SCANLAN v. AMERICAN AIRLINES GROUP, INC.

Filing 206

MEMORANDUM. SIGNED BY DISTRICT JUDGE HARVEY BARTLE, III ON 8/29/2024. 8/29/2024 ENTERED AND COPIES E-MAILED.(ahf)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
JAMES P. SCANLAN, et al.
v.
AMERICAN AIRLINES GROUP,
INC., et al.

:
:
:
:
:
:

CIVIL ACTION

NO. 18-4040

MEMORANDUM
Bartle, J.

August 29, 2024
Plaintiff James P. Scanlan, an American Airlines pilot

and retired Major General in the United States Air Force
Reserve, and Carla Riner, an American Airlines pilot and a
Brigadier General in the Delaware Air National Guard, have
brought this class action against that defendants American
Airlines Group, Inc. and American Airlines, Inc. under the
Uniformed Services Employment & Reemployment Rights Act, 38
U.S.C. § 4301, et seq. (“USERRA”) and for breach of the profit
sharing plan initiated and established by defendants.

The

second amended complaint alleges that defendants American
Airlines Group, Inc. and American Airlines Inc. violated Section
4316(b)(1) of USERRA and the terms of the profit sharing plan
because they pay or credit employees for their imputed earnings
when on jury duty and bereavement leave but not when employees
are on short-term military leave.
Before the court is the motion of defendants American
Airlines Group, Inc. and American Airlines, Inc. for summary

judgment on plaintiffs’ request for liquidated damages under
USERRA (Doc. # 173) and defendants’ motion to strike plaintiffs’
jury trial for any claims seeking non-liquidated damages under
USERRA (Doc. # 201).
I
This action has a prolonged history.

After discovery,

the court certified several subclasses under Rule 23(b)(2) and
23(b)(3) of the Federal Rules of Civil Procedure.

See Order,

Scanlan v. Am. Airlines, Grp., Inc., Civ. A. No. 18-4040 (E.D.
Pa. May 3, 2022) (Doc. # 166).

This court thereafter granted

the defendants’ motion for summary judgment on all claims.

Our

Court of Appeals affirmed on the breach of contract claim
relating to the profit sharing plan but reversed on the USERRA
claims.

It held that these latter claims must be resolved by

the factfinder.

Scanlan v. Am. Airlines Grp., Inc., 102 F.4th

164, 70 (3d Cir. 2024).

In granting the motion for summary

judgment, this court did not reach the issue related to
liquidated damages and did not have before it at that time the
motion to strike the jury demand.

These issues are now ripe for

consideration.
II
Under Rule 56 of the Federal Rules of Civil Procedure,
summary judgment is appropriate “if the movant shows that there
is no genuine dispute as to any material fact and the movant is
-2-

entitled to judgment as a matter of law.”

Fed. R. Civ. P.

56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 323
(1986).

A dispute is genuine if the evidence is such that a

reasonable factfinder could return a verdict for the nonmoving
party.
(1986).

See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254
The court views the facts and draws all inferences in

favor of the nonmoving party.

See In re Flat Glass Antitrust

Litig., 385 F.3d 350, 357 (3d Cir. 2004).
Summary judgment is granted when there is insufficient
evidence for a reasonable factfinder to find for the nonmovant.
See Anderson, 477 U.S. at 252.

“The mere existence of a

scintilla of evidence in support of the [nonmoving party]’s
position will be insufficient; there must be evidence on which
the jury could reasonably find for [that party].”

Id.

In

addition, Rule 56(e)(2) provides that “[i]f a party fails to
properly support an assertion of fact or fails to properly
address another party’s assertion of fact as required by
Rule 56(c), the court may . . . consider the fact undisputed for
the purposes of the motion.”

Fed. R. Civ. P. 56(e)(2).
III

The court turns first to defendants’ motion for
summary judgment on the issue of liquidated damages.
USERRA provides in part for the following relief:

-3-

[T]he court may require the employer to pay
the person an amount equal to the amount
referred to in subparagraph (B) 1 as
liquidated damages, if the court determines
that the employer’s failure to comply with
the provisions of this chapter was willful.
38 U.S.C. § 4323(d)(1)(C).
The Supreme Court has held that a violation is willful
if “the employer either knew or showed reckless disregard for
the matter of whether its conduct was prohibited by the
statute[.]”
(1988).

McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133

The Supreme Court made clear that a finding of

willfulness cannot be based on negligence or a completely good
faith but incorrect assumption that there was compliance with
the relevant statute in all aspects.

Id. at 134-35.

Plaintiffs contend that defendants acted willfully
because they were advised by plaintiffs of their violation of
USERRA and then did nothing.

