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UPS Class Action Defense Cases–Taylor v. UPS: Fifth Circuit Reverses Dismissal Of Labor Law Class Action Holding Statutes Of Limitation Governing Class Action Claims Were Tolled During Appeal Of Related Class Action

Statutes of Limitation for Class Action Claims Against UPS were Tolled in Labor Law Class Action during Appeal from Summary Judgment in Favor of UPS in Certified Class Action Alleging Related Claims Fifth Circuit Holds

Plaintiff filed a class action against his former employer, United Parcel Service, alleging labor law violations; the class action complaint asserted that UPS discriminated against its employees on the basis of race. Taylor v. United Parcel Service, Inc., ___ F.3d ___, 2008 WL 5401487, *1 (5th Cir. December 30, 2008). Plaintiff worked for UPS from 1975 to 2004, during which time he was member of class action lawsuit that had been filed in 1994. Id. The 1994 class action alleged that UPS engaged in race discrimination; plaintiff “was a member of the pay and promotion class and gave deposition testimony on behalf of the class” in a class action that was dismissed on UPS’s motion for summary judgment in June 2000 and affirmed by the Eighth Circuit in August 2004. Id. (citing Morgan v. United Parcel Service of America, Inc., 143 F.Supp.2d 1143 (E.D.Mo. 2000), aff’d, 380 F.3d 459 (8th Cir. 2004), cert. denied, 544 U.S. 999 (2005)). In January 2003, during the pendency of the appeal in the prior class action, plaintiff filed a Title VII charge with the Equal Employment Opportunity Commission, and in March 2003, plaintiff filed the present putative class action “alleging that UPS had denied him promotion on the basis of race and retaliation since at least 1993, denied him equal pay on the basis of race and retaliation since November 1991, and provided a hostile work environment.” Id. As the Fifth Circuit explained, “The biggest difference between the claims asserted in the Morgan class action [filed in 1994] and this suit is [plaintiff’s] addition of the retaliation claims, which allegedly are related to his participation in Morgan.” Id. Defense attorneys moved for summary judgment as to all of the class action claims; the district court granted the motions as to the promotion and hostile work environment claims, but denied the motions as to plaintiff’s discriminatory and retaliatory pay disparity claims. Id., at *2 (citing Taylor v. United Parcel Service, Inc., 421 F.Supp.2d 946, 956 (W.D.La. 2006)). Plaintiff appealed, and the Fifth Circuit reversed.

The Fifth Circuit explained that its statute of limitations analysis played a “central part” in the district court’s decision to toss out of the class action complaint. Taylor, at *2. Specifically, “[t]he district court found that tolling ceased on [plaintiff’s] claims in 2000, when the Eastern District of Missouri dismissed the Morgan class claims, rather than in 2004, when the Eighth Circuit affirmed that dismissal”; based on that conclusion, all of plaintiff’s promotion claims in the current class action were time-barred to the extent they arose prior to March 2002. Id. (For reasons we do not here discuss, the district court found that plaintiff’s post-March 2002 promotion claims failed on the merits. See id.) With respect to the “retaliatory promotion” claims, the district court entered summary judgment in favor of UPS because plaintiff presented no evidence that the decision makers at UPS knew of his role in the Morgan class action, and that the time between plaintiff’s involvement in the 1994 class action and the March 2002 pay period “was simply too long to independently support an inference of causation.” Id. Finally, the lower court rejected the class action’s “hostile work environment” claim, and held that the four-year statute of limitations barred the class action’s discriminatory and retaliatory pay claims. Id., at *2-*3. Plaintiff challenged on appeal the district court’s ruling only as to the promotion and pay disparity claims, but not the hostile work environment claim. Id., at *3.

The Circuit Court stated that “[t]he most important question before us is the extent to which the Morgan class action tolled the statute of limitations governing [plaintiff’s] claims.” Taylor, at *3. The bulk of the Fifth Circuit’s analysis is devoted to this issue. See id., at *3-*9. The key issue was whether the current class action claims were tolled from the date the 1994 class action was filed until the date the Missouri federal court dismissed that class action, or whether the present class action claims were tolled through the date on which the Eighth Circuit affirmed dismissal of the 1994 class action. Id., at *3. Starting from “the bedrock premise that a party who sues on a cause of action tolls the statute of limitations during the entire prosecution of the action, including the prosecution of any appeal,” id., at *4, and relying on the seminal cases of American Pipe & Construction Co. v. Utah, 414 U.S. 538 (1974) and Crown, Cork & Seal Co. v. Parker, 462 U.S. 345 (1983) – “the two most prominent Supreme Court cases concerning tolling in connection with the denial of class certification,” id., at *5, the Circuit Court found it “clear” that the tolling of any statutes of limitation ends once the district court denies class action certification, id., at *6.

Nonetheless, and relying on the Third Circuit’s decision in Edwards v. Boeing Vertol Co., 717 F.2d 761 (3d Cir. 1983), vacated on other grounds, 468 U.S. 1201 (1984), the Fifth Circuit found the present class action presented a different issue because the Morgan class action did not involve denial of class action treatment; rather, the district court granted conditional class action treatment to the 1994 class action, and then ruled against the plaintiffs on the merits. See Taylor, *1-*3. In the Fifth Circuit’s opinion, “because the Morgan district court did not deny class certification, American Pipe, Crown, Cork & Seal, and Calderon are inapposite.” Id., at *9. Plaintiff “remained a member of a certified class while Morgan was on appeal,” so “he was entitled to assume that the class representatives continued to represent him and protect his interests in appealing the order dismissing the class claims on the merits.” Id. Accordingly, the applicable statutes of limitation were tolled until the Eighth Circuit affirmed the dismissal of the Morgan class action. Id. The Circuit Court therefore reversed the judgment and remanded the class action to the district court, id., at *12.

NOTE: We do not here discuss the Fifth Circuit’s analysis of the merits of plaintiff’s claims other than to note that it concluded plaintiff had established a prima facie case of discriminatory and retaliatory pay disparities. See Taylor, at *10-*12.

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