommendation; receive further evidence; or return
the matter to the magistrate judge with instructions.” Id. The Court has conducted the
requisite de novo review of the issues and the relevant pleadings, including the
Recommendation and Plaintiff’s objections thereto.

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Plaintiff’s initial Complaint also asserted a claim of tortious interference with contract against
individual Defendants Anthony “Bart” Steele and Scott Anderson; however, pursuant to
stipulation, both men were dismissed in April of 2015 as parties, along with the claim for tortious
interference of contract. (Doc. # 52.)
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Dismissal for failure to state a claim, “without affording the plaintiff notice or an
opportunity to amend is proper only ‘when it is patently obvious that plaintiff could not
prevail on the facts alleged, and allowing him an opportunity to amend his complaint
would be futile.’” Curley v. Perry, 246 F.3d 1278, 1281-82 (10th Cir. 2001) (internal
quotation marks and citation omitted).
III. ANALYSIS
Plaintiff asserts that Magistrate Judge Wang erred in four respects: 2 (1) she
applied the incorrect burden of proof in deciding whether Plaintiff plausibly alleged
disability and age discrimination (i.e., he asserts that she applied the more stringent trial
burden); (2) she erroneously required that Plaintiff show that his age was a “but for”
cause of his termination, rather than “the factor that made the difference,” and she also
discounted evidence demonstrating a plausible connection between his age and his
termination; (3) she discounted evidence that Plaintiff was disabled and also that he
was terminated as the result of his disability; and (4) she applied the wrong legal
standard and improperly concluded that Plaintiff failed to plausibly allege an implied
breach of contract claim. The Court considers these objections in turn.
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Plaintiff also “objects to that portion of Magistrate Judge Wang’s analysis concerning events
prior to November 8, 2012, or events pre-dating Stallion’s Chapter 11 Bankruptcy reorganization
in February 2010,” with a single-sentence argument: “Plaintiff’s Complaint makes no such Claim
and Defendant’s efforts at raising an issue not pled, need not have been addressed [Complaint,
¶¶ 44-83, pp.9-25] which are not specifically referenced in Document 58, pp.6-7.” (Doc. # 59 at
4) (brackets in original). The Court construes this argument as best it can. To the extent that
Plaintiff is arguing that Magistrate Judge Wang need not have included analysis regarding the
administrative exhaustion of Plaintiff’s claims, this argument fails. Plaintiff’s Complaint
contained allegations which pre-dated November 8, 2012 and Stallion’s Bankruptcy, such as
Plaintiff’s 2009 layoff. Accordingly, it was proper for Magistrate Judge Wang to examine which
claims were time-barred under the ADEA, ADA, and CADA. Additionally, Plaintiff asserts that
Magistrate Judge Wang should not have dismissed his CADA claims. However, because the
Court determines that Judge Wang’s conclusions regarding Plaintiff’s ADEA and ADA claims
were correct, and because his CADA claims parallel his federal claims, Plaintiff’s objection fails.
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A.

THE BURDEN OF PROOF
Plaintiff objects that Magistrate Judge Wang erred in applying the “trial burden of

proof and trial evidentiary requirement,” rather than applying the Twombly/Iqbal
standard. (Doc. # 59 at 4.) However, Magistrate Judge Wang specifically
acknowledged that a plaintiff need not establish a prima facie case of discrimination in
his or her complaint in order to survive a motion to dismiss, and, quoting Khalik v.
United Air Lines, 671 F.3d 1188, 1192 (10th Cir. 2012), correctly noted that the Court
could still look to the “elements of each alleged cause of action to help determine
whether Plaintiff has set forth a plausible claim.” (Doc. # 58.) Plaintiff alleges that
notwithstanding this acknowledgement, Magistrate Judge Wang still required him to
establish a prima facie case and “assert[ed] that such elements are required to meet the
Standard of Review she relied upon.” (Doc. # 49 at 5.)
Plaintiff does not, however, explain how Magistrate Judge Wang “required” him
to show a prima facie case, and a close examination of her Recommendation reveals
that she did no such thing. Rather, her analysis comported with Khalik: she looked at
the elements of the law to guide her determination as to whether Plaintiff had
“sufficiently stated plausible claims” under the ADA or the ADEA, because “general
assertions of discrimination . . ., are insufficient to survive a motion to dismiss. While
specific facts are not necessary, some facts are.” 671 F.3d at 1193 (brackets, citation,
and internal quotation marks omitted). As such, Magistrate Judge Wang did not err in
looking to the elements of disability and age discrimination claims to determine whether
Plaintiff plausibly stated a claim.