As evidentiary support, plaintiffs

rely first on defendants’ Answer to Interrogatory # 13.

In that

interrogatory, plaintiff asked defendants to show how they
responded to learning of plaintiffs’ allegation concerning
USERRA and how defendants became aware of and responded to those
complaints.

Defendants simply answered they became aware of

1.
Subparagraph (B) reads: “The court may require the employer
to compensate the person for any loss of wages or benefits
suffered by reason of such employer’s failure to comply with the
provisions of this chapter.”
-4-

plaintiff’s claim “when he filed the amended complaint on
January 7, 2019.”
Plaintiffs also cite an e-mail chain and deposition
testimony to support its position that defendants’ violation of
USERRA was willful.

Plaintiffs assert that defendants’

violation of USERRA was raised by plaintiffs’ union
representatives in 2017 with Todd Jewell, defendants’ managing
director of labor relations and that defendants took no action.
The e-mail chain consists of messages between plaintiff James
Scanlan and various pilots, including representatives on their
Negotiating Committee which interacted with the defendants.

The

e-mails are dated from February 2, 2017 through March 31, 2017.
The e-mails focus almost exclusively on the defendants’ profit
sharing plan which was a benefit established by the defendants
but was not a benefit negotiated as a result of collective
bargaining.

While USERRA was mentioned in passing in some of

the e-mails, any mention with one exception was tied to the
discussion of the profit sharing plan.

Significantly, there is

absolutely nothing in the e-mails to demonstrate that any
representatives of the pilots raised an alleged violation of
USERRA with any representatives of the defendants during the
period of the e-mails or at any other time before this lawsuit
was filed.

-5-

In his deposition to which plaintiffs cite, Jewell
testified that he did not recall if he consulted with an
attorney concerning a USERRA violation during this period.

In

any event, the question to him appears to relate to the terms of
the profit sharing plan – not USERRA.
Plaintiffs’ references to the profit sharing plan are
now irrelevant since the profit sharing plan is no longer a part
of this action.

As noted above, the Court of Appeals affirmed

this court’s grant of summary judgment in favor of defendants on
this claim.
Plaintiffs, of course, have the burden of proof on the
issue of willfulness.

It is the plaintiffs who must come

forward at this stage with sufficient evidence to show that a
genuine dispute of material fact exists.

Their contention that

defendants have advanced no evidence of any kind regarding their
efforts to comply with USERRA does not help plaintiffs defeat
defendants’ motion for summary judgment.

See Harter v GAF

Corp., 967 F.2d 846, 851-52 (3d Cir. 1992).

The absence of any

evidence of willfulness does not carry the day for plaintiffs.
In sum, plaintiffs have presented no evidence to
establish willfulness.

Their citations to the record provide

nothing to support their assertion that defendants knew that
they were violating USERRA or that they acted in reckless
disregard of whether their position violated USERRA.
-6-

The critical issue under USERRA pending before the
court is whether short term military leave, for which employees
receive no pay or benefits from defendants, is comparable to
jury duty and bereavement leave for which employees do receive
pay and benefits.

The Court of Appeals in this action ruled

that the issue of comparability is for the factfinder.

It

explained that there is evidence that jury duty and military
leave have a common purpose of civic duty but that there is also
evidence of differences as jury duty is compulsory and military
leave is not compulsory.

The Court observed that the factfinder

will have to weigh the evidence as to whether military duty and
bereavement leave have a common public purpose.

As part of the

comparability analysis, the factfinder will need to weigh the
similarities and the distinctions concerning duration,
frequency, and the employees’ control with respect to these
various types of leave.

Scanlan v. American Airlines Grp.,

Inc., 102 F.4th 164, 170 (3d Cir. 2024).

Finally, the

factfinder must then decide if military leave compares or
contrasts with jury duty and bereavement leave.
Plaintiffs have pointed to no case where any
factfinder has found or any court has determined that
bereavement leave or jury duty is comparable to military leave.
On the contrary, there have been district judges who have held
that military leave is not comparable to bereavement leave or
-7-

jury duty or that plaintiffs such as those here are not entitled
to relief under USERRA as a matter of law.

