McLeod v. Gen. Mills, Inc.
| Decision Date | 23 October 2015 |
| Docket Number | Civil No. 15–494 (JRT/HB) |
| Citation | 140 F.Supp.3d 843 |
| Parties | Elizabeth McLeod, Heidi O'Sullivan, Sherri Slocum, Ivette Harper, Robert West, Kevin Stemwell, Stephen Miller, Peggy Maxe, Karalyn Littlefield, Colleen Friedrichs, Arlene Hornilla, Marilyn Epp, Dwight Sevaldson, Ann Carlson, Michael Baehr, Gabriele Bauer, Mark Davis, Susanne Dehnke, Frank Delaney, Paula Freeman–Brown, Barbara Fuglie, Richard Fuglie, Christopher Gunn, Michelle Laurence, Robert Morris, Vicki Nellen–Jungers, Heidi Neumann, Greg Norman, Michelle Race, Susan Ryan, Timothy Schroeder, Diane Sundquist, and Greg Zimprich, Plaintiffs, v. General Mills, Inc., Defendant. |
| Court | U.S. District Court — District of Minnesota |
Stephen J. Snyder, Brent Snyder, C. and Craig A. Brandt, SNYDER & BRANDT, P.A., 120 South Sixth Street, Suite 2550, Minneapolis, MN 55402, for plaintiffs.
Marko J. Mrkonich and Susan K. Fitzke, LITTLER MENDELSON, P.C., 80 South Eighth Street, Suite 1300, Minneapolis, MN 55402, for defendant.
Laurie A. Vasichek, EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, 330 South Second Avenue, Suite 720, Minneapolis, MN 55401, for amicus curiae Equal Employment Opportunity Commission.
Daniel B. Kohrman, AARP FOUNDATION LITIGATION, 601 E Street N.W., Fourth Floor, Building B, Washington, DC 20049, for movant AARP.
In June 2012, defendant General Mills, Inc. ("General Mills") terminated approximately 850 employees as part of a corporate restructuring plan called "Project Refuel." Elizabeth McLeod and 32 other persons aged 40 or above ("plaintiffs") were among those laid off as part of the restructuring, and have brought this action alleging that they were improperly terminated in violation of the Age Discrimination in Employment Act of 1967 ("ADEA").1
General Mills moves the Court to dismiss the plaintiffs' complaint under the Federal Arbitration Act ("FAA") and Federal Rule of Civil Procedure 12(b)(1), with prejudice, because each of the plaintiffs signed a binding arbitration agreement and general release agreement as a condition of receipt of a severance package. General Mills also moves to compel arbitration on an individual basis as per the arbitration agreement. General Mills additionally requests that, in the event that the motion to dismiss is not granted in its entirety, the Court strikes the collective action allegations contained in the Amended Complaint and stays the case pending arbitration. Finally, General Mills requests that the Court award reasonable expenses. Because the language of the Older Workers Benefit Protection Act of 1990 ("OWBPA"), 29 U.S.C. § 626(f)(3), mandates that a dispute like this one be heard in a "court of competent jurisdiction," the Court will deny General Mills' motion to dismiss and compel arbitration.
In June 2012, General Mills terminated approximately 850 employees as part of a corporate restructuring project called "Project Refuel." ( The plaintiffs—33 General Mills employees who were laid off as a part of Project Refuel—allege that the layoffs violated the ADEA because they "affected employees age 40 or over at much higher rates than younger employees." (Id. ¶¶ 3–4.) Additionally, the plaintiffs allege that General Mills was replacing employees terminated under Project Refuel with younger employees. (Id. ¶ 3.) In support of those allegations, the plaintiffs cite statistics, derived from employee termination data, which purportedly show that older employees were many times more likely than younger employees to be laid off during the restructuring. (Id. ¶¶ 86–103.) They accuse General Mills of engaging in an overarching pattern or practice of age discrimination. (Id. ¶¶ 7478.)
Specifically, the plaintiffs provide the following biographical information about each plaintiff named in the action:
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[Editor's Note: The preceding image contains the reference for footnote2 ].
