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Siotkas v. Labone

January 6, 2009

DOUKAS P. SIOTKAS, PLAINTIFF,
v.
LABONE, INC., MICHAEL PEAT, AND ALAN DAVIS, DEFENDANTS.
CAROLINE J. VAN HEULE, PLAINTIFF,
v.
LABONE, INC., MICHAEL PEAT, AND ALAN DAVIS, DEFENDANTS.



The opinion of the court was delivered by: Gold, Steven M., United States Magistrate Judge

MEMORANDUM & ORDER

INTRODUCTION

Plaintiffs bring these related actions alleging that LabOne, Inc., a drug testing laboratory, "falsely accus[ed] countless individuals of substituting their urine specimen." Siotkas Compl. ¶ 2; Van Heule Compl. ¶ 2. Both plaintiffs were airline employees required to undergo drug testing pursuant to federal statutes and regulations. Their urine specimens were sent to and analyzed by defendant LabOne, which ultimately reported to their employer, Delta Air Lines, Inc. ("Delta"), that the specimens were "substituted," or not consistent with normal human urine. Both employees lost their jobs with Delta as a consequence of the reported test results, although Siotkas' employment was ultimately restored. Plaintiffs assert claims for tortious interference with their employment, fraud, negligence, intentional tort, prima facie tort, and deceptive business practices.

Defendants have filed motions to dismiss the complaints, arguing that comprehensive federal drug-testing regulations preempt plaintiffs' state common-law causes of action. Defendants also contend that plaintiffs' complaints fail to state causes of action under New York state law with respect to intentional interference with employment relations, fraud, intentional tort, and prima facie tort. In addition, Van Heule has filed a motion for partial summary judgment.

While the motions were pending, the Second Circuit decided Drake v. Laboratory Corp. of America Holdings, 458 F.3d 48 (2d Cir. 2006), which specifically addressed the question of "whether and to what extent federal statutes and regulations concerning drug testing of persons employed in the aviation industry preempt the application of state tort law to events arising out of such drug tests." Drake,458 F.3d at 51-52. The Second Circuit held that "state tort claims are preempted to the extent that [a plaintiff] asserts that [a drug-testing laboratory] violated state . . . drug-testing standards that are independent of federal law," id. at 52, because "state law cannot 'enlarg[e] or enhance[e]' the regulations to impose burdens more onerous than those of the federal requirements on matters addressed by the federal regulations." Id. at 65 (citation omitted). The Court further held, however, that state tort claims are not preempted when they are based on allegations that a defendant "engaged in wrongful behavior not addressed by federal law," or when "state-law causes of action do no more than provide remedies for violations of the federal regulations." Id. at 52.

After Drake was decided, the parties filed supplemental memoranda of law addressing its impact on plaintiffs' claims. The parties also consented to have the case assigned to me for all purposes. I then heard oral argument on the motions and received post-argument briefing. For the reasons stated below, the motions to dismiss are granted in part and denied in part and Van Heule's motion for partial summary judgment is denied.

BACKGROUND

A. Regulatory Framework Governing Drug Testing of Aviation Employees

To understand the parties' preemption arguments, it is useful to begin with a brief review of the relevant federal drug-testing statutes and regulations. The Federal Aviation Act ("FAAct") grants the Federal Aviation Administration ("FAA") broad powers to adopt the necessary regulations to ensure air safety and security. 49 U.S.C. § 44701(a)(5). In 1988, the FAA issued regulations mandating that all "safety-sensitive" aviation employees, such as pilots and flight attendants, be subjected to pre-employment and random drug testing.*fn1 14 C.F.R. pt. 121, App. I. The FAA regulations incorporate by reference the drug testing procedures established by the Department of Transportation ("DOT"). Id. § 1.B. The protocols established by the DOT are codified at 49 C.F.R. pt. 40. As noted by the Second Circuit in Drake, the DOT procedures "set out elaborate rules for conducting drug tests." Drake, 458 F.3d at 57. For example, the DOT regulations dictate various aspects of the collection process, 49 C.F.R. §§ 40.31-79.73, such as who may collect urine specimens, id. § 40.31, and what forms must be used for collection, id. § 40.45. Subpart F of the current DOT regulations prescribes the responsibilities of laboratories conducting drug testing, including the requirements for conducting validity testing. 40 C.F.R. §§ 40.89-40.95.

The FAAct does not provide for a private right of action. See Drake, 458 F.3d at 57. The FAAct does, however, have a "savings clause," which explicitly provides that the remedies for violations are not limited to those in the FAAct. 49 U.S.C. § 40120(c) ("A remedy under this part is in addition to any other remedies provided by law."). See also Drake, 458 F.3d at 58. Thus, plaintiffs may pursue state-law causes of action based on violations of federal laws and regulations so long as they are not preempted by the federal statutes or regulations.

