BRIAN SEXTON v. PANEL PROCESSING, INC., et al.
No. 13-1604
United States Court of Appeals for the Sixth Circuit
May 09, 2014
Originating Case No.: 1:12-cv-10946
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
100 EAST FIFTH STREET, ROOM 540
POTTER STEWART U.S. COURTHOUSE
CINCINNATI, OHIO 45202-3988
Deborah S. Hunt, Clerk
Tel. (513) 564-7000
www.ca6.uscourts.gov
Filed: May 09, 2014
Mr. Steven Joel Fishman
Mr. David Allen Malinowski
Mr. Donald H. Scharg
Bodman
201 W. Big Beaver Road, Suite 500
Troy, MI 48084
Mr. William Arthur Pfeifer
Isackson, Wallace & Pfeifer
114 S. Second Avenue
Alpena, MI 49707
Mr. Stephen Silverman
U.S. Department of Labor
200 Constitution Avenue, N.W., N-4611
Washington, DC 20210
Re: Case No. 13-1604, Brian Sexton v. Panel Processing, Inc., et al.
Originating Case No. : 1:12-cv-10946
Dear Counsel,
The court today announced its decision in the above-styled case.
Enclosed is a copy of the court‘s opinion together with the judgment which has been entered in conformity with
Yours very truly,
Deborah S. Hunt, Clerk
Cathryn Lovely
Deputy Clerk
cc: Mr. David J. Weaver
Enclosures
Mandate to issue.
RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 14a0095p.06
UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT
BRIAN SEXTON, Plaintiff-Appellant, v. PANEL PROCESSING, INC. and PANEL PROCESSING OF COLDWATER, INC., Defendants-Appellees.
No. 13-1604
Appeal from the United States District Court for the Eastern District of Michigan at Bay City.
No. 1:12-cv-10946—Thomas L. Ludington, District Judge.
Argued: January 28, 2014
Decided and Filed: May 9, 2014
BEFORE: SUTTON, McKEAGUE and WHITE, Circuit Judges.
COUNSEL
SUTTON, J., delivered the opinion of the court, in which McKEAGUE, J., concurred. WHITE, J. (pp. 16–29), delivered a separate dissenting opinion.
OPINION
SUTTON, Circuit Judge. The Employee Retirement Income Security Act prohibits an employer from retaliating against an employee “because he has given information or has testified or is about to testify in any inquiry or proceeding relating to [the Act].”
I.
Panel Processing makes floor panels. Brian Sexton worked as a general manager in its facility in Coldwater, Michigan, and served as a trustee for the company‘s employee retirement plan. In 2011, Sexton and another trustee, Robert Karsten, campaigned on behalf of two employees running for the company‘s board of directors. The employees won the election, but the board refused to seat them on the ground that it would violate the company‘s bylaws, which limited the number of inside directors. At the same time, the board removed Sexton and Karsten as trustees of the retirement plan.
Two days later, Sexton emailed the chairman of the board:
I believe that your actions . . . in refusing to seat [the employees] as directors of the company and removing Rob Karsten and me as Trustees of the [retirement plan] are violations of ERISA and the Michigan Corporations Business Act and other state and federal laws. I plan to bring these violations to the attention of the U.S. Department of Labor and Michigan Department of Licensing and Regulatory Affairs unless they are immediately remedied.
R. 9-13 at 2. Neither the chairman nor anyone else responded to the email, and Sexton took no further action. About six months later, the company fired Sexton from his job as a general manager.
Sexton sued the company in Michigan state court for violating the State‘s Whistleblower Protection Act and for breaching his employment contract. One might think that, when a Michigan plaintiff sues a Michigan defendant under Michigan law in a Michigan court, the case would stay there. But the company invoked complete preemption, a doctrine that converts state law claims “within the scope of [ERISA‘s] civil enforcement provisions” into federal claims. Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 66 (1987). Under this banner, the company recharacterized Sexton‘s state whistleblower claim as an ERISA claim. See
Once in federal court, Sexton did not challenge the company‘s removal of the case or its use of complete preemption. Sexton and Panel Processing instead litigated the case as though Sexton had raised a claim under ERISA. The district court granted summary judgment to the company on this ERISA claim, and it declined supplemental jurisdiction over Sexton‘s breach-of-contract claim.
