Mаnuel RUIZ-SANCHEZ et al., Plaintiffs, Appellants, v. The GOODYEAR TIRE & RUBBER COMPANY, Defendant, Appellee.
No. 12-1694.
United States Court of Appeals, First Circuit.
May 31, 2013.
717 F.3d 249
The upshot of this is that SGI-Walpole and Stor/Gard cannot prevail. After all, it would take a topsy-turvy view of causation to say that a leak not listed as one of the combined causes of the collapse (GZA report) and dismissed as too insignificant to matter (AEGIS report) really was the predominant cause of the collapse or put in motion events that caused the collapse. See, e.g., Boazova, 968 N.E.2d at 394 n. 4; Jussim, 610 N.E.2d at 955-56. And because Strathmore acted well within its rights in denying coverage, the magistrate judge properly denied SGI-Walpole and Stor/Gard‘s summary-judgment motion and properly granted summary judgment for Strathmore on all claims. See, e.g., Timpson v. Transamerica Ins. Co., 41 Mass.App.Ct. 344, 669 N.E.2d 1092, 1098 (1996).
Final Words
Our story over, we affirm the judgment below in all respects. Each side shall bear their own costs on appeal.
Julio Cesar Alejandro Serrano, with whom Eileen Landron Guardiola, Eduardo Vera Ramirez, Luis A. Rodriguez Munoz and Landron & Vera, LLP were on brief, for appellants.
Jorge L. Capo-Matos, with whom Alberto J. Bayouth-Montes and O‘Neill & Borges LLC were on brief, for appellee.
Before LYNCH, Chief Judge, TORRUELLA and SELYA, Circuit Judges.
When a tire company closed its plant in Puerto Rico, it offered its employees severance pay contingent upon the execution of general releases. The plaintiff acquiesced. Nearly a year later, he reversed direction and asserted claims for unjust dismissal under Puerto Rico law. The district court rejected these claims.
The plaintiff appeals the dismissal of a particular claim under a protective Puerto Rico statute,
If the answer to that question were dispositive of the case in its present posture, we might well certify it to the Supreme Court of Puerto Rico under
For this reason, we vacate the relevant portion of thе judgment and remand for further proceedings consistent with this opinion.
I. BACKGROUND
“Because this case was decided below on a motion to dismiss, we rehearse the facts as revealed by the complaint and the documents annexed thereto.” Katz v. Pershing, LLC, 672 F.3d 64, 69 (1st Cir.2012).
For thirty-three years, plaintiff-appellant Manuel Ruiz-Sanchez toiled for Kelly Springfield Puerto Rico, Inc., a wholly owned subsidiary of defendant-appellee Goodyear Tire and Rubber Company. During his tenure there, he аttained the position of general manager.
On April 7, 2009, Goodyear‘s human resources manager, Emily Baranek, signaled the end of the plaintiff‘s long career when she informed Kelly Springfield‘s work force that the plant would cease operations at month‘s end. To ease the blow, she announced that Goodyear was prepared to offer severance packages; provided, however, that each recipient sign a general release of “all known and unknown claims, promises, causes of action, or similar rights of any type that [the employee] presently may have ... with respect to [Goodyear].” Anyone who disagreed with the proposed amount of his or her severance payment was directed to contact Baranek.
The arrangement constructed a forty-five day window within which an employee could “review and consider” the offer and the release. Any employee who signed a release was given the right to revoke it within seven days thereafter.
The plaintiff‘s response was less than enthusiastic. In a letter dated April 23, he expressed dissatisfaction with the amount of his proposed severance payment ($28,512) and suggested instead a significantly higher figure ($105,742). In the same letter, he inquired about avoiding severance altogether through a transfer to a different position at Goodyear‘s office in Miami. This inquiry was apparently prompted by the fact that some employees were afforded the opportunity to transfer from Kelly Springfield‘s Puerto Rico plant to Miami. Baranek responded verbally; she rejected the more munificent severance payment suggested by the plaintiff, explained that Goodyear was not willing to increase the amount of its offer, and scotched any possibility of a transfer. She later confirmed these advices in writing.
On April 30 (the day that the plant closed), the plaintiff accepted the $28,512 severance package and signed the proffered release. At that point in time, twenty-two days remained in the forty-five day “consideration period.” The seven-day “rescission period” passed without incident.
