Paetz v. U.S.

• Decision Date: 11 August 1986
• Docket Number: No. 85-7346,85-7346
• Parties: 41 Fair Empl.Prac.Cas. 1682, 41 Empl. Prac. Dec. P 36,590 Robert PAETZ, Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1533

795 F.2d 1533

41 Fair Empl.Prac.Cas. 1682,

41 Empl. Prac. Dec. P 36,590

Robert PAETZ, Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee.

No. 85-7346.

United States Court of Appeals Eleventh Circuit.

Aug. 11, 1986.

Robert Sellers Smith, Smith, Huckaby & Graves, P.A., Huntsville, Ala., for plaintiff-appellant.

Frank W. Donaldson, U.S. Atty., Herbert J. Lewis, III, Asst. U.S. Atty., Birmingham, Ala., for defendant-appellee.

Appeal from the United States District Court for the Northern District of Alabama.

Before JOHNSON and HATCHETT, Circuit Judges, and ALAIMO ^*, Chief District Judge.

HATCHETT, Circuit Judge:

The principal issue presented in this appeal is whether a civil service employee had an age discrimination claim pending on May 1, 1974, the effective date of the amendment extending the Age Discrimination in Employment Act to federal employees. Finding that the claim was pending, we reverse.

I. Facts

The appellant, Robert Paetz, is a rocket expert who came from Germany to the United States in 1945 to work with Dr. Wernher Von Braun. After serving under a "Special Contract for Employment of German Nationals with the War Department in the United States," Paetz became a citizen and a federal employee in the United States Civil Service. In 1971, Paetz was subjected to a reduction-in-force (RIF). The government downgraded him from the position of AST Launch Vehicle Project Management, GS-15, to the position of AST Technical Management, GS-12. On July 12, 1972, Paetz's GS-12 position was terminated, and he was separated from the Civil Service. At the time of separation, Paetz was 63 years old and had accumulated 27 years of government service.

Paetz appealed both RIF actions to the Atlanta Regional Office, U.S. Civil Service Commission (CSC). ¹ The Commission denied both appeals. Paetz then appealed these denials to the Board of Appeals and Review (BAR) of the CSC. On April 23, 1973, the BAR issued its final adverse decision on the second appeal. On February 18, 1974, Paetz filed a petition with the CSC to reopen and reconsider the decision of the BAR regarding the 1971 RIF. On June 11, 1974, the CSC denied the petition.

On February 12, 1975, Paetz filed an action in the United States District Court for the Northern District of Alabama seeking judicial review of the 1971 and 1972 RIF decisions. On February 1, 1977, the district court denied the government's motion for summary judgment and remanded the case to the CSC for a new hearing. On May 20, 1977, during a preconference hearing in the Atlanta Regional Office, the CSC treated both of Paetz's appeals as rescinded and agreed to incorporate the record of the 1971 and 1972 appeals in the new proceeding. This action is important to the disposition of this appeal.

On July 22, 1977, the CSC notified Paetz that the order of the Atlanta Regional Office of December 12, 1972, was rescinded and the case remanded. On April 6, 1978, the Atlanta office issued decisions adverse to Paetz on both RIFs.

On July 19, 1979, the MSPB rescinded both April 6, 1978, decisions and remanded the cases to the Atlanta office. On June 1, 1981, the Atlanta office decided the cases against Paetz. After an appeal by Paetz, in an order dated March 1, 1984, the MSPB modified and affirmed the 1981 decision of the Atlanta field office. In the Order and Opinion, the MSPB advised Paetz of his right to have the case further adjudicated. ² In Paetz's original appeal to the CSC, he raised issues relating to the operation of a reduction-in-force, i.e., the definition of competitive levels and bumping rights. Paetz complained that the method of defining competitive levels failed to provide protection to senior employees. In his February 18, 1974, petition for the CSC to reopen and reconsider the BAR's decision on the 1971 RIF, Paetz complained about three matters. He complained about (1) being denied a veteran's preference, (2) the use of narrow competitive levels, and (3) the use of a subjective qualification test resulting in discrimination against "senior employees causing them to forfeit their bumping rights." In his February 12, 1975, district court lawsuit seeking judicial review of the RIF decisions, Paetz alleged that the government made no effort to establish reasonable competitive levels or to protect his bumping rights "solely because of his age and years of service." The chronology of Paetz's case is set out in the margin. ³

II. Action in District Court

In Paetz's complaint in district court, he challenged the 1971 and 1972 RIF actions. The complaint alleges (1) that the administrative process was procedurally unfair because of delay in adjudicating the claim, (2) that Paetz was downgraded and terminated because of improper selection procedures, and (3) that Paetz was downgraded and terminated unlawfully because of his age and length of service, in violation of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. Sec. 621 (1983).

