Wamsley v. Champlin Refining and Chemicals, Inc.
| Citation | 11 F.3d 534 |
| Decision Date | 30 December 1993 |
| Docket Number | No. 92-1743,92-1743 |
| Parties | 63 Fair Empl.Prac.Cas. (BNA) 821, 63 Empl. Prac. Dec. P 42,758, 62 USLW 2408 Allen M. WAMSLEY, Donald J. Whittenberg, Anthony J. Nagy, Betty R. Sanderson and Glenda K. Bennett, Plaintiffs-Appellants, v. CHAMPLIN REFINING AND CHEMICALS, INC., et al., Defendants, Champlin Refining and Chemicals, Inc., et al., Defendants-Appellees. |
| Court | United States Courts of Appeals. United States Court of Appeals (5th Circuit) |
Robert Edward Goodman, Jr., Fults, Francis & Goodman, Dallas, TX, for plaintiffs-appellants.
Susan L.P. Starr, EEOC, Washington, DC, for amicus curiae EEOC.
Stanley Weiner, Janet A. Hendrick, Jones, Day, Reavis & Pogue, Dallas, TX, for Champlin, Citgo and Termination Pay Plan.
Ann Elizabeth Reesman, McGuiness & Williams, Washington, DC, for amicus curiae EEAC.
James Baird, Seyfarth, Shaw, Fairweather & Geraldson, Chicago, IL, for amicus curiae NPELRA.
Appeal from the United States District Court for the Northern District of Texas.
Before JONES and DeMOSS, Circuit Judges, and BARBOUR, District Judge 1.
We are called upon in this case to determine whether the waiver requirements of the Older Workers Benefit Protection Act 2 (the "OWBPA"), make our holding in Grillet v. Sears Roebuck & Co., 927 F.2d 217 (5th Cir.1991), unsound. Because we conclude that nothing in the text or the legislative history of the OWBPA evidences a congressional intent to disturb the common law principles to which our holding in Grillet is anchored, the district court's judgment is affirmed.
Appellants are former employees of Champlin Refining & Chemicals, Incorporated ("Champlin") or one of its predecessors-in-interest. In September of 1990, Champlin informed its Irving, Texas office employees that at the end of the year Champlin would become a wholly owned subsidiary of Citgo Petroleum Corporation. Champlin explained that as a result, the Irving office was to be closed and several of its employees were going to lose their jobs. Champlin also explained that it was initiating a "Termination Pay Plan" (the "Plan") for the benefit of those employees whose employment would be terminated. In October, Champlin circulated a copy of the Plan to all of its employees, including Appellants.
In November and December, Champlin informed Appellants that they were among the employees who were going to be "let go." Champlin provided them with a "Notice Pertaining to Release of Claims" document and a "Release of Claims" agreement. 3 The notice included the following provision:
Although you may execute the Release of Claims as soon as you wish, you also may take up to 45 days from your receipt of the Release of Claims to consider it. Your decision to execute the Release of Claims and accept benefits under the Termination Pay Plan will be revocable for seven days after execution, and no payment of termination pay will be made until that period has expired. Therefore, to be able to provide your termination pay to you not later than five business days after the termination of your employment, the Company must receive your executed Release of Claims at least seven days before that payment date.
The release provided for Appellants' waiver of any action or claim against Champlin and "its successors, assigns, [and] affiliates,"
"relating to or arising out of [their] employment with [Champlin] ... or the termination of such employment, including but not limited to, claims for ... age discrimination under ... the Age Discrimination in Employment Act of 1967." The release made clear that the benefits to be paid under the Plan constituted the consideration for the releaseEach of the appellants executed a release, and in return, Champlin paid Appellants severance benefits. 4 It is undisputed that Appellants would not have otherwise been entitled to receive these benefits; such benefits were paid strictly as consideration for their release of Champlin.
In April of 1991, Wamsley, Whittenberg, Nagy, and Sanderson sent Champlin a letter threatening suit under the ADEA. 5 Later that year, in May, each of the aforementioned appellants filed charges against Champlin for age discrimination with the Equal Employment Opportunity Commission. 6 In January of 1992, their releases notwithstanding, Appellants filed suit against Champlin, Citgo and the Plan (collectively referred to as "Champlin") alleging that it had unlawfully discriminated against them on the basis of age when it terminated their employment and denied them certain benefits under the Plan.