Almost one year later, the plaintiff sued Goodyear in a local court. His complaint asserted claims for unjust dismissal under both Law 80 and a Puerto Rico statute
In due course, Goodyear moved to dismiss the complaint both for lack of personal jurisdiction and for failure to state a claim. The district court rejected Goodyear‘s jurisdictional contention. Ruiz-Sanchez v. Goodyear Tire & Rubber Co., No. 10-1598, 2011 WL 4709875, at *4-5 (D.P.R. Sept. 30, 2011). It then ruled that the releаse foreclosed the age discrimination claim but that the Law 80 claim could go forward. Id. at *5-7 (citing
Goodyear moved for reconsideration of the Law 80 ruling. The district court reconsidered the matter and concluded, on reflection, that the release barred the Law 80 claim as well. Ruiz-Sanchez v. Goodyear Tire & Rubber Co., 859 F.Supp.2d 225, 229 (D.P.R.2012). The court proceeded to dismiss the case with prejudice.
This timely appeal ensued. In it, the plaintiff challenges only the dismissal of his Law 80 claim.
II. ANALYSIS
The district court‘s dismissal of the Law 80 claim followed a motion to reconsider an earlier order. We normally review a district court‘s decision to grant or deny reconsideration for abuse of discretion. See, e.g., Bennett v. Saint-Gobain Corp., 507 F.3d 23, 34 (1st Cir.2007). Here, however, the parties’ arguments are directed to the underlying issue—the propriety vel non of dismissal—so the
In this case, the district court proceeded immediately to the issue of whether the release, which was annexed to the plaintiff‘s complaint, bars the maintenance of his Law 80 claim. Release is an affirmative defense. See
Because this is a diversity case, the substantive law of Puerto Rico controls. Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78 (1938); Borges ex rel. S.M.B.W. v. Serrano-Isern, 605 F.3d 1, 6 (1st Cir.2010). It follows that the validity of the plaintiff‘s Law 80 claim must be evaluated under Puerto Rico law.
Puerto Rico law generally allows for release or settlement of a claim, referred to as a “compromise.” See
With respect to the first prerequisite, the termination of the plaintiff‘s employment necessarily created an uncertain legal relationship. After all, “[t]he ubiquity of litigation that surrounds the nonconsensual termination оf employment relationships bears powerful witness to the myriad uncertainties about legal rights and obligations incident to such terminations.” Caban Hernandez v. Philip Morris USA, Inc., 486 F.3d 1, 12 (1st Cir.2007).
With respect to the second prerequisite, the language of the release manifests an obvious intent to eliminate those uncertainties. In pertinent part, the release memorializes the plaintiff‘s agreement “to release all known and unknown claims” arising out of his employment, and specifically lists Law 80 as one type of claim which the plaintiff intends to forego. In this regard, the release “acknowledge[s] that this Severance Payment is more than [Goodyear] is otherwise obliged to provide.”
With respect to the third prerequisite, the parties made reciprocal concessions. The plaintiff agreed not to pursue any claims that he may have had arising out of the aborted employment relationship; Goodyear agreed to give the plaintiff a severance payment to which he otherwise may not have been entitled.
At first blush, then, the fulfillment of these three requirements appears to warrant the conclusion that the release was a valid settlement of the plaintiff‘s Law 80 claim pursuant to Puerto Rico law. See Citibank, 21 P.R. Offic. Trans. at 505-06, 121 D.P.R. 503. But appearances sometimes can be deceiving, and the plaintiff resists this conclusion.
As an initial matter, the plaintiff suggests that his execution of the release and his acceptance of the severance payment should not matter because those acts occurred under duress. In this connection, his brief dwells on “the compressed time frame” and the imminence of the plant closure. But there are no facts in the record (and, specifically, nothing plausibly alleged in the complaint) to support a remonstrance that the plaintiff did not have adequate time to consider the severаnce package. Indeed, the known facts point in the opposite direction: the plaintiff had forty-five days to decide whether to sign the release—and he opted to act after only twenty-three days had elapsed. In the same vein, he had available a seven-day rescission period, but he let it expire. For aught that appears, the plaintiff had ample time to consider the release fully and to make an informed judgment about whether to sign it. Any claim of duress is woven entirely out of flimsy strands of speculation and surmise and, thus, cannot survive scrutiny. See Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009).
This brings us to the much harder question that undergirds the appeal. Law 80 contains an anti-waiver provision stating that:
The right of an employee who is discharged from his employment without just cause, to receive the compensation provided in § 185a of this title, is hereby declared to be unwaiveable.
Any contract or part thereof in which the employee waives the compensation to which he is entitled to, pursuant to §§ 185a-185m оf this title, shall be null and void.
