Newman v. Lehman Brothers Holdings Inc. , 901 F.3d 19 ( 2018 )

United States Court of Appeals
For the First Circuit
No. 15-2239
BARBARA NEWMAN,
Plaintiff, Appellant,
v.
LEHMAN BROTHERS HOLDINGS INC.,
GROUP BENEFITS PLAN, ET AL.,
Defendants, Appellees,
METROPOLITAN LIFE INSURANCE COMPANY, ET AL.,
Defendants.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Denise J. Casper, U.S. District Judge]
Before
Torruella, Lynch, and Kayatta,
Circuit Judges.
Jason P. Steed, with whom Kilpatrick Townsend & Stockton LLP
was on brief, for appellant.
David W. Robinson, with whom Ruberto, Israel & Weiner PC was
on brief, for appellees.
August 20, 2018
TORRUELLA, Circuit Judge. This case concerns the
requirement that administrative remedies be exhausted before a
claim under the "whistleblower" protection provisions of the
Sarbanes-Oxley Act of 2002 ("SOX"), 18 U.S.C. § 1514A, can reach
federal court. Plaintiff Barbara Newman ("Newman") claims to have
suffered retaliation for reporting violations of federal laws and
regulations at her workplace, Lehman Brothers, Inc. ("Lehman
Brothers") in 2008. The district court dismissed these claims
pursuant to Fed. R. Civ. P. 12(b)(6). Newman appeals the dismissal
of her claims as it pertains to a handful of the original
defendants, namely: Lehman Brothers Holding Inc. Group Benefits
Plan ("the Plan"), and a group of five corporations affiliated
under the name Neuberger Berman ("the Neuberger defendants"). We
affirm.
I. Background
In reviewing a district court's dismissal of a complaint
for failure to state a claim, "we accept the [complaint's] well-
pleaded facts as true and indulge all reasonable inferences
therefrom in the plaintiff's favor." Jorge v. Rumsfeld, 404 F.3d
556, 559 (1st Cir. 2005). We may also "augment those facts with
facts extractable from documentation annexed to or incorporated by
reference in the complaint." Id.-2-
A. Factual Background
In May 2007, Newman began working in the corporate
communications department of Lehman Brothers. Her job was to
draft communications that would "raise the profile" of both Lehman
Brothers and of Neuberger Berman, which was then a wholly-owned
subsidiary of Lehman Brothers and today is a small constellation
of distinct corporations that together comprise the Neuberger
defendants.1
While at Lehman Brothers, Newman noticed that her
coworkers were engaged in conduct that she suspected to be in
violation of federal securities law. She reported these concerns
to the Lehman Brothers "Alert Line" and to her supervisors.
Subsequently, Newman was ostracized at work and ultimately
terminated from her employment.
Simultaneous to her whistle blowing activity, Newman
requested disability benefits through the benefits plan
administered by the Plan. Newman was approved for short-term
disability benefits, but experienced difficulty in obtaining long-
term and supplemental long-term disability benefits. Newman was
terminated from her employment while on short-term disability
benefits.
1 These include: Neuberger Berman, LLC; Neuberger Berman, Inc.;
Neuberger Berman Management, LLC; Neuberger Berman Group, LLC; and
Neuberger Berman Management, Inc.
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On July 23, 2008, Newman filed a complaint ("the OSHA
complaint") under § 806 of SOX with the Occupational Safety and
Health Administration ("OSHA").2 The OSHA complaint states that
Newman was submitting a written complaint "within [ninety] days of
the adverse action under [SOX]" because she was "retaliated against
by Lehman Brothers Inc. through termination on April 23, 2008 via
a phone call."
The OSHA complaint then listed ten retaliatory actions
that Newman accused Lehman Brothers of having taken against her.
Among the list of "unfavorable employment actions" were "Discharge
or layoff," "Blacklisting," "Disciplining," and "Denial of
benefits." The OSHA complaint also provided a list of around
thirty individuals accused of having violated SOX's whistleblower
protection provision. The complaint concluded with a brief list
of contradictory factual statements as to Newman's termination
date, such as that "[o]n March 12, 2008, I was effectively
terminated from Lehman Brothers when I took a sick day" but also
2 "An employee seeking § 1514A protection must first file an
administrative complaint with the Department of Labor." Day v.