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On a similar note, Plaintiff argues that it was inappropriate for Magistrate Judge
Wang to mention the McDonnell-Douglas prima facie framework because “direct
evidence of discrimination is plausibly pled.” (Doc. # 59 at 4.) “Direct evidence is
evidence, which if believed, proves the existence of a fact in issue without inference or
presumption.” Hall v. U.S. Dep’t of Labor, 476 F.3d 847, 855 (10th Cir.2007). Stated
differently, “[d]irect evidence demonstrates on its face that the employment decision
was reached for discriminatory reasons.” Riggs v. AirTran Airways, Inc., 497 F.3d 1108,
1117 (10th Cir. 2007). Plaintiff does not elaborate on what “direct evidence” of
discrimination he pleaded and the only evidence the Court could identify in the
Complaint is his allegation that “[t]hroughout Plaintiff’s employment, co-workers
repeatedly made offensive comments regarding his age.” (Doc. # 4, ¶ 23.) However,
Plaintiff provided no further factual support for this allegation: i.e., he did not elaborate
as to which coworkers made offensive comments, what those comments were, or when
they were made. Accordingly, Plaintiff failed to plausibly plead direct evidence of
discrimination. In any event, as explained above, Magistrate Judge Wang did not
incorrectly “require” that Plaintiff plead a prima facie case. Rather, she merely tested
his factual allegations against the legal elements to determine if he plausibly stated a
claim.
B.

THE “BUT FOR” STANDARD AND JUDGE WANG’S DETERMINATION
REGARDING CAUSATION
Plaintiff asserts that Magistrate Judge Wang incorrectly required him to allege

facts that would support a claim that his age was the “but for” cause of his termination:
“[i]n this Circuit, since at least Jones [v. Oklahoma City Public Schools, 617 F.3d 1273,
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1277-78 (10th Cir. 2010)], an employer may be held liable for Age Discrimination even if
other factors contributed to the termination as long as age was the factor that made the
difference.” (Doc. # 59 at 5-6.) Jones, however, did not abrogate a “but-for” causation
requirement; rather, it defined that requirement in holding that age need not be the
“sole” motivating factor: “Instead, an employer may be held liable under the ADEA if
other factors contributed to its taking an adverse action, as long as ‘age was the factor
that made a difference.’” Jones, 617 F.3d at 1277 (quoting Wilkerson v. Shinseki, 606
F.3d 1256, 1266 (10th Cir. 2010)). Magistrate Judge Wang specifically cited and
properly applied this more nuanced definition of “but-for” causation from Jones. (Doc. #
58 at 9.)
Plaintiff also asserts that Magistrate Judge Wang erred in determining that he did
not allege sufficient facts to support his claim that age was “the factor that made a
difference” in his termination. Without explaining how or why, Plaintiff asserts that “[a]s
Plaintiff’s Complaint makes clear, his age made a difference” and “Plaintiff’s Complaint
provides more than simple speculation.” (Id. at 6.) Plaintiff’s sole allegations pertaining
to disparate treatment on account of age are as follows: (1) in 2011, he observed he
was one of the oldest workers at the facility, and (2) prior to his termination, unidentified
coworkers (i.e., not a decisionmaker) made “offensive comments” regarding his age.
(Doc. # 4, ¶¶ 21-23.) Judge Wang correctly concluded that neither of these allegations
is probative of a causal connection of any kind between Plaintiff’s age and Anderson’s
decision to terminate him, much less indicative that his age was “the factor that made
the difference”:

