U.S. Equal Employment Opportunity Commission v. PMT Corporation

Filing 28

ORDER denying 8 Motion to Dismiss the complaint; granting 10 Motion to Dismiss claims involving Patricia Lebens; granting 21 Motion for Extension of Time to File Response/Reply (Written Opinion). Signed by Senior Judge David S. Doty on 8/27/2014. (PJM)

UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Civil No. 14-599(DSD/TNL)
U.S. Equal Employment Opportunity
Commission,
Plaintiff,
ORDER

v.
PMT Corporation,
Defendant.

Nicholas
J.
Pladson,
Esq. and
Equal
Employment
Opportunity Commission, 330 South Second Avenue, Suite
720, Minneapolis, MN 55401, counsel for plaintiff.
David J. Duddleston, Esq., Anna R. Hickman, Esq. and
Jackson Lewis PC, 225 South Sixth Street, Suite 3850,
Minneapolis, MN 55402; Brian T. Benkstein, Esq. and Moss
& Barnett, PA, 90 South Seventh Street, Suite 4800,
Minneapolis, MN 55402, counsel for defendant.

This matter is before the court upon the motions to dismiss by
defendant PMT Corporation (PMT).

Based on a review of the file,

record and proceedings herein, and for the following reasons, the
court denies the motion to dismiss the complaint and grants the
motion to dismiss claims involving Patricia Lebens.

BACKGROUND
This

employment

dispute

arises

out

of

an

investigation

conducted by plaintiff U.S. Equal Employment Opportunity Commission
(EEOC).

On

October

27,

discrimination against PMT.

2010,

the

EEOC

Compl. ¶ 8.

filed

a

charge

of

The EEOC alleges that PMT maintained a hiring system that
discriminated against female applicants for sales positions in
favor of equally-qualified or less-qualified males.

Id. ¶ 13(a).

PMT president Alfred Iversen was the final decisionmaker for hiring
sales representatives. Id. ¶ 13(c). The EEOC alleges that Iversen
instructed PMT employees to reject the applications of female
applicants for sales positions.

Id. ¶ 13(d).

2007,

PMT

and

October

representatives.

27,

2010,

Id. ¶ 13(e).

hired

Between January 1,

at

least

70

sales

All new hires were male.

Id.

¶ 13(f). In total, three of the 120 sales representatives employed
at PMT between 2007 and 2012 were female.

Id. ¶ 13(h).

The EEOC also alleges that PMT engaged in age discrimination.
Between January 1, 2007, and October 27, 2010, PMT did not hire any
sales representatives that were over 40 years of age.

Id. ¶ 17(b).

The EEOC alleges that Iversen directed employees to screen out
applicants based on their age.
Finally,

the

EEOC

Id. ¶ 17(e).

alleges

that,

after

the

initial

discrimination charge was filed, Iversen retaliated against former
Human

Resources

Manager

Patricia

Lebens,

allegations that led to the EEOC charge.

the

source

of

the

After Iversen discovered

in September 20121 that Lebens was the source of the allegations,
he directed PMT Human Resources Manager Luke Wetterlin to contact
the Carver County Sheriff’s Office and file a criminal complaint

1

Lebens resigned from PMT in November 2010.
2

Compl. ¶ 22(f).

accusing Lebens of theft.

Id. ¶ 28(b).

The Sheriff’s Office

investigated the allegations and gave Lebens twenty-four hours to
produce documentation rebutting the allegations.

Id. ¶ 28(f).

Lebens produced such documentation, and the Sheriff’s Office found
the allegations unfounded and closed the case.

Id. ¶ 28(i).

After the charge was filed, the EEOC and PMT engaged in
conciliation

by

conversations.

meeting

Id. ¶ 11.

in-person

and

having

On May 13, 2013, the EEOC declared that

further conciliation efforts would be futile.
2014,

the

EEOC

discrimination,
constructive

filed
age

a

preserve records.

complaint,

discrimination,

discharge,

follow-up

retaliation

Id.

alleging
hostile
and

On March 5,

claims

work

failure

for

sex

environment,
to

make

and

PMT moves to dismiss.2

DISCUSSION
I.

Standard of Review
To survive a motion to dismiss for failure to state a claim,

“a complaint must contain sufficient factual matter, accepted as
true, to state a claim to relief that is plausible on its face.”
Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir. 2009)
(citations and internal quotation marks omitted).
facial

plausibility

when

the

plaintiff

2

[has

“A claim has

pleaded]

At oral argument, the court granted PMT’s
extension of time to file a response or reply.
3

factual

motion

for

content that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.”

