541 U.S. 369 (2004), 02-1205, Jones v. R. R. Donnelley & Sons Co.

Docket Nº:No. 02-1205
Citation:541 U.S. 369, 124 S.Ct. 1836, 158 L.Ed.2d 645, 41 U.S.L.W. 4332
Party Name:Jones v. R. R. Donnelley & Sons Co.
Case Date:May 03, 2004
Court:United States Supreme Court
 
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Page 369

541 U.S. 369 (2004)

124 S.Ct. 1836, 158 L.Ed.2d 645, 41 U.S.L.W. 4332

Jones

v.

R. R. Donnelley & Sons Co.

No. 02-1205

United States Supreme Court

May 3, 2004

Argued February 24, 2004

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT

Syllabus

After this Court held that federal courts should apply the most appropriate state statute of limitations to claims arising under 42 U.S.C. § 1981, which contains no statute of limitations, see Goodman v. Lukens Steel Co., 482 U.S. 656, 660, Congress enacted a 4-year statute of limitations for causes of action "arising under an Act of Congress enacted after [December 1, 1990]," 28 U.S.C. § 1658(a). Petitioners, African-American former employees of respondent, filed a class action alleging violations of § 1981, as amended by the Civil Rights Act of 1991. Respondent sought summary judgment, claiming that the applicable state 2-year statute of limitations barred their claims, but the District Court held that petitioners' wrongful discharge, refusal to transfer, and hostile work environment claims arose under the 1991 Act, and therefore are governed by § 1658. The Seventh Circuit reversed, concluding that § 1658 does not apply to a cause of action based on a post-1990 amendment to a preexisting statute.

Held: petitioners' causes of action are governed by § 1658. Pp. 375-386.

(a) Because the meaning of "arising under" in § 1658 is ambiguous, Congress' intent must be ascertained by looking beyond the section's bare text to the context in which it was enacted and the purposes it was designed to accomplish. Pp. 375-377.

(b) Before § 1658's enactment, Congress' failure to pass a uniform limitations statute for federal causes of action had created a void that spawned a vast amount of litigation. The settled practice of borrowing state statutes of limitations generated a host of issues, such as which of the forum State's statutes was the most appropriate, whether the forum State's law or that of the situs of the injury controlled, and when a statute of limitations could be tolled. Congress was keenly aware of these problems, and a central purpose of § 1658 was to minimize the need for borrowing. That purpose would not be served if § 1658 were interpreted to reach only entirely new sections of the United States Code. An amendment to an existing statute is no less an "Act of Congress" than a new, stand-alone statute. What matters is the new rights of action and corresponding liabilities created by the enactment. Thus,

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a cause of action "aris[es] under an Act of Congress enacted" after December 1, 1990 -- and therefore is governed by § 1658's 4-year statute of limitations -- if the plaintiff's claim against the defendant was made possible by a post-1990 enactment. This construction best serves Congress' interest in alleviating the uncertainty inherent in the practice of borrowing state statutes of limitations, while protecting litigants' settled expectations by applying only to causes of actions not available until after December 1, 1990. It also is consistent with the common usage of "arise" and with this Court's interpretations of "arising under" as it is used in statutes governing the scope of federal subject matter jurisdiction. Pp. 377-383.

(c) Petitioners' hostile work environment, wrongful termination, and "failure to transfer" claims all "ar[rose] under" the 1991 Act in the sense that they were made possible by that Act. The 1991 Act overturned this Court's decision in Patterson v. McLean Credit Union, 491 U.S. 164, 171, which held that racial harassment relating to employment conditions was not actionable under § 1981. The Act redefined § 1981's key "make and enforce contracts" language to include the "termination of contracts and the enjoyment of all benefits, privileges, terms, and conditions of the contractual relationship," § 1981(b). In Rivers v. Roadway Express, Inc., 511 U.S. 298, this Court held that the amendment enlarged the category of conduct subject to § 1981 liability, id. at 303, and thus did not apply to a case that arose before it was enacted, id. at 300. Rivers' reasoning supports the conclusion that the 1991 Act qualifies as an "Act of Congress enacted after [December 1, 1990]." Petitioners' causes of action clearly arose under the 1991 Act, and the hypothetical problems posited by respondent and the Seventh Circuit pale in comparison with the difficulties that federal courts faced for decades in trying to answer questions raised by borrowing state limitations rules. Pp. 383-385.

