Minnesota Sch. Bd. Ass'n Ins. v. U.S. E.E.O.C.

• Decision Date: 13 September 2001
• Docket Number: No. CIV. 00-2042(RHKRLE).,CIV. 00-2042(RHKRLE).
• Citation: 184 F.Supp.2d 899
• Parties: THE MINNESOTA SCHOOL BOARD ASSOCIATION INSURANCE TRUST, and Independent School District 94-Cloquet, Plaintiffs, v. THE UNITED STATES EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Education Minnesota, and Education Minnesota-Cloquet, Defendants.
• Court: U.S. District Court — District of Minnesota

184 F.Supp.2d 899

THE MINNESOTA SCHOOL BOARD ASSOCIATION INSURANCE TRUST, and Independent School District 94-Cloquet, Plaintiffs, v. THE UNITED STATES EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Education Minnesota, and Education Minnesota-Cloquet, Defendants.

No. CIV. 00-2042(RHKRLE).

United States District Court, D. Minnesota.

September 13, 2001.

Morgan Allen Godfrey, Shamus P O'Meara, Mark R. Azman, Johnson & Condon, Edina, MN, for Minnesota School Boards Ass'n Ins. Trust, Independent School Dist. 94, Cloquet.

Maria L. Morocco, E.E.O.C., Washington, DC, for E.E.O.C.

Stephen J. Snyder, Laurie A Knocke, Winthrop & Weinstine, St. Paul, MN, Harley M Ogata, Education Minnesota, St. Paul, MN, for Education Minnesota, Education Minnesota-Cloquet.

ORDER

KYLE, District Judge.

Before the Court are Plaintiff's Objections to the August 15, 2001 Report and Recommendation of Magistrate Judge Raymond L. Erickson. Defendants have responded in opposition.

Having conducted the required de novo review of the objected to portions of the Report and Recommendation, the undersigned concludes that it should be adopted; it is thorough, well reasoned and fully supported by applicable legal principles.¹

Upon all of the files, records, and proceedings herein, IT IS ORDERED that:

1. The Objections (Doc. No. 56) are OVERRULED;

2. The Report and Recommendation (Doc. No. 55) is ADOPTED;

3. Plaintiffs' Motion for Partial Summary Judgment, and for Injunctive Relief (Doc. No. 13) is DENIED AS MOOT;

4. Defendant EEOC's Motion to Dismiss (Doc. No. 22) is GRANTED; and

5. Defendant Union's Motion to Dismiss (Doc. No. 26) is GRANTED.

REPORT AND RECOMMENDATION

Aug. 15, 2001.

I. Introduction

This matter came before the undersigned United States Magistrate Judge pursuant to a special assignment, made in accordance with the provisions of Title 28 U.S.C. § 636(b)(1)(B), upon the Plaintiffs' Motion for Partial Summary Judgment, and for Injunctive Relief; upon the Defendant Equal Employment Opportunity Commission's ("EEOC's") Motion to Dismiss; and upon the Defendants Education Minnesota's, and Education Minnesota-Cloquet's (collectively, "Unions'"), Motion to Dismiss. A Hearing on the Motions was conducted on March 22, 2001, at which time, the Plaintiffs appeared by Shamus P. O'Meara, and Mark R. Azman, Esqs.; the Defendant EEOC appeared by Maria Luisa Morocco, Esq.; and the Defendant Unions appeared by Laurie A. Knocke and Harley Ogata, Esqs.

For reasons which follow, we recommend that the Plaintiffs' Motion for Partial Summary Judgment, and for Injunctive Relief, be denied, as moot. We further recommend that the Motions to Dismiss, of the EEOC, and of the Unions, be granted.

II. Factual and Procedural History

The Plaintiffs in this case, the Minnesota School Boards Association Insurance Trust ("MSBAIT"),¹ and Independent School District 94-Cloquet ("ISD 94"), brought this suit because of actions taken by the EEOC. According to the Plaintiffs, over the past year, the EEOC has targeted approximately three hundred Minnesota School Districts with age discrimination claims, under the Federal Age Discrimination in Employment Act of 1967 ("ADEA"). See, Title 29 U.S.C. § 621 et seq.

Specifically, the EEOC has been investigating the retirement plans, which are employed by the School Districts, through the application of their respective collective bargaining agreements. The EEOC investigates employment discrimination charges and enforces Federal Equal Employment Opportunity statutes, including the ADEA. During the past year, based on the filing of 67 individual charges of discrimination see, Affidavit of Monty Johnson, at ¶ 3, and the EEOC's own issuance of directed charges,² the EEOC has investigated whether the Minnesota Independent School Districts' early retirement plans violate the ADEA.³ As a result, the EEOC has sent numerous School Districts, and Local Unions, letters of determination, which state that there is reasonable cause to believe that their early retirement plans violate the ADEA.⁴ In such instances, the EEOC attempts to engage in conciliations efforts, which are completely voluntary. The EEOC has not filed any enforcement actions in Court, which relate to any of the charges. Id. at ¶ 18. According to the Plaintiffs, however, a number of Plan Participant School Districts have voluntarily agreed, through the EEOC's conciliatory efforts, to settlements.