Ashcroft v.

Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly,
550 U.S. 544, 556 (2007)).

Although a complaint need not contain

detailed factual allegations, it must raise a right to relief above
the speculative level.

See Twombly, 550 U.S. at 555.

“[L]abels

and conclusions or a formulaic recitation of the elements of a
cause of action” are not sufficient to state a claim.

Iqbal, 556

U.S. at 678 (citation and internal quotation marks omitted).
The court does not consider matters outside the pleadings
under Rule 12(b)(6).

See Fed. R. Civ. P. 12(d).

The court,

however, may consider matters of public record and materials that
do not contradict the complaint, as well as materials that are
“necessarily embraced by the pleadings.” See Porous Media Corp. v.
Pall Corp., 186 F.3d 1077, 1079 (8th Cir. 1999) (citations and
internal quotation marks omitted).

In this case, the EEOC charge

and probable cause determination are necessarily embraced by the
pleadings and are properly considered.
II.

Good-Faith Conciliation Efforts
PMT argues that dismissal is warranted because the EEOC acted

arbitrarily

and

Specifically,

unreasonably

PMT

argues

during

that

the

the
EEOC

conciliation
did

not

process.

attempt

to

conciliate in good faith because it sought relief for untimely
claims. “The EEOC may bring a direct suit against an employer only

4

after it has attempted to conciliate in good faith but failed to
reach an agreement.” EEOC v. Trans States Airlines, Inc., 462 F.3d
987, 996 (8th Cir. 2006) (citations omitted).

“To satisfy the

statutory requirement of conciliation, the EEOC must (1) outline to
the employer the reasonable cause for its belief that Title VII has
been violated; (2) offer an opportunity for voluntary compliance;
and

(3)

respond

in

a

reasonable

and

flexible

reasonable attitudes of the employer.”
Expert

Co.,

omitted).

340

F.3d

“Whether

1256,
the

1259

EEOC

(11th

has

manner

to

the

EEOC v. Asplundh Tree
Cir.

2003)

adequately

(citation

fulfilled

its

obligation to conciliate is dependent upon the reasonableness and
responsiveness

of

the

[EEOC's]

conduct

under

all

the

circumstances.”

EEOC v. UMB Bank, N.A., 432 F. Supp. 2d 948, 954

(W.D. Mo. 2006) (alterations in original) (citations and internal
quotation marks omitted).
not

attempted

If a court determines that the EEOC has

conciliation
in

extreme

in

good

faith,

circumstances,

it

may

dismiss

stay
the

the

proceedings

or,

matter

altogether.

EEOC v. Crye-Leike, Inc., 800 F. Supp. 2d 1009, 1018

(E.D. Ark. 2011).
PMT argues that any allegations relating to conduct that
occurred more than 300 days before the filing of the EEOC charge
are time-barred, and that the EEOC has acted unreasonably in
including such conduct in its charge and conciliation efforts. The
EEOC responds that the 300 day limit does not apply where, as here,

5

the EEOC alleges an ongoing pattern or practice of discrimination.
The court agrees.
Generally, actions filed under Section 706 of Title VII may
encompass only those acts that occurred within 300 days of a
timely-filed EEOC charge.

42 U.S.C. § 2000e-5(e)(1).

Where an

action alleges a “continuing violation,” however, the court may
consider

“alleged

discriminatory

statutory limitations period.”

acts

occurring

prior

to

the

Koren v. Supervalu, Inc., No. 00-

1479, 2003 WL 1572002, at *9 (D. Minn. Mar. 14, 2003) (citation
omitted).

Such continuing violations are to be contrasted with

“discrete

retaliatory

or

discriminatory

act[s]

termination, refusal to hire, or failure to promote.”

(such

as

Madison v.

IBP, Inc., 330 F.3d 1051, 1056 (8th Cir. 2003) (citation omitted).
Here, if the EEOC can ultimately prove a pattern or practice of
discrimination
violation,

even

existed,3
though

such
the

a

claim

would

discriminatory

be

acts

a
at

continuing
issue

are

otherwise discrete acts. See Coons v. Mineta, No. 03-5766, 2006 WL
3147735,

at

*8

(D.

Minn.

Nov.

