The opinion of the court was delivered by: Parker, Judge
AMENDED DECISION AND ORDER
In this ERISA action, Plaintiffs are former employees of Texaco, Inc.
("Texaco") and Texaco Exploration and Production, Inc. ("TEN"), who were
hired directly by Texaco or TEPI and then reclassified as independent
contractors in the early 1990's. The plaintiffs bring this putative class
action under various provisions of the Employee Retirement Income
Security Act of 1974, 29 U.S.C. § 1001, et seq. ("ERISA"). They
allege that defendants Texaco, members of its Board of Directors, TEPI,
and Janet L. Stoner, the benefit plans administrator, (collectively, "the
defendants") violated ERISA by unlawfully failing to include them in
various Texaco ERISA plans after they were improperly reclassified as
independent contractors or temporary employees.*fn1
The four plaintiffs are Alton C. Schultz, Jr., Elaine B. Jackson,
Gladys Criddle, and Harold J. Weber, Jr. Alton Schultz was hired by TEPI
in May 1991 as an "Independent Petroleum Landman". Two months later in
July 1991 he began receiving his paychecks from a temporary agency called
Metro Careers, Inc. and subsequently received paychecks from other
temporary agencies. He worked at various Texaco facilities until January
28, 1999. Schultz alleges he learned of a benefits suit by ARCO
Corporation employees in June of 1999 and soon thereafter filed a request
with Texaco for benefits. Texaco denied his request.
Elaine Jackson was hired by TEPI in October 1990 as an "Oil and Gas
Lease Analyst". In July 1991, she was informed that Metro Careers would
handle her payroll. She continued to work at Texaco until March of 1995
when she was released. She was rehired as an "Oil and Gas Lease Analyst"
in July 1996, received her paychecks through Kelly Temporary Services,
and ceased working for Texaco in February 1999. She alleges that she too
learned of the suit by ARCO employees in June 1999 and then filed a
request for benefits from Texaco which was denied.
Gladys Criddle was hired by TEPI in late 1990 as a well spotter. At
some point subsequent to her hiring, she began receiving checks from a
temporary employment agency called Norrell. She continued to work at
Texaco until January 1999. She does not allege that she requested
information about Texaco benefit plans.
Harold Weber first worked for Texaco between 1966 and 1984, when he
resigned to pursue other employment. In March 1991, Texaco rehired Weber
as an "independent landman" on a per diem basis. In July 1991, Metro
Careers began paying Mr. Weber. He worked at Texaco until February 1999.
Mr. Weber then requested various benefits from Texaco and was ultimately
denied them in January 2000.
The plaintiffs allege that they were transferred from Texaco and TEPI
to various temporary agencies and, although they received checks from
these agencies, no other substantive changes occurred in their employment
status. They allege that they were provided office space, tools, and
Texaco equipment. They were paid by the hour, had their time sheets
approved by Texaco and reported to Texaco when sick or on vacation. They
allege that they received training and professional education from
Texaco, performed work directly for Texaco and were supervised in their
daily activities by Texaco employees. The plaintiffs maintain that, even
if they were no longer directly on Texaco or TEPI's payroll, they were
nonetheless "common law" employees, despite Texaco's decision to treat
them as independent contractors or leased employees.
The action was commenced in January 2000. On March 24, 2000, the
plaintiffs filed a Second Amended Complaint although, as previously
noted, in June 2000 certain defendants and claims were voluntarily
dismissed. The current complaint alleges that: (a) the defendants
breached their fiduciary duties under Section 502(a)(3) by
mis-classifying the plaintiffs as independent contractors; (b) the
defendants improperly denied ERISA benefits under Section 502(a)(1)(B);
(c) the defendants refused to supply benefit information in violation of
Section 502(c); (d) their reclassification was a deliberate attempt to
interfere with plaintiffs' rights to benefits in violation of ERISA
section 510; and (e) the defendants violated state law. The Plaintiffs
also seek injunctive relief under Section 409 and Section 502(a)(3)
reclassifying them as employees with full ERISA benefits, and preventing
Texaco and TEPI from making similar allegedly improper
In April 2000, Texaco moved to dismiss the Second Amended Complaint
pursuant to Fed.R.Civ.P. 12(b)(1) and 12(b)(6), on the grounds that
various claims are time-barred or are otherwise legally insufficient.
Specifically, the defendants seek to dismiss the claims based on ERISA
Sections 510, 502(a)(1)(B), 502(a)(3), and 502(c). For the reasons stated
below, the motion is granted in part and denied in part.
The plaintiffs first claim violations of Section 510 of ERISA,
29 U.S.C. § 1140. In relevant part, Section 510 makes it unlawful for
an employer to:
Plaintiffs argue that the defendants violated Section 510 when they
removed plaintiffs from Texaco or TEPI's payrolls and reclassified them
as independent workers or leased employees since the purpose of this
shift was to interfere with their attainment of ERISA rights.
Defendants contend that the claim is time-barred. Section 510 does
not expressly contain a statute of limitations. However, our Circuit has
held that the statute of limitations for Section 510 claims is the
analogous two-year state statute of limitations for causes of action in
violation of New York Worker's Compensation Law Section, 120. Sandberg
v. KPMG Peat Marwick, LLP, 111 F.3d 331, 336 (2d Cir. 1997).
It is undisputed that the last time the plaintiffs received checks
directly from Texaco or TEPI was in 1990 or 1991 when they were
classified or reclassified as employees of various temporary agencies.
However, the plaintiffs did not assert their Section 510 claim until
January of 2000, almost seven years later.
The plaintiffs argue that the Court should equitably toll the
limitations period because the conduct of the defendants in continuing to
mistakenly classify them amounts to a continuing violation of the
statute, or, in the alternative, the Court should equitably toll the
limitations period for the Section 510 and 502(a)(1)(B) claims because
the defendants' concealment of plaintiffs' eligibility for ERISA benefits
prevented them from discovering their injury.
Neither of these arguments is persuasive. First, no continuing
violation occurred. The plaintiffs, according to the Second Amended
Complaint, were misclassified in discrete, singular actions in 1990 or
1991. Furthermore, plaintiffs do not allege or identify any ongoing,
discriminatory policy, or series of discriminatory acts, as required for
the continuing violation doctrine to apply. Accordingly, the Title VII
cases cited by plaintiffs in which a discriminatory policy or a series of
discriminatory acts were alleged are inapposite.
Specifically, plaintiffs allege a single "erroneous classification"
in late 1990/early 1991 which "continued to interfere with [their]
attainment of employment benefits . . ." (2d Amd.Complaint, ¶ 118).
However, the mere fact that the effects of a single, wrongful act
continue to be felt over a period of time does not render that single,
wrongful act a "continuing violation." See, e.g., Tolle v. Carroll
Touch, Inc., 977 F.2d 1129, 1138-41 (7th Cir. 1992). See also Lightfoot
v. Union Carbide Corp., 110 F.3d 898, 907-908 (2d Cir. 1997); Hudson v.
Delphi Energy and Engine Management Systems, Inc., 10 F. Supp.2d 256, 259
(W.D.N.Y. 1998). Indeed, if accepted by the Court, plaintiffs'
interpretation of the continuing violation doctrine would lead to the
illogical result that no ...