United States District Court, Southern District of New York
April 11, 2003
ROSA BACHILLER, PLAINTIFF,
TURN ON PRODUCTS, INC. D/B/A YOUNIQUE KNIT, INC., AND DESIREE RAGABEER, DEFENDANTS.
The opinion of the court was delivered by: John S. Martin, United States District Judge
OPINION & ORDER
In this action, Rosa Bachiller ("Plaintiff") alleges that Turn On Products, Inc. ("Turn On" or "Defendant") and Desiree Ragabeer ("Ragabeer" or "Defendant") discriminated against her violation of Section 1981 of the Civil Rights Act of 1866, 42 U.S.C. § 1981, the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq., the New York State Human Rights Law, Executive Law §§ 290 et seq., and the New York City Human Rights Law, Administrative Code §§ 8-101 et seq.
Plaintiff alleges that Defendants discriminated against her during her employment at Turn On and unlawfully terminated her employment there on the basis of her race and/or national origin and her age.
This case is presently before the Court on Defendants' motion for summary judgment. For the reasons set forth below, Defendants' motion is granted.
Plaintiff is Puerto Rican and was 54 years old at the time she was discharged. She came to the United States at age four and eventually obtained a High School Equivalency Diploma.
Plaintiff commenced employment at Turn On on July 1, 1997 as an accounts payable clerk and was discharged on October 9, 1999. On that date, Ragabeer, Turn On's Office Manager, informed Plaintiff of her termination and provided her with a written agreement releasing all claims Plaintiff may have against Turn On and its agents (the "Release") and a notice letter (the "Notice"). The Notice, which is addressed to Plaintiff, acknowledges the provision of three copies of the Release to her and establishes her rights with respect to the Release, stating:
Please note, as stated in the Release Agreement, that
you have the right to consult with an attorney and 21
days from this date to review the Release Agreement.
Additionally, if you decide to execute the attached
Release Agreement, you will have seven (7) days
following the execution of the Release Agreement
to revoke the same.
(emphasis added). Plaintiff acknowledged receipt of the Notice and the Release by signing the Notice. The Release is a four-page typewritten document which provides that Plaintiff will receive a severance pay of $1,400 if she signs it. Although the Release acknowledges that Turn On owes Plaintiff one week's vacation pay, amounting to $700, it does not make receipt of that amount contingent on the execution of the Release:
2. Severance Pay. (a)(i) Bachiller acknowledges that
the Company has no obligation to make the Severance
payment set forth hereunder. In consideration of
Bachiller entering into this agreement, together
with its Release, Confidentiality, Non-Disparagement
and other provisions, the Company agrees to pay
Thousand Four Hundred Dollars ($1,400.00) less any and
all appropriate Federal, State and City taxes
required to be deducted (the "Severance
Payment"). The Severance Payment will be paid to
Bachiller provided she has not exercised her right to
cancel this Agreement under Article 5 of this
(ii) Additionally, the Company acknowledges that it
owes Bachiller one (1) week's vacation pay of Seven
Hundred Dollars ($700.00), which will be paid to
Bachiller by the Company minus the appropriate
(b) This will confirm that the Company shall have
absolutely no obligation to make the Severance
Payment set forth in 2(a)(i) above and Bachiller shall
not be entitled to any Severance Payment unless and
until this Agreement with its Release and
Confidentiality provisions and Non-Disparagement is
deemed effective and enforceable as stated above.
The Release also sets forth in detail the claims and causes of action that Plaintiff would relinquish if she signed the Release:
Bachiller hereby irrevocably and unconditionally
releases, waives and forever discharges the Company
and its successors, assigns, and all its past and
present directors, officers, shareholders,
consultants, agents, employees, representatives,
attorneys, fiduciaries (hereafter the "Other
Releasees") from any and all actions, causes of
action, claims, demands, damages, right, remedies and
liabilities (hereinafter referred to collectively as
"Bachiller's Claims") of whatsoever kind or
character, in law or equity, suspected or
unsuspected, past or present, that she has ever had,
may now have or may later assert, against the Company
and the other Releasees or any of them, including, but
not limited to, claims arising out of or related to
Bachiller's employment and positions with the Company
or her termination of employment and those positions,
from the beginning of time to the last time of
Bachiller's employment, including, without
limitation: (i) any and all claims arising from any
federal, state and/or local labor or civil rights
laws, including, without limitation, the federal Civil
Rights Acts of 1866, 1871, 1964 and 1991, the Age
Discrimination in Employment Act of 1967, as amended
by, inter alia, the Older Worker Benefit Protection
Act of 1990 . . . and New York State and New York City
Human Rights laws and Labor Laws . . .; (ii) any and
all claims arising out of any claim for . . . any
age, sex, race or other type of discrimination or
harassment or related claims, including federal, state
and/or local laws.
Plaintiff signed the Release on the day she was discharged and claims she did so because Ragabeer told her she had to sign it in order to receive her vacation pay. Plaintiff consulted an attorney sometime after her discharge. On or about October 22, 1999, Plaintiff's attorney contacted Turn On seeking to revoke the Release. The seven-day time period permitting revocation had already expired.
Defendants contend that Plaintiff waived the claims asserted in this action by executing the Release. Plaintiff argues that the Release is invalid because Defendants did not provide her with adequate time to consider the agreement.
