Rea v. Federated Investors
627 F.3d 937
| 3rd Cir. | 2010Background
- Rea filed bankruptcy in 2002 and was discharged in 2003.
- In 2009 Rea applied for employment with Federated Investors via Infinity Tech Services.
- Infinity informed Rea Federated refused to hire him because of his bankruptcy.
- Section 525 prohibits discrimination and employment-related actions; district court dismissed, ruling no private action under §525(b).
- Rea appeals arguing §525(b) should be read broadly to bar private-employer hiring discrimination; court affirms district court’s narrow reading based on statutory text and intent.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §525(b) prohibits private-employer hiring discrimination. | Rea argues §525(b) bars private employers from discriminating in hiring against debtors. | Federated contends §525(b) does not create a private-time hiring-prohibition; language mirrors §525(a) but excludes denial of employment. | Yes, §525(b) does not create such a private action; affirmation of dismissal. |
Key Cases Cited
- Russello v. United States, 464 U.S. 16 (U.S. 1983) (principle of intentional, purposeful legislative drafting omitted in related sections)
- Leary v. Warnaco, Inc., 251 B.R. 656 (S.D.N.Y. 2000) (argued broad reading of §525(b) to cover denial of employment)
- Burnett v. Stewart Title, Inc., 431 B.R. 894 (S.D. Tex. 2010) (criticized expanding §525(b) to hiring discrimination)
- Myers v. TooJay's Mgmt. Corp., 419 B.R. 51 (M.D. Fla. 2009) (rejected expansive reading of §525(b))
- In re Stinson, 285 B.R. 239 (Bankr. W.D. Va. 2002) (§525(b) prohibits after-offer employment actions by private entities)