3

2,

2006)

(finding

“systemic

PMT also argues that the EEOC is bound by its statements to
the Eighth Circuit Court Appeals during oral argument in EEOC v.
CRST Van Expedited, Inc., 679 F.3d 657 (8th Cir. 2012), where its
attorney stated that the “EEOC is only permitted to go back and
seek damages 300 days prior to the filing of the charge.”
Duddleston Decl. Ex. 27, at 17:22-23. CRST, however, was not a
pattern or practice case. See 611 F. Supp. 2d 918, 923 (N.D. Iowa
2009) (“Notably, the EEOC did not allege CRST was engaged in ‘a
pattern or practice’ of illegal sex-based discrimination ....”
(emphasis in original)).
As a result, CRST is factually
distinguishable, and PMT’s argument is unavailing.
6

discriminatory approach to hiring ... that has led to discrete
discriminatory acts” is a continuing violation); see also Kahler v.
Peters, No. 05-1107, 2007 WL 551612, at *3 n.13 (D. Minn. Feb. 21,
2007) (rejecting argument “that consecutive failures to hire must
be looked at as separate and discrete acts” (citation omitted)).
Thus,

relief

for

conduct

outside

the

300-day

period

is

not

categorically barred, and the EEOC did not act in bad faith by
attempting to obtain relief for such conduct.

As a result,

dismissal is not warranted.
III. Identification of Victims
PMT next argues that dismissal is warranted because the EEOC
has

not

identified

discrimination.

any

individual

that

was

a

victim

of

Specifically, PMT argues that by not identifying

the names of any applicants that PMT failed to hire, the EEOC has
not complied with its pleading burden under Twombly and Iqbal.

In

support, PMT again cites EEOC v. CRST Van Expedited, Inc., in which
the Eighth Circuit affirmed the dismissal of an EEOC class-action
where “the EEOC was unable to provide [CRST] names of all class
members ..., or an indication of the size of the class.”

679 F.3d

at 676 (8th Cir. 2012) (alterations in original) (citation and
internal quotation marks omitted).

As already explained, however,

CRST was not a pattern or practice case, and, as such, is factually

7

distinguishable.

Indeed, PMT does not identify a single “pattern

or practice” case in which a court dismissed the claim for failure
to identify individual victims.
Further, when the EEOC pursues a pattern or practice claim, it
“does not stand in the employee’s shoes.”

EEOC v. Waffle House,

Inc., 534 U.S. 279, 297 (2002) (citation omitted).
EEOC acts

to

“advance

the

public

interest

remedying employment discrimination.”
Inc. v. EEOC, 446 U.S. 318, 331 (1980).
EEOC

has

specifically

detailed

the

in

Rather, the

preventing

and

Gen. Tel. Co. of the Nw.,
Here, in that role, the
scope

of

the

claim

by

identifying the time period at issue, the alleged perpetrator of
the discrimination and the alleged discriminatory conduct.4

Given

such details, the court finds that the complaint states a claim
that rises above the speculative level as required by Twombly and
Iqbal and gives PMT fair notice of the charges against it.

Cf.

EEOC v. Original Honeybaked Ham Co. of Ga., 918 F. Supp. 2d 1171,
1180 (D. Colo. 2013) (“The greater the specificity in describing
the alleged unlawful conduct, the less important it becomes to
specifically

identify

aggrieved

persons.

If

the

employer

understands the nature, extent, location, time period, and persons
involved in the alleged unlawful conduct, it may be able to

4

The court notes that the EEOC’s lack of specificity
regarding the pattern or practice claim is likely compounded by
PMT’s alleged failure to keep records of applications, as required
by federal regulation. See Compl. ¶¶ 31-33.
8

reasonably estimate the number and identities of persons who may be
impacted.”).

As a result, dismissal is not warranted, and the

motion to dismiss the complaint is denied.
IV.

Claims Relating to Patricia Lebens
PMT next argues that the portion of the claim relating to

Patricia Lebens should be dismissed.
A.

Retaliatory Hostile Work Environment

PMT first argues5 that the EEOC fails to state a claim for
retaliatory hostile work environment.

“[R]etaliation claims under

Title VII [can] be based on a hostile work environment and need not
be based solely on discrete adverse employment actions that affect
the terms or conditions of employment.”

Stewart v. Indep. Sch.

Dist., No. 196, 481 F.3d 1034, 1042 (8th Cir. 2007) (citation
omitted).

To

state

a

claim

for

retaliatory

hostile

work

environment, a plaintiff must show “(1) that he or she engaged in
statutorily protected activity; (2) an adverse employment action
was taken against him or her; and (3) a causal connection exists
between the two events.”