II.
On appeal, Sexton does not contest the district court‘s application of complete preemption to Sexton‘s claim or otherwise attempt to resurrect his claim under Michigan‘s Whistleblower Protection Act. Under our case law, true enough, the doctrine of complete preemption goes to the subject matter jurisdiction of the court. Mikulski v. Centerior Energy Corp., 501 F.3d 555, 565 (6th Cir. 2007) (en banc). But we are satisfied, just as the parties and the district court were satisfied, that the company properly invoked the doctrine here.
III.
Sexton (supported by the Secretary of Labor) instead takes aim at the district court‘s rejection of his claim under ERISA. The relevant law says in relevant part: “It shall be unlawful for any person to discharge, fine, suspend, expel, or discriminate
All matters of interpretation begin with text; some end there. The text of this provision takes us well down the way of ending this dispute. No one claims that Sexton sent the email in the context of a “proceeding.” And no one claims that the email amounted to testimony—that he “testified” or was “about to testify” in an “inquiry” or “proceeding” by sending the email. That leaves the possibility that the email amounted to “giv[ing] information . . . in any inquiry.” We have no problem with the idea that, by sending the email, Sexton was “giv[ing] information.” But, as Sexton and the Secretary concede, the statute demands not just the limitless “giv[ing]” of “information.” It requires that the information be given in an “inquiry“—“any” inquiry, to be sure, but an inquiry all the same. “Inquiry” might mean an official investigation, as in “Earl Warren led an inquiry into the assassination of President Kennedy.” Or it might mean a question or a request for information, as in “The advocate answered the judge‘s inquiry.” See Bryan A. Garner, A Dictionary of Modern Legal Usage 317 (2d ed. 1995). We need not decide whether
This interpretation not only respects the meaning—indeed accounts for the broadest possible meaning—of these terms, but it also respects the different ways Congress has dealt with retaliation in the work place. Congress has enacted roughly forty anti-retaliation laws, see Jon O. Shimabukuro et al., Cong. Research Serv., R43045, Survey of Federal Whistleblower and Anti-Retaliation Laws (2013), and they tend to include two distinct types of prohibitions. The first protects employees who oppose, report or complain about unlawful practices. See, e.g.,
protects employees who participate, testify or give information in inquiries, investigations, proceedings or hearings. See, e.g.,
Most anti-retaliation laws include both types of clauses. See, e.g.,
By contrast, a few laws include only the first type of clause, the sort that protects employees who report unlawful practices. See, e.g.,
In enacting this provision of ERISA, Congress included only a clause protecting people who give information or testify in inquiries or proceedings. Unlike most of the other laws just cited, ERISA thus does not contain a clause protecting people who oppose, report or complain about unlawful practices. “[W]here words differ as they differ here, Congress acts intentionally and purposely in the disparate inclusion or exclusion.” Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53, 63 (2006). A contrary interpretation would parody the presumption against
redundancy. See Maracich v. Spears, 133 S. Ct. 2191, 2205 (2013). If clauses protecting involvement in investigations automatically protect even complaints outside investigations, dozens of opposing/reporting/complaining clauses across the United States Code would serve no purpose.
Sexton, the Secretary and the dissent insist that
Subtracting words from the law is bad enough, but Sexton‘s theory also requires us to add words in their place. As written,
Sexton and the Secretary propose a textual detour around these problems: Because “complaining” sometimes means “challenging,” “challenging” sometimes means “questioning,” and “questioning” sometimes means “inquiring,” it follows that a complaint is an inquiry. But this line of reasoning could transform all manner of things into inquiries—everything from the Peloponnesian War (the Spartans challenged, hence questioned, Athenian supremacy) to the Boston Tea Party (the protesters challenged, hence questioned, British taxes). And it could
transform complaints into all manner of things—everything from a whisper (complaining means grumbling, grumbling means murmuring, murmuring means whispering) to a shout (complaining means bewailing, bewailing means crying, crying means shouting). Not unlike the children‘s game of telephone, this approach risks converting the ultimate message into something quite different from the original message—indeed sometimes into the opposite message. An approach to interpretation that exponentially blurs meaning is not apt to help in the fair interpretation of statutes. In the end, the overlap between “complain” and one meaning of “question” and the overlap between a different meaning of “question” and “inquiry” do not transform “complain” into “inquiry.”