305 F.3d 717 reversed and remanded.

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OPINION

STEVENS, JUSTICE

Like many federal statutes, 42 U.S.C. § 1981 does not contain a statute of limitations. We held in Goodman v. Lukens Steel Co., 482 U.S. 656, 660 (1987), that federal courts should apply "the most appropriate or analogous state statute of limitations" to claims based on asserted violations of § 1981. Three years after our decision in Goodman, Congress enacted a catch-all 4-year statute of limitations for actions arising under federal statutes enacted after December 1, 1990. 28 U.S.C. § 1658. The question in this case is whether petitioners' causes of action, which allege violations of § 1981, as amended by the Civil Rights Act of 1991 (1991 Act), 105 Stat. 1071, are governed by § 1658 or by the personal injury statute of limitations of the forum State.

I

Petitioners are African-American former employees of respondent's Chicago manufacturing division. On November

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26, 1994, petitioners filed this class action alleging violations of their rights under § 1981, as amended by the 1991 Act. Specifically, the three classes of plaintiffs alleged that they were subjected to a racially hostile work environment, given an inferior employee status, and wrongfully terminated or denied a transfer in connection with the closing of the Chicago plant. Respondent sought summary judgment on the ground that petitioners' claims are barred by the applicable Illinois statute of limitations because they arose more than two years before the complaint was filed. Petitioners responded that their claims are governed by § 1658, which provides:

Except as otherwise provided by law, a civil action arising under an Act of Congress enacted after the date of enactment of this section may not be commenced later than 4 years after the cause of action accrues.

28 U.S.C. § 1658(a).[1] Section 1658 was enacted on December 1, 1990. Thus, petitioners' claims are subject to the 4-year statute of limitations if they arose under an Act of Congress enacted after that date.

The original version of the statute now codified at Rev.Stat. § 1977, 42 U.S.C. § 1981 was enacted as § 1 of the Civil Rights Act of 1866, 14 Stat. 27. It was amended in minor respects in 1870 and recodified in 1874, see Runyon v. McCrary, 427 U.S. 160, 168-169, n. 8 (1976), but its basic coverage did not change prior to 1991. As first enacted, § 1981 provided in relevant part that

all persons [within the jurisdiction of the United States] shall have the same right in every State and Territory to make and enforce contracts . . . as is enjoyed by white citizens.

14 Stat. 27. We held in Patterson v. McLean Credit Union, 491 U.S. 164 (1989),

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that the statutory right "to make and enforce contracts" did not protect against harassing conduct that occurred after the formation of the contract. Under that holding, it is clear that petitioners' hostile work environment, wrongful discharge, and refusal to transfer claims do not state violations of the original version of § 1981. In 1991, however, Congress responded to Patterson by adding a new subsection to § 1981 that defines the term "make and enforce contacts" to include the "termination of contracts and the enjoyment of all benefits, privileges, terms, and conditions of the contractual relationship." 42 U.S.C. § 1981(b).[2] It is undisputed that petitioners have alleged violations of the amended statute. The critical question, then, is whether petitioners' causes of action "ar[ose] under" the 1991 Act or under § 1981 as originally enacted.

The District Court determined that petitioners' wrongful termination, refusal to discharge, and hostile work environment claims arose under the 1991 Act and therefore are governed by § 1658. Adams v. R. R. Donnelley & Sons, 149 F.Supp.2d 459 (ND Ill. 2001).[3]

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In its view, the plain text of § 1658 compels the conclusion that

whenever Congress, after December 1990, passes legislation that creates a new cause of action, the catch-all statute of limitations applies to that cause of action.

Id. at 464. The 1991 amendment to § 1981 falls...

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