Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

SCHULTZ v. TEXACO INC

January 3, 2001

ALTON C. SCHULTZ, JR., ELAINE B. JACKSON, GLADYS CRIDDLE, AND HAROLD J. WEBER, JR., INDIVIDUALLY AND ON BEHALF OF A CLASS OF OTHERS SIMILARLY SITUATED, PLAINTIFFS,
v.
TEXACO INC., TEXACO EXPLORATION AND PRODUCTION, INC., THE RETIREMENT PLAN OF TEXACO, INC., THE EMPLOYEE THRIFT PLAN OF TEXACO, INC., TEXACO COMPREHENSIVE MEDICAL PLAN, TEXACO DENTAL ASSISTANCE PLAN, SHORT-TERM DISABILITY PLAN OF TEXACO, INC., LONG-TERM DISABILITY PLAN OF TEXACO, INC., TERM LIFE INSURANCE PLAN OF TEXACO INC., GROUP ACCIDENT PLAN OF TEXACO INC., JANET L. STONER, PETER I. BIJUR, A. CHARLES BAILLIE, MARY K. BUSH, EDMUND M. CARPENTER, MICHAEL C. HAWLEY, FRANKLYN G. JENIFER, SAM NUNN, CHARLES H. PRICE, II., CHARLES R. SHOEMATE, ROBIN B. SMITH, WILLIAM C. STEERE, JR., AND THOMAS A. VANDERSLICE, DEFENDANTS.



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

BACKGROUND

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 reclassifications.

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.

DISCUSSION

I.

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:

29 U.S.C. § 1140.

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 ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.