Nor are the contours of that relationship readily apparent. Generally speaking, Law 80 requires employers to compensate at-will employees who are discharged without just cause.2
The court below concluded that Law 80‘s anti-waiver provision applies to prospective waivers of Law 80 rights, not to waivers that come about when “an employee waives his Law 80 rights in an agreement posttermination ... in order to avoid litigation.” Ruiz-Sanchez, 859 F.Supp.2d at 228. On this basis, the court held that the anti-waiver provision did not override the release executed by the plaintiff. Id. at 228-29. Because the release memorialized an otherwise valid extrajudicial compromise, it foreclosed any claim of entitlement to Law 80 relief. Id.; see
Confining the application of section 185i to prospective waivers of Law 80 claims, which has the effect of denying its application to extrajudicial compromises that settle previously аccrued claims, may be a reasonable interpretation of the statute.4
On the one hand, it is evident that Law 80 was designed to provide economic proteсtion from the ravages of arbitrary dismissals; and the text of section 185i contains no distinction between prospective waivers and waivers of previously accrued claims. By like token, section 185i‘s reference to “[a]ny contract” might be thought to imply that it applies unreservedly to extrajudicial compromises.
So, too, it can be argued that a broad reading of section 185i is consistent with general trends in Puerto Rico labor law. After all, judicial suрervision of contracts between employers and employees is not uncommon in Puerto Rico. See, e.g.,
On the other hand, none of these conclusions is compelled. Indeed, there are factors that support a narrower interpretation of section 185i. It can be argued that the absence of a distinction between prospective waivers and waivers of previously accrued claims in the text of the statute is telling. The same can be said for the absence of any mention of the anti-waiver provision‘s applicability to extrajudicial compromises. On at least one other occasion when the Puerto Rico legislature sought to limit the availability of extrajudicial compromises, it did so explicitly. See
The short of it is thаt the push and pull of these competing centrifugal and centripetal forces muddy the waters as to how the Puerto Rico legislature intended section 185i to be construed vis-a-vis extrajudicial compromises of previously accrued Law 80 claims. This interpretive question is difficult, and we have no clear guidance on it from the Commonwealth‘s highest court. In addition, this question is a potentially important one, and prudence strongly suggests that a federal court—which is, after all, not the final arbiter of state law, see Andrew Robinson Int‘l, Inc. v. Hartford Fire Ins. Co., 547 F.3d 48, 51-52 (1st Cir.2008)—should not rush to answer it unnecessarily.
Given the interests of comity and federalism, we would be inclined to certify this question to the Supreme Court of Puerto Rico if answering it would be dispositive of this case. See Acadia Ins. Co. v. McNeil, 116 F.3d 599, 605 (1st Cir.1997) (“[W]hen the meaning of a state law de
To put into better perspective why we hold this belief, we pause to limn the parameters of the bypassed question. In its motion to dismiss, Goodyear offered an alternative basis for dismissal: it contended that Law 80 had no application in the circumstances of this case. It rested this contention on exceptions and exclusions contained in Law 80 itself,5 and it has renewed this alternative contention on appeal.
We add that Goodyear‘s alternative contention, though not yet proven, appears to be colorable. It does, however, require further factual development—factual development that precludes resolving the contention through a
III. CONCLUSION
We need go no further. For the reasons elucidated above, we vacate the order of dismissal as to the Law 80 claim6 and remand for further proceedings consistent with this opinion.
Vacated and remanded. No costs.
TORRUELLA, Circuit Judge (Concurring).
I agree with the majority‘s result and its reasoning that we need not reach the ques
However, I concur to briefly note my disagreement with the majority‘s conclusion that Section 185i—Law 80‘s anti-waiver provision—is ambiguous. In my view, a plain reading of that provision indicates a categоrical prohibition on the waiver, by contract, of an employee‘s Law 80 rights to compensation, prospective or accrued, including post-termination and in the extrajudicial settlement context. The statute refers generally to the rights of employees who are “discharged,” in the past tense, as coming within the coverage of those who cannot waive receipt of compensation, indicating that contracts made by employees vested with accrued rights are invalid if they contain waivers of those rights. Further, the right that “is hereby declared to be unwaiveable” is not conditioned or modified, supporting a reading of categorical unwaiveability. Finally, the provision declares that “any” contract waiving the right to compensation due under Law 80 shall be null and void. The use of such a categorical term includes all contracts within its scope, rejecting any differentiatiоn between pre- and post-termination contracts.
Since, as stated, we need not reach this issue at this stage, I leave the interpretation of Section 185i‘s scope to the Puerto Rico Supreme Court.