Mormann v. Iowa Workforce Dev.

• Decision Date: 15 June 2018
• Docket Number: No. 16-1333,16-1333
• Citation: 913 N.W.2d 554
• Parties: Marlon MORMANN, Appellant, v. IOWA WORKFORCE DEVELOPMENT, Appellee.
• Court: Iowa Supreme Court

913 N.W.2d 554

Marlon MORMANN, Appellant,

v.IOWA WORKFORCE DEVELOPMENT, Appellee.

No. 16-1333

Supreme Court of Iowa.

Filed June 15, 2018

Lori Bullock and Jill Zwagerman of Newkirk Zwagerman, P.L.C., Des Moines, and Nathaniel R. Boulton of Hedberg & Boulton, P.C., Des Moines, for appellant.

Thomas J. Miller, Attorney General, and David L.D. Faith II and Jeffrey C. Peterzalek, Assistant Attorneys General, for appellee.

APPEL, Justice.

In this interlocutory appeal, Marlon Mormann, an applicant for the position of Deputy Workers’ Compensation Commissioner at Iowa Workforce Development (IWD) calls upon us to determine whether the statutory requirement that complaints be filed with the Iowa Civil Rights Commission (ICRC) within 300 days of the discriminatory act may be tolled through application of the discovery rule or equitable estoppel. See Iowa Code § 216.15(13) (2015). If we determine these equitable tolling doctrines are available, Mormann asks us to find that he is entitled to avoid strict application of the 300-day filing requirement.

The district court granted IWD’s motion to dismiss Mormann’s failure-to-hire claim. The court assumed equitable doctrines could apply to the 300-day filing requirement in the Iowa Civil Rights Act (ICRA) but concluded Mormann could not escape the filing limitation through application of the discovery rule or equitable estoppel. The court did not dismiss a constructive discharge claim brought by Mormann related to his departure from IWD on January 5, 2015, finding this claim was filed within the 300-day filing period.

Mormann filed an application for interlocutory review, which we granted. For the reasons expressed below, we hold the equitable tolling doctrines of the discovery rule and equitable estoppel are available with respect to the 300-day filing limitation in the ICRA. We further hold, however, that Mormann is not entitled to toll the 300-day filing limitation through application of either the discovery rule or equitable estoppel. As a result, we affirm the decision of the district court.

I. Factual and Procedural Background.

A. Factual Background to Failure-to-Hire Claim.

1. Introduction. Mormann worked for IWD from 1990 to 2015. During this period of time, he held a number of positions, including deputy workers’ compensation commissioner. He also served as an administrative law judge in the workers’ compensation division of IWD. At all times relevant to this case, Mormann was an administrative law judge in the unemployment insurance division of IWD.

2. Application for position of deputy workers’ compensation commissioner. In January 2014, Mormann applied for an open deputy workers’ compensation commissioner position. Workers’ Compensation Commissioner Christopher Godfrey chaired a hiring committee that interviewed and evaluated candidates. On February 19, Godfrey sent an email to Teresa Wahlert, the Director of IWD. In the email, Godfrey advised Wahlert that Erin Pals was the committee’s top candidate.

Godfrey explained to Wahlert why the committee favored Pals over Mormann. Godfrey noted Pals did not have as much experience as Mormann. Godfrey, however, told Wahlert that Mormann was not the top candidate because his resume and cover letter were brief; because of concerns that Mormann would not have a practitioner’s perspective; because his past work for the division, though prompt, was sometimes short on analysis; and because after leaving his prior position of deputy workers’ compensation commissioner he had not been active in the workers’ compensation community. If Pals declined the position, however, Godfrey recommended the position be offered to Mormann.

On March 7, Godfrey sent Mormann a letter informing him that he had not been selected for the position. Godfrey told Mormann,

I am writing to regretfully inform you that we have decided on an alternate candidate to fill the position of Deputy Workers’ Compensation Commissioner. The decision was a difficult decision and as I mentioned before, you were one of the finalists for the position. You are clearly qualified for a Deputy Commissioner’s position and I am certain that you would be a terrific addition to our staff. I encourage you to submit your application for future openings with the Division of Workers’ Compensation, if you remain interested in our division.

