Workplace Class Action Blog

Time’s Up! Second Circuit Holds That Filing Of EEOC Charge Does Not Toll Limitations Period For State-law Tort Claims

Posted in Class Action Litigation

By Gerald L. Maatman Jr. and Howard M. Wexler

The end of daylight savings is not the only reason why employers within the Second Circuit need to be paying extra close attention to their clocks. It is not uncommon for an employer faced with a lawsuit alleging unlawful discrimination, harassment, or retaliation to be sued as well under state tort law claims arising out of the same factual circumstances, e.g,. intentional infliction of emotional distress, negligent hiring/retention, assault and battery. The U.S. Court of Appeals for the Second Circuit recently held in Castagna, et al. v. Bill Lucino, Majestic Kitchens, Inc., No. 13-0796 (2d Cir. Mar. 5, 2014), that “as a matter of federal law that the filing of charge of discrimination with the Equal Employment Opportunity Commission (“EEOC”) does not toll the statute of limitations period for state-law tort claims, even for those alleging claims arising out of the same factual circumstances as the discrimination alleged in the EEOC Charge.” Id. at 2. In so holding, the Second Circuit joined the Seventh and Ninth Circuits on this issue.

This ruling is important for employers in single plaintiff as well as workplace class action litigation.

Background

In Castagna, an employee resigned from her receptionist position after she alleged the owner of the company screamed at her and subsequently shoved her computer monitor at her. Id. at 3-4. Approximately three months later the employee brought an EEOC charge alleging discrimination based on her sex, and included as relevant evidence the shoving of the computer monitor. Id. at 4. The employee received a right-to-sue letter from the EEOC on August 14, 2009, and then filed a lawsuit in federal court on November 9, 2009. Id.

In her complaint, the employee alleged discrimination under Title VII as well as claims of intentional infliction of emotional distress, assault, and battery under New York state law. Id. Defendant filed a motion to dismiss her three New York-based tort claims on grounds that they were barred by the applicable one year statute of limitations. Id. In opposition, the employee argued that the one year limitations period was tolled by the filing of her EEOC charge. Id. The District Court rejected this argument and dismissed the claims as time-barred. Id.

The Second Circuit’s Decision

The employee argued that if the statute of limitations period were not tolled pending the filing of an EEOC charge, she would have been forced to file suit in state court to preserve her tort claims, and then bring a federal discrimination claim upon the conclusion of the EEOC’s investigation. Id. at 5. The employee argued that such a scheme does not comport with notions of judicial economy, which mandates the tolling of the relevant limitations period once an EEOC charge is filed. Id. at 6.

The Second Circuit noted that the only two federal courts of appeals to previously address this issue – the Seventh and Ninth Circuits – rejected the argument that the filing of an EEOC charge tolls the limitations period for state law tort claims. Id. In agreeing with the Seventh and Ninth Circuits, the Second Circuit reasoned that Congress did not intend for the EEOC process to “delay independent avenues of redress” and there is “no basis for concluding that Congress intended that a civil rights claimant should be entitled to delay filing any state law tort claims during the EEOC’s consideration of a charge of discrimination. Id. at 9. The Second Circuit therefore upheld the dismissal of the time-barred state law tort claims. Id. at 9-10.

Implications For Employers

Given that the Second, Seventh, and Ninth Circuits have all reached the same conclusion, employers – especially those within the jurisdiction of these three Circuits – have reason to feel confident that courts will not accept arguments by plaintiffs to toll the limitations period of state law claims simply because an individual has filed an EEOC charge.  It is possible that as a result of this decision employees may file lawsuits to preserve their state law based claims during the pendency of the EEOC process. However, one thing for certain is that employers should carefully review all state law causes of action in a discrimination lawsuit filed after the issuance of a right-to-sue letter since it is very possible that the limitations period on some of these state law claims may have already expired and thus moving to dismiss them might make sense depending on the possible damages that are available under such state laws.