As noted, the retirement plans at issue are included in a School District's collective bargaining agreement. MSBAIT does not negotiate, or sign the collective bargaining agreements between individual School Districts, and the respective Local Union. Rather, local affiliates, such as the Defendant Education Minnesota-Cloquet, represent the specific School District employees, in collectively bargaining for certain retirement plans, and were the signatories to those plans. See, Affidavit of Larry E. Wicks, at ¶¶ 9-10. Conversely, the Defendant Education Minnesota is a voluntary organization, whose purpose is to provide a unified voice for educators in Minnesota. Id. at ¶ 2. Education Minnesota does not engage in collective bargaining, or in grievance processing, and is not a signatory to any collective bargaining agreement with any School District in Minnesota. Id. at ¶ 7. Education Minnesota's role in collective bargaining, at the local level, is limited to providing advise and consultation to its Local Unions, such as Education Minnesota-Cloquet, which is the Local Union in which teachers in ISD 94 are members. Id. at ¶ 9. About 350 of the Local Unions belong to Education Minnesota. Id. at 1.

On June 16, 2000, the EEOC filed a Charge of Discrimination against ISD 94, so as to determine its compliance with the ADEA. See, Exhibit B to Affidavit of Shamus P. O'Meara. ISD 94 filed a response to the Charge, advising the EEOC, among other things, that the purposes behind the voluntary early retirement program were: (1) to lower costs, by replacing high income employees with lower income employees; (2) to retain a mix of age, and experience levels, of teachers within the schools; (3) to avoid a concentration of employees of the same age, and/or length of service, which would cause problems if the District had to replace departing teachers with similarly qualified teachers at one time; (4) to provide incentive to teachers who chose to retire early; and (5) to conform to relevant laws regarding constructive receipt, and age discrimination. See, Exhibit C to Affidavit of Shamus P. O'Meara. ISD 94 further advised, that its early retirement plan was a completely voluntary program which had been adopted at the request of the teachers. Id. On July 21, 2000, the EEOC issued a Determination which found reasonable cause to believe that the District's policy was facially discriminatory. See, Exhibit D to Affidavit of Shamus P. O'Meara.

The Determination indicated that the EEOC was prepared to begin conciliation, and it included a proposed Conciliation Agreement which would require the District to pay all of the employees, who were affected by the allegedly discriminatory policy, double the amount of money lost within a two-year time period prior to the filing of the Charge. See, Exhibit E to Affidavit of Shamus P. O'Meara. The District's attorney then wrote the EEOC requesting additional information to support the EEOC's Determination. See, Exhibit F to Affidavit of Shamus P. O'Meara. The EEOC subsequently determined that its efforts to "conciliate this charge have been unsuccessful," and asserted that it "will not make further efforts to conciliate this charge." Exhibit G to Affidavit of Shamus P. O'Meara. The EEOC concluded by stating that it would be "forwarding the case for possible litigation." Id.

On August 30, 2000, the Plaintiffs initiated this litigation, pursuant to the Federal Declaratory Judgment Act, Title 28 U.S.C. § 2201 et seq., the Administrative Procedure Act, Title 5 U.S.C. § 700 et seq., as well as the Constitution of the United States. See, Second Amended Complaint, at ¶ 1. In their Second Amended Complaint, the Plaintiffs seek declaratory, and injunctive relief, against the EEOC, Education Minnesota, and Education Minnesota-Cloquet, as follows: (1) a declaration that the ADEA is unconstitutional and, therefore, cannot be applied, by the EEOC, against the Plan Participants; (2) a declaration that the Plan Participants are arms of the State of Minnesota, and are, therefore, immune from private suits under the ADEA by virtue of the Eleventh Amendment; (3) a declaration, alternatively, that all of the collective bargaining agreements of the Plan Participants comply with the ADEA; (4) an order enjoining the EEOC from bringing a lawsuit against any Plan Participant for violation of the ADEA; and, (5) a ruling that the Unions will be bound by the Count's decision. See, Second Amended Complaint, Counts I — V.

The Plaintiffs now move for Partial Summary Judgment, on Counts I and II, of their Second Amended Complaint. The first basis for this Motion is their belief that Supreme Court precedent, with respect to Congress' power under the Fourteenth Amendment,⁵ and under the Commerce Clause,⁶ requires the Court to strike down the ADEA, as applied to the States, as an unconstitutional exercise of authority and, therefore, unenforceable, by the EEOC, against the States. Second, the Plaintiffs contend that the Plan Participants are arms of the State, and are, therefore, entitled to Eleventh Amendment immunity, against private suits for money, under the ADEA. See, Kimel v. Florida Bd. of Regents, 528 U.S. 62, 120 S.Ct. 631, 145 L.Ed.2d 522 (2000).

On the other hand, the EEOC, and the Unions, have moved to dismiss the Plaintiffs' claims on a number of diverse bases. First, both the EEOC, and the Unions, seek a dismissal of the case under Rule 12(b)(1), Federal Rules of Civil Procedure, for lack of subject matter jurisdiction.⁷ Specifically, they contend that the case is not ripe...