3. Deposition of Wahlert in the Godfrey matter related to failure to hire Mormann. On September 17, Wahlert gave a deposition in an unrelated case brought by Godfrey. Wahlert was asked a series of questions regarding the failure of IWD to offer the deputy commissioner position to Mormann. Wahlert stated that she did not agree with Godfrey’s recommendation that if Pals declined the job, the position should be offered to Mormann. Wahlert testified, however, that "[they] never had to have that discussion" about her disagreement with the recommendation because "it really wasn’t important unless [they] got to the point where [Godfrey] wanted to offer the job [to Mormann]." Wahlert further testified, "So, I never stated what my opinions were at that time." When asked to explain the basis for her disagreement with the recommendation that the position be offered to Mormann if Pals declined, Wahlert cited

statements that [Mormann] had made to people and during his interview that he thought he was going to retire. And so I was concerned that training and time would be invested and that perhaps more of a conversation needed to be had to be sure that the investment was appropriate for the long-term.

Wahlert’s September 2014 deposition was originally taken under seal. It became public, however, on March 18, 2015.

4. Mormann’s complaint with the ICRC. On May 4, Mormann filed a complaint with the ICRC. In his complaint, Mormann stated he was born in November 1956, making him fifty-seven years old at the time of his application for the deputy workers’ compensation commissioner position. Mormann challenged the decision of IWD and Wahlert not to hire him for the position.

Iowa Code section 216.15(13) states that "a claim ... shall not be maintained unless a complaint is filed with the commission within three hundred days after the alleged discriminatory or unfair practice occurred." Mormann recognized his complaint was filed more than 300 days after he received notice of the decision to hire another person as deputy workers’ compensation commissioner. Mormann, however, noted the ICRA authorized the ICRC to establish rules, and the ICRC had adopted Iowa Administrative Code rule 161—3.3(3) pursuant to its rulemaking authority. This rule provides,

By law the filing period described in subrule 3.3(1) and in Iowa Code subsection 216.15[ (13) ] is subject to waiver, estoppel, and equitable tolling. Whether the filing period shall be equitably tolled in favor of a complainant depends upon the facts and circumstances of the particular case. Equitable tolling suspends the running of the filing period during the period of time in which the grounds for equitable tolling exist.

Iowa Admin. Code r. 161—3.3(3).

Mormann argued he had no way to discover the age discrimination until after a district court "gag order" was lifted on March 18, 2015. Mormann claimed in his civil rights complaint that Wahlert intervened in the hiring decision but initially refused to explain the reason for rejecting Mormann for the position. Mormann, however, asserted Wahlert cited the fact that Mormann was too close to retirement as a basis for the decision. Wahlert did not advise Godfrey of her view on Mormann because it was not important unless it got to the point where Godfrey wanted to hire Mormann for the job. Given these facts, Mormann claimed the true reason he was not considered did not come out until Wahlert’s deposition was released on March 18.

Mormann attached exhibits to his complaint: (1) a news article dated March 18, 2015, stating that the depositions in the Godfrey matter were released; (2) a partial transcript of Wahlert’s deposition; (3) a partial transcript of Governor Terry Branstad’s deposition in the Godfrey matter; (4) the March 7, 2014 letter from Godfrey stating Mormann was not hired for the position of deputy commissioner but praising Mormann’s qualifications and urging him to apply if other positions become available; and (5) the February 19 email from Godfrey to Wahlert explaining the search committee’s recommendation of Pals over Mormann for the deputy workers’ compensation commissioner position.

In his complaint, Mormann sought reinstatement, back pay, front pay, attorneys’ fees, and damages for outrageous conduct. Mormann obtained a right-to-sue letter from the ICRC and filed an action in district court on March 28, 2016.

B. District Court Proceedings.

1. Overview of petition. Mormann’s district court petition alleged age discrimination in connection with the failure of IWD to offer him the deputy workers’ compensation commissioner position.¹ He alleged that since 1990, he had been employed as a deputy workers’ compensation commissioner or as an administrative law judge. At the time he was denied the job as deputy workers’ compensation commissioner, Mormann alleged he was employed as an administrative law judge in the unemployment appeals bureau of IWD. According to Mormann, however, he had held the position of deputy workers’ compensation commissioner twice before.

Mormann alleged the position of deputy workers’ compensation commissioner was given to "a younger candidate who had no prior experience in the role." He asserted Wahlert "not only influenced, but was directly involved in making hiring decisions" related to the deputy workers’ compensation commissioner position.

Mormann alleged the "real reason" he was denied the position surfaced only with the public release of Wahlert’s deposition on March 18, 2015. Prior to that date, according to Mormann, the deposition of Wahlert was subject to a "gag order" placed on participants in the hiring process which "Wahlert employed regarding the Deputy...