Opinion
Civ. No. 03-3297 (JNE/JGL)
February 9, 2004
Steve G. Heikens, Esq., Heikens Law Office, appeared for Plaintiff Fran Neben.
Thomas M. Sipkins, Esq., Halleland Lewis Nilan Sipkins Johnson, P.A., appeared for Defendant Thrivent Financial for Lutherans
ORDER
Fran Neben brought this action against her employer, Thrivent Financial for Lutherans (Thrivent), alleging that Thrivent discriminated against her on the basis of her gender in violation of Title VII of the Civil Rights Act of 1964 (Title VII), 42 U.S.C. § 2000e to 2000e-17 (2000), and on the basis of her age and gender in violation of the Minnesota Human Rights Act (MHRA), Minn. Stat. ch. 363A (Supp. 2003). She also asserts claims under Minnesota law for breach of the covenant of good faith and fair dealing and intentional misrepresentation. The case is before the Court on Thrivent's Motion to Dismiss and for Partial Summary Judgment. For the reasons set forth below, the Court grants the motion.
I. BACKGROUND
In January 2002, Aid Association for Lutherans (AAL) and Lutheran Brotherhood (LB) merged to become Thrivent. The merger resulted in the elimination of 80 general agent positions and the creation of 48 managing partner positions. General agents from AAL and LB were selected to become managing partners in Thrivent. Neben, a general agent at AAL, was not selected to become a managing partner. After the initial selection of managing partners, several managing partner or co-managing partner positions became available throughout 2002. Thrivent did not select Neben to fill any of these openings.
On October 23, 2002, Neben filed a charge with the Equal Employment Opportunity Commission (EEOC), alleging that Thrivent had discriminated against her on the basis of her gender. She received a Notice of Right to Sue in May 2003 and brought this action the next month. Thrivent now moves for summary judgment on Neben's Title VII and MHRA claims insofar as they are based on the initial selection of managing partners. Thrivent also moves to dismiss Neben's claims for breach of the covenant of good faith and fair dealing and intentional misrepresentation.
II. DISCUSSION
A. Thrivent's Motion for Partial Summary Judgment
Summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The moving party "always bears the initial responsibility of informing the district court of the basis for its motion," and must identify "those portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party satisfies its burden, Rule 56(e) requires the nonmoving party to respond by submitting evidentiary materials that designate "specific facts showing that there is a genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). In determining whether summary judgment is appropriate, a court must look at the record and any inferences to be drawn from it in the light most favorable to the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).
1. Count 1 — Title VII
Thrivent argues that it is entitled to summary judgment on Neben's Title VII claim insofar as the claim is based on Thrivent's initial selection of managing partners because Neben did not file a timely charge with the EEOC. "To maintain a Title VII suit, the complainant must file a timely charge with the EEOC." Worthington v. Union Pac. R.R., 948 F.2d 477, 479 (8th Cir. 1991). Ordinarily, a charge must be filed with the EEOC within 180 days after the alleged unlawful employment practice. 42 U.S.C. § 2000e-5(e)(1). If the complainant first institutes proceedings with a state agency authorized to grant or seek relief from such practice, then the charge must be filed with the EEOC within 300 days after the practice. Id. No charge may be filed with the EEOC until at least 60 days have passed since the state commenced proceedings, unless such proceedings terminated earlier. Id. § 2000e-5(c). The parties dispute when the limitations period began to run and the applicable limitations period.
As to when the limitations period began to run, Thrivent asserts that it began to run on December 3, 2001, when Neben learned that she had not been selected for a managing partner position. Neben contends that the limitations period began to run on the effective date of the merger. According to Neben, the merger took effect on January 2, 2002, after receiving approval from government agencies. The Title VII limitations period begins to run when the challenged decision is made and communicated to the plaintiff, even if the effects of that decision do not occur until some future date or remain subject to change. Curby v. Solutia, Inc., 351 F.3d 868, 873 (8th Cir. 2003) (citing Delaware State College v. Ricks, 449 U.S. 250, 259 (1980)). In Curby, the Eighth Circuit considered arguments similar to those raised by Thrivent and Neben. In that case, the plaintiff worked for Solutia, Inc. Id. at 870. Solutia and another company, FMC Corporation, formed a joint venture by combining their phosphorous and derivatives division. Id. The plaintiff asserted Title VII claims, alleging that Solutia had discriminated against her on the basis of her sex and race by failing to name her as the joint venture's chief executive officer. Id. at 873. The Eighth Circuit rejected the Plaintiff's argument that the statute of limitations began to run upon the Federal Trade Commission's approval of the joint venture. Id. Because the plaintiff filed her charge of discrimination more than one year after learning that she would not be the joint venture's CEO, her Title VII claims were untimely. Id. Accordingly, the Court rejects Neben's contention that the limitations period began to run in this case only upon approval of AAL and LB's merger. The limitations period began to run when the decision not to select Neben as a managing partner was made and communicated to her.