Id. at 1043 (citation and internal

quotation marks omitted).
Here, PMT argues that Lebens cannot demonstrate a causal
connection between her protected activity and any hostile work

5

PMT also argues that the retaliatory hostile work
environment and constructive discharge claims are time-barred.
Because the court finds that such claims fail on the merits, it
need not reach that argument.
9

environment maintained by PMT.

Specifically, PMT argues that it

did not discover that Lebens engaged in protected conduct by
reporting her allegations to the EEOC until after her employment
with PMT ended. Indeed, the complaint alleges that PMT only became
aware that Lebens was the source of the EEOC allegations when it
received the EEOC probable cause determination, almost two years
after Lebens had resigned from PMT.

Compl. ¶ 27.

Because PMT was

unaware that Lebens was the individual who had reported it to the
EEOC reports, her protected conduct cannot be causally connected to
any adverse employment action or hostile work environment.

See

Khamati v. Sec’y of Dep’t of the Treasury, 557 F. App’x 434, 443
(6th Cir. 2014) (requiring, for hostile work environment claim,
that defendant knew of plaintiff’s protected activity); Bergbauer
v. Mabus, 934 F. Supp. 2d 55, 79 (D.D.C. 2013) (same).

As a

result, the EEOC cannot state a prima facie claim of retaliatory
hostile work environment on behalf of Lebens, and dismissal of that
claim is warranted.
B.

Constructive Discharge

PMT next argues that the EEOC fails to state a claim for
constructive discharge.

“To establish a case of constructive

discharge, [a plaintiff] must show that (1) a reasonable person in
her situation would find the working conditions intolerable, and
(2) the employer intended to force her to quit.”

Rester v.

Stephens Media, LLC, 739 F.3d 1127, 1132 (8th Cir. 2014).

10

A claim

for constructive discharge requires considerably more proof than an
“unpleasant and unprofessional environment.”
285 F.3d 705, 716 (8th Cir. 2002).

Jones v. Fitzgerald,

“A constructive discharge

arises only when a reasonable person would find the conditions of
employment intolerable.”
F.3d

490,

494

(8th

Tidwell v. Meyer’s Bakeries, Inc., 93

Cir.

1996)

(citation

omitted).

To

act

reasonably, however, “an employee has an obligation not to assume
the worst and to jump to conclusions too quickly.”

Id. (citation

omitted). “[C]onstructive discharge claims fail as a matter of law
where

the

employee

opportunity

to

employee quits.”

has

correct

not
the

given

the

intolerable

employer

a

condition

reasonable
before

the

Lisdahl v. Mayo Found., 633 F.3d 712, 719 (8th

Cir. 2011) (citations omitted).
Here, the claim for constructive discharge fails for similar
reasons as the claim for retaliatory hostile work environment.
Because there are no allegations that PMT was aware of Lebens’s
reports during the time of her employment, it is impossible for PMT
to have intended to force her to quit because of such reports.
Moreover, the EEOC does not allege any facts suggesting that Lebens
gave

PMT

an

opportunity

to

conditions before resigning.

correct

the

allegedly-intolerable

As a result, the EEOC cannot state a

claim for constructive discharge, and dismissal of that claim is
also warranted.

11

C.

Retaliation

Finally, PMT argues that the EEOC failed to allege a viable
retaliation claim on behalf of Lebens based on PMT’s criminal
complaint to the Carver County Sheriff’s Office. Specifically, PMT
argues that dismissal is warranted because the EEOC failed to
exhaust its administrative remedies with regards to that claim.6
The court agrees.
In

the

Title

VII

context,

“the

EEOC

[must]

satisfy

two

conditions7 before it brings suit against an employer: First, there

6

PMT also argues that the retaliation claim fails because the
criminal complaint to the Carver County Sheriff’s Office does not
amount to an adverse employment action.
Because the court
determines that dismissal is warranted due to failure to exhaust
administrative remedies, it need not reach such an argument.
7