Under the Older Workers' Benefit Protection Act of 1990 ("OWBPA"), 29 U.S.C. § 626(f), an individual's waiver of claims under the Age Discrimination in Employment Act of 1967 ("ADEA") must comply with the following requirements:
(A) the waiver is part of an agreement between the
individual and the employer that is written in a
manner calculated to be understood by such
individual, or by the average individual eligible to
(B) the waiver specifically refers to rights or claims
arising under this chapter;
(C) the individual does not waive rights or claims
that may arise after the date the waiver is executed;
(D) the individual waives rights or claims only in
exchange for consideration in addition to anything of
value to which the individual already is entitled;
(E) the individual is advised in writing to consult
with an attorney prior to executing the agreement;
(F)(i) the individual is given a period of at least 21
days within which to consider the agreement;.
(G) the agreement provides that for a period of at
least 7 days following the execution of such
agreement, the individual may revoke the agreement,
and the agreement shall not become effective or
enforceable until the revocation period has
expired . . .
The Release is typewritten and plainly informs Plaintiff in clear language of her rights. The Release specifically refers to the ADEA and other civil rights causes of action and applies only to existing claims. Plaintiff executed the Release in exchange for severance pay, compensation to which she was not otherwise entitled. Plaintiff was advised in writing in the Notice to consult an attorney. The Release and the Notice also informed Plaintiff that she had 21 days to review the agreement and that if she signed the agreement, she had 7 days to revoke it.
Despite the plain terms of the Release and its provision of 21 days to consider the agreement, Plaintiff argues that the Release is not valid because she was not "given at least 21 days to consider the agreement before signing it." Plaintiff cannot reasonably make this claim when the Notice, which Plaintiff signed before signing the Release, clearly advised her that she had 21 days to consider the Release. The Release is valid under the OBWPA and Plaintiff is therefore barred from bringing federal age discrimination claims against Defendants.
In determining the validity of a release of claims brought pursuant to federal civil rights statutes other than the ADEA, the inquiry is whether under the "totality of the circumstances," the individual's waiver of his rights can be considered knowing and voluntary. Bormann v. AT&T Communications, Inc., 875 F.2d 399 (2d Cir. 1989); Livingston v. Adirondack Beverage Co., 141 F.3d 434 (2d Cir. 1998); Nicholas v. NYNEX, 929 F. Supp. 727 (S.D.N.Y. 1996). The following factors must be considered in determining the validity of a release:
1) the plaintiff's education and business experience,
2) the amount of time the plaintiff had possession of
or access to the agreement before signing it, 3) the
role of plaintiff in deciding the terms of the
agreement, 4) the clarity of the agreement, 5) whether
the plaintiff was represented by or consulted with an
attorney, . . . 6) whether the consideration given in
exchange for the waiver exceeds employee benefits to
which the employee was already entitled by contract or
law,  whether (the] employer encourages or
discourages [the] employee to consult an
attorney . . . and  whether the employee had a fair
opportunity to do so.
Bormann at 403. These factors are not exhaustive, nor must they all be satisfied. See Nicholas at 730. The typewritten Release here and its accompanying Notice clearly and plainly inform Plaintiff that if she signs the Release, she will be barred from bringing any claim against Defendants based on the conditions or termination of her employment. Plaintiff, who has a High School Equivalency Diploma and who at the time her employment was terminated was an accounts payable clerk, was capable of understanding the Release and the Notice. Plaintiff was not otherwise entitled to the severance pay which was offered in exchange for execution of the Release. The Notice accompanying the Release clearly advises Plaintiff of her right to consult an attorney and Plaintiff does not allege that Defendants discouraged her from obtaining an attorney. Plaintiff had a fair opportunity to review the agreement and speak with an attorney before signing it. The fact that Plaintiff signed the agreement immediately after her termination, that she did not have a role in deciding its terms and that she was not represented by counsel at the time she signed the agreement do not change the fact that the totality of the circumstances here overwhelmingly weigh in favor of upholding the validity of the Release. Plaintiff's waiver of the civil rights claims alleged in this action was knowing and voluntary.
The "totality of the circumstances" standard "is somewhat more stringent than the analysis called for under ordinary [New York State] contract law, for determining whether a release of discrimination claims was executed knowingly and voluntarily." Nicholas v. NYNEX, Inc., 929 F. Supp. 727, 730 (S.D.N.Y. 1996). Accordingly, since Plaintiff has waived her federal claims, she has also waived her claims under New York State and New York City Human Rights Law. See Laramee v. Jewish Guild for the Blind, 72 F. Supp.2d 357, 360 (S.D.N.Y. 1999).
To the extent Plaintiff argues that she signed the Release under conditions of duress, that claim is without merit. The elements of a claim of economic duress under New York law are: "1) a threat, (2) which was unlawfully made, and (3) caused involuntary acceptance of contract terms, (4) because the circumstances permitted no other alternative." Kamerman v. Steinberg, 891 F.2d 424, 431 (2d Cir. 1989). Plaintiff claims that Ragabeer told her she had to sign the Release to get her vacation pay. Even if the Defendants unlawfully conditioned receipt of this compensation on the execution of the Release, Plaintiff has not shown that she lacked a practical alternative to signing the agreement immediately after her discharge. Plaintiff had 21 days to consider the agreement and consult an attorney before signing it even if the Defendants unlawfully threatened to withhold her vacation pay. Moreover, even if Plaintiff signed the agreement because she was in a "despondent state," that doesn't explain why she failed to timely revoke it. A cursory review of the Release would have disabused Plaintiff of the notion that receipt of her vacation pay was conditioned on execution of the Release. The Release clearly states that Turn On owes Plaintiff one week's vacation pay and that the only compensation contingent on execution of the Release is a severance pay to which Plaintiff was not otherwise entitled. Plaintiff cannot claim that she had no choice but to sign the agreement and make an untimely demand for its revocation.
The Release is valid and enforceable and Plaintiff is barred from bringing this action. Defendants' motion for summary judgment is therefore granted.*fn1