D.J. Olean v. Com. of PA ( 2021 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
David J. Olean, :
Petitioner :
:
v. : No. 604 M.D. 2020
: Submitted: May 7, 2021
Commonwealth of Pennsylvania, :
Respondent :
BEFORE: HONORABLE MARY HANNAH LEAVITT, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE ELLEN CEISLER, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE LEAVITT FILED: December 14, 2021
David J. Olean, pro se, has filed a petition for review against the
Commonwealth in the nature of a trespass action and suit in equity. The petition
alleges that the benefits of the Commonwealth’s Alternate Retirement Program Plan
(ARP Plan), in which he is enrolled, are inferior to those provided by the State
Employees’ Retirement System Plan (SERS Plan). Olean claims that because of this
disparity he has suffered an economic loss, in violation of his constitutionally
protected property rights.1 Olean also claims that the lack of any response from
government officials to whom he has complained is a violation of his constitutional
right to redress of grievances.2 The Commonwealth, by the Attorney General, has
1
Article I, Section 1 of the Pennsylvania Constitution states:
All men are born equally free and independent, and have certain inherent and
indefeasible rights, among which are those of enjoying and defending life and
liberty, of acquiring, possessing and protecting property and reputation, and of
pursuing their own happiness.
PA. CONST. art. I, §1.
2
In addition, Article I, Section 20 of the Pennsylvania Constitution states:
filed preliminary objections seeking dismissal of Olean’s petition on grounds of
sovereign immunity. We will dismiss the petition.
On November 9, 2020, Olean filed his petition for review. The petition
alleges that he was employed by Pennsylvania State University (Penn State) for over
15 years. Petition, ¶10. At the time he was hired in January 2000, he was given a
choice of participating in one of two retirement plans: the ARP Plan, which is a
defined contribution pension plan, or the SERS Plan, which is a defined benefit
pension plan. Id., ¶11. Olean chose to enroll in the ARP Plan. Id., ¶12.
The petition alleges that in 1992, the General Assembly set the
employer contribution rate in the ARP Plan at “9.29% of employee gross earnings
for the fiscal year 1992-1993 and all years after that.”3 Id., ¶26. The contribution
rate has remained unchanged. Id., ¶32. In contrast, the employer contribution rate
The citizens have a right in a peaceable manner to assemble together for their
common good, and to apply to those invested with the powers of government for
redress of grievances or other proper purposes, by petition, address or
remonstrance.
PA. CONST. art. I, §20.
3
Section 5301(a)(12) of the State Employees’ Retirement Code, states:
(a) Mandatory membership.--Membership in the system shall be mandatory as of
the effective date of employment for all State employees except the following:
***
(12) School employees who have elected membership in an
independent retirement program approved by the employer,
provided that in no case, except as hereinafter provided, shall the
employer contribute on account of such elected membership at a rate
greater than the employer normal contribution rate as determined in
section 5508(b) (relating to actuarial cost method). For the fiscal
year 1986-1987 an employer may contribute on account of such
elected membership at a rate which is the greater of 7% or the
employer normal contribution rate as determined in section 5508(b)
and for the fiscal year 1992-1993 and all fiscal years after that at a
rate of 9.29%.
71 Pa. C.S. §5301(a)(12).
2
for the SERS Plan was not fixed at the rate of 9.29% of employee gross earnings.
Id., ¶34. Rather, in 1994, 1998, 2001, 2002, 2010, and 2017, the General Assembly
enacted legislation, which was signed by the Governor, “significantly improving the
SERS benefit for themselves and all other plan participants.” Id., ¶36.
The petition also alleges that the Pennsylvania Public Employee
Retirement Commission (Commission)4 is required to determine the method to set
the employer contribution rates for optional alternative retirement programs to
ensure parity with the contribution rates for the SERS Plan. Petition, ¶21. In 1994,
the Commission prepared a report recommending that the contribution to the ARP
Plan be set at 10.52% of the employer’s payroll for five years and that this rate be
reviewed by the Commission every five years thereafter. Id., ¶28. No action was
taken on the Commission’s recommendations, and no further studies have been done
on the parity of employer contributions to the two retirement plans. Id., ¶¶29, 37.