Sexton persists that it would be strange for the law to protect an employee who reports a violation when asked a question in the context of an inquiry or proceeding but not an employee who reports a violation on his own initiative. Yet this result looks strange only if one assumes that Congress passed
The Secretary offers a variation on this theme. Section 1140, he says, at least protects an employee whose complaint prompts an investigation, because giving information that leads to an inquiry counts as giving information “in” that inquiry. And it would be odd, he adds, for the law to deny an employee protection from retaliation merely because the employer later chooses not to conduct an investigation—meaning that
investigation of Watergate, but one would not say that Deep Throat gave information in Senator Ervin‘s inquiry. Otherwise, all disclosures or complaints would occur “in” an inquiry or proceeding, so long as the employee subsequently filed a lawsuit—the later “proceeding”
The risk of unusual results, moreover, would not disappear even if we adopted the theory offered by Sexton and the Secretary. The law as written contains a sensible limitation on the information that enjoys federal protection: The information must be conveyed “in any inquiry or proceeding relating to [the Act].” Erasing that limit leaves a law that protects anyone who has “given information“—a boundless phrase that covers everything from giving tax advice to giving score updates on a World Cup soccer match. We could try to overcome this problem by limiting our reconfigured statute‘s coverage to information that relates to the Act. But that does not help much, because a law protecting anyone who has “given information relating to the Act” would still protect the professor denied tenure because all of his law review articles concern ERISA. We could try to sidestep this problem too by limiting our doubly reconfigured statute‘s coverage to disclosures about violations of the Act. But this takes us too far in the opposite direction, because now we have taken away federal protection from the witness who testifies at a benefits hearing about an employee‘s disability. All of these problems disappear if we honor the boundaries that the statute already contains.
Sexton and the Secretary argue that their interpretation advances
to protect whistleblowers in the abstract. Section 1140 does not single out information about violations of the law; it covers information of any genre. The claim that Congress passed
Keep in mind, moreover, that Congress may have enacted this provision not so much to protect the jobs of whistleblowers as to protect the integrity of inquiries. Section 1140‘s reference to “inquir[ies] or proceeding[s]” suggests that Congress had the latter objective in mind. We have attributed a similar purpose to a similar clause in another anti-retaliation law. See Booker v. Brown & Williamson Tobacco Co., 879 F.2d 1304, 1313 (6th Cir. 1989) (discussing Title VII‘s participation clause). A sense of how ERISA works shows why Congress would pursue that objective here. The Act requires retirement plans to provide for administrative review of employees’ claims. See
Turning to the Congressional Record, the Secretary unearths a snippet of Senate debate that (he claims) analogizes ERISA‘s prohibition against retaliation to Title VII‘s prohibition. The relevant statement explains that
of all statutes, we should hesitate to add a provision the statute does not contain (a clause protecting any employee who opposes allegedly unlawful practices) and to eliminate a limitation that the statute does contain (“in any inquiry or proceeding“).
Shifting from purpose to policy, Sexton and the Secretary claim that their interpretation encourages employees to report violations to their employers, and that enforcement of the Act depends on such reports. This last claim is debatable. The Act already requires an employer to keep records and file reports about retirement plans,
Moving on to precedent, Sexton and the Secretary argue that case law requires an expansive interpretation of federal anti-retaliation laws and undercuts our focus on the text. Not so. When faced with “clear language,” the Supreme Court recently explained—in a retaliation case no less—a court may not “conclude that what Congress omitted from the statute is nevertheless within its scope.” Univ. of Texas Sw. Med. Ctr. v. Nassar, 133 S. Ct. 2517, 2528 (2013). That is this case.
Nor does Kasten v. Saint-Gobain Performance Plastics Corp. change things. 131 S. Ct. 1325 (2011). The Fair Labor Standards Act prohibits discharging an employee because he has “filed any complaint” alleging a violation of the Act,
oral complaints to the law‘s administration. Id. at 1333–34. Far from licensing free-form interpretation of anti-retaliation laws, Kasten confirms the primacy of the statutory text.