See e.g., Order,

White v. United Airlines, Civ. A. No. 19-114 (N.D. Ill. Mar. 24,
2024) (Doc. # 127); White v. United Airlines, 416 F. Supp. 3d
736 (N.D. Ill. 2019); Travers v. Fed Ex Corp., 473 F. Supp. 3d
421, 434 (E.D. Pa. 2020), rev’d, 8 F.4th 198 (3d Cir. 2021);
Hoefert v. American Airlines, Inc., 438 F. Supp. 3d 724, 742
(N.D. Tex. 2020); Petty v. Metro. Gov’t of Nashville-Davidson
Cnty., Civ. A. No. 05-680, 2006 WL 3333509 (M.D. Tenn. Nov. 16,
2006), rev’d, 538 F.3d 431 (3d Cir. 2008), cert. denied, 556
U.S. 1165 (2009); Scanlan v. American Airlines Grp., Inc., 638
F. Supp. 3d 453 (E.D. Pa. 2022), rev’d, 102 F.4th 164 (3d Cir.
2024).
These decisions, even if wrong, further negate
plaintiffs’ argument that defendants’ similar interpretation of
USERRA constituted willful misconduct.

With so many courts

ruling as they have, it is not reasonable to conclude that
defendants knew they were wrong or acted in reckless disregard
of whether their conduct was prohibited by USERRA.
On the record before the court, plaintiffs have
advanced no evidence to prove willfulness on the part of
defendants, and thus defendants cannot be held liable for

-8-

liquidated damages.

Accordingly, defendants are entitled to

summary judgment on this issue. 2
IV
Defendants concede that plaintiffs would be entitled
to a jury trial for liquidated damages had that remedy remained
available in this case but argue that the right to a jury trial
extends no further.

The defendants now move to strike

plaintiff’s demand for a jury trial on claims for non-liquidated
damages with respect to loss of wages and benefits. 3
In addition to liquidated damages, USERRA includes the
following remedies in Section 4323:
(d)(1)
In any action under this section,
the court may award relief as follows:
(A) The court may require the employer
to comply with the provisions of this
chapter.
2.
Plaintiffs rely heavily on Serricchio v. Wachovia
Securities LLC, 658 F. 3d 169 (2d Cir. 2011), in which the Court
of Appeals for the Second Circuit concluded that defendant had
willfully violated USERRA in connection with the reinstatement
of the plaintiff following his military service. Among other
statutory violations, the defendant knowingly delayed his
reemployment for four months after he had reapplied despite
USERRA’s requirement that an employee under such circumstances
“shall be promptly reemployed.” Id. at 191-92. This is a far
cry from the facts presented by the plaintiffs here.

3.
The Court of Appeals in its recent opinion, referred to the
factfinder as the jury. However, that Court did not have before
it the question as to whether the plaintiffs were entitled to a
jury trial and in this court’s view did not decide, despite its
terminology, whether a jury or non-jury trial is warranted.
See, e.g., Scanlan, 102 F.4th at 170. All parties agree that
the issue was not decided on appeal.
-9-

(B) The court may require the employer
to compensate the person for any loss of
wages or benefits suffered by reason of such
employer’s failure to comply with the
provisions of this chapter.
. . .
(2)(A) Any compensation awarded under
subparagraph (B) . . . shall be in addition
to, and shall not diminish, any of the other
rights and benefits provided for under this
chapter.
(e) Equity powers. – The court shall use,
in any case in which the court determines it
is appropriate, its full equity powers,
including temporary or permanent
injunctions, temporary restraining orders,
and contempt orders, to vindicate fully the
rights or benefits of persons under this
chapter.
38 U.S.C. § 4323.
In this action, plaintiffs have sued the defendants
for failing to pay them wages and provide them with benefits
while they were on short-term military leave.

Plaintiffs seek

declaratory, injunctive, and monetary relief for themselves and
the members who comprise the certified classes under Rule
23(b)(2) and Rule 23 (b)(3) of the Federal Rules of Civil
Procedure.
A party has the right to a jury trial when guaranteed
by the Seventh Amendment to the Constitution or by statute. 4
4.
The Seventh Amendment has not been incorporated into the
due process clause of the Fourteenth Amendment. McDonald v.
Chicago, 561 U.S. 742, 765 n.13 (2010).
-10-

Tull v. United States, 481 U.S. 412, 417 n.3 (1987).

The

Seventh Amendment provides that “[i]n suits at common law, where
the value in controversy shall exceed twenty dollars, the right
of trial by jury shall be preserved[.]”

The Amendment preserves

the right to a jury trial as it existed when the Amendment was
adopted in 1791.

Curtis v. Loether, 415 U.S. 189, 191 (1974).

The Amendment mirrors the situation as it existed at that time
in England where a jury trial was customary in the law courts
but not required in courts of equity and admiralty.

The right

to a jury trial applies not only to common law claims but also
to claims enforceable under a statute if legal rights and
remedies are created.

Id. at 193-194.

To determine whether a statutory claim is subject to a
jury trial, it must likewise be determined whether it is more
akin to an action tried in English law courts or to suits in the
courts of equity or admiralty.