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At or about the date of their termination, each plaintiff signed a release and arbitration agreement ("release agreement") as a condition of receipt of an employee severance package. (Am. Compl. ¶ 5; First Velcheck Decl., Exs. 1–14; Second Velcheck Decl., Exs. 1–19.) The release agreement stipulates that any dispute or claim relating to the release agreement be resolved exclusively through final and binding arbitration on an individual basis. (Am. Compl. ¶ 8; see also, e.g., Second Velcheck Decl., Ex. 1.) The two-page release agreement specifically includes the following language:
I agree that, in the event there is any dispute or claim arising out of or relating to the above release of claims, including, without limitation, any dispute about the validity or enforceability of the release or the assertion of any claim covered by the release, all such disputes or claims will be resolved exclusively through a final and binding arbitration on an individual basis and not in any form of class, collective, or representative proceeding.
(E.g., Second Velcheck Decl., Ex. 1 at 2.) The arbitration agreements are expressly governed by the Federal Arbitration Act ("FAA"). (Id. )
In addition to requiring binding arbitration, the agreement also contains a broad release from all causes of action or claims against General Mills, including claims arising under the ADEA. (Id. ; Am. Compl. ¶ 8.) Specifically, the release states:
I hereby release [General Mills] ... from all causes of action, claims, debts or other contracts and agreements which I ... may have for any cause up to this date, including, but not limited to, any and all claims directly or indirectly relating to my employment, or to my separation from employment. This release includes any and all claims under federal, state, and local laws prohibiting employment discrimination, harassment or retaliation, and specifically includes, without limitation, claims arising under the Age Discrimination In Employment Act ... [and the] Older Workers Benefit Protection Act....
(E.g., Second Velcheck Decl., Ex. 1 at 2.)
The plaintiffs filed their initial complaint on February 11, 2015, alleging, among other claims, that General Mills improperly terminated the employment of 14 former employees due to their age, in violation of the ADEA. (Compl. ¶¶ 1–26, Feb. 11, 2015, Docket No. 1.) General Mills then filed a motion to dismiss the plaintiffs' complaint and compel individual arbitration, due to the release agreements signed by the plaintiffs. (Mot. to Dismiss & Compel Arbitration, Mar. 5, 2015, Docket No. 5.) General Mills also seeks to strike the complaint's collective action allegations, and reasonable expenses. (Id. )
On March 26, 2015, the plaintiffs timely filed an amended complaint which added an additional 19 plaintiffs, but that otherwise remained substantially the same as the initial complaint. (Am.Compl.) Specifically, the amended complaint, like the initial complaint, asserts the following five counts: (1) ADEA declaratory judgment claim, seeking a declaration that the release agreements are unenforceable because they were not signed "knowingly and voluntarily" by the plaintiffs as prescribed by the ADEA and the OWBPA; (2) ADEA collective action claim, alleging disparate treatment age discrimination; (3) ADEA individual claims, alleging disparate treatment age discrimination; (4) ADEA collective action claims, alleging disparate impact age discrimination; and (5) ADEA individual claims, alleging disparate impact age discrimination. (Am.Compl. ¶¶ 245–76.)
Two weeks later, General Mills filed an amended motion to dismiss and compel arbitration that was predominantly the same as its initial motion to dismiss, but which was updated to reflect the new plaintiffs in the amended complaint. (Am. Mot. to Dismiss & Compel Arbitration, April 9, 2014, Docket No. 20.) It is this amended motion to dismiss that is now before the Court.
The parties submitted additional briefing, but incorporate by reference all of the arguments made in their original motion to dismiss briefing. Per order of the Court, the Equal Employment Opportunity Commission ("EEOC") and the AARP also filed amicus briefs in opposition to General Mills' motion to dismiss.
In reviewing a motion to dismiss brought under Federal Rule of Civil Procedure 12(b)(6), the Court considers all facts alleged in the complaint as true to determine if the complaint states a " ‘claim to relief that is plausible on its face.’ " See, e.g., Braden v. Wal–Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir.2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ). To survive a motion to dismiss, a complaint must provide more than " ‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action.’ " Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). Although the Court accepts the complaint's factual allegations as true, it is "not bound to accept as true a legal conclusion couched as a factual allegation." Bell Atl. Corp., 550 U.S. at 555, 127 S.Ct. 1955 (internal quotation marks omitted).
"A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937. "Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility," and therefore must be dismissed. Id. ...
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Shields v. Gen. Mills, Inc.
...in that case denied General Mills's motion to dismiss and to compel arbitration under the Release Agreements. McLeod v. General Mills, Inc., 140 F. Supp.3d 843 (D. Minn. 2015). As in this case, the McLeod plaintiffs asserted a declaratory judgment claim seeking a declaration that the waiver......