To ensure that they are applied "in a 'consistent and uniform' manner," the FAA drug-testing regulations include a preemption provision. Drake, 458 F.3d at 62 (quoting 53 Fed. Reg. at 47048). This provision expressly "preempts any state or local law, rule, regulation, order, or standard covering the subject matter of [the regulations], including but not limited to, drug testing of aviation personnel performing safety-sensitive functions." 14 C.F.R. Pt. 121, App. I § XI.A. State criminal laws are expressly not preempted; the regulations "do[] not preempt provisions of state criminal law that impose sanctions for reckless conduct of an individual that leads to actual loss of life, injury, or damage to property whether such provisions apply specifically to aviation employees or generally to the public." Id. § XI.B.

The drug tests at issue here were conducted by a private laboratory. Private laboratories such as LabOne must adhere to the DOT regulations as well as regulations issued by other government agencies. The Department of Health and Human Services ("HHS") oversees the National Laboratory Certification Program ("NLCP") and is responsible for establishing drug- testing policies. Def. R.56.1 ¶ 2.*fn2 NLCP-certified laboratories, such as LabOne, are required to comply with all Program Documents ("PDs") issued by HHS. Id. ¶¶ 3, 4.

On September 28, 1998, HHS issued Program Document 35 ("PD 35"), offering "guidance" for laboratories conducting validity testing. The DOT regulations explain that Specimen validity testing is the evaluation of the specimen to determine if it is consistent with normal human urine. The purpose of validity testing is to determine whether certain adulterants or foreign substances were added to the urine, if the urine was diluted, or if the specimen was substituted. 49 C.F.R. § 40.89(a). Insofar as relevant to plaintiffs' cases, HHS indicated in PD 35 that a laboratory should report a specimen as "substituted" if "the creatinine concentration is # 5 mg/dL and the specific gravity is # 1.001 or $1.020." PD 35 Section A.2.b. Although PD 35 does not indicate whether a laboratory must measure the creatinine concentration to at least one decimal point, it requires that tests for creatinine concentration and specific gravity shall "follow scientifically suitable methods and produce results which are accurately quantified." PD 35 Section A.1.a.

On July 28, 1999, HHS clarified this ambiguity in PD 35 and definitively stated that truncating a quantitative value is not acceptable with "#" decision points or cutoffs. In "#" scenarios, truncating would change the result from acceptable to unacceptable (e.g., truncating . . . a creatinine of 5.4 mg/dL to 5 mg/dL). Values from tests for creatinine (#5 mg/dL) . . . should contain one significant decimal place more than that specified in the stated decision point.

Program Document 37, Issue 5, Comment.

B. Plaintiffs' Claims

With this regulatory framework in mind, plaintiffs' claims -- and in particular the preemption arguments made by the parties with respect to them -- may be analyzed. Both plaintiffs allege that LabOne negligently and even intentionally failed to conduct proper validity tests of plaintiffs' specimens, and inaccurately reported to Delta, plaintiffs' employer, that their specimens were "substituted."

Caroline Van Heule completed her training to become a Delta flight attendant on November 11, 1998. Van Heule Compl. ¶ 12. On or about November 4, 1998, prior to starting her employment, Van Heule was required to submit to a drug test pursuant to federal law, as discussed above. Id. ¶¶ 13-14. Plaintiff complied and her urine specimen was sent to defendant LabOne for analysis. Id. ¶¶ 15, 16. Before testing her specimen for the presence of any drugs, however, LabOne conducted a validity test. Id. ¶ 18. The validity test results for Van Heule's specimen indicated a specific gravity of 1.001 and a creatinine level of 5 mg/dL. Id. ¶ 20. See also id. Ex. A. A corroborating validity test was performed with the same results. Id. ¶ 25. Based on these results and pursuant to PD 35, LabOne then reported to Delta's Medical Review Officer ("MRO") that the specimen was "substituted: not consistent with normal human urine." Id. ¶ 26. Thereafter, Delta's MRO informed Van Heule of the results and her employment was terminated. Id. ¶¶ 30, 31.

More than two years later, by letter dated January 2, 2001, LabOne notified Delta that HHS had conducted a special inspection of LabOne and other certified laboratories "to determine whether th[e] laboratories ha[d] properly implemented HHS guidance on validity testing." Id. ¶ 41. In its letter, LabOne informed Delta:

As a result of the inspection at LabOne, Inc. it was discovered that between September 28, 1998 and January 22, 2000, [LabOne] did not measure the creatinine concentration of specimens to at least one decimal place. This problem affected any specimen that was reported as 'substituted' where that report was based, in part, on a creatinine concentration that fell directly on the decision point of 5 mg/dL.

Van Heule Reply Aff. Ex. A. More specifically, it appears that LabOne rounded or truncated their measurements so that a creatinine level in the range of 4.5 to 5.4 mg/dL was reported as a 5. LabOne informed Delta that Van Heule's specimen validity testing results fell on the decision point of 5 mg/dL. Id. "Consequently, [LabOne] do[es] not know whether such a result really meets HHS criteria for determining that a specimen is substituted. Under these circumstances, we cannot permit a substitution result for this test to stand, and the test must be cancelled." Id.