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Plaintiff does not identify who made the derogatory comments, whether
those individuals had any role in management or the determination of
whether he was retained or not as an employee, when they were made, or
the context in which they were made. Nor does he allege a nexus
between these comments and Mr. Anderson’s actions; the court is simply
left to assume that one exists. See Khalik, 671 F.3d at 1194 (affirming
order granting employer’s motion to dismiss and stating ‘there is nothing
more than sheer speculation to link . . . the termination to a discriminatory
or retaliatory motive).
(Doc. # 58 at 9); see also Medlock v. United Parcel Serv., Inc., 608 F.3d 1185, 1197
(10th Cir. 2010) (internal citation omitted) (“In order to rely on age related statements,
[plaintiff] must show that they were made by a decision maker, and that there was a
nexus between the discriminatory statements and the decision to terminate.”)
Plaintiff also contends that his “[c]omplaint raises the specter of whether or not
the discharge for alleged violations of the company policy was legitimate under the
circumstances pled, thus, demonstrating pled pretext.” (Id.) This argument effectively
puts the cart before the horse: without evidence of a causal connection between
Plaintiff’s age and his termination, evidence that Defendants’ purported reason for
termination was not the actual reason for his termination is irrelevant, particularly
because the only evidence of pretext here (that a manager was not required to submit
to being watched during his drug test) relates in no way to age.
C.

PLAINTIFF’S DISABILITY CLAIM
A “disability” is a “physical or mental impairment that substantially limits one or

more major life activities.” 42 U.S.C. § 12102(1)(A); see also Toyota Motor Mfg., Ky.,
Inc. v. Williams, 534 U.S. 184, 195 (2002) (“Merely having an impairment does not
make one disabled for purposes of the ADA. Claimants also need to demonstrate that
the impairment limits a major life activity.”) Plaintiff objects to Magistrate Judge Wang’s
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conclusion that he failed to allege any facts to indicate that his Lumbar Degenerative
Disc Disease or his ACL injury constituted a disability for purposes of the ADA, i.e.,
evidence that either condition “substantially limits” one or more of his major life
activities. Specifically, he argues that “Management officials of Stallion and almost
every other employee had knowledge of his Lumbar Disease . . . [and] he was placed
on Medical Limited Ability Status, and assigned to light duty pursuant to his Physicians
[sic] work restriction.” (Doc. #59 at 7.)

That (unnamed) Management officials knew

about Plaintiff’s back condition is in no way probative of the fact that the condition
“interfered with one of his major life activities.” As for his placement on Medical Limited
Ability Status, Plaintiff does not allege that his ACL injury substantially limited a major
life activity or that it resulted in long term impairment. Accordingly, Magistrate Judge
Wang correctly concluded that Plaintiff failed to allege a “disability” for purposes of the
ADA.
Magistrate Judge Wang also correctly concluded that there was no basis for
finding that Defendants terminated Plaintiff’s employment because of his disability; the
Complaint fails to allege a single fact to support the notion that Plaintiff’s medical
condition, or any accommodation for a medical condition, led to his termination. Even if
Plaintiff is attempting to argue that his termination was related to his disability by virtue
of the fact that marijuana was what he used to treat his disability, Magistrate Judge
Wang’s citation to Curry v. MillerCoors, Inc., No. 12-cv-02471-JLK, 2013 WL 4494307,
at *3 (D. Colo. Aug. 21, 2013), is well-taken. In that case, Judge Kane held that “antidiscrimination law does not extend so far as to shield a disabled employee from the
implementation of his employer's standard policies against employee misconduct.” Id.
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As such, Plaintiff’s termination as a result of his use of medical marijuana does not
constitute discrimination.
In any case, Plaintiff does not properly object to this conclusion regarding
causation, 3 arguing in a conclusory and circular fashion that his Complaint
“demonstrates throughout concerning his disability discrimination being based upon his
disability status and not anything having to do with the prescribed treatment for that
disability.” (Doc. # 59 at 8.)
D.

