Golub v. Berdon LLP

Background

Dr. J. David Golub, proceeding without a lawyer, sued Berdon LLP after Berdon terminated his employment. Golub alleged violations of the Age Discrimination in Employment Act (ADEA), the False Claims Act (FCA), and several state laws. He alleged that he had reported that a Berdon colleague, identified as B.S., submitted fraudulent filings to the Internal Revenue Service and state government agencies, and that Berdon terminated him shortly afterward. Golub also alleged state-law claims for breach of contract and breach of the covenant of good faith and fair dealing.

Berdon moved to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) and sought sanctions under the court’s inherent authority. Golub sought sanctions under Rule 11, asked the court to strike filings, requested that three appendices be admitted into evidence, and sought discovery.

ADEA Claims

The court treated Golub’s ADEA allegations as asserting both age discrimination and retaliation. The court stated that an age-discrimination claim requires facts supporting an inference that age caused the adverse employment action and that age was the “but-for” cause of the action. Although Golub alleged that he was over 40, qualified for his position, and terminated, the court found no plausible connection between his age and the termination. The only age-related allegation was that Golub was older than an employee who was not terminated. The court also noted that Golub’s allegations attributed the termination to his report of alleged professional misconduct, not to his age. The court therefore concluded that the complaint did not plausibly allege status-based age discrimination.

The court also rejected the ADEA retaliation theory. A protected activity for an ADEA retaliation claim must involve opposing an employment practice made unlawful by the ADEA or participating in an ADEA investigation or proceeding. The court found that Golub alleged retaliation for reporting a colleague’s professional misconduct, not retaliation for opposing age discrimination or another unlawful ADEA practice. The ADEA claim was dismissed without prejudice.

False Claims Act Retaliation Claim

The court explained that an FCA retaliation claim requires protected activity, the employer’s knowledge of that activity, and adverse action because of the activity. Golub alleged that he reported fraudulent tax filings, but the court found that he did not show that his conduct furthered an FCA action or was an effort to stop an FCA violation. The court also found that the complaint did not show a good-faith or objectively reasonable basis for believing that Golub was investigating matters supporting a viable FCA case.

The court emphasized that the FCA excludes claims, records, or statements made under the Internal Revenue Code from its scope. Based on the allegations that the reported misconduct involved tax fraud, the court found it implausible that Golub’s report constituted protected activity under the FCA. The FCA retaliation claim was dismissed without prejudice.

State-Law Claims and Jurisdiction

The court considered whether it had federal jurisdiction over the state-law claims. Diversity jurisdiction requires more than $75,000 in controversy and complete diversity of citizenship. Golub alleged that he was a resident of New Jersey and South Carolina, but the court explained that residence does not establish citizenship or domicile. Berdon was alleged to be a resident of New York, but because it is a limited-liability partnership, its citizenship depends on the citizenship of all its members. The complaint did not identify those members’ citizenship, so the court could not determine that complete diversity existed.

The court also considered supplemental jurisdiction, which can allow a federal court to hear related state-law claims arising from the same facts as federal claims. Because the court dismissed the federal claims and the case was still at the pre-discovery stage, it declined to exercise supplemental jurisdiction over the state-law claims. Those claims were dismissed without prejudice for lack of subject-matter jurisdiction.

Ancillary Requests and Disposition

The court denied all requests for ancillary relief. It found that the parties’ conduct was not sufficiently egregious to warrant sanctions and that Golub had not complied with Rule 11’s requirements. The court declined to strike filings because it had not relied on them. It also declined to admit the appendices separately because they had been submitted with the complaint and were already part of the record. The court found no basis for discovery at that point.

The court granted Berdon’s motion to dismiss without prejudice. Golub was permitted to file, within 30 days, a motion seeking permission to file an amended complaint, together with the proposed amended complaint and an explanation of why amendment would not be futile. If he did not make that motion within 30 days, the claims would be dismissed with prejudice. The Clerk was directed to close Docket No. 47 and mail the opinion and order to Golub.