Crawford v. Metropolitan Government of Nashville is of a piece. 555 U.S. 271 (2009). It held that Title VII‘s opposition clause protects employees who oppose unlawful practices, regardless of whether they speak on their own initiative or in response to employer questions. The result does not help Sexton, because (unlike the law invoked in this case) Title VII‘s opposition clause does not distinguish inquiries and proceedings from other settings. Nor does the reasoning help him, because Crawford turned on the “ordinary meaning” of the opposition clause, id. at 276, not on any special interpretive rule for anti-retaliation statutes. The dissent for its part takes up Crawford‘s observation that “nothing in [Title VII‘s opposition clause] requires a freakish rule protecting an employee who reports discrimination on her own initiative but not one who reports the same discrimination in the words when her boss asks a question.” Id. at 277–78. The dissent reasons that it makes no sense to distinguish complaints made during questioning from complaints made without questioning, prompting the conclusion that
Sexton, the Secretary and the dissent also cast about for support in our circuit‘s precedents. The decisions they reel in, see, e.g., EEOC v. Ohio Edison Co., 7 F.3d 541 (6th Cir. 1993); EEOC v. Romeo Cmty. Sch., 976 F.2d 985 (6th Cir. 1992), do not help them. Each case interprets a statute that already contains an opposition clause to protect a form of opposition. None authorizes a court to create an opposition clause out of nothing.
The same is true of out-of-circuit decisions. Every relevant holding hurts Sexton‘s position. The Third and Fourth Circuits have both held that
2003) (concluding that “the most compelling interpretation of the statutory language” excludes workplace complaints). The Second Circuit has reasoned the same way. Nicolaou v. Horizon Media, Inc., 402 F.3d 325, 329 (2d Cir. 2005) (per curiam) (reasoning that
As for Sexton‘s citation of cases from the Fifth, Seventh and Ninth Circuits, they offer less than advertised. In the case from the Fifth Circuit, an employee sued his employer under state law for wrongful discharge, alleging that it fired him for refusing to carry out orders violating ERISA. Anderson v. Elec. Data Sys. Corp., 11 F.3d 1311 (5th Cir. 1994). The Fifth Circuit held that federal law preempts this state claim—a holding that
The Ninth Circuit‘s decision follows a similar pattern. Hashimoto v. Bank of Hawaii, 999 F.2d 408, 411 (9th Cir. 1993). An employee sued her employer under a state whistleblower law, alleging that it fired her for complaining about violations of ERISA. The Ninth Circuit held that the doctrine of complete preemption converted the state claim into a federal ERISA claim. Id. at 409. This holding does not cover the issue at hand, which concerns the validity of a claim under federal law, not the propriety of recharacterizing a state claim as a federal one. Sexton and the Secretary persist that, according to the Ninth Circuit‘s opinion,
That leaves the Seventh Circuit. It held that
(7th Cir. 2012). But that decision does not help Sexton because his email did neither.
According to the dissent, the Fifth, Seventh and Ninth Circuit decisions prove at least that
The Secretary urges us to defer to his interpretation of the statute. He (correctly) does not claim deference under Chevron v. Natural Resources Defense Council,
323 U.S. 134, 140 (1944), which entitles an agency‘s views to respect proportionate to its persuasive power. As shown, we find the Secretary‘s arguments unpersuasive.
For what it is worth, our decision has few if any consequences beyond this Act. Most federal statutes that prohibit retaliation, like Title VII and the Fair Labor Standards Act, do include separate clauses protecting employees who complain about or oppose unlawful practices.
For these reasons, we affirm.
APPENDIX
It shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which he is entitled under the provisions of an employee benefit plan, this subchapter, section 1201 of this title, or the Welfare and Pension Plans Disclosure Act, or for the purpose of interfering with the attainment of any right to which such participant may become entitled under the plan, this subchapter, or the Welfare and Pension Plans Disclosure Act. It shall be unlawful for any person to discharge, fine, suspend, expel, or discriminate against any person because he has given information or has testified or is about to testify in any inquiry or proceeding relating to this chapter or the Welfare and Pension Plans Disclosure Act. In the case of a multiemployer plan, it shall be unlawful for the plan sponsor or any other person to discriminate against any contributing employer for exercising rights under this chapter or for giving information or testifying in any inquiry or proceeding relating to this chapter before Congress. The provisions of section 1132 of this title shall be applicable in the enforcement of this section.