PLAINTIFF’S BREACH OF IMPLIED CONTRACT CLAIM
Judge Wang recommended that Plaintiff’s breach of implied contract claim

should be dismissed because Defendants’ drug and alcohol policy cannot be construed
as a legally binding promise, either implied or express, from which Plaintiff could derive
an expectation of continuing employment. Plaintiff argues that this recommendation is
in error because Plaintiff’s “termination was in Breach of Stallion’s drug and alcohol
policy since the policy ‘by its terms did not prohibit lawful use and Plaintiff never tested
positive for marijuana use at work.’” (Id. at 9.) Specifically, he objects that “[t]he mere
fact that Stallions [sic] policy is subject to change, does not impact upon the implied
contract presented since Plaintiff’s pleadings make clear, there was no change in the
policy during all times material and Plaintiff did not violate the policy but was fired for
violation of the policy.” (Id. at 10.) These arguments, however, miss the mark; Judge
Wang’s decision properly applied Colorado contract law principles to the Drug and
Alcohol Policy and cogently explained how the policy does not contain a guarantee of

3

An objection is properly made if it is both timely and specific. United States v. One Parcel of
Real Property Known As 2121 East 30th Street, 73 F.3d 1057, 1059 (10th Cir. 1996).
10

continued employment for those who did not violate it. (Doc. # 19 at 13.) She also
explained that even if a promise of continued employment could be implied, Defendants
specifically disclaimed such a promise by making it clear that the policies were subject
to change “without prior notice” and in reiterating that employees were “at will.” (Id. at
14-15.) Indeed, Plaintiff signed two separate “Handbook Acknowlegments” of his at-will
status. (Doc. # 4-2.)
Notwithstanding Judge Wang’s analysis of Plaintiff’s failure to state a claim for
breach of contract, because Plaintiff’s federal claims are properly dismissed, the Court
will decline to exercise supplemental jurisdiction: “When all federal claims have been
dismissed, the court may, and usually should, decline to exercise jurisdiction over any
remaining state claims.” Koch v. City of Del City, 660 F.3d 1228, 1248 (10th Cir. 2011)
(quoting Smith v. City of Enid ex rel. Enid City Comm'n, 149 F.3d 1151, 1156 (10th
Cir.1998)); see also United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 726 (1966)
(footnote omitted) (“Needless decisions of state law should be avoided both as a matter
of comity and to promote justice between the parties, by procuring for them a surerfooted reading of applicable law. Certainly, if the federal claims are dismissed before
trial, even though not insubstantial in a jurisdictional sense, the state claims should be
dismissed as well.”)
IV. CONCLUSION
The Court has conducted a de novo review of this matter, including reviewing all
relevant pleadings, the Recommendation, and Plaintiff’s objection thereto. Based on
this de novo review, the Court concludes that Magistrate Judge Wang’s
Recommendation is correct and is not called into question by Plaintiff’s Objections.
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Accordingly, it is hereby ORDERED that Plaintiff’s Objections (Doc. # 59) are
OVERRULED. It is
FURTHER ORDERED that the Recommendation of United States Magistrate
Judge Wang (Doc. # 58) is AFFIRMED and ADOPTED as an order of this Court.
Pursuant to the Recommendation, it is
FURTHER ORDERED that Defendants’ Motion to Dismiss for Failure to State a
Claim (Doc. # 19) is GRANTED. It is
FURTHER ORDERED that Plaintiff’s claims are DISMISSED WITHOUT
PREJUDICE and that this case is DISMISSED in its entirety. It is
FURTHER ORDERED that the Joint Motion to Stay Remaining Discovery
Pending Ruling on Recommendation of United States Magistrate Judge Regarding
Defendants’ Motion to Dismiss (Doc. # 61) is DENIED as moot.
DATED:

May 26, 2015
BY THE COURT:

_________________________
CHRISTINE M. ARGUELLO
United States District Judge

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