In this case, Thrivent relies on the affidavits of Otis Haarmeyer, AAL's Director of Agencies, and James Thomsen, LB's Senior Vice President of Field Distribution, to establish that the limitations period began to run on December 3, 2001. Haarmeyer states that he "personally contacted . . . Neben on December 3, 2001 and informed her that she had not been selected for a Managing Partner position." Thomsen states that Neben and others "who were not selected for the Managing Partner positions were notified via telephone on December 3, 2001." Neben does not dispute that she learned on December 3, 2001, that she had not been selected for a managing partner position. The Court therefore concludes that the limitations period began to run on that date. See id. Without regard to whether the limitations period is 180 days or 300 days, Neben did not timely file a charge of discrimination with respect to the selection of managing partners on December 3, 2001. The Court therefore grants Thrivent's motion for partial summary judgment on Neben's Title VII claim.
Neben contends that she needs to conduct additional discovery to respond to Thrivent's motion. See Fed.R.Civ.P. 56(f). Specifically, Neben seeks discovery to determine "when the merged entity became legal and whether the selection of managing partners actually had any legally binding effect" before the merger took place. Curby reveals that the issues identified by Neben are not relevant to determine when the limitations period began to run. See 351 F.3d at 873. Accordingly, Neben's reliance on Rule 56(f) to oppose Thrivent's motion is unavailing.
Because Neben's charge was untimely with respect to the initial selection of managing partners under the most generous limitations period, the Court declines to consider the parties' arguments regarding which period applies.
2. Count 2 — MHRA
Thrivent asserts that it is entitled to summary judgment on Neben's MHRA claim insofar as the claim is based on Thrivent's initial selection of managing partners because it is time-barred. "When considering state law claims, federal courts are required to apply state statutes of limitations." Settle v. Fluker, 978 F.2d 1063, 1064 (8th Cir. 1992). State commencement rules apply to determine when a state law claim is commenced because the commencement rules are part of the statute of limitations. Larsen v. Mayo Med. Ctr., 218 F.3d 863, 867 (8th Cir. 2000).
The MHRA provides that a claim of an unfair discriminatory practice must be brought as a civil action, filed in a charge with a local commission, or filed in a charge with the commissioner of human rights within one year after the practice. Minn. Stat. § 363A.28, subd. 3. Here, Neben elected to bring her MHRA claim as a civil action without first filing a charge with a local commission or the commissioner. See id. § 363A.33, subd. 1 (stating that "a person may bring a civil action seeking redress for an unfair discriminatory practice directly to district court"). A civil action is "brought" within the meaning of the MHRA when it is commenced in the manner provided by Minn. R. Civ. P. 3.01. Ochs v. Streater, Inc., 568 N.W.2d 858, 859-60 (Minn.Ct.App. 1997). Under Rule 3.01, a civil action is commenced against each defendant:
Although Neben filed a charge with the EEOC, the charge was not cross-filed with the MDHR. The charge is addressed exclusively to the EEOC and Neben did not check the box on the charge to request cross-filing with the MDHR. Moreover, Neben's attorney wrote a letter to the EEOC expressly requesting that the charge not be cross-filed: "We do not request cross-filing with Minnesota's Department of Human Rights."
(a) when the summons is served upon that defendant, or
(b) at the date of acknowledgement of service if service is made by mail, or
(c) when the summons is delivered to the sheriff in the county where the defendant resides for service; but such delivery shall be ineffectual unless within 60 days thereafter the summons is actually served on that defendant or the first publication thereof is made.
Under the MHRA, the limitations period begins to run "`when the alleged discriminatory act [occurred] rather than when the consequences of that act become most painful.'" TRI, Inc. v. Boise Cascade Office Prods., Inc., 315 F.3d 915, 920 (8th Cir. 2003) (quoting Turner v. IDS Financial Services, Inc., 471 N.W.2d 105, 108 (Minn. 1991)). Again, Neben learned on December 3, 2001, that she had not been selected to be a managing partner. The limitations period began to run on that date. See id. Neben served the summons upon Thrivent on June 13, 2003, more than one year after December 3, 2001. Consequently, Neben's MHRA claim is untimely with respect to the initial selection of managing partners. The Court therefore grants Thrivent's motion for partial summary judgment on Neben's MHRA claim.
