BNSF Railway Company v. Feit
ORDER denying 12 Motion to Dismiss for Lack of Jurisdiction. Signed by Judge Donald W. Molloy on 4/25/2011. (dle)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MONTANA
BNSF RAILWAY COMPANY, a Delaware )
Eric Feit (“Feit”) moves to dismiss the above captioned case on various
grounds. First, he argues BNSF failed to join an indispensable party. He also
argues the narrow circumstances that justify abstention exist. Finally, Feit argues
for dismissal based on the doctrine of collateral estoppel. Feit’s arguments are
unpersuasive so the Court will retain jurisdiction.
II. Factual Background
Feit applied for employment with BNSF but did not receive a job offer.
February 27, 2009, Feit filed an administrative complaint with the Montana
Department of Labor and Industry. He charged BNSF of illegally discriminating
against him because of a perceived disability (obesity) in violation of the Montana
Human Rights Act.
March 10, 2010, a hearing examiner for the Department of Labor and
Industry ruled in favor of Feit and then awarded relief against BNSF on August 5,
2010. BNSF appealed the order to the Montana Human Rights Commission.
December 6, 2010, the Montana Human Rights Commission affirmed the order.
December 7, 2010, BNSF petitioned this Court to review the Montana Human
Rights Commission’s decision. Feit moves to dismiss the case.
Failure to Join an Indispensable Party
Characterizing the state as an indispensable party, Feit submits that the case
should be dismissed pursuant to Federal Rule of Civil Procedure 19, which allows
a claim to be dismissed when a party that is required to be joined cannot be joined
in the case. Fed. R. Civ. P. 19. According to Feit, the State has a substantial
interest in enforcing a judgment against BNSF; “[w]ithout a final determination
that the railroad discriminated against Feit, the State would be denied its interest in
enforcement.” Def.’s Br. in support of Mot. Dismiss 7 (Dec. 23, 2010) (dkt # 13).
Feit further argues the State’s intervention in past cases supports the conclusion
that it is indispensable here. Id. Because the Eleventh Amendment bars states
from being sued in federal court, Feit contends the inability for Montana to be
joined justifies dismissing the case.
The Montana Supreme Court held in Young v. City of Great Falls that
“Rule 19, M.R.Civ.P., does not, by its terms contemplate inclusion of an
administrative board as an indispensable party for purposes of judicial review.”
632 P.2d 1111, 1112–1113 (Mont. 1981). United States Senior District Court
Judge Lovell recently recognized the rule in Young and held state agencies are
“nominal” or “neutral parties” that “do not have a stake in the outcome” of the
judicial-review of an administrative decision. Reinhardt v. Mont. Human Rights
Bureau, 2010 WL 5391280 * 5 (D. Mont. 2010). In Reinhardt v. Montana Human
Rights Bureau, the plaintiff filed a judicial-review action and named the State as a
party. Judge Lovell held the agencies were “neither necessary nor indispensable
parties,” and given their limited interest, he dismissed the agencies and denied the
motion to remand. Id. *13–*14. So too here.
A general government interest in the welfare of its citizens does not make
the state more than a nominal party. Dept. of Fair Empl. & Hous. v. Lucent
Techs., Inc., 2007 WL 2947421, *4–*5 (N.D. Cal. 2007) (state agency that filed
employment discrimination suit is a nominal party that does not destroy diversity
jurisdiction). The purpose of all litigation is to preserve and enforce rights and
secure compliance with the law of the State, but the State cannot be a party in
interest in all litigation.
The absence of a statutory requirement to name the Commission in a
judicial review of a final decision of the Montana Human Rights Commission
further supports the conclusion that the Commission is not an indispensable party.
The legislature requires only that “[c]opies of the petition must be promptly served
upon the agency and all parties of record.” Mont. Code Ann. § 2-4-702(2)(a)
(2009). “Where the legislature has intended for administrative bodies to be made
parties, they have specifically so provided.” Young, 632 P.2d at 1113.