The court must then examine the

remedy sought, that is whether it is legal or equitable in
nature.

In resolving whether a party is entitled to a jury

trial under the Seventh Amendment, the characterization of the
relief is more important than finding whether the claim is
analogous to one heard in the law courts of England in the late
eighteenth century.

As The Supreme Court stated in Curtis v.

Loether,

-11-

But when Congress provides for enforcement
of statutory rights in an ordinary civil
action in the district courts, where there
is obviously no functional justification for
denying the jury trial right, a jury trial
must be available if the action involves
rights and remedies of the sort typically
enforced in an action at law.
Id. at 195.
In Dairy Queen Inc. v. Wood, 369 U.S. 469 (1962), the
Supreme Court faced the question whether the district court had
erred in striking the defendant’s demand for a jury trial.

The

action involved a licensing agreement involving the trademark
“Dairy Queen.”

The plaintiffs, the owners of the trademark,

claimed that the defendant had materially breached the agreement
by defaulting on the periodic payments due to plaintiffs.

When

defendant continued to use the trademark despite cancellation of
the defendant’s right to do so, plaintiffs filed suit.
Plaintiffs sought temporary and permanent injunctive relief to
prevent future use of the trademark, an accounting to determine
the amount of money due, and an injunction pending an
accounting.

Id. at 475.

The Supreme Court held that defendant

was entitled to a jury trial on the claim for money damages for
breach of contract and for trademark infringement.
80.

Id. at 479-

The fact that plaintiffs used the term “accounting” in the

complaint was of no moment as the right to a jury trial did not
depend on the words used in the pleading.
-12-

Id.

The Supreme

Court further held that the right to a jury trial may not be
lost even where legal issues may be characterized as incidental
to equitable issues.

Id.

The most analogous precedent in the Third Circuit on
the question whether plaintiffs are entitled to a jury trial is
Gruca v. U.S. Steel Corp., 495 F.2d 1252 (3d Cir. 1974).

There,

plaintiff, a veteran, brought suit for legal and equitable
relief under the Military Selective Service Act (“MSSA”) of
1967.

See 50 App. U.S.C. § 459 (codified at 50 U.S.C. § 1518

(1970)).

Plaintiff had worked for the defendant as a laborer

for several years before entering military service.

After his

discharge and return to work, he claimed he was denied the
seniority to which he was entitled.

This denial delayed his

ability to obtain a superior and more lucrative position as a
crane operator.

He sought both adjustment to his seniority

status and back pay.

Gruca, 495 F.2d at 1254.

decide if his claims were time-barred.

The Court had to

To determine this

question, the Court delved into whether plaintiff sought legal
relief as to which the state statute of limitations would apply
or whether he sought equitable relief as to which the doctrine
of laches would govern.
The court held that the plaintiff’s “arsenal of
remedies under [Section] 459 [of MSSA] is not limited solely to
those which are equitable in nature.”
-13-

Id. at 1257.

Section 459

gave the court the power to require the employer “to comply with
. . . [certain provisions of the section] and to compensate such
person for any loss of wages and benefits . . .”

The Court

understood this statutory language to allow the plaintiff to
seek both legal and equitable relief.

Id.

Since the court

concluded that plaintiff’s claim could not be characterized “as
being exclusively in equity to enforce rights cognizable only in
equity,” the state statute of limitations, and not the doctrine
of laches, applied to his claim seeking legal relief.

Id.

It

cited Dairy Queen, Inc., supra, in support. 5
MSSA was the predecessor to USERRA.
at 200-01.

Travers, 8 F.4th

The provision of USERRA providing remedies to a

plaintiff is virtually identical to that in MSSA, except that
USERRA has added the remedy of liquidated damages when the
defendants’ conduct is willful.

As noted above, MSSA and USERRA

provide:

5.
As it turned out, the Court ultimately held that the time
limit under the statute of limitations and under the doctrine of
laches was the same. Gruca, 495 F.2d at 1258.
-14-

MSSA
(50 App. U.S.C. § 459)

USERRA
(38 U.S.C. § 4323(1)(B))

The district court . . .
shall have power . . .
To require such employer
to comply with such
[aforesaid] provisions
and to compensate such
person for any loss of
wages or benefits
suffered by reason of
such employer’s unlawful
action.

The court may require
the employer to
compensate the person
for any loss of wages or
benefits suffered by
reason of such
employer’s failure to
comply with the
provisions of this
chapter.

Our Court of Appeals has held that the claim for
payment of money under MSSA is a legal claim seeking a remedy
which is legal in nature.

Gruca, 495 F.2d at 1257-28.