Olean’s petition avers that the Governor and General Assembly have
increased the benefits for the SERS Plan members, which includes them, but have
not increased the benefits for employer contribution rate to the ARP Plan since 1992-
1993. Id., ¶¶32, 36. Olean alleges that there is no parity between the employer
contribution rates to the two plans or the benefits they pay to retirees. Id., ¶¶44-46,
54.
Olean’s petition alleges that Penn State failed to provide him with all
the necessary information about the ARP Plan so that he could make an informed
4
The Commission was created by the Act of July 9, 1981, P.L. 208, to review legislation affecting
public employee pension and retirement plans and to study public employee pension and
retirement policy both at the State and local levels, the interrelationship of the systems, and their
actuarial soundness and costs. Former Section 4 of the Public Employee Retirement Commission
Act, formerly 43 P.S. §1401, repealed by the Act of July 20, 2016, P.L. 849, No. 100 (Act 100 of
2016). Subsequently, Act 100 of 2016 dissolved the Commission and transferred certain powers
and duties to the Department of Auditor General.
3
decision when selecting a plan. Petition, ¶¶56-58. In 2015, he contacted Penn State
and the Commission about the lack of parity between the retirement plans. He was
told that the ARP Plan employer contribution rate was established by statute, and
there were plans to make the ARP Plan benefit “comparable” to the SERS Plan. Id.,
¶¶64-65, Ex. 6. Olean alleges that Penn State and the Commission “knew or should
have known” that the two plans do not provide comparable benefits. Id., ¶¶67-68.
Lastly, Olean’s petition avers that he filed complaints with the Office
of Attorney General, Department of Labor and Industry, United States Senator
Robert Casey’s Office, Governor Wolf’s Office, State Representative Brooks’
Office, and State Senator Brewster’s Office; he has received no meaningful
responses. Id., ¶¶73-76, 88-89, 91-92. In addition, he sent a criminal complaint
directly to Attorney General Josh Shapiro. Olean contacted several county bar
associations for legal assistance, but he was not able to find an attorney to represent
him. Id., ¶¶ 96-100.
Based on the foregoing, Olean’s petition presents two main claims.5
First, he argues that the Commonwealth has failed to ensure equal employer
contributions to the ARP Plan and the SERS Plan. As a result, Olean’s retirement
compensation has been diminished, in violation of his property rights protected by
Article I, Section 1 of the Pennsylvania Constitution. PA. CONST. art. I, §1. Second,
he argues that he has been denied his right to petition the government for redress of
his grievances in violation of Article I, Section 20 of the Pennsylvania Constitution,
PA. CONST. art. I, §20, because the governmental officials did not act on his
complaints.
5
Olean lists 11 “claims” in his petition. Most assert factual allegations or conclusions as opposed
to identifying specific laws he alleges the Commonwealth has violated. In ascertaining Olean’s
claims, we considered the petition in its entirety without regard to its organization.
4
For relief, Olean seeks an order directing the Commonwealth to: (1)
require all SERS participants, except for current and retired employees of the
Pennsylvania State Police and the Commonwealth Court, to forfeit their benefits
earned as of 1992-1993 going forward; (2) require all state employees, except for
current employees of the Pennsylvania State Police and the Commonwealth Court,
to participate in the ARP Plan; and (3) enforce the Public Employee Pension
Forfeiture Act.6 Oelan also seeks compensatory damages in the amount of
$2,000,000 and punitive damages.
The Commonwealth has filed preliminary objections to Olean’s
petition, asserting seven grounds for dismissing the petition.7 First, the
Commonwealth argues that it is immune from Olean’s claim for damages.