DISSENT
HELENE N. WHITE, Circuit Judge (dissenting). I respectfully dissent.
The question whether section 510 protects unsolicited employee complaints has split the circuits. The Fifth, Seventh, and Ninth Circuits have interpreted
I do not agree that
I. Supreme Court Guidance on the Interpretation of Anti-Retaliation Provisions — Kasten (2011) and Crawford (2009)
Two relatively recent Supreme Court decisions construed anti-retaliation provisions, Kasten, and Crawford v. Metropolitan Government of Nashville & Davidson County, Tennessee, 555 U.S. 271 (2009) (reversing the Sixth Circuit). Neither involved
A. Crawford‘s Interpretation of Title VII
The Crawford Court interpreted Title VII‘s opposition clause,
B. Kasten‘s Interpretation of the FLSA
In Kasten, 131 S. Ct. 1325 (2011), the Supreme Court considered the anti-retaliation provision of the Fair Labor Standards Act (FLSA),
Kasten worked for Saint-Gobain Performance Plastics Corporation. Id. Saint-Gobain had placed employee timeclocks
The district court granted summary judgment in favor of Saint-Gobain, concluding that the FLSA‘s anti-retaliation provision did not protect oral complaints. Id. The Seventh Circuit affirmed. Id. The Supreme Court granted certiorari to resolve a circuit split on the question whether oral complaints are protected under the FLSA
The Kasten Court first considered the text of the statute, noting that “the word ‘filed’ has different relevant meaning in different contexts.” Id. at 1331. In considering other possible interpretations of the word “filed,” the Court examined dictionaries, regulations promulgated by other federal agencies, caselaw, other appearances of the word “filed” in the FLSA, and other statutes’ anti-retaliation provisions. Id. at 1331–33. In looking beyond the FLSA to other statutes containing antiretaliation provisions, the court noted:
Those statutes, however, use somewhat different language. See, e.g.,
§ 158(a)(4) (protecting an employee who has “filed charges or given testimony“);§ 623(d) (protecting those who ”opposed any [unlawful] practice” (emphasis added));42 U.S.C. §§ 2000e-3(a) ,12203(a) (same);29 U.S.C. § 2615(a)(2) (similar). See also, e.g.,15 U.S.C. § 2087(a)(1) (2006 ed., Supp. III) (”provided . . . to the employer . . . information relating to any violation” (emphasis added));§ 2651(a) (similar);30 U.S.C. § 815(c)(1) (“filed or made a complaint” (emphasis added));42 U.S.C. § 5851(a)(1)(A) (”notified his employer” (emphasis added));49 U.S.C. § 42121(a)(1) (“provided . . . information” (emphasis added));§ 60129(a)(1) (same).
Kasten, 131 S. Ct. at 1332–33. Given the use of broader language in other anti-retaliation statutes and the fact that the use of the word “filed” in
The Kasten Court looked further into “functional considerations” and decided
The need for effective enforcement of the FLSA led the Court to compare it to the National Labor Relations Act (NLRA),
II. Sixth-Circuit Interpretation of Anti-Retaliation Provisions
Sixth Circuit precedent analyzing anti-retaliation provisions has not taken as restrictive a view as the majority does here. In EEOC v. Ohio Edison Co., 7 F.3d 541, 545 (6th Cir. 1993), this court broadly construed the opposition provision of Title VII. See
III. The Circuit Split: Circuits That Protect “Unsolicited Internal Complaints”
A. Post-Kasten Interpretation of § 510
In George v. Junior Achievement of Central Indiana, Inc., 694 F.3d 812, 815 (7th Cir. 2012), the Seventh Circuit explicitly held that § 510 protects an employee‘s unsolicited internal complaint. The plaintiff in George noticed that his employer had failed to deposit money withheld from his paycheck into his retirement account. Id. at 813. George protested about this ERISA violation to various high-level executives of the company. Id. Eventually, he received checks that made up the missed deposits plus interest, but he was discharged within several months. Id. Like the Fifth and Ninth Circuits, the Seventh Circuit held that George‘s unsolicited internal complaints were protected “inquiries.”