As a threshold matter, the EEOC argues that it has generally
alleged the performance of conditions precedent to suit and, as a
result, dismissal is precluded under Rule 9(c). Rule 9(c) provides
that “[i]n pleading conditions precedent, it suffices to allege
generally that all conditions precedent have occurred or been
performed.
But when denying that a condition precedent has
occurred or been performed, a party must do so with particularity.”
The administrative filing requirements of Title VII are “a
condition precedent to suit subject to the pleading requirements of
Rule 9(c).” Brooks v. Monroe Sys. for Business, Inc., 873 F.2d
202, 205 (8th Cir. 1989) (citation omitted).
Nothing in the text of Rule 9(c), however, requires such
denial to be made in an answer rather than in a motion to dismiss.
Indeed, “Rule 9(c) has the effect of forcing defendant to raise the
issue whenever he believes there actually is a question about
performance.” Id. (citation and internal quotation marks omitted).
As a result, the court finds under these circumstances - where PMT
has specifically and particularly denied that the conditions
precedent occurred - the “motion to dismiss comports with the
thrust of Rule 9(c) by appraising [the EEOC] ... of the condition
precedent in dispute.” Pauls v. Elaine Revell, Inc., 571 F. Supp.
1018, 1021 n.6 (N.D. Ill. 1983); see also, e.g., Associated Mech.
(continued...)
12

must

be

Second,

an
if

administrative
the

investigation

investigation

of

establishes

the

charges

reasonable

....

cause

to

believe discrimination has occurred, the EEOC must attempt to
eliminate

the alleged

conciliation efforts.”

discriminatory conduct

through

informal

EEOC v. JBS USA, LLC, 940 F. Supp. 2d 949,

962 (D. Neb. 2013) (citations omitted).

Where, as here,

alleged

conduct

discriminatory

or

retaliatory

has

“the

occurred

subsequent to a timely filed EEOC charge ... [a] plaintiff will be
deemed to have exhausted administrative remedies if the allegations
of the judicial complaint are like or reasonably related to the
administrative charges that were timely brought.”

Wedow v. Kan.

City, Mo., 442 F.3d 661, 672 (8th Cir. 2006) (second alteration in
original) (citation and internal quotation marks omitted).

Such a

determination is a “judicial exception to the exhaustion doctrine.”
Richter v. Advance Auto Parts, Inc., 686 F.3d 847, 852 (8th Cir.
2012) (citation and internal quotation marks omitted).

Generally,

“retaliation

underlying

claims

are

discrimination claims.”

not

reasonably

related

to

Wedow, 442 F.3d at 673 (citation and

internal quotation marks omitted).
The EEOC argues, nevertheless, that the retaliation claim
premised on the police report to the Carver County Sheriff’s Office

7

(...continued)
Contractors, Inc. V. Martin K. Eby Constr. Co., 271 F.3d 1309, 1317
(11th Cir. 2001) (“The specific denial of performance of conditions
precedent may be raised by motion as well as by answer.” (citations
omitted)).
13

is reasonably related to the retaliatory hostile work environment
claim contained in the original EEOC probable cause determination.
See Duddleston Decl. Ex. 2.

In support, the EEOC relies on Wedow,

in which the Eighth Circuit found “subsequent retaliatory acts were
of a like kind to the retaliatory acts alleged in the EEOC charge”
and excused the administrative exhaustion requirement. 442 F.3d at
674. The EEOC charge in Wedow, however, explicitly stated that the
originally-charged retaliation was “of an ongoing and continuing
nature.” Id.
charge or

No such allegations are present in the original EEOC

determination

here

and,

indeed,

there

was

a

large

temporal disconnect between the alleged retaliatory hostile work
environment and the alleged subsequent retaliation.

Further, the

EEOC argues that PMT has received notice that the retaliation claim
at issue would be a part of this matter, and that to require
additional exhaustion would be overly formulaic and a waste of
agency resources.

The Eighth Circuit, however, has considered and

rejected similar

policy

exhaustion.

arguments

in

requiring

See Richter, 686 F.3d at 853.

administrative

As a result, the

retaliation at issue here was not “reasonably related” to the
underlying charge and determination and was instead a “discrete
claim[] based on incidents occurring after the filing of [the]
EEO[C] complaint.”

Id. at 852-53 (emphasis in original) (citation

and internal quotation marks omitted). Therefore, because the EEOC

14

has not administratively exhausted its claims relating to the
police report, dismissal is warranted.

CONCLUSION
Accordingly, based on the above, IT IS HEREBY ORDERED that:
1.

The motion to dismiss the complaint [ECF No. 8] is

denied;
2.

The motion to dismiss claims involving Patricia Lebens

[ECF No. 10] is granted; and
3.

The motion for extension of time to file response/reply

[ECF No. 21] is granted.
Dated:

August 27, 2014
s/David S. Doty
David S. Doty, Judge
United States District Court

15