Staples, Inc., 555 F.3d 42, 52 (1st Cir. 2009). However, the
Secretary of Labor has delegated responsibility for receiving and
investigating whistleblower complaints to OSHA, an agency within
the Department of Labor. See Carnero v. Bos. Sci. Corp., 433 F.3d
1, 3 n.1 (1st Cir. 2006); Delegation of Authority and Assignment
of Responsibility to the Assistant Secretary for Occupational
Safety and Health, 67 Fed. Reg. 65,008, (Oct. 22, 2002); see also
29 C.F.R. § 1980.103(c).
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that "[o]n April 23, 2008, I was terminated from Lehman Brothers."
In September 2008, Newman supplemented her OSHA complaint with an
interview with OSHA ("the OSHA interview"). See 29 C.F.R.
§ 1980.104(e) (stating that a complaint may be "supplemented as
appropriate through interviews of the complainant").
B. Procedural Background
In January 2012, Newman's case began its tortuous path
through the federal judiciary. We need not dwell on the details
of this journey; it suffices to say that Newman began as a pro se
plaintiff, and later acquired counsel and filed the operative
Second Amended Complaint ("SAC"), which pursued claims under SOX
and the Employment Retirement Income Security Act (ERISA), 18
U.S.C. § 502(a)(1)(B), against a large number of defendants.
These claims have largely been dismissed or moved to other courts.3
What remains of those claims is that which is before us now: an
appeal from the district court's dismissal of Newman's SOX claim
against the Neuberger Defendants and the Plan pursuant to Rule
12(b)(6).4
3 Newman's claim against Lehman Brothers, which is not at stake
in this appeal, is currently stayed under 11 U.S.C. § 362(a) since
that entity is in bankruptcy.
4 Newman's claim under ERISA against MetLife and the Plan was
dismissed on September 16, 2015. Newman v. Metro. Life Ins. Co.,
No. CV 12-10078-DJC, 2015 WL 5447613, at *1 (D. Mass. Sept. 16,
2015). Newman has not appealed this ruling.
-5-
The district court dismissed Newman's SOX claim, finding
that Newman had failed to exhaust her administrative remedies prior
to bringing her SOX claim to federal court because (1) she did not
file her OSHA complaint within the ninety-day deadline and (2) she
also failed to name the defendants in her written OSHA complaint.
This timely appeal followed, focused solely on the dismissal of
Newman's SOX claim against the Plan and the Neuberger defendants.
II. Discussion
This court reviews the grant of Rule 12(b)(6) motions de
novo. MacDonald v. Town of Eastham, 745 F.3d 8, 11 (1st Cir.
2014). In doing so, the court is "not bound by the district
court's reasoning but, rather, may affirm an order of dismissal on
any ground evident from the record." Id. (citations omitted).
Ordinarily, we consider only the "facts alleged in the complaint,
and exhibits attached thereto." Freeman v. Town of Hudson, 714
F.3d 29, 35 (1st Cir. 2013). However, there are some "narrow
exceptions" in which a court may, if it chooses, consider extrinsic
documents, such as "documents the authenticity of which are not
disputed by the parties; . . . official public records; . . .
documents central to the plaintiff's claim; [and] . . . documents
sufficiently referred to in the complaint" without turning the
12(b)(6) motion into a motion for summary judgment. Id. at 36(alteration in original)(citing Watterson v. Page, 987 F.2d 1, 3
(1st Cir. 1993)).
-6-
Particularly when "a complaint's factual allegations are
expressly linked to -- and admittedly dependent upon -- a document
(the authenticity of which is not challenged), that document
effectively merges into the pleadings," thereby giving the court
the discretion to consider such additional material. Trans-Spec
Truck Serv., Inc. v. Caterpillar Inc., 524 F.3d 315, 321 (1st Cir.
2008). While we retain discretion to affirm or deny on any basis
in the record, this Court generally reviews "only those documents
actually considered by the district court in its 12(b)(6) analysis
unless we are persuaded that the court below erred in declining to
consider proffered documents." Id.Based on these materials, we assess whether there are
sufficient facts "to raise a right to relief above the speculative
level on the assumption that all allegations in the complaint are
true." Ocasio-Hernández v. Fortuño-Burset, 640 F.3d 1, 8 (1st
Cir. 2011) (citing Bell Atl. v. Twombly, 550 U.S. 544, 555 (2007)).
"If the factual allegations in the complaint are too meager, vague,
or conclusory to remove the possibility of relief from the realm
of mere conjecture," we will affirm the dismissal. Morales-Cruz
v. Univ. of P.R., 676 F.3d 220, 224 (1st Cir. 2012) (citing S.E.C.
v. Tambone, 597 F.3d 436, 442 (1st Cir. 2010) (en banc)).
A. Newman's Termination Claim
For a SOX claim of workplace retaliation to proceed in
federal court, the plaintiff must first file a complaint with the
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Department of Labor through OSHA. 18 U.S.C. § 1514A(b). At the
time relevant to this case, Newman was required to file her OSHA
complaint "[w]ithin 90 days after an alleged violation of the Act."
29 C.F.R. § 1980.103(d)(2011); see also 18 U.S.C. § 1514A(b)
(2)(D)(2006).5 If after 180 days the Department of Labor has not
issued a final decision on an administrative complaint, the
plaintiff may file an action in federal court. 18 U.S.C.
§ 1514A(b)(2)(D). Here, because the Department of Labor did not
issue a final decision within 180 days, Newman filed her complaint
in federal court. We now review the dismissal of her SOX claim
pursuant to Rule 12(b)(6).
Newman alleges that she was terminated from her job in
retaliation for her whistleblower activity. For this claim to
proceed, Newman was required to first exhaust the available
administrative remedies by, inter alia, filing an OSHA complaint
within ninety days of the alleged retaliatory action. In
considering administrative exhaustion requirements in similar
statutes, we have held that such requirements are mandatory, though
not jurisdictional, and "akin to a statute of limitations."
Bonilla v. Muebles J.J. Álvarez, Inc., 194 F.3d 275, 278 (1st Cir.
1999); cf. Farris v. Shinseki, 660 F.3d 557, 563 (1st Cir. 2011)
5 Congress has since extended this ninety-day statute of
limitations to 180 days. See 18 U.S.C § 1514A; Pub. L. No. 111-
203, title IX, §§ 922(b),(c), 929A, 124 Stat. 1376 (2010).
-8-
(noting that "failure to comply with an agency's applicable time
limit may expose the plaintiff's federal law suit to dismissal"
for a case proceeding under the Americans with Disabilities Act);
Franceschi v. U.S. Dep't. of Veterans Affairs, 514 F.3d 81, 85
(1st Cir. 2008) (confirming the same for claims under Title VII of
the Civil Rights Act of 1964). Like a statute of limitations,
unexcused non-compliance with prescribed time limits of
administrative remedies "bars the courthouse door" for a would-be
federal plaintiff. Bonilla, 194 F.3d at 278; see also Jorge, 404
F.3d at 564 (describing "the timely filing of a charge with the
[Equal Employment Opportunity Commission]" as one of "two key
components" for administrative exhaustion in a Title VII case).
Accordingly, the district court sought to determine the
date of Newman's termination in order to ascertain whether her
OSHA complaint was timely. Finding no express date in Newman's
SAC,6 the district court consulted the OSHA complaint, which the
SAC indicates is the administrative charge underlying this case.
As noted above, in the OSHA complaint Newman twice stated that she
was terminated on April 23, 2008. That means, thus, that Newman's
employment was terminated ninety-one days before filing her OSHA
6 The operative complaint states that "Newman filed claims
regarding the retaliation with [OSHA] . . . [and] was soon after
terminated." It also states that "Newman was terminated while on
short term disability."
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complaint on July 23, 2008 -- or one day beyond the statutorily
permitted filing time. See Fed. R. App. P. 26(a) (computing time);
Day, 555 F.3d at 53 ("An employee must file a complaint with [OSHA]
no later than ninety days after the date on which the alleged
violation occurred.").
Newman argues that this was improper fact-finding on the
part of the district court, and that, instead, the district court
should have found that she was terminated sometime after filing
her OSHA complaint, as stated in her SAC. We disagree.
The district court did not engage in improper fact-
finding. A finding that Newman exhausted the administrative
remedies available to her is a statutory prerequisite for her
complaint to proceed. 18 U.S.C. § 1514A. Newman's SAC makes
explicit reference to her OSHA complaint. Her "complaint's
factual allegations are expressly linked to . . . and admittedly
dependent upon" the OSHA complaint. Trans-Spec Truck Serv., Inc.,
524 F.3d at 321; see also Fed. R. Civ. P. 10(c) ("A copy of a
written instrument that is an exhibit to a pleading is a part of
the pleading for all purposes."). Therefore, the district court
was correct to consider the OSHA complaint, particularly given the
lack of clarity the SAC provided on this important matter. And
our own look at the OSHA complaint leads us to conclude, as did
the district court, that it was filed outside the requisite
timeframe.
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Newman urges us to focus our gaze instead on the
background section of her SAC, which states that Newman was
terminated from her job "soon after" filing her OSHA complaint.
This is unhelpful. If Newman was terminated after the filing of
her OSHA complaint, it is difficult to make sense of either the
content of her OSHA complaint -- which twice alleges that her
employment was terminated on April 23, 2008, ninety-one days before
she filed the OSHA complaint -- or how the OSHA complaint could
have exhausted the administrative remedies of a retaliatory act
that had not yet occurred. Moreover, the mere inclusion of a
vague statement in the pleading does not preclude the district
court's fair consideration of an incorporated, uncontested
document. See Clorox Co. P.R. v. Proctor & Gamble Commercial Co.,
228 F.3d 24, 32 (1st Cir. 2000) (considering a 12(b)(6) motion to
dismiss a claim of false advertising in light of advertising copy
contained in record); see also Yacubian v. United States, 750 F.3d
100, 108 (1st Cir. 2014) ("[I]t is a well-settled rule that when
a written instrument contradicts allegations in the complaint to
which it is attached, the exhibit trumps the allegations." (citing
Young v. Wells Fargo Bank, N.A., 717 F.3d 224, 229 n.1 (1st Cir.
2013))); Ogden Martin Sys. of Indianapolis, Inc. v. Whiting Corp.,
179 F.3d 523, 529 (7th Cir. 1999) ("[A] plaintiff may plead himself
out of court by attaching documents to the complaint that indicate
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that he or she is not entitled to judgment." (citing In re Wade,
969 F.2d 241, 249 (7th Cir. 1992))).
In a final effort to establish the timeliness of her
OSHA complaint, Newman invites us to ignore the dates she provided
in the written OSHA complaint, as well as the timeframe hinted at
in her SAC, in favor of her statements during her OSHA interview.
There, Newman stated that she may have been terminated on April 23,
but did not learn about this until April 24, and that she remained,
at the time of her OSHA interview in September, still unsure about
the actual date of her termination.
We decline this invitation. Newman did not raise this
argument to the district court, and, therefore, it has been waived.
See Iverson v. City of Bos., 452 F.3d 94, 102 (1st Cir. 2006)
("[T]heories not squarely and timely raised in the trial court
cannot be pursued for the first time on appeal."). In Newman's
memorandum in opposition to defendants' motion to dismiss the SAC,
she simply asserted a right to discovery, arguing that because her
first amended complaint survived a 12(b)(6) motion,7 her second
must as well. 8 In a similar fashion, during the hearing on
7 The district court found that Newman's SOX claim was not time-
barred precisely because her complaint stated that her termination
date was April 24, 2008. Given the opportunity to amend, Newman
removed this date from what became the operative complaint.
8 This is incorrect. "An amended complaint, once filed, normally
supersedes the antecedent complaint. Thereafter, the earlier
complaint is a dead letter and no longer performs any function in
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defendants' motion to dismiss, plaintiff's counsel argued that
Newman did not know the date of her termination, and should not
"be expected" to know the date. Setting the merits of these
arguments aside, it is clear that Newman did not argue to the
district court that the facts supporting the timeliness of her
OSHA complaint were contained in her OSHA interview. As such,
this argument was not properly raised below and cannot be raised
for the first time here. Id.We are sensitive to the challenges that pro se plaintiffs
face in pleadings and do not condemn inexperienced plaintiffs to
be forever bound by their clerical errors and minor factual slip-
ups. See Boivin v. Black, 225 F.3d 36, 43 (1st Cir. 2000)
("[C]ourts hold pro se pleadings to less demanding standards than
those drafted by lawyers . . . [and] endeavor, within reasonable
limits, to guard against the loss of pro se claims due to technical
defects."). But here, however, the lack of precision about
Newman's date of termination is no minor factual slip up. Rather,
Newman's counsel removed from the operative complaint any mention
of an exact date of termination and substituted it with a
temporally imprecise contention that she was terminated "soon
after" filing her complaint to OSHA about her termination.
the case." Connectu LLC v. Zuckerberg, 522 F.3d 82, 91 (1st Cir.
2008) (citations omitted). Accordingly, our only concern is the
SAC and the arguments made about it.
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In sum, Newman's SAC failed to plead sufficient facts to
raise a plausible claim for relief under SOX, as she untimely filed
her OSHA complaint, and failed to exhaust her administrative
remedies.
B. Newman's Other SOX Claims
Newman further contends that the district court erred by
granting dismissal without addressing the other retaliatory acts
raised in her SAC. Retaliatory termination was not the only SOX
claim in Newman's complaint; she also alleged that the defendants
interfered with her rights to certain disability benefits. In
this sense, Newman is correct in stating that the district court
erred insofar as it considered Newman's administrative complaint
as to this claim to be time-barred along with her termination
claim. This is so because Newman's OSHA complaint was filed within
ninety days of the last retaliatory act with regard to her
disability benefits, which occurred months after her termination.
However, in our review of the district court's doing, we
"may affirm an order of dismissal on any ground evident from the
record." MacDonald, 745 F.3d at 11. And the record is clear that
nowhere before the district court did Newman rely on additional
retaliatory acts like the denial of disability benefits to contest
defendants' motion to dismiss. Although Newman's SAC did allege
the denial of benefits as part of her SOX claim, her memorandum in
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opposition to defendants' motion to dismiss put forward no
arguments about this or any other acts of retaliation.
In an apparent attempt to provide a lifeline to her
arguments about these other acts, Newman now contends that she did
not have to address the additional instances of retaliation in her
opposition to defendants' motion because the defendants only moved
to dismiss the retaliation claim related to termination. But this
is incorrect. In their 12(b)(6) motion, defendants moved to
dismiss the entirety of Newman's SOX claim, which encompassed both
her allegations about termination and the subsequent denial of
benefits. Newman then did not argue in her opposition that the
denial of benefits was an actionable act of retaliation from which
the ninety-day deadline must be calculated. Rather, her counsel
expressly argued that the ninety days ran "from the date
of...termination." Thus, Newman waived her opportunity to argue
on appeal about additional acts of retaliation like the alleged
denial of benefits, and we may not entertain such arguments. See,
e.g., Lawton v. State Mut. Life Assurance Co. of Am., 101 F.3d
218, 222 (1st Cir. 1996) ("No precept is more firmly settled in
this circuit than that theories not squarely raised and seasonably
propounded before the trial court cannot rewardingly be advanced
on appeal."); but cf. N.J. Carpenters Pension & Annuity Funds v.
Biogen IDEC Inc., 537 F.3d 35, 54 (1st Cir. 2008).
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C. Newman's Motion to Reconsider
Lastly, Newman asks us to review the district court's
denial of her motion to reconsider its dismissal of her complaint,
on the basis of purportedly new evidence that contradicts the
district court's findings. We review a district court decision
on a motion to reconsider for abuse of discretion. Bennett v.
Saint-Gobain Corp., 507 F.3d 23, 34 (1st Cir. 2007).
Newman's allegedly new evidence consists of benefit
statements secured through the Pension Benefit Guaranty
Corporation, which she claims show that Newman was considered a
Lehman Brothers employee until January 2009, and other evidence
that purports to dispute the court's conclusion that she was
terminated on April 23. Newly discovered evidence could certainly
justify a district court's reconsideration of its judgment. Id.However, Newman's motion to reconsider recognized that
she was in possession of the evidence she has now put forth since
February 2014 -- months before the defendants sought dismissal of
her SAC. Therefore, Newman's "additional evidence was merely
newly proffered, not newly discovered." Id. Newly proffered
evidence "hardly qualifies as newly discovered evidence."
Rodríguez v. Fullerton Tires Corp., 115 F.3d 81, 86 (1st Cir.
1997).
Thus, the district court did not abuse its discretion in
declining to reconsider its holding.
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III. Conclusion
For the aforementioned reasons, the district court's
judgment is affirmed.
Affirmed.
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