Spence v. Straw ( 1995 )

Opinions of the United
1995 Decisions States Court of Appeals
for the Third Circuit
5-10-1995
Spence v Straw
Precedential or Non-Precedential:
Docket 94-1866
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UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
___________
Nos. 94-1866 and 94-1916
___________
KEVIN SPENCE
Appellant,
vs.
EDWARD STRAW, ADMIRAL, Director of the
DEFENSE LOGISTICS AGENCY of the U.S.
Department of Defense
Appellee.
___________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
(D.C. Civil No. 92-cv-03713)
___________
Submitted Under Third Circuit LAR 34.1(a)
March 27, 1995
BEFORE: MANSMANN, COWEN and LEWIS, Circuit Judges.
(Filed May 10, 1995)
___________
Alan B. Epstein
Jablon, Epstein, Wolf & Drucker
The Bellevue
Broad Street at Walnut
Ninth Floor
Philadelphia, PA 19103
Attorney for Appellant
Richard Mentzinger, Jr.
Karen E. Rompala
Office of the United States Attorney
Suite 1250
615 Chestnut Street
Philadelphia, PA 19106
Attorneys for Appellee
___________
OPINION OF THE COURT
___________
LEWIS, Circuit Judge.
In this case we are required to evaluate whether a
party suing under section 504 of the Rehabilitation Act of 1973,
29 U.S.C. § 794, is required to exhaust administrative remedies
provided in Title VII of the Civil Rights Act of 1964, 42 U.S.C.
§2000e-16, and whether suit under the Rehabilitation Act -- with
prior exhaustion of remedies -- is the exclusive means by which a
plaintiff may raise claims against federal agencies relating to
handicap discrimination. Concluding that the answer to both of
these questions is yes, we will affirm the district court in most
respects, while modifying the court's judgment to conform to our
analysis.
I.
Because this case comes to us upon grant of a motion to
dismiss, we accept all of the plaintiff's well-pleaded facts as
true. Bogosian v. Gulf Oil Corp., 561 F.2d 434 (3d Cir. 1977).
According to the recitations in the amended complaint, the
following facts comprise this dispute.
In early 1992, Kevin Spence applied to the Defense
Logistics Agency of the Department of Defense ("DLA") for the
position of "Sewing Machine Operator (Single Needle)." He passed
the DLA's competency examination with a score of 85. The DLA
promptly provided Spence with a Notice of Rating, which confirmed
his score and declared him eligible for the sewing machine
operator position. On April 23, 1992 Spence passed the physical
examination required for hire. After passing another performance
examination on June 2, 1992, Spence was notified by the DLA that
he had "been tentatively selected for a permanent position of
Sewing Machine Operator, W-3."
However, on June 24, 1992 Spence was required to take
an eye examination, and he failed. The test showed that his
approximate vision in both eyes was 20/50, and the DLA required
sewing machine operators to have at least 20/20 vision in one eye
and 20/40 in the other. Because he had failed the eye
examination, Spence was informed that the DLA had rescinded his
selection as a sewing machine operator.
Spence filed a pro se complaint against the DLA in June
1992. The DLA moved to dismiss that complaint, but that motion
was denied because the DLA had not served counsel which had been
appointed to assist Spence. When a second motion to dismiss was
properly filed and served, the pro se complaint was dismissed
without prejudice in March 1994 on the ground that it did not
with specificity set forth a cause of action under the
Rehabilitation Act. The district court noted, however, that new
counsel had recently been appointed for Spence, and that it was
likely that this counsel would be able to set forth Spence's
concerns in a manner providing adequate notice to the DLA of the
nature of plaintiff's claims. Thus, Spence's new counsel was
allowed 30 days to file an amended complaint.
This was done. In the amended complaint, from which
our factual recitation is gleaned, Spence sued Admiral Edward
Straw ("Straw"), Director of the DLA, in his official and
individual capacities, premising jurisdiction upon 28 U.S.C.
§ 1331. Having provided the factual allegations described above,
Spence contended in his amended complaint that those facts stated
two causes of action. Count One alleged that Spence was a
handicapped individual as defined under section 504 of the
Rehabilitation Act and that he was denied employment as a sewing
machine operator solely because of his slight vision handicap.
Spence contended that the DLA's vision requirements were not
reasonably related to the sewing machine operator position, and
that even if they were, Spence could perform the job with a
slight and reasonable accommodation on the part of the DLA, which
would not unduly burden that agency. By failing to hire Spence
because of his handicap, Spence contended, the DLA had violated
section 504.
Count Two of the amended complaint alleged that the DLA
denied Spence equal protection under the Due Process Clause of
the Fifth Amendment by singling him out and unnecessarily
differentiating him because of his vision handicap. Furthermore,
Spence contended, the DLA's actions were arbitrary and
irrational, because Spence had passed the requisite performance
test showing that he could perform the job of sewing machine
operator.
Straw filed a motion for summary judgment upon and
dismissal of the amended complaint on two grounds: (1) Spence
failed to exhaust administrative remedies on his claim in Count
One under section 504 of the Rehabilitation Act prior to filing
suit, and the amended complaint is now time-barred; and
(2) Spence's constitutional claim in Count Two should be
dismissed because the Rehabilitation Act provides exclusive,
preemptive remedies for a plaintiff pursuing handicap
discrimination claims. The district court agreed, and in a
memorandum and order filed in August 1994, the district court
granted Straw's motion to dismiss the amended complaint with
prejudice (and dismissing the motion for summary judgment as
moot). Spence timely appealed, and we have jurisdiction of the
district court's final order under 28 U.S.C. § 1291.
II.
We exercise plenary review over a district court's
dismissal of a complaint for failure to state a claim upon which
relief can be granted. Moore v. Tartler, 986 F.2d 682, 685 (3d
Cir. 1993). Accepting as true all well-pleaded facts in the
plaintiff's complaint (D.R. v. Middle Bucks Area Vocational
Technical School, 972 F.2d 1364, 1367 (3d Cir. 1992)), the
relevant inquiry is whether under any reasonable interpretation
of those allegations the plaintiff may be entitled to relief
(Holder v. City of Allentown, 987 F.2d 188, 193 (3d Cir. 1993)).
We apply this standard to both of the district court's central
holdings below, first discussing exhaustion of remedies prior to
suing for violation of section 504, and then turning to the
question of whether the Rehabilitation Act provides the exclusive
means of raising allegations of discrimination on the basis of
handicap by federal agencies.
A.
1.
Congress passed the Rehabilitation Act of 1973 in part
"to promote and expand employment opportunities in the public and
private sectors for handicapped individuals and to place such
individuals in employment." 29 U.S.C. § 701(8) (1976). The
Rehabilitation Act approached this goal in a number of ways, but
one strategy focused on prohibiting discrimination against the
handicapped by the federal government, federal contractors and
other recipients of federal funds.
As originally drafted the Rehabilitation Act required
federal agencies to submit affirmative action plans for
handicapped individuals (section 501(b), codified at 29 U.S.C.
§ 791(b)), required federal contractors to include in their
contracts provisions mandating that the contractor would take
affirmative action to employ qualified handicapped individuals
(section 503, codified at 29 U.S.C. § 793), and stated with
respect to recipients of federal funds that "[n]o otherwise
qualified handicapped individual . . . shall, solely by reason of
his handicap, be excluded from participation in, be denied the
benefits of, or be subjected to discrimination under any program
or activity receiving Federal financial assistance" (section 504,
codified at 29 U.S.C. § 794). However, as originally drafted the
Rehabilitation Act did not explicitly permit handicapped
individuals to bring claims for violations of its provisions.
Congress filled this gap in 1978, with the Senate and
House adding different language to what became the Rehabilitation
Act amendments of that year. See Prewitt v. United States Postal
Service, 662 F.2d 292, 301-04 (5th Cir. 1981) (discussing 1978
amendment process in detail). The Senate's contribution focused
on provision of a new section in the Rehabilitation Act --
section 505, codified at 29 U.S.C. § 794a. That provision stated
in section 505(a)(1) that
[t]he remedies, procedures, and rights set
forth in section 717 of the Civil Rights Act
of 1964 (42 U.S.C. 2000e-16) [Title VII],
including the application of sections 706(f)
through 706(k) (42 U.S.C. 2000e-5(f) through
(k)), shall be available with respect to any
complaint under [29 U.S.C.] section 791
[Rehabilitation Act section 501] of this
title . . . .
Section 505(a)(1), codified at 29 U.S.C. § 794a(a)(1).
Section 505(a)(2), in turn, provided a private cause of
action for handicapped individuals against providers and
recipients of federal assistance, stating:
The remedies, procedures, and rights set
forth in Title VI of the Civil Rights Act of
1964 [42 U.S.C. §2000d et seq.] shall be
available to any person aggrieved by any act
or failure to act by any recipient of Federal
assistance or Federal provider of such
assistance under [29 U.S.C.] section 794 of
this title [Rehabilitation Act section 504].
Section 505(a)(2), codified at 29 U.S.C. § 794a(a)(2).
At the same time the Senate was focusing on new section
505, the House "extended section 504's proscription against
handicap discrimination to `any program or activity conducted by
an Executive agency or by the United States Postal Service
. . . '" Prewitt, 662 F.2d at 302. In short,
by its 1978 amendments to the Rehabilitation
Act, Congress clearly recognized both in
section 501 and in section 504 that
individuals now have a private cause of
action to obtain relief for handicap
discrimination on the part of the federal
government and its agencies. The amendments
to section 504 were simply the House's answer
to the same problem that the Senate saw fit
to resolve by strengthening section 501 [by
adding section 505]. The joint House-Senate
conference committee could have chosen to
eliminate the partial overlap between the two
provisions, but instead the conference
committee, and subsequently Congress as a
whole, chose to pass both provisions, despite
the overlap.
Id. at 304.
Because of the less than artful manner in which
Congress amended the Rehabilitation Act, the statutory provisions
produce an apparently incongruent enforcement scheme. Federal
agencies may, by the terms of the Rehabilitation Act, be sued for
violation of either section 501 or 504 of the Act. If a party
sues a federal agency for violation of section 501 by pursuing a
claim under section 505(a)(1), Title VII remedies are
"available." 29 U.S.C. § 794a(a)(1). Under Title VII, the
remedies available include any remedies for discrimination
provided by the federal agency itself. 42 U.S.C. § 2000e-16(c).
The Supreme Court has explained that when Title VII remedies are
available, they must be exhausted before a plaintiff may file
suit. And although section 505(a)(1) states only that Title VII
remedies are "available" when one complains of a violation of
section 501, "the legislative history leaves no doubt that
Congress meant to require exhaustion of administrative remedies
[in such cases] just as in ordinary Title VII actions."
McGuinness v. United States Postal Service, 744 F.2d 1318, 1320
(7th Cir. 1984), citing S.Rep. No. 890, 95th Cong., 2d Sess.
18-19 (1978); 124 Cong. Rec. 30578 (1978) (remarks of Senator
Cranston); and Prewitt, 662 F.2d at 303-04. Thus, a party is
barred from suing a federal agency for violation of section 501
if he or she has failed to exhaust administrative remedies under
Title VII.
However, an aggrieved party may also sue a federal
agency for violation of section 504 -- which Congress amended in
1978 to prohibit discrimination by federal agencies -- by
pursuing a claim under section 505(a)(2). Section 505(a)(2),
however, states that the "remedies, procedures, and rights of
Title VI" -- and not Title VII -- are available. 29 U.S.C.
§ 794a(a)(2) (emphasis added).
Spence argues that since he sued the DLA for violation
of section 504, Title VII remedies were not available to him and
need not have been exhausted. Appellant's Br. 11-12.
Furthermore, he correctly notes that although we have not
directly ruled on the issue of whether Title VI remedies must be
exhausted before suit may be brought to enforce section 504, we
have ruled that exhaustion of remedies is not required when a
claim is brought pursuant to Title VI. Id. 12, citing Chowdhury
v. Redding Hospital & Medical Center, 677 F.2d 317 (3d Cir.
1982). Thus, Spence concludes, he did not have to exhaust any
administrative remedies before filing suit.
However, we reject Spence's analysis, having been
particularly persuaded by Judge Posner's lucid statutory
construction of the Rehabilitation Act in McGuinness, a case
closely analogous to the one before us. In McGuinness, an
applicant for a job as a postman with the Milwaukee office of the
United States Postal Service was rejected on the ground that his
flat feet and hammer toes rendered him physically unfit for the
job. He appealed his rejection to the general manager of the
Postal Service's employee relations division, but when he was
told by the general manager that the decision was final, he did
not "take the next step open to him, which would have been to
consult with the Postal Service's equal employment opportunity
counselor, followed (if necessary) by the filing of a formal
complaint." McGuinness, 744 F.2d at 1320.
Instead, McGuinness sued the Postal Service, seeking
damages and the next available postman vacancy. The district
court dismissed McGuinness's complaint and, significantly,
refused to permit him to amend the complaint to state a claim
under section 505(a)(1) because he had failed to exhaust his
administrative remedies. On appeal, the Seventh Circuit affirmed
the district court's dismissal, modifying it only to make clear
that dismissal was without prejudice to McGuinness "bringing a
new suit if and when he exhausts his administrative remedies."
McGuinness, 744 F.2d at 1321.
McGuinness argued that he did not have to exhaust
administrative remedies because his suit was being asserted under
section 504, rather than 505(a)(1). However, the court of
appeals rejected that contention in language that is applicable
here:
Although section 504 has been held applicable
to employment discrimination as well as other
forms of discrimination against the
handicapped by recipients of federal money
. . . it is unlikely that Congress, having
specifically addressed employment of the
handicapped by federal agencies (as distinct
from employment by recipients, themselves
nonfederal, of federal money) in section 501,
would have done so again a few sections later
in section 504. Moreover, as McGuinness
himself is quick to point out, section 505
does not make Title VII remedies available to
people complaining of a violation of section
504; instead, in subsection (a)(2), it makes
Title VI remedies available to them.
McGuinness made no attempt to exhaust Title
VI remedies either. Now it is true that he
probably would not have been required to do
so even if section 504 were applicable to his
claim. Title VI remedies -- which involve
things like cutting off federal funds to the
discriminator -- are not designed to help
individuals . . . . But that is beside the
point. The point is that it would make no
sense for Congress to provide (and in the
very same section -- 505(a)) different sets
of remedies, having different exhaustion
requirements, for the same wrong committed by
the same employer; and there is no indication
that Congress wanted to do this -- as of
course it could do regardless of what might
seem sensible to us -- when it added section
505 in 1978.
McGuinness, 744 F.2d at 1321 (citations omitted). The Seventh
Circuit concluded that either an individual should not be
permitted to sue a federal agency under section 504, or
alternatively that an individual asserting a claim based upon
section 504 must first exhaust Title VII remedies. Id. at
1321-22.
We note that although our sister circuits have not been
entirely consistent in the manner in which they have reached the
ultimate result, the Seventh Circuit's resolution of the
exhaustion issue in McGuinness is consistent with other courts of
appeals that have faced the question of whether a plaintiff must
exhaust Title VII remedies before bringing suit under section
504. One court of appeals has explicitly ruled that an
individual may sue a federal agency or the Postal Service only
under sections 501 and 505(a)(1). See Boyd v. United States
Postal Service, 752 F.2d 410, 413 (9th Cir. 1985). Other courts
of appeals have found that if a litigant sues a federal agency
under sections 504 and 505(a)(2), he or she must satisfy Title
VII remedies so as not to evade the remedial scheme developed by
Congress in the Rehabilitation Act. Prewitt v. United States
Postal Service, 662 F.2d 292 (5th Cir. 1981); Smith v. United
States Postal Service, 742 F.2d 257 (6th Cir. 1984); Morgan v.
United States Postal Service, 798 F.2d 1162, 1164-65 (8th Cir.
1986); Doe v. Garrett, 903 F.2d 1455 (11th Cir. 1990). Finally,
in Milbert v. Koop, 830 F.2d 354 (D.C. Cir. 1987), the District
of Columbia Circuit determined that it need not decide whether
suits by individuals under sections 504 and 505(a)(2) are barred,
but noted that courts that had allowed suits under those
provisions had required exhaustion of Title VII remedies prior to
suit, and strongly suggested plaintiffs suing federal agencies
for handicap discrimination in the future "seek relief under
section 501 rather than under section 504." Id. at 357. After
examination of this case law, and adopting Judge Posner's
analysis in McGuinness, we conclude that a plaintiff must exhaust
Title VII remedies before bringing suit under sections 504 and
505(a)(2) of the Rehabilitation Act, just as he or she must
before suing under sections 501 and 505(a)(1) of the Act.1
1
. Spence relies principally upon three cases: Camenisch v.
University of Texas, 616 F.2d 127 (5th Cir. 1980), vacated on
other grounds, 451 U.S. 390 (1981), Pushkin v. Regents of
University of Colorado, 658 F.2d 1372 (10th Cir. 1981), and
Greater Los Angeles Council on Deafness, Inc. v. Community
Television of Southern California, 719 F.2d 1017 (9th Cir. 1983).
However, those cases are distinguishable: in each of those cases
the defendant contended only that Title VI remedies had to be
exhausted. Camenisch, 616 F.2d at 133-36; Pushkin, 658 F.2d at
1381-82; Greater Los Angeles Council on Deafness, 719 F.2d at
1021; see also Smith v. Barton, 914 F.2d 1330 (9th Cir. 1990)
(stating that since "administrative remedies" under section 504
2.
The DLA argued to the district court that under the
regulations governing the filing of discrimination complaints
with the DLA, Spence had 45 days from the date of the alleged
discrimination in which to contact an Equal Employment
Opportunity counselor at the DLA. Joint Appendix ("J.A.") 67,
citing 29 C.F.R. § 1614.105(a)(1). The agency further noted that
Spence could have sought an extension of the 45 day period
(..continued)
result only in "suspension or termination of the federal
assistance to the institutional recipient" (i.e., Title VII),
exhaustion is not required). There was no indication, therefore,
that any of those courts addressed the applicability or relevance
of Title VII remedies. Furthermore, we note that the Fifth
Circuit subsequently limited its Camenisch holding to suits
involving claims against federal grantees -- in suits against
federal agencies under the Rehabilitation Act, parties are
required to exhaust their Title VII remedies. Prewitt v. United
States Postal Service, 662 F.2d 311, 314 (5th Cir. 1981). And as
explained in the text, in Boyd v. United States Postal Service,
752 F.2d 410 (9th Cir. 1985), the Ninth Circuit found that
individuals may sue federal agencies only under sections 501 and
505(a)(1) of the Rehabilitation Act, undercutting Spence's
reliance upon Greater Los Angeles Council on Deafness.
Spence also argues that our decisions in Chowdhury v.
Redding Hospital & Medical Center, 677 F.2d 317 (3d Cir. 1982),
and Cheyney State College Faculty v. Hufstedler, 703 F.2d 732 (3d
Cir. 1983), suggest that exhaustion of administrative remedies is
not required prior to filing suit under sections 504 and
505(a)(2). We disagree. Chowdhury and Cheyney State College
Faculty stand for the proposition that a party need not exhaust
Title VI remedies before filing a suit claiming a violation of
that statute. Although in Chowdhury we drew support for our
conclusion that exhaustion is not required under Title VI from
cases construing section 504 of the Rehabilitation Act
(Chowdhury, 677 F.2d at 322), neither Chowdhury nor Cheyney State
College Faculty involved a claim under the Rehabilitation Act,
thus neither case discussed whether a litigant pursuing a claim
under sections 504 and 505(a)(2) has any duty to exhaust Title
VII remedies. We decline to turn obiter dictum in Chowdhury into
a holding here.
pursuant to 29 C.F.R. § 1614.105(2), which permits an agency to
extend the 45-day time limit of subsection (a)(1) of the
regulation
when the individual shows that he or she was
not notified of the time limits and was not
otherwise aware of them, that he or she did
not know and reasonably should not have been
known [sic] that the discriminatory matter or
personnel action occurred, that despite due
diligence he or she was prevented by
circumstances beyond his or her control from
contacting the counselor within the time
limits, or for other reasons considered
sufficient by the agency . . . ."
29 C.F.R. § 1614.105(2). The DLA contended that since it was
undisputed that the alleged discriminatory act had occurred back
in 1992 and that Spence had not exhausted his Title VII remedies,
the 45-day time limit had run on his ability to pursue those
remedies, such administrative action was now barred, and his
amended complaint should therefore be dismissed with prejudice as
untimely.2
The district court dismissed Spence's section 504 claim
for failure to exhaust administrative remedies, but failed to
note whether that dismissal was with or without prejudice. We
believe that the complaint should be dismissed as premature,
rather than untimely, and without prejudice to Spence's potential
to file suit again upon exhaustion of administrative remedies.
We note that the regulations cited by the DLA state that the
2
. On appeal, the DLA does not state whether it continues to
maintain that Spence's claims are time-barred -- or potentially
premature.
agency may decide to accept an otherwise untimely administrative
complaint "for other reasons considered sufficient by the
agency." 29 C.F.R. § 1614.105(a)(1). Although we are skeptical
whether the DLA will consider Spence's possible argument that he
did not know that he had to exhaust Title VII remedies before
suing under sections 504 and 505(a)(2) "sufficient reason" to
extend the 45-day deadline, that issue is for the DLA to
determine in the first instance. Cf. McGuinness, 744 F.2d at
1320-21 (interpreting similar provision in 29 C.F.R.
§ 1613.214(a)(4), and clarifying that dismissal in that case was
"without prejudice to [McGuinness] bringing a new suit if and
when he exhausts his administrative remedies"). Thus, we will
clarify the district court's order dismissing this action to note
that Spence may maintain another suit if he pursues his Title VII
remedies, the DLA excuses his failure to file the complaint
during the 45 days following the alleged discriminatory act, and
he exhausts the relevant procedures. We offer no view as to the
appropriate outcome; instead, we emphasize that this is a matter
for the DLA, not us, to determine.
B.
The district court dismissed Spence's claim that the
DLA denied Spence equal protection under the Due Process Clause
of the Fifth Amendment (and that the DLA's actions were arbitrary
and irrational) on the ground that the Rehabilitation Act
provides the exclusive means by which a litigant may raise claims
of discrimination on the basis of handicap by federal agencies.
Spence challenges that holding, as well, but we agree with the
district court's conclusion.
Given that we have found that a litigant must exhaust
administrative remedies under Title VII before filing suit
against a federal agency alleging discrimination on the basis of
handicap under sections 504 and 505(a)(2) of the Rehabilitation
Act, it would be anomalous to permit a litigant to avoid that
remedial scheme by simply asserting an independent constitutional
claim premised upon the same facts. As the Seventh Circuit
explained in McGuinness in rejecting a similar claim under the
Fifth Amendment, "[A]ny effort to avoid sections 505's
requirement of exhausting administrative remedies by challenging
the same conduct under another provision of law must fail because
it would `allow [Congress's] careful and thorough remedial scheme
to be circumvented by artful pleading.'" McGuinness, 744 F.2d at
1322, quoting Brown v. General Services Administration, 425 U.S.
820, 833 (1976).3 Thus, although a litigant may raise claims
such as those asserted by Spence in a suit following exhaustion
of Title VII remedies, he or she may not do so without first
pursuing those remedies.
3
. Courts have held that section 504 does not prevent a
litigant from asserting a separate theory that is not simply a
disguised handicap discrimination claim. E.g., Smith v. Barton,
914 F.2d 1330, 1334 (9th Cir. 1990) (Rehabilitation Act does not
bar a claim under 42 U.S.C. § 1983 based on alleged violations of
a First Amendment right to association, since plaintiffs "allege
violations that are unrelated to issues of handicap
discrimination"). While we do not foreclose that possibility, we
find that Spence's due process/equal protection argument is
essentially identical to his argument under the Rehabilitation
Act, and therefore is barred absent prior exhaustion of Title VII
remedies.
III.
We will modify the judgment of the district court to
clarify that dismissal of Spence's suit is without prejudice to
Spence bringing another suit under the Rehabilitation Act if and
when he exhausts his Title VII administrative remedies under the
Act. In all other respects, the district court will be affirmed.
_________________________