B. Thrivent's Motion to Dismiss
In ruling on a motion to dismiss a complaint for failure to state a claim upon which relief can be granted, a court must accept the complaint's factual allegations as true and construe them in the light most favorable to the plaintiff. Midwestern Mach., Inc. v. Northwest Airlines, Inc., 167 F.3d 439, 441 (8th Cir. 1999); Davis v. Hall, 992 F.2d 151, 152 (8th Cir. 1993). The court will not dismiss the complaint unless it appears beyond doubt that the plaintiff cannot prove any set of facts in support of his claim that would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46 (1957); Schaller Tel. Co. v. Golden Sky Sys., Inc., 298 F.3d 736, 740 (8th Cir. 2002). 1. Count 3 — Covenant of good faith and fair dealing
Neben alleges that Minnesota recognizes "an implied-in-law covenant of good faith and fair dealing in all contracts, which includes contracts of general agency and registered representative agreements." Notwithstanding Neben's allegation, Minnesota does not recognize an implied covenant of good faith and fair dealing in employment contracts. Brozo v. Oracle Corp., 324 F.3d 661, 668 (8th Cir. 2003) ("Minnesota does not recognize an implied duty of good faith and fair dealing in employment contracts."); Poff v. W. Nat'l Mut. Ins. Co., 13 F.3d 1189, 1191 (8th Cir. 1994) (stating that "the Minnesota Supreme Court has squarely held that there is no implied covenant of good faith and fair dealing in Minnesota employment contracts"); Hunt v. IBM Mid Am. Employees Fed. Credit Union, 384 N.W.2d 853, 858 (Minn. 1986) ("[W]e have not read an implied covenant of good faith and fair dealing into employment contracts."). The Court therefore dismisses the claim insofar as it is based on an implied covenant.
"Although the Minnesota courts will not imply a covenant of good faith and fair dealing in employment contracts, recent cases recognize that there can be an express covenant to this effect." Poff, 13 F.3d at 1191. General policy statements do not create such a covenant. Id. Rather, to create an express covenant of good faith and fair dealing, "there must be specific and definite terms that meet the contractual requirements of an enforceable unilateral offer." Poff, 13 F.3d at 1191. Whether an employer extends a unilateral offer is a question of law. Martens v. Minn. Mining Mfg. Co., 616 N.W.2d 732, 740 (Minn. 2000). To constitute an offer for a unilateral contract, an employer's statement must be sufficiently definite to allow a "court to discern with specificity what the provision requires of the employer so that if the employer's conduct in . . . making . . . decisions affecting the employment is challenged, it can be determined if there has been a breach." Id. at 742. "An employer's general expression of a plan of promotion and recognition does not . . . rise to the level of a unilateral contract. . . ." Id. at 748.
In this case, Neben alleges that AAL stated that general agents willing to relocate would be considered for managing partner positions nationwide and that selections would be made based on objective and subjective criteria. The objective criteria included: "Agency performance (sales results, growth, market share, staffing results, new member/household growth), Compliance data, Fraternal activity, Career Goals/preferences." The subjective criteria included a "series of interviews, paper-and-pencil tests[,] leadership simulation exercises[,] and input fom those who know the [general agent] best." The criteria allegedly employed by AAL to select its general agents to become managing partners in the merged entity necessarily involve the exercise of discretion. A general agent's performance in the interviews, tests, and simulations, and the comments about that agent do not set forth a standard sufficiently definite to determine the agent's entitlement to a managing partner position. Neben essentially alleges that AAL set forth a general plan to determine which general agents would become managing partners. Construing the Complaint in the light most favorable to Neben, the Court concludes that AAL's alleged statements are too indefinite to constitute a unilateral offer. Accordingly, the Court dismisses Neben's claim insofar as the claim is based on an express covenant. See id. 2. Count 4 — Intentional misrepresentation
Neben bases her claim for intentional misrepresentation on representations made by AAL about the "benefits and value of . . . being a captive agent and the long-term career opportunities presented," and the process by which it selected general agents to become managing partners as part of the merger. To state a claim for intentional misrepresentation under Minnesota law, a plaintiff must allege: (1) the defendant made a representation; (2) the representation was false; (3) it had to do with a past or present fact; (4) the fact was material; (5) the fact was susceptible of knowledge; (6) the defendant knew it was false or, in the alternative, asserted it as of his own knowledge without knowing whether it was true or false; (7) the defendant intended to induce the plaintiff to act; (8) the plaintiff was induced to act; (9) the plaintiff acted in reliance on the representation; (10) the plaintiff was damaged; and (11) the damage was attributable to the representation. M.H. v. Caritas Family Servs., 488 N.W.2d 282, 289 (Minn. 1992); Florenzano v. Olson, 387 N.W.2d 168, 174 n. 4 (Minn. 1986). `It is a well-settled rule that a representation or expectation as to future acts is not a sufficient basis to support an action for fraud merely because the represented act or event did not take place." Vandeputte v. Sonderholm, 216 N.W.2d 144, 147 (Minn. 1974). "Where a representation regarding a future event is alleged, . . . an additional element of proof is that the party making the representation had no intention of performing when the promise was made." Martens, 616 N.W.2d at 747. "[N]either opinions nor statements that are `general and indefinite' are representations of fact." Id.