The district court granted summary judgment for the United States. The court listed three grounds. First, Paetz never filed an administrative claim based on age discrimination. Second, if Paetz raised age discrimination in his RIF appeals, he did not have an administrative claim pending on the effective date of the 1974 amendments which extended the ADEA's coverage to federal employees. 29 U.S.C. Sec. 633a (1983). Third, if Paetz claimed age discrimination in his RIF appeals and if claims were pending on the effective date of the 1974 amendments, he failed to file a lawsuit within the time allowed by the applicable statute of limitations.

Paetz filed a Motion for New Trial or in the Alternative to Alter or Amend Judgment and Transfer Cause to the United States Court of Appeals for the Federal Circuit. On May 16, 1985, the district court denied the motion.

III. Issues

We must decide two issues: (1) whether the action is time-barred and (2) whether the district court has subject matter jurisdiction of Paetz's claim of age discrimination.

IV. Discussion

A. Statute of Limitations

Paetz filed this case within the statute of limitations period following the March 1, 1984, final decision. Limitations on claims against the United States do not commence to run until completion of the administrative process. Zidell Explorations, Inc. v. United States, 427 F.2d 735, 192 Ct.Cl. 331 (1970).

The government, however, contends that Paetz's lawsuit is time-barred because he filed the 1975 district court action late. The government seeks to set the commencement date for the statute of limitations as June 11, 1974, the date of the Civil Service Commission's final decision on Paetz's petition to reopen. The government argues that the thirty-day limit of 42 U.S.C. Sec. 2000e-16(c) should be applied to age claims where the claimant has pursued administrative proceedings and obtained a final decision. See Lehman v. Nakshian, 453 U.S. 156, 101 S.Ct. 2698, 69 L.Ed.2d 548 (1981) (holding that Congress patterned certain ADEA provisions after Title VII of Civil Rights Act of 1964).

We need not determine the date on which the applicable statute of limitations began to run. A statute of limitations defense is an affirmative defense. See Rule 8(c), Fed.R.Civ.P. Failure to assert such a defense in a defendant's pleadings is a waiver. See American National Bank v. FDIC, 710 F.2d 1528 (11th Cir.1983); Jones v. Miles, 656 F.2d 103, 107 n. 7 (5th Cir. Unit B 1981). The government did not plead a statute of limitations defense in 1975; the defense is waived.

B. Subject Matter Jurisdiction

Paetz contends that district court jurisdiction is based on 5 U.S.C. Sec. 7703(b)(2) (appeal from a final order of the MSPB in age discrimination cases), and on ADEA 29 U.S.C. Sec. 633a(c).

Without addressing whether 5 U.S.C. Sec. 7703(b)(2) is a grant of jurisdiction, the government contends that the district court's jurisdiction only arises under ADEA 29 U.S.C. Sec. 633a(c). The government argues that the district court lacks jurisdiction because Paetz did not have an age discrimination claim pending on May 1, 1974, the effective date of the ADEA amendments. The government cites Bunch v. United States, 548 F.2d 336 (9th Cir.1977) as support for this proposition. The government contends that because no allegation of discrimination is made, Paetz's claim is exclusively within the jurisdiction of the United States Court of Appeals for the Federal Circuit. See 28 U.S.C. Sec. 1295 and 5 U.S.C. Sec. 7703(b)(1).

We agree with that portion of the government's argument which states that Paetz's petition to reopen a final decision did not destroy the finality of the CSC's decision and transform it into a "pending" claim. The Administrative Procedures Act deems administrative action final for purposes of judicial review regardless of whether a petition for reconsideration is presented to the agency. See 5 U.S.C. Sec. 704; see also Clark v. Goode, 499 F.2d 130 (4th Cir.1975) (racial discrimination; petition to reopen filed subsequent to a final decision of the CSC does not convert a finally adjudicated administrative claim into a "pending" claim). Paetz's claim was not reopened or revived by the CSC before May 1, 1974, and was not pending within the meaning of Clark on May 1, 1974. Paetz's position, therefore, is similar to the plaintiff's position in Macellaro v. Goldman, 643 F.2d 813 (D.C.Cir.1980) (case closed before 1974 amendments not revived by post-1974 allegation of age discrimination).

Unlike the plaintiffs in Clark and Macellaro, however, Paetz received a final decision on the merits of his age discrimination claim through administrative processes on March 1, 1984, effective April 5, 1984. ⁴ Paetz cites 5 U.S.C. Sec. 7703(b)(2) (procedure for an appeal from a final order of the MSPB in age discrimination cases) as authority for the filing of this suit. We agree that section 7703(b)(2), read with 5 U.S.C. Sec. 7702(a)(3) supports the district court's...