Young v. Chao

Background

Cheryl Young, representing herself, had prevailed in administrative proceedings involving discrimination and retaliation claims against the Department of Transportation. The Equal Employment Opportunity Commission ordered the agency to reinstate her to an equivalent position and provide back pay. Young disputed whether the position offered was equivalent to her previous position and filed a petition asking the EEOC to enforce its order.

The EEOC found the petition partly meritorious regarding the agency’s documentation and payment of back pay, but concluded that the offered position was sufficiently similar to Young’s prior position. It also concluded that Young was entitled to back pay only through March 17, 2017, when she effectively rejected the offer. The EEOC issued an errata on December 14, 2018, identifying the corrected enforcement decision as its final decision and informing Young that she could file a civil action within 90 days after receiving it.

The court had previously dismissed Young’s enforcement claim under Rule 12(b)(1), reasoning that the agency had complied with the EEOC’s order. It also dismissed any possible claim for new judicial review as untimely under Rule 12(b)(6). The Ninth Circuit affirmed dismissal of the enforcement claim but reversed the denial of leave to amend, allowing Young to pursue new review if she could allege that she received the corrected December 2018 decision within 90 days before filing suit.

Young’s operative complaint asserted claims under Title VII and the Age Discrimination in Employment Act for race and age discrimination, a hostile work environment, and retaliation. The court had previously allowed those claims to proceed except for a claim that she was denied a particular position in 2016 and 2017 because of her race.

The Secretary’s Motion

The Secretary moved for summary judgment or, alternatively, renewed dismissal. He argued that the 90-day filing period began with the EEOC’s February 23, 2016 decision on the merits, rather than with the 2018 enforcement decision. He also argued that Young should be required to return the funds she received through the administrative proceedings before pursuing new judicial review.

Young argued that the Ninth Circuit had already resolved the filing-deadline issue, that the 2018 enforcement decision marked the end of the administrative proceedings, and that no statute required her to return the funds before filing suit. She also argued that any administrative award could be deducted from a later judgment or addressed at the end of the case.

Timeliness

The court held that Young’s claims were not untimely for purposes of this motion. Although the Secretary cited decisions from other courts supporting his interpretation, those decisions were not binding on the court. The court concluded that they could not override the Ninth Circuit’s earlier decision, which necessarily treated receipt of the corrected December 2018 enforcement decision as relevant to whether Young could satisfy the 90-day deadline.

The court applied the law-of-the-case doctrine, which generally prevents a court from reconsidering an issue already decided by the same court or a higher court in the same case. The court determined that the Ninth Circuit’s reversal of the earlier dismissal necessarily rested on the conclusion that the December 2018 decision was the relevant final agency action for the filing deadline. The court therefore declined to reconsider that conclusion, even though the issue had not been fully presented to the Ninth Circuit.

Repayment of Administrative Funds

The court held that Young’s continued possession of funds received through the administrative proceedings was not grounds for dismissing her new-review claims. It relied on appellate decisions holding that the governing statutory scheme does not require a plaintiff to return administrative payments before seeking new judicial review. The court stated that imposing such a requirement would add a condition that the statute does not contain.

The court noted that equitable defenses or a later claim for repayment might still be available. It also recognized that the Secretary could seek an offset against any recovery by Young or seek a judgment for repayment if Young did not prevail. But the Secretary had not filed a counterclaim seeking those funds.

Escrow or Bond

The court declined to order Young to place the funds in escrow or post a bond. The Secretary had not yet asserted a counterclaim for repayment, so the court found it premature to consider preliminary relief securing funds that might later be recoverable. The court also stated that the administrative disposition was not automatically nullified merely because Young filed a new action.

Disposition

The court denied the Secretary’s motion. Young was not required to repay the administrative funds as a condition of bringing her claims. The court also set deadlines for any future counterclaim and related request for escrow or a bond, while warning that Young might ultimately be required to return the money if a later repayment claim succeeded.