Thrivent argues that Neben's intentional misrepresentation claim should be dismissed because Neben failed to allege that false representations having to do with past or present facts were made to her. In response, Neben contends that she does not have to allege how the representations made to her were false, that discovery is the proper time to determine how the representations were false, that her allegation that the representations were false and misleading is sufficient, and that the representations relate to past or present facts.
"Fraud must be pled with particularity and the material facts constituting fraud must be alleged." Iverson v. Johnson Gas Appliance Co., 172 F.3d 524, 529 (8th Cir. 1999) (citations omitted); see Fed.R.Civ.P. 9(b). Fraud encompasses intentional misrepresentation. Iverson, 172 F.3d at 529; Dvorak v. Maring, 285 N.W.2d 675, 678 n. 4 (Minn. 1979) ("[W]e see no distinction between a theory of recovery based on intentional misrepresentation and one based on fraud."). Conclusory allegations that a defendant's conduct was fraudulent or deceptive do not satisfy the particularity requirement. Schaller Tel. Co. v. Golden Sky Sys., Inc., 298 F.3d 736, 746 (8th Cir. 2002); see Martens, 616 N.W.2d at 747 (stating that a claim for intentional misrepresentation must be pled "with specificity"). Accordingly, Neben's bare allegation that representations made to her were false is not sufficient.
Moreover, Neben's allegations fail to state a claim because the alleged misrepresentations do not relate to past or present facts. With regard to the selection of general agents to become managing partners, Neben alleges that AAL stated that general agents willing to relocate would be considered for managing partner positions nationwide and selected on the basis of objective and subjective criteria. Relying on Hanks v. Hubbard Broadcasting, Inc., 493 N.W.2d 302 (Minn.Ct.App. 1992), Neben argues that an employer's assertion that it has a plan to promote employees is a representation of a past or present fact. In Hanks, a jury found that a broadcasting company's statement that it had a plan to promote a news anchor constituted a representation of a past or present material fact. Id. at 309. The Minnesota Court of Appeals affirmed, stating that "the jury could reasonably find that the statements of HBI managers went well beyond statements of intent, i.e. HBI's representation that it already had a plan to promote Spencer and her new co-anchor was a statement of objective fact, not just a statement of future intention." Id. Neben's reliance on Hanks is misplaced because she does not allege that AAL made representations specific to her about already having a plan to select her as a managing partner. Instead, she essentially alleges that AAL set forth a policy by which it would select general agents to become managing partners. AAL's description of the process by which it selected general agents to become managing partners is a general statement of policy, not a representation of fact. See Martens, 616 N.W.2d at 747. As to Neben's allegations regarding AAL's statements about the value and benefit of working for it, they are general statements of opinion, not representations of fact.
Because Neben failed to allege that false representations having to do with past or present facts were made to her, the Court grants Thrivent's motion to dismiss Neben's claim for intentional misrepresentation.
III. CONCLUSION
Based on the files, records, and proceedings herein, and for the reasons stated above, IT IS ORDERED THAT:
1. Thrivent's Motion to Dismiss and for Partial Summary Judgment [Docket No. 3] is GRANTED.
2. Count 1 and Count 2 are DISMISSED insofar as they are based on the selection of managing partners on December 3, 2001.
3. Count 3 and Count 4 are DISMISSED.