Two other circuits have held that § 510 applies to unsolicited informal complaints. Anderson v. Electronic Data Systems Corp., 11 F.3d 1311, 1313, 1315 (5th Cir. 1994); Hashimoto v. Bank of Hawaii, 999 F.2d 408, 411 (9th Cir. 1993). The Ninth Circuit stated that reporting misconduct is a necessary step in the commencement of any formal inquiry and that, unless informal beginnings are covered, employers would be induced to dismiss employees as soon as they complained or asked a barbed question.
. . . .
The statute does not specify who asks the question or, more generally, initiates the inquiry. There is no linguistic reason why “inquiry” cannot refer to the employee‘s questions as well as the employer‘s. Most questions (or observations) will lead to questions in return; after George complained, managers at Junior Achievement asked questions of
him. Treating § 510 as covering only half of the dialogue would not make sense.
Id. at 814, 815. The George court rejected the Third Circuit‘s contention that § 510‘s language is unambiguous:
Both the initial clauses in § 510 and the prepositional phrase that modifies them employ the disjunctive, which implies that informal and formal approaches are separate tracks, both of which are covered. Section 510 can be parsed this way:
((has given information) or (has testified or is about to testify)) in (any ((inquiry) or (proceeding))).
Likewise we can group the actions and settings based on formality:
((has given information) in (any inquiry)) or ((has testified or is about to testify) in (any proceeding)).
This understanding about which words go with which other words is not compelled by rules of grammar—the language is ambiguous—but clues including the similar ordering of the informal and formal options lend support to splitting the provision into two parallel tracks.
. . . .
Because § 510 refers to inquiries without specifying who is doing the inquiring, it logically covers employees’ inquiries. Crawford provides some support for this understanding. .. Junior Achievement proposes to add modifiers such as “formal” or “solicited” to the word “inquiry” in § 510. Just as in Crawford, we must enforce the text as enacted, without the additions. See also Kasten, 131 S. Ct. at 1330. The grammatical structure and functions of § 510 do not support reading the statute as if it read: “for giving information . . . in response to any inquiry” (adding the italicized words to the enacted text). Crawford admonishes us to resist the urge to read words into statutes.
George, 694 F.3d at 814-16 (rejecting Edwards v. A.H. Cornell & Son, Inc., 610 F.3d 217, 224 (3rd Cir. 2010) (emphasis in original). George followed Kasten in deciding that “[w]hen dealing with ambiguous anti-retaliation provisions,” a court must “resolve the ambiguity in favor of protecting employees.” 694 F.3d at 814 (citing Kasten, 131 S. Ct. at 1333-35).
B. Pre-Kasten Interpretation of § 510
Before the Supreme Court decided Kasten, the Ninth Circuit considered a case involving an employee‘s unsolicited internal complaint in Hashimoto v. Bank of Hawaii, 999 F.2d 408 (9th Cir. 1993). Hashimoto was instructed by her co-workers to commit various ERISA violations. Id. at 409. After Hashimoto complained to other employees about “potential and/or actual violations by the Bank of the reporting and disclosure requirements and fiduciary standards of ERISA,” she was discharged. Id. Although the controlling issue was whether Hashimoto‘s state claims were preempted, the Ninth Circuit noted that § 510 was “clearly meant to protect whistle blowers” in Hashimoto‘s position. Id. at 411. The court stated that the “normal first step in giving information or testifying” was “to present the problem first to the responsible managers of the ERISA plan.” Id. If an employee “is then discharged for raising the problem, the process of giving information or testifying is interrupted at its start: the anticipatory discharge discourages the whistle blower before the whistle is blown.” Id.
The Fifth Circuit interpreted § 510 as protecting unsolicited internal complaints in Anderson v. Electronic Data Systems Corp., 11 F.3d 1311 (5th Cir. 1994). Anderson was asked by a specific employee to commit various ERISA violations. Id. at 1312. After Anderson refused and reported the alleged ERISA violations to management, he was demoted and discharged. Id. Similar to the Ninth Circuit in Hashimoto, the Fifth Circuit in Anderson focused on the ERISA preemption issue, but noted that § 510 protects employees, like Anderson, who “provid[e] information or testimony relating to ERISA.” Id. at 1315.