They also alleged that their releases were "void or voidable" due to duress and Champlin's failure to comply with one of the conditions of the OWBPA. Appellants contended that Champlin had failed to provide them 45 days to consider the release as required under the OWBPA, and thus, the releases were not "knowing and voluntary" within the meaning of the section 626(f)(1) of the ADEA.
Champlin answered the suit with a motion to dismiss. It argued that the releases were valid under the OWBPA and relied on the above-quoted portion of the notice document as proof that Champlin had provided its employees the 45-day consideration period. It also tendered affidavits specifically denying that Appellants were told to execute and return the release prior to the expiration of the 45-day period. Champlin explained that it had simply told its employees that they could avoid an interruption in payroll if they returned the executed releases before their termination date.
Champlin also averred that Appellants had not returned or offered to return the severance benefits they received as consideration for the releases. Thus, Champlin argued that even if the court was unable to determine as a matter of law that Champlin had provided the 45-day consideration period, the court should hold that Appellants had ratified the releases and dismiss their claims.
Appellants responded to Champlin's motion and proof by tendering affidavits in which each swore to facts surrounding their termination and execution of the release. Appellants claimed to have been told by certain individuals in the Champlin organization that they had to sign and return the release by their termination date, less than 45 days after receiving the notice, in order to receive benefits under the Plan.
On August 14, 1992, the district court granted Champlin judgment and dismissed Appellants' suit. The court held that the releases were knowing and voluntary within the meaning of the ADEA and, thus, barred Appellants' suit. The court alternatively held that even if the releases were not valid when executed, Appellants had ratified the agreements by failing to return to Champlin the benefits they had received as consideration after learning of the releases' alleged invalidity.
Appellants appeal, raising two general contentions. They argue first, that fact issues
exist regarding the knowing and voluntary nature of their releases. They also contend that the doctrine of ratification has no application in this suit. Although we agree with Appellants' first contention, we reject their second. The district court's judgment is, therefore, affirmedCongress, through enactment of the OWBPA, has determined that employers must afford their employees the right to consider for 45 days whether they should waive any rights or claims vis a vis the ADEA in exchange for benefits under a group termination program. 29 U.S.C. Sec. 626(f)(1)(F)(ii). Appellants contend, inter alia, that Champlin denied them this right. Champlin responds by arguing that it complied with the 45-day requirement and pointing to the "Notice Pertaining to Release of Claims" document as proof. Appellants counter by swearing that the information contained therein was orally countermanded by certain persons at Champlin. Champlin, of course, denies that Appellants were told anything of the sort.
Which version accurately describes Champlin's dealings with Appellants is an issue that cannot be resolved by the court through summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-55, 106 S.Ct. 2505, 2510-11, 91 L.Ed.2d 202 (1986). We are unable to conclude, therefore, that Appellants' releases were "knowing and voluntary" under the OWBPA. Although we recognize that Appellants have managed to create a fact issue on this point, we consider the issue to be immaterial in light of our conclusion that Appellants have ratified their releases as a matter of law.
Appellants do not dispute that they have neither returned nor offered to return the benefits they received as consideration for the releases. Rather, Appellants argue that the law does not require them to make such a tender in order to pursue claims under the ADEA. In taking this position, Appellants press two arguments. They first contend that the OWBPA has effectively overruled our decision in Grillet v. Sears, Roebuck & Company. In Grillet, the court held that when an employee agrees to release her employer from liability under the ADEA and receives benefits as consideration for the agreement, the employee ratifies the agreement if she retains the consideration after learning that the release is voidable. 927 F.2d at 220. Appellants alternatively argue that Grillet was erroneously decided and should be overruled. We treat each argument in turn.
Appellants contend that "[t]he language and purpose of the OWBPA preclude ratification of a release otherwise in violation of the OWBPA." The language upon which Appellants rely states that an individual "may not " waive any ADEA claim unless the waiver is knowing and voluntary within the meaning of section 626(f)(1) of title 29. (emphasis Appellants') Appellants read this language to mean that any waiver failing to meet one of the requirements under section 626(f)(1) is not simply voidable, but void and, therefore, unable to be ratified.
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