EQUAL EMPLOYMENT OPPORTUNITY COMMISSION v. GRANE HEALTHCARE CO. et al

Filing 86

MEMORANDUM AND ORDER OF COURT denying 38 Motion for Protective Order; granting 43 Motion to Compel; denying 60 Motion for Partial Judgment on the Pleadings; granting 64 Motion to Amend/Correct, and as more fully stated in said Memorandum and Order of Court. Signed by Judge Kim R. Gibson on 3/15/2013. (dlg)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF PENNSYLVANIA

EQUAL EMPLOYMENT OPPORTUNITY )
COMMISSION,
)
Plaintiff,

v.
GRANE HEALTHCARE CO. and
EBENSBURG CARE CENTER, LLC
Defendants.

)
)
)
)
)
)
)
)
)
)

CIVIL ACTION NO. 3:10-250
JUDGE KIM R. GIBSON

MEMORANDUM AND ORDER OF COURT

I. SYNOPSIS

This matter comes before the Court on Plaintiffs, Equal Employment Opportunity
Commission's ("EEOC"), "Motion for Partial Judgment on the Pleadings" (Doc. No. 60) and its
"Motion for Protective Order" (Doc. No. 38). Defendants, Grane Healthcare and Ebensburg
Care Center, doing business as Cambria Care Center, ("the Defendants") have opposed the
motions by filing a "Motion to File Amended Answer to Plaintiffs Complaint and in Opposition
to Plaintiffs Partial Motion for Judgment on the Pleadings," (Doc. No. 64) and a "Motion to
Compel 30(B)(6) Deposition." (Doc. No. 43).

For the reasons that follow, the Court will

GRANT Defendants' motion to amend the answer, DENY Plaintiffs motion for partial

judgment on the pleadings, GRANT Defendants' motion to compel, and DENY Plaintiffs
motion for protective order.

II. JURISDICTION AND VENUE

Jurisdiction is proper in the United States District Court for the Western District of
Pennsylvania pursuant to 28 U.S.C. §§ 1331, et seq., and pursuant to Section 107(a) of the
Americans with Disabilities Act of 1990, 42 U.S.C. § 12117(a). Venue is proper under 28

u.s.c. § 1391(b).

III. BACKGROUND

This case arises from a dispute under Title I of the Americans with Disabilities Act ("the
ADA") of 1990, as amended through the ADA Amendments Act of 2008, Pub. L. 110-325, and
Title I of the Civil Rights Act of 1991 between the EEOC ("Plaintiff'), the Agency of the United
States of America charged with the administration, interpretation and enforcement of Title I of
the ADA, and Grane Healthcare and Ebensburg Care Center, doing business as Cambria Care
Center, ("the Defendants"). (See Doc. No. 1). Specifically, EEOC alleges that the Defendants
participated in an illegal hiring practice where candidates that applied for employment would be
subject to medical examinations and health inquiries. (See Doc. No. 1). EEOC alleges that the
Defendants used this information in selecting candidates for employment. (See Doc. No. 1). The
Defendants denied the allegations and raised affirmative defenses in their answer. (See Doc. No.
8).

On September 14, 2012, Plaintiff EEOC filed a motion for partial judgment on the
pleadings (Doc. No. 60), arguing that while Defendants' Answer (Doc. No. 8) generally denied
the conditions precedent to this lawsuit, it had failed to do so with the necessary specificity
required under relevant law. (Doc. No. 60 at 1). On October 1, 2012, Defendants filed a motion
to amend the answer (Doc. No. 64) as a response to Plaintiffs motion.

2

In addition to these two opposing motions, a discovery dispute has arisen in this case and
will be determined here in conjunction with these two prior pending motions. On July 9, 2012,
Defendants served a Second Revised Notice of a 30(b)(6) deposition to Plaintiff. Through this,
Defendants sought information regarding actions undertaken by Plaintiff that form the
underlying basis of the EEOC's contention that Defendants violated the ADA. In response,
EEOC filed a motion for a protective order (Doc. No. 38), seeking cover against Defendants'
deposition request. Defendants next countered on August 3, 2012, with a motion to compel
30(B)(6) deposition. (Doc. No. 43). The parties participated in oral argument regarding the
instant motions on January 25, 2013. All pending motions have been fully briefed in this matter,
and are now ripe for disposition.