Accordingly, such a claim for payment of money for lost wages
under USERRA is likewise a legal claim in nature for which the
plaintiffs are entitled to a jury trial.

Plaintiffs here, like

the plaintiff in Gruca, also pleaded equitable claims for
relief.

These claims are intermingled with those for payment of

money damages.

The fact that equitable claims are in the

picture does not override the right of plaintiffs to a jury
trial for loss of wages and benefits.
The defendants argue that the reasoning of Gruca has
been superseded by later congressional amendments related to the
MSSA and to USERRA which have eliminated any limitations period
for claims brought under these statutes.
-15-

Defendants maintain

that such changes incorporate the intent of Congress to fashion
claims under USERRA and the MSSA as equitable in nature and to
deny plaintiffs a right to a jury trial.
Defendants cite a 1974 Senate Report on a proposed
amendment to the MSSA, which states: “Providing further, that no
State statute of limitations shall apply to proceedings under
this section.”

The report goes on to say that “[t]his amendment

would clarify the original intent of Congress that all
reemployment rights actions under the Act are to be governed by
equitable principles.”

The report then referenced two Fifth

Circuit decisions which applied a short state statute of
limitations.

It also identified Gruca, which was described as

applying “a state statute of limitations to the monetary portion
of the veteran’s claim, but applied the equitable doctrine of
laches to his claim for seniority adjustment.”

In support of

the elimination of state statutes of limitations to bar claims,
the report concluded, “[t]hese [Court of Appeals] holdings
operate to the detriment of the veteran who must rely, in most
cases, on the assistance of the Government to vindicate his
claim.”
The Veterans’ Benefits Improvement Act, enacted in
2008, amended USERRA.

Pub. L. No. 110-389 (110th Cong. 2008).

The Act removed the prior language first included in MASSA and
later in USERRA that “no state statute of limitations shall
-16-

apply.”

In its place, USERRA now excludes any limitations

period, regardless of the source.

USERRA states:

If any person seeks to file a complaint
. . . with . . . a Federal or State court
under this chapter alleging a violation of
this chapter, there shall be no limit on the
period for filing the complaint . . . .
38 U.S.C. § 4327(b).
This court agrees with the cogent dissent in Troy v.
City of Hampton that the purpose of prohibiting the defense of
state statutes of limitations in MSSA was simply to prevent
short deadlines from denying veterans the salutary benefits of
that law.

756 F.2d 1000, 1008-09 (4th Cir. 1985) (Ervin, J.,

dissenting).

USERRA in 2008 simply contained reworded language

to the same if not broader effect.
While the 1974 Senate Report, to the extent relevant,
states, as noted above, that “reemployment rights actions [under
MSSA] should be governed by equitable principles,” it is not in
this court’s view an expression of the intent of Congress that
veterans were not to have a right to a jury trial for loss of
wages and benefits.

If Congress had intended that result, it

knows how to say so.

The first definition of “equitable” in

Black’s Law Dictionary (12th ed. 2024) is “[j]ust; consistent
with principles of justice and right.”

The meaning of

“equitable principles” as used in the 1974 report is not
synonymous with the eighteenth century meaning of equitable
-17-

claims and remedies for which a party must submit to a non-jury
trial.

In short, Congress has not invalidated the right to a

jury trial in USERRA and has not superseded Gruca on this issue.
Defendants have also cited a number of cases for back
pay under Title VII of the Civil Rights Act, the Americans with
Disabilities Act of 1990, and 42 U.S.C. § 1983 in support of
their argument that plaintiffs’ claims under USERRA are
equitable.

See, e.g., Staub v. Proctor Hosp., 532 U.S. 411, 417

(2011); Spencer v. Wal-Mart Stores, Inc., 469 F.3d 311, 317 (3d
Cir. 2006); Gurmankin v. Costanzo, 626 F.2d 1115, 1123 (3d Cir.
1980).

There is no need to delve into the intricacies of these

cases as the statutory language is not the same as in the MSSA
and USERRA.

Our Court of Appeals, albeit many years ago, has

spoken in Gruca as to the language at issue here.

This court

must abide by that holding and not circumvent it by relying on
an analysis of different statutes which have different purposes
or on what other circuits may have concluded.
Finally, the court notes that it has certified classes
under Rule 23(b)(2) and Rule 23(b)(3).

These classifications do

not control whether a party is entitled to a jury trial under
the Seventh Amendment.

See, e.g., Randall v. Rolls-Royce, 637

F.3d 818, 825 (7th Cir. 2011).
Accordingly, the motion of defendants to strike
plaintiffs’ demand for a jury trial will be denied.
-18-