Preliminary Objections, ¶29. Second, the Commonwealth argues that Olean’s
claims are barred by the doctrine of res judicata because he filed a substantially
similar action in federal court that was dismissed on August 13, 2020 and which
Olean did not appeal. Preliminary Objections, ¶¶17-19, Ex. B.8 Third, the
Commonwealth asserts that this Court lacks jurisdiction because Olean’s claims
relate to employee benefit plans and, therefore, are preempted by the Employee
Retirement Income Security Act of 1974, 29 U.S.C. §1144(a). Preliminary
Objections, ¶22. Fourth, the Commonwealth contends that Olean’s claims, if viable,
are barred by the applicable statute of limitations because he chose to participate in
6
Act of July 8, 1978, P.L. 752, as amended, 43 P.S. §§1311-1315.
7
For purposes of this opinion, we have rearranged the order of the Commonwealth’s preliminary
objections.
8
Exhibit B is a copy of the order dismissing a case filed by Olean against the Commonwealth in
the United States District Court for the Middle District of Pennsylvania for lack of subject matter
jurisdiction pursuant to the Eleventh Amendment of the United States Constitution, U.S. CONST.
amend. XI. Olean v. Commonwealth (M.D. Pa., No. 1:20-cv-00360, order filed August 13, 2020).
5
the ARP Plan in 2000 but waited two decades to file his petition.9 Id., ¶27. Fifth,
the Commonwealth argues that Olean lacks standing to sue because he admits that
he was given a choice between the two retirement plans and he elected the ARP Plan.
Id., ¶¶31, 33. Sixth, the Commonwealth asserts that the petition fails to state a claim
upon which relief can be granted for several reasons, “including, but not limited to,
the General Assembly is not required to pass any specific laws [that Olean]
requests.” Id., ¶35. Finally, the Commonwealth contends that Olean failed to join
all necessary and indispensable parties because he did not name Penn State, “the
ARP Plan” or the ARP Plan administrator as respondents. Id., ¶¶40-41.
When ruling on preliminary objections, we must accept as true all well-
pleaded material allegations in the petition for review and any reasonable inferences
that we may draw from the averments. Meier v. Maleski, 648 A.2d 595, 600 (Pa.
Cmwlth. 1994). A court need not accept as true conclusions of law, unwarranted
inferences, argumentative allegations, or expressions of opinion encompassed in the
petition for review. Portalatin v. Department of Corrections, 979 A.2d 944, 947
(Pa. Cmwlth. 2009). A demurrer will be sustained where the law is clear that the
petitioner has failed to state a claim for which relief may be granted. Clark v. Beard,
918 A.2d 155, 158 n.4 (Pa. Cmwlth. 2007). In this regard, any doubt is resolved in
favor of the petitioner.
9
The Commonwealth asserts that to the extent Olean brings a claim under 42 U.S.C. §1983(relating to violations of civil rights), a two-year statute of limitations applies. Preliminary
Objections, ¶26. In response, Olean confirmed that he is not bringing a claim pursuant to 42 U.S.C.
§1983. Brief in Opposition to Preliminary Objections at 7, 9. Likewise, the Commonwealth
asserts that Olean fails to state a claim under the Fourteenth Amendment to the United States
Constitution, U.S. CONST. amend. XIV, as he failed to allege a recognized interest which the
Commonwealth has violated. Preliminary Objections, ¶¶36-37. Olean agrees that he failed to
state a Fourteenth Amendment claim but asserts that his petition should not be dismissed. Brief in
Opposition to Preliminary Objections at 13.