Plaintiff Doukas B. Siotkas was employed as a pilot by Delta in 1999. Siotkas Compl. ¶ 14. On July 30, 1999, Siotkas was told to report for a random drug test. Id. ¶¶ 15, 16. Siotkas provided a urine specimen that was sent to LabOne, which conducted a validity test on the sample. Id. ¶¶ 16-20. The validity test results for Siotkas indicated a creatinine level of 0 mg/DL and a specific gravity of 1.000. Id. ¶ 22. Based on these results and pursuant to PD 35, LabOne concluded that Siotkas' sample was "substituted." Id. ¶ 23. Following the same procedures as it did in Van Heule's case, LabOne conducted a corroborating validity test with the same result as the initial validity test. Id. ¶¶ 27, 28. On August 2, 1999, LabOne reported its finding that Siotkas had supplied a "substituted" sample to Delta's MRO. Id. ¶ 31. Delta's MRO then reported the results to Siotkas, who was removed from his position as a pilot. Id. ¶ 35, 36.

Shortly thereafter, Delta notified the FAA of Siotkas' drug test results. Id. ¶ 37. The FAA then revoked Siotkas' certificate as a pilot and Delta terminated his employment. Id. ¶¶ 38, 39. The Air Line Pilots Association then filed a grievance on behalf of Siotkas which resulted in proceedings before the National Transportation Safety Board ("NTSB"). Id. ¶¶ 41, 42; see also Tr. 5.*fn3 In connection with the NTSB proceedings, the FAA concluded in September 2000 that "LabOne had no reason to report that Siotkas substituted his specimen and that LabOne did not have specimen-testing procedures and protocols designed to accurately test and report on specimen validity." Id. ¶ 44. The FAA advised Delta that "findings of substituted urine samples reported by LabOne were scientifically unreliable and that substitute specimen test reports by LabOne should be disregarded." Id. ¶ 47. Delta then terminated its contract with LabOne. Id. ¶ 48. At or about the time of the FAA findings, Siotkas' employment as a pilot with Delta was restored. Id. ¶¶ 45, 46.

Although the grounds for reporting plaintiffs' specimens as substituted were different -- Van Heule had a creatinine level that fell on the decision point of 5 mg/dL, whereas Siotkas had a creatinine level of 0 mg/dL -- both plaintiffs make similar claims with respect to LabOne's reporting of creatinine levels. Both plaintiffs contend that LabOne failed to implement PD 35. Siotkas Compl. ¶¶ 51 et seq.; Van Heule Compl. ¶ 53. Siotkas also alleges that, by using the same aliquot for the creatinine and specific gravity tests, LabOne violated PD 37, which was not yet in effect at the time of Van Heule's specimen testing. Siotkas Compl.¶¶ 57, 58. In addition, both plaintiffs allege negligence by LabOne with respect to its testing procedures more generally, including its use of de-ionized water as opposed to distilled water in its equipment, its use of reagents designed to analyze blood rather than urine, and its practice of ignoring equipment error messages. Siotkas Compl. ¶¶ 62, 64, 65-66; Van Heule Compl. ¶ 53. Moreover, plaintiffs allege that LabOne failed to employ supervisors with the credentials required by federal law. Siotkas Compl. ¶¶ 73-83; Van Heule Compl. ¶ 53. Finally, plaintiffs contend that employees of LabOne altered business records to conceal their negligence. Siotkas Compl. ¶¶ 84-90; Van Heule Compl. ¶ 53.

DISCUSSION

Standards Governing a Motion to Dismiss

The Federal Rules of Civil Procedure require only that a complaint set out a "short and plain statement of the claim showing that the pleader is entitled to relief." FED. R. CIV. P. 8.

Motions to dismiss address the sufficiency of a plaintiff's complaint, not the weight of his evidence, and a court deciding a motion to dismiss must accept the allegations in the complaint as true and draw all inferences in favor of the non-moving party. See Miller v. Wolpoff & Abramson, L.L.P., 321 F.3d 292, 300 (2d Cir. 2003).

For many years, courts construing Rule 12 motions applied the rule set forth in Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102 (1957), that a complaint should be dismissed only if "it appear[ed] beyond doubt that the plaintiff c[ould] prove no set of facts in support of his claim which would entitle him to relief." The Supreme Court, however, has now abandoned the Conley "no set of facts" formulation and instead adopted a "plausibility standard." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, _, 127 S.Ct. 1955, 1968-69 (2007). Under this standard, to survive a motion to dismiss, a complaint must allege facts sufficient "to raise a reasonable expectation that discovery will reveal evidence" to support the plaintiffs' claims. Id. at 1965. The Second Circuit has interpreted Twombly not [as] requiring a universal standard of heightened fact pleading, but . ...


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