IV. Circuits That Do Not Protect Unsolicited Internal Complaints
Every circuit court case that interprets § 510 protection as not protecting an employee‘s unsolicited internal complaint was decided pre-Kasten. But After Kasten, the Fourth Circuit in a FLSA retaliation case followed the Supreme Court‘s guidance on statutory interpretation.
A. Pre-Kasten Interpretation of § 510
The Fourth Circuit in King v. Marriott Int‘l, Inc., 337 F.3d 421 (4th Cir. 2003), held that unsolicited internal complaints are not protected under § 510. King had learned of potential ERISA violations and reported them to her immediate supervisor. Instead of remedying the violations, the supervisor promoted King and gave her increased responsibilities regarding benefit plan finances. When the supervisor revived his potentially violative plan, King objected again and shared her objections with two in-house attorneys in addition to her supervisor. Id. When the supervisor revived his plan a third time, King objected again, orally and in writing, and was fired, purportedly for feuding with other employees. Id. The Fourth Circuit concluded that King‘s complaints were not protected under § 510:
In interpreting a very similar provision of the Fair Labor Standards Act . . . 3 we concluded that the term “proceeding” referred only to administrative or legal proceedings, and not to the making of an intra-company complaint. See Ball v. Memphis Bar-B-Q Co., 228 F.3d 360, 364 (4th Cir. 2000). In Ball, we said that
“the ‘proceeding’ necessary for liability . . . refers to procedures conducted in judicial or administrative tribunals,” noting that “proceeding,” in the Act, was “modified by attributes of administrative or court proceedings.” In particular, we explained, “testify” and “institute” both connote “a formality that does not attend an employee‘s oral complaint to his supervisor.”
King, 337 F.3d at 427. The King court determined that § 510 of ERISA, like the FLSA provision interpreted in Ball, was “much narrower” than other anti-retaliation provisions, such as found in Title VII, and required a stricter interpretation. King, 337 F.3d at 427 (citing Ball, 228 F.3d at 364, and Ball‘s reference to Title VII‘s anti-retaliations provision,
In Edwards v. A.H. Cornell & Son, Inc., the Third Circuit followed King and held that § 510 of ERISA does not protect an
The Second Circuit also denied § 510 protection to unsolicited internal complaints in Nicolaou v. Horizon Media, Inc., 402 F.3d 325 (2d Cir. 2005). Nicolaou discovered a “serious payroll discrepancy” that she believed put her company in violation of ERISA. Id. at 326. She brought the discrepancy to the attention of the Chief Financial Officer and Controller, and eventually felt compelled to inform “outside counsel” for the company, who conducted his own investigation and agreed with Nicolaou. Id. Nicolaou and the attorney then met with the President of the company, who reassigned Nicolaou, after which her employment was terminated. Because the district court record did not reflect whether the President of the company arranged the meeting, the Second Circuit remanded to the district court to decide whether Nicolaou could “demonstrate that she was contacted to meet with [the President] in order to give information about the alleged underfunding of the Plan.” Id. at 330 (emphasis added). The Court decided that the “informal gathering of information falls within the plain meaning of ‘inquiry,‘” and was protected by § 510. Id. at 329. Thus, if Nicolaou could demonstrate that she was contacted by her employer “to give information about the alleged underfunding of the Plan, her actions would fall within the protection of Section 510.” Id. at 330. The Court limited § 510 protection to employees who give information in employer-initiated inquiries. The Nicolaou court did not consider Nicolaou‘s actions before her meeting with the President as relevant under § 510.
The Second Circuit based its conclusions on the “plain language” of § 510. Nicolaou, 402 F.3d at 328. The court refused to recognize any similarities to the FLSA,
B. Post-Kasten Statutory Interpretation in the Fourth Circuit
No circuit court interpreting § 510 of ERISA as failing to protect an employee‘s unsolicited internal complaints has returned
The issue in Minor was whether an employee‘s internal complaint could trigger the protection of
The Fourth Circuit held that “although the language of
Determining that neither Kasten nor Ball were “directly controlling,” the Fourth Circuit turned “to an independent review of the language of
Because the term “filed any complaint” in
V. Analysis
The threshold question is whether § 510 is reasonably susceptible of different interpretations. Kasten, 131 S. Ct. at 1330-31 (observing that an anti-retaliation provision is ambiguous if “the language of the provision, considered in isolation, may be open to competing interpretations.“); see also Edwards, 610 F.3d 217 at 222. If § 510 is ambiguous regarding whether it protects unsolicited internal complaints, Kasten counsels that its interpretation “depends upon reading the whole statutory text, considering the purpose and context of the statute, and consulting any precedents or authorities that inform the analysis.” Kasten, 131 S. Ct. 1325, 1330 (citing Dolan, 546 U.S. at 486).
The circuit split and divergent opinions regarding whether § 510 protects an employee‘s unsolicited internal complaints suggest an ambiguity. See Smiley v. Citibank (South Dakota), N.A., 517 U.S. 735, 739 (1996) (in light of different interpretations in state supreme courts and federal circuit courts, the court found it difficult “to contend that the word ‘interest’ in the National Bank Act is unambiguous . . .“); North Fork Coal Corp. v. Fed. Mine Safety & Health Review Comm‘n, 691 F.3d 735, 740 (6th Cir. 2012) (the fact that the phrase “pending final order on the complaint” of
Kasten has important implications for interpreting § 510. In both King and Edwards, which relies on King‘s reasoning, § 510 protection was limited to employees who give information in “something more formal than written or oral complaints made to a supervisor.” King, 337 F.3d at 427; Edwards, 610 F.3d at 223 (“even beyond the plain meaning of ‘inquiry’ and ‘proceeding,’ the phrase ‘testified or is about to testify’ implies that the phrase ‘inquiry or proceeding’ is limited to more formal actions.“) Relying on another pre-Kasten case, Ball,5 the King court determined that § 510 of ERISA, like the anti-retaliation provision of the FLSA interpreted in Ball, was “much narrower” than other anti-retaliations provisions, requiring a stricter interpretation of § 510. Id. King interpreted
The Second Circuit in Nicolaou focused less on the formality of the inquiry and more on the importance of the inquiry being “employer-initiated.” 402 F.3d at 330. In fact, the Nicolaou court observed that ERISA‘s § 510 is “unambiguously broader in scope” than the FLSA‘s
After the Supreme Court decided Kasten, the Fourth Circuit held that
VI.
The district court decided this case primarily on the basis that Sexton‘s email was not an inquiry. The majority makes this point as well. Initially, Sexton inquired of the Human Resources manager as to the results of the election. After confirming that the employees had received the most votes, he sent the email to the board chairman. The majority concedes that Sexton gave information in the email, but concludes that it was not given in an inquiry. I agree with the Secretary that a complaint may, in context, be an inquiry, and that Sexton was clearly asserting that Panel Processing had violated ERISA and inquiring whether the board would take action or Sexton would be required to do so. Sexton argues that Panel Processing responded to that inquiry by firing him.
VII.
Section 510 is susceptible of several interpretations, only one of which is that employee information must be given 1) at the employer‘s initial request and/or 2) in “something more formal than written or oral complaints,” in order to be protected. See, e.g., King, 337 F.3d at 427. I would follow George, the only circuit court decision issued after Kasten. 694 F.3d at 814 (“When dealing with ambiguous anti-retaliation provisions, we are supposed to resolve the ambiguity in favor of protecting employees.” (citing Kasten, 131 S. Ct. at 1333-35)); see also Crawford, 555 U.S. at 277-78 (“nothing in the statute requires a freakish rule protecting an employee who reports discrimination on her own initiative but not one who reports the same discrimination in the same words when her boss asks a question.“)
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
No. 13-1604
BRIAN SEXTON,
Plaintiff - Appellant,
v.
PANEL PROCESSING, INC. and PANEL
PROCESSING OF COLDWATER, INC.,
Defendants - Appellees.
Before: SUTTON, McKEAGUE, and WHITE, Circuit Judges.
JUDGMENT
On Appeal from the United States District Court
for the Eastern District of Michigan at Bay City.
THIS CAUSE was heard on the record from the district court and was argued by counsel.
IN CONSIDERATION WHEREOF, it is ORDERED that the judgment of the district court is AFFIRMED.
ENTERED BY ORDER OF THE COURT
Deborah S. Hunt, Clerk