6
We begin with the Commonwealth’s assertion that Olean’s claims are
barred by the doctrine of sovereign immunity.10 “Under the Pennsylvania
Constitution, the Commonwealth enjoys sovereign immunity from lawsuits.” Sutton
v. Bickell, 220 A.3d 1027, 1034 (Pa. 2019). The Pennsylvania Constitution
authorizes the General Assembly to waive immunity by statute. Article I, section 11
of the Pennsylvania Constitution provides:
All courts shall be open; and every man for an injury done him
in his lands, goods, person or reputation shall have remedy by
due course of law, and right and justice administered without
sale, denial or delay. Suits may be brought against the
Commonwealth in such manner, in such courts and in such cases
as the Legislature may by law direct.
PA. CONST. art. I, §11 (emphasis added). This provision was long understood to
mean that only the General Assembly had the power to abrogate the doctrine of
sovereign immunity and to forbid judicial abrogation of the doctrine. Mayle v.
Pennsylvania Department of Highways, 388 A.2d 709, 716-17 (Pa. 1978). In Mayle,
388 A.2d at 716-20, the Supreme Court held that this understanding of article I,
section 11 was incorrect and abrogated sovereign immunity. Thereafter, the
legislature reinstated sovereign immunity and simultaneously waived the immunity
for certain claims. Chapter VI of the act known as the “Pennsylvania Consolidated
Statutes” states, in relevant part, as follows:
10
Under the Pennsylvania Rules of Civil Procedure, immunity from suit is an affirmative defense
that must be pled in a responsive pleading under the heading new matter, not as a preliminary
objection. PA.R.CIV.P. 1030(a). Courts, however, have permitted a limited exception to this rule
and allowed parties to raise the affirmative defense as a preliminary objection where the defense
is “clearly applicable on the face of the [petition for review].” Smolsky v. Pennsylvania General
Assembly, 34 A.3d 316, 321 n.7 (Pa. Cmwlth. 2011). “Where the [petitioner] does not object to
the improper procedure, courts have ruled on the affirmative defense of immunity raised by
preliminary objections.” Id. Although Olean argues that sovereign immunity does not apply, he
does not object to the Commonwealth raising the defense as a preliminary objection.
7
[T]hat the Commonwealth, and its officials and employees acting
within the scope of their duties, shall continue to enjoy sovereign
immunity and official immunity and remain immune from suit
except as the General Assembly shall specifically waive the
immunity.
1 Pa. C.S. §2310 (emphasis added). The General Assembly has waived sovereign
immunity for certain claims against the Commonwealth agencies, officials, and
employees. 42 Pa. C.S. §§8521-8522.11 The Commonwealth of Pennsylvania,
which is not a Commonwealth agency, “still enjoys absolute immunity pursuant to
1 Pa. C.S. §2310.” Brouillette v. Wolf, 213 A.3d 341, 356 (Pa. Cmwlth. 2019) (citing
Finn v. Rendell, 990 A.2d 100, 105 (Pa. Cmwlth. 2010) (citations omitted and
emphasis in original)).
Here, the petition names the “Commonwealth of Pennsylvania” as
Respondent, not a Commonwealth agency, official, or employee. The
Commonwealth of Pennsylvania enjoys absolute immunity from suit. Finn, 990
A.2d at 105. Thus, Olean’s claims for damages against the Commonwealth of
Pennsylvania are barred by sovereign immunity.
Even if Olean had named a Commonwealth agency or employee as a
respondent, his petition would not state a claim. Olean seeks affirmative action by
the Commonwealth to revise the benefits of SERS members and to make state
employees participate in the ARP Plan. Such a grant of mandatory injunctive relief
would be barred by sovereign immunity. Fawber v. Cohen, 532 A.2d 429, 433 (Pa.
11
The General Assembly has waived immunity “to claims for damages” brought against
Commonwealth agencies and employees caused by: (1) vehicle liability; (2) medical-professional
liability; (3) care, custody or control of personal property; (4) Commonwealth real estate, highways
and sidewalks; (5) potholes and other dangerous conditions; (6) care, custody or control of animals;
(7) liquor store sales; (8) national guard activities; (9) toxoids and vaccines; and (10) sexual abuse.