Considering the holdings in Young and Reinhardt as applied here, the state
is not an indispensable party, and Federal Rule of Civil Procedure 19 does not
require that the case be dismissed. If the judgment against BNSF is affirmed,
Montana may file an enforcement action pursuant to Montana Code Annotated §
Feit also argues the case should be dismissed or remanded in accordance
with various abstention doctrines. “[F]ederal courts have a strict duty to exercise
the jurisdiction that is conferred upon them by Congress.” Quakenbush v. Allstate
Ins., 517 U.S. 706, 716 (1996). “Abstention from the exercise of federal
jurisdiction is the exception, not the rule.” Colo. River Water Conserv. Dist. v.
U.S., 424 U.S. 800, 813 (1976). The narrow circumstances that justify abstention
do not exist here.
Feit rests his principle abstention argument on the reasoning in Burford v.
Sun Oil Co., 319 U.S. 315 (1943). Burford-type abstention enables federal courts
to decline jurisdiction to avoid needless conflict with a state’s administration of its
affairs. It applies when “policy problems of substantial public import” transcend
the result in the case at bar. Quakenbush v. Allstate Ins. Co., 517 U.S. 707, 726
(1996). In Burford, the federal court declined to review an order granting a permit
to drill oil in Texas because of the specialized aspects of the state’s complicated
regulatory system of local law. Burford, 319 U.S. at 322. Centralized review
promoted the state’s complex oil conservation scheme.
BNSF argues against Burford abstention because Montana has not
concentrated suits challenging agency decisions on discrimination issues in a
particular court, and federal review would not disrupt establishment of coherent
City of Tucson v. U.S. West Communications, Inc. set out three
requirements that must be met in the Ninth Circuit before Burford abstention
applies: (1) the state must concentrate suits challenging the actions of an agency
involved in a particular court, (2) federal issues can not be separated easily from
complex state law issues with respect to which state courts might have special
competence, and (3) federal review might disrupt state efforts to establish a
coherent policy. 284 F.3d 1128, 1133 ( 9th Cir. 2002).
Feit represents that a specialized court system is not a prerequisite to
Burford abstention. The California federal district court case Feit cites to support
his argument states a specialized court is not a prerequisite to Burford abstention,
but the court noted the state must demonstrate special efforts to create consistent
policy. There, efforts to create consistent policy existed because the state
consolidated review by referring the category of cases to one judge.
Regardless of whether a specialized court system is a prerequisite to
Burford abstention, Ninth Circuit case law limits Burford abstention to
circumstances where the state consolidated review of an issue in a particular court.
City of Tucson, 284 F.3d at 1133 (“Burford abstention requires . . . the state has
chosen to concentrate suits challenging the actions of the agency involved in a
Unlike Burford, here Montana has not centralized review of Human Rights
Commission decisions in a particular court. See Mont. Code Ann. § 2-4702(2)(a); Reinhardt v. Mont. Human Rights Bureau. Feit argues that the Human
Rights Commission is specialized in employment discrimination, but he presents
nothing to suggest Montana attempted to create consistent policy by taking special
steps to consolidate review of the agency’s decisions. Because the effort to create
consistent policy is demonstrated in the state’s efforts in controlling the review of
the agency decision, an argument that the agency is a specialized court does not
satisfy the Ninth Circuit requirement that review be consolidated in a particular
court. Therefore, Burford abstention does not apply here.
Furthermore, federal review of an agency’s decision regarding employment
discrimination will not disrupt state policy. A discrimination case does not
involve the same complicated regulatory scheme that the Court avoided in
Burford. Federal review will not disrupt public policy, and applying Montana law
in a diversity case is not an unfamiliar or burdensome task.
Other Abstention Principles
None of the other abstention doctrines cited by Feit apply here. Although
Feit refers to Younger, Pullman, and Colorado River abstention doctrines, his brief
fails to discuss how that authority might apply here. While various circumstances
exist under which Federal Courts have determined abstention is the prudent path,
abstention applies only in exceptional circumstances, Colo. River Conserv. Dist.,
424 U.S. at 813, and the facts here do not weigh in favor of abstention.
a. Younger Abstention
Younger abstention applies when a party invokes federal jurisdiction to
restrain state criminal proceedings or certain state nuisance proceedings
antecedent to a state criminal prosecution. See Younger v. Harris, 401 U.S. 37
(1971); Huffman v. Pursue, Ltd., 420 U.S. 592 (1975). Circumstances that justify
abstaining under Younger do not exist here.
b. Colorado River Abstention
The unique circumstances that counseled in favor of abstention in Colorado
River Water Conservation District v. United States, do not exist here either. The
abstention question in Colorado River arose when the United States brought suit
in United States district court seeking a declaratory judgment on water rights in a
Colorado river system. Colo. River Water Conserv. Dist., 424 U.S. at 805.
Colorado had established a comprehensive state system for adjudicating water
rights, and a parallel action existed in state court. Id. at 806. In the interest of
judicial economy and to avoid piecemeal litigation, especially when
interdependent water rights litigation was at issue, abstention was appropriate. Id.
A substantially similar state action does not parallel BNSF’s federal
administrative review action.1 Furthermore, exercising jurisdiction does not
disrupt an interdependent litigation scheme like the water rights litigation in
Colorado River. See Id. at 818 (stating that generally “pendency of an action in
the state court is no bar to proceedings concerning the same matter in the Federal
court having jurisdiction”).
c. Pullman Abstention
Finally, Feit’s references to Pullman abstention do not weigh in favor of
abstention. The federal court avoided deciding a substantial constitutional issue in
Pullman because under state law the Railroad Commission may not have had
authority to issue the disputed and controversial regulation. R.R. Commn. of Tex.
Feit suggests that the enforcement action removed from state court, CV 11-01-H-DWM,
is a parallel state action that supports Younger or Colorado River abstention. The enforcement
action is not the type of contemplated parallel action because it is not substantially similar to the
review action. Nakash v. Marciano, 882 F.2d 1411, 1416 (9th Cir. 1989); see Moses H. Cone
Mem’l Hosp., 460 U.S at28 (“parallel state-court litigation [must] be an adequate vehicle for the
complete and prompt resolution of the issues between the parties”). The action to enforce the
agency’s decision will not resolve the issues in the review action.
v. Pullman Co., 312 U.S. 496, 501 (1941). Pullman abstention has been used
when the resolution of ambiguous state law will allow the court to avoid deciding
a substantial federal issue or a state law issue of unusually strong import. Id.; La.
Power & Light Co. v. Thibodaux, 360 U.S. 25, 30 (1959).
The facts here do not satisfy the criteria needed for Pullman abstention. The
review of the Human Rights Commission’s decision involved no sensitive federal
Equitable or Discretionary Relief
BNSF also argues abstention does not apply because only limited equitable
relief was ordered. Courts have the power to dismiss or remand cases on
abstention principles “only where the relief being sought is equitable or otherwise
discretionary.” Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 731 (1996).
Where legal relief is in dispute, a federal court reluctant to exercise jurisdiction
based on abstention principles may stay the action. Id. at 721. Although Feit was
awarded limited equitable relief, this action is primarily a legal action. Even if the
narrow circumstances justifying abstention existed, Feit has not asked for a stay,
and dismissal or remand is not appropriate.
C. Collateral Estoppel
Feit also argues for dismissal based on the doctrine of collateral estoppel.
Collateral estoppel is an affirmative defense. Fed. R. Civ. P. 8(c). It bars
relitigation of an issue that has already been adjudicated. McDaniel v. Mont., 208
P.3d 817, 826 (2009). To the extent that Feit argues collateral estoppel bars
relitigating the issue of liability, insufficient information exists to justify dismissal.
The elements of collateral estoppel are: (1) the issue is identical to the issue
of a prior adjudication, (2) a final judgment on the merits was issued, (3) the party
against whom the plea is asserted was a party or privy to the party in the prior
adjudication, and (4) the party against whom preclusion is now asserted was
afforded a full and fair opportunity to litigate the issue which may be barred? Id.
Identification of identical issues is the most critical element. Haines Pipeline
Constr. Inc. v. Mont. Power Co., 876 P.2d 632, 636 (1994).
Feit represents that BNSF seeks to relitigate “whether the Montana Supreme
Court would apply an obscure footnote to a federal regulation.” However, Feit
does not provide a citation to the “obscure footnote,” nor does he cite any case that
previously litigated the issue. Without more, the court cannot determine whether
collateral estoppel bars litigation of an issue or whether resolution of the issue
would justify dismissing the entire case.
For the foregoing reasons, IT IS HEREBY ORDERED that Feit’s Motion to
Dismiss (dkt # 12) is DENIED.
Dated this 25th day of April, 2011.
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