IV. STANDARD OF REVIEW
A. Defendant's Motion to Amend

On October 1, 2012, Defendants filed a motion to amend the answer to Plaintiffs
complaint. (Doc. No. 64). In such instances, Federal Rule of Civil Procedure 15(a)(2) provides
that "a party may amend its pleading only with the opposing party's written consent or the
court's leave. The court should freely give leave when justice so requires." FED. R. Crv. P.
15(a)(2). As the Third Circuit has explained, a district court may deny a motion to amend a
complaint if "(1) the moving party has demonstrated undue delay, bad faith or dilatory motives,
(2) the amendment would be futile, or (3) the amendment would prejudice the other party."
Fraser v. Nationwide Mut. Ins . .Co., 352 F.3d 107, 116 (3d Cir. 2003) (citing Grayson v.
Mayview State Hosp., 293 F.3d 103, 108 (3d Cir. 2002)); see also Jarzynka v. UPMC Health
Sys., Civ. A. No. 10-1594, 2011 U.S. Dist. LEXIS 111837, *7-8 (W.D. Pa. Sept. 29, 2011).

3

Defendants' motion to amend will be analyzed under this standard as set forth in the discussion
section below. Also, Plaintiffs motion for partial judgment on the pleadings will be assessed in
accordance with the Court's determination of the motion to amend.
B. Plaintiffs Motion for a Protective Order and Defendants' Motion to Compel
Rule 26(b)(l) of the Federal Rules of Civil Procedure sets the contours for discovery.
This rule provides that "[p]arties may obtain discovery of any matter, not privileged, that is
relevant to any party's claim or defense." The rule further states that "(r]elevant information need
not be admissible at the trial if the discovery appears reasonably calculated to lead to the
discovery of admissible evidence." It is well-settled that Rule 26 establishes a liberal discovery
policy. Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 351, 98 S.Ct. 2380, 57 L.Ed.2d 253
(1978); Hickman v. Taylor, 329 U.S. 495, 507-08,67 S.Ct. 385, 91 L.Ed. 451 (1947).
This Court is empowered, however, to issue an order to protect a person from
"annoyance, embarrassment, oppression, or undue burden or expense," if there is good cause to
issue such an order. FED. R. Clv. P. 26(c). In this Circuit, the party seeking the protective order
bears the burden of showing that it is particularly necessary to obviate a significant harm; broad
allegations·ofharm will not suffice. Trans Pacific Ins. Co. v. Trans-Pacific Ins. Co., f36 F.R.D.
385, 391 (E.D.Pa.1991) (citing Cipollone v. Ligget Group, Inc., 785 F.2d 1108, 1121 (3d
Cir.1986), cert. denied, 484 U.S. 976, 108 S.Ct. 487, 98 L.Ed.2d 485 (1987)); Pansy v. Borough
ofStroudsburg, 23 F.3d 772 (3d Cir. 1994).

V. DISCUSSION
The four motions before the Court can be analyzed as two distinct subsets in order to
determine each. The Court will first conduct an analysis of Defendants' motion to amend in

4

conjunction with Plaintiffs motion for partial judgment on the pleadings. The Court will then
turn its attention to the two remaining motions, namely, Plaintiffs motion for a protective order

and Defendant's motion to compel. For the reasons that follow, the Court will grant both of
Defendants' motions and deny both of Plaintiffs motions.
A. Defendants' Motion to Amend the Answer and Plaintiff's Motion for Partial
Judgment on the Pleadings

Defendants seek to amend their answer in order to specifically deny the existence of the
conditions precedent that were alleged to occur in the complaint. (See Doc. No. 65). Before the
EEOC is able to file a lawsuit in its name, it must establish that it has met four conditions
precedent, namely: the existence of a timely charge of discrimination, the fact that EEOC
conducted an investigation, issued a reasonable cause determination, and attempted conciliation
prior to filing suit. EEOC v. Allegheny Airlines, 436 F. Supp. 1300 (W.D. Pa. 1977) citing
E.E.O.C. v. E. l Dupont de Nemours and Co., etc., 373 F. Supp. 1321 (D.Del.1974), affd on

other grounds, 516 F.2d 1297 (3d Cir. 1975). Defendants did not specifically deny the existence
ofthe conditions precedent in their answer. (See Doc. No. 8)
Defendants argue that at the time the answer was filed they were not aware of EEOC's
failure to investigate the charge. (See Doc. No. 65 at 3). Defendants claim to have only become
aware of this fact during the discovery process. (Id.). In particular, Defendants claim that they
did not delay in filing an amended answer because they only learned of the failure during a
deposition on September 11, 2012. (I d. at 10).

On this basis, Defendants now wish to amend

the answer in order to deny that the Plaintiff met the conditions precedent to the lawsuit, of
which includes this newly discovered fact. (Id.).

5

Although Defendants wish to amend their answer over a year after filing, Defendants did
not engage in undue delay because they only became aware of the need for an amendment during
the discovery process, a month before filing the instant amendment. 1 Moreover, permitting
amendment would not be futile because the EEOC must prove the existence of condition
precedents in order to file suit. Nor would permitting an amendment prejudice the Plaintiff as
this is only the first amendment to the pleadings. The lawsuit remains at an early stage and this
Court generally grants leave to amend under a liberal standard.
Determining Defendant's motion to amend must be done in conjunction with a
determination of Plaintiffs motion for partial judgment on the pleadings. Plaintiff filed its
motion on September 14, 2012, arguing that Defendants' answer generally denied the conditions
precedent to this lawsuit, rather than denying them with specificity.

(Doc. No. 60. at 1).

Plaintiffs averment in turn requests that the court grant judgment on the pleadings in favor of
EEOC regarding the existence of a timely charge of discrimination, the fact that EEOC
conducted an investigation, issued a reasonable cause determination, and attempted conciliation
prior to filing suit. (Doc. No. 60 at 2). As the Court determined above, because it will grant
Defendants' motion to amend their answer on the basis of the circumstances underlying how this
case has progressed, such a determination renders Plaintiffs motion for partial judgment on the
pleadings moot. Thus, for these reasons, Plaintiffs motion is denied without prejudice, and
Defendants will be permitted to amend their answer in accordance with this Memorandum.

1

Defendants filed their instant motion on Oct. I, 2012, as both a motion to amend and an opposition to
Plaintiff's motion for partial judgment on the pleadings, which Plaintiff had filed on Sept. 14, 2012three days after Defendants became aware of EEOC's alleged failure to investigate the charge.
6

B.

Plaintifrs Motion for Protective Order and Defendants' Motion to Compel

Defendants seek to compel a 30(B)(6) deposition in order to examine whether the EEOC
satisfied the conditions precedent to the lawsuit as is required with an investigation into whether
Defendants used certain health information in making their hiring decisions. (See Doc. No. 43).
However, the EEOC seeks to protect such discovery by requesting a protective order from the
Court that would permit Plaintiff to avoid providing a designee to testify on such matter. (See
Doc. No. 39)
At the heart of this discovery dispute is whether the Defendants are able to challenge the
existence of an EEOC investigation regarding Defendants' alleged violations of the ADA. As
previously noted, the EEOC must satisfy the condition precedent that there was an investigation
prior to filing suit. See Allegheny Airlines, 436 F. Supp. 1300 (W.D. Pa. 1977) The Defendants
seek to depose the EEOC Investigator in order to discover if an investigation occurred. (See
Doc. No. 44). Plaintiff argues that the Defendants are not permitted to challenge the sufficiency
of an EEOC investigation and filed the instant motion for a protective order to prevent the
deposition of the EEOC investigator. (See Doc. No. 39). Plaintiffs rely heavily on EEOC v.
Keco, 748 F.2d 1097 (6th Cir. 1984), where the 6th Circuit reasoned that a district court should

not determine whether conciliation was sufficient because the form and substance of a condition
precedent is a matter of EEOC discretion alone. Defendants counter that they do not seek to
challenge the sufficiency of the investigation, but seek to challenge the actual existence of an
investigation. (See Doc. No. 47). Thus, the central question regarding whether such matter is
discoverable becomes whether a challenge to the actual existence of an EEOC investigation is
tantamount to a challenge of the actual sufficiency of the investigation.

7

As a preliminary matter, in E. E. 0. C. v. LifeCare Management Services, LLC, No. 02:08cv-1358, 2009 WL 772834 (W.D. Pa. Mar. 17, 2009), this District held that the EEOC, like all
other litigants, must testify to underlying facts and may object to any privileged information at
the time the question is presented. Additionally, a Defendant is permitted generally to depose an
EEOC investigator where the EEOC is a named party in order to find underlying facts. See
EEOC v. Airborne Express, 1999 WL 124380, (E.D. PA. 1999). Moreover, the existence of a

condition precedent is a relevant fact to the lawsuit because condition precedents are required in
order for the EEOC to even file a complaint. See EEOC v. Allegheny Airlines 436 F. Supp.
1300 (W.D. Pa. 1977) (EEOC cannot expand their complaint to include employment
discrimination in different job classifications where the conciliation only occurred in one job
classification); EEOC v. East Hills Ford Sales, 445 F. Supp. 985 (W.D. Pa. 1978) (EEOC
complaint cannot result in an impermissible broadening by raising issues which had not been
subject of EEOC investigation and conciliation).
In the case sub judice, the Court finds that the EEOC has not met its burden of
demonstrating good cause for a protective order of the deposition of an EEOC investigator for
the purpose of discovering the existence of an investigation. The reasoning that the Plaintiff so
heavily relies on from the 6th Circuit in Keco Industries only goes so far as to say that a district
court should not examine the adequacy of an EEOC's investigation. The opinion does not state
that a district court should not examine whether the investigation occurred at all. This court
believes that, to the extent that Defendants seek discovery on the substantive aspects of the
investigation indicating sufficiency, such discovery is precluded and the EEOC may object to
such discovery requests during the deposition testimony; however, discovery as to the existence
of the occurrence of an actual investigation is not prohibited under controlling authority. Thus,

8

for these reasons, the Court denies Plaintiffs motion for a protective order and grants
Defendants' motion to compel.

VI. CONCLUSION

As discussed above, the case remains at an early stage of litigation, and in accordance
with the Court's liberal standard regarding pleadings, the Court will GRANT Defendants'
motion to amend the answer (Doc. No. 64). As a procedural matter, Defendants may seek
discovery on the existence of the investigation only after amending their answer. As the answer
stands now, with no specific objection to the complaint as required by FED. R. Crv. P. 9(c), the
procedural aspects of investigation do not fall within the scope of discovery under Fed. R. Civ. P.
26(b)(l). Therefore, the Defendants' motion to compel (Doc. No. 43) is GRANTED contingent
upon an amended answer. Concomitantly, Plaintiffs motion for a protective order (Doc. No. 38)
and motion for partial judgment on the pleadings (Doc. No. 60) are DENIED. An appropriate
order follows.

9

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF PENNSYLVANIA

EQUAL EMPLOYMENT OPPORTUNITY )
COMMISSION,
)
Plaintiff,

v.
GRANE HEALTHCARE CO. and
EDENSBURG CARE CENTER, LLC
Defendants.

)
)
)
)
)
)
)
)
)
)

CIVIL ACTION NO. 3:10-250
JUDGE KIM R. GIBSON

ORDER

Now this 15th day of March, 2013, upon consideration of all four pending motions in this
case, and in accordance with the Memorandum, IT IS HEREBY ORDERED that Defendants'
"Motion to File Amended Answer to Plaintiffs Complaint and in Opposition to Plaintiffs
Partial Motion for Judgment on the Pleadings," (Doc. No. 64) is GRANTED, Plaintiffs
"Motion for Partial Judgment on the Pleadings" (Doc. No. 60) is DENIED, Plaintiffs "Motion
for Protective Order" (Doc. No. 38) is DENIED, and Defendants' "Motion to Compel 30(B)(6)
Deposition." (Doc. No. 43) is GRANTED.

KIM R. GIBSON,
UNITED STATES DISTRICT JUDGE

10