42 Pa. C.S. §8522(b).
8
1987). See also Stackhouse v. Pennsylvania State Police, 892 A.2d 54, 61 (Pa.
Cmwlth. 2006) (claims seeking mandatory injunctions to compel affirmative action
by Commonwealth officials are barred by sovereign immunity). The courts’
equitable powers cannot trump sovereign immunity. Scientific Games International,
Inc. v. Department of Revenue, 66 A.3d 740, 758 (Pa. 2013).
Olean argues, nevertheless, that the General Assembly’s reinstatement
of sovereign immunity was unconstitutional because it interferes with his right of
access to the courts guaranteed by Article I, Section 11 of the Pennsylvania
Constitution. PA. CONST. art. I, §11. This Court has previously rejected Olean’s
argument.
In Zauflik v. Pennsbury School District, 72 A.3d 773, 780-81 (Pa.
Cmwlth. 2013), we explained that the General Assembly’s authority to restore
sovereign immunity is consistent with Article I, Section 11 of the Pennsylvania
Constitution. Article I, Section 11 provides that suits against the Commonwealth
may be brought “in such manner, in such courts and in such cases as the Legislature
may by law direct.” PA. CONST. art. I, §1 (emphasis added). Because the
Pennsylvania Constitution vests the General Assembly with discretion to decide
which cases may be brought against the Commonwealth, Olean’s argument lacks
merit. Zauflik, 72 A.3d at 781.
Further, Olean argues that state sovereign immunity does not apply
where an individual alleges that a state’s action violates the federal or state
constitution. Olean directs this Court to the Florida Supreme Court’s decision in
Department of Revenue v. Kuhnlein, 646 So.2d 717, 721 (Fla. 1994) (emphasis
added), wherein that Court stated:
Sovereign immunity does not exempt the State from a challenge
based on violation of the federal or state constitutions, because
9
any other rule self-evidently would make constitutional law
subservient to the State’s will. Moreover, neither the common
law nor a state statute can supersede a provision of the federal
or state constitutions.
This Court is not bound by the decisions of other state courts.
Condemnation by Pennsylvania Turnpike Commission v. Lands of Tarlini, 185 A.3d
1177, 1186 (Pa. Cmwlth. 2018). Further, the language in Kuhnlein is inapposite here
because the Sovereign Immunity Act does not “supersede” or conflict with Article
I, Section 11 of the Pennsylvania Constitution. The General Assembly, through the
Sovereign Immunity Act, defined the types of claims for damages that may lie
against Commonwealth agencies and their employees, which this Court has held is
consistent with the discretion conferred on the legislature by Article I, Section 11 of
the Pennsylvania Constitution. Zauflik, 72 A.3d at 780-81.12
Accordingly, we sustain the Commonwealth’s preliminary objection
asserting sovereign immunity and dismiss the petition for review.13
____________________________________________
MARY HANNAH LEAVITT, President Judge Emerita
12
Additionally, several of the “claims” in Olean’s petition for review relate to actions or inactions
of the General Assembly, the Governor, and Penn State. However, Olean has not named these
entities or individuals as parties in this matter, and he has only served the Office of Attorney
General with a copy of the petition. See PA. R.A.P. 1513(b) (“[t]he government unit and any other
indispensable party shall be named as respondents”); PA.R.CIV.P. 2102(a)(2) (“[a]n action against
a Commonwealth agency or party shall be styled in the following manner: Plaintiff v. ‘_____
(Name of Agency or Party) of the Commonwealth of Pennsylvania’”). The failure to join an
indispensable party to a lawsuit deprives this Court of jurisdiction. O’Hare v. County of
Northampton, 782 A.2d 7, 13 (Pa. Cmwlth. 2001). To the extent Olean intended to bring claims
against these parties, he needed to identify them in the caption.
13
Given our disposition of this matter, we need not address the Commonwealth’s remaining
preliminary objections.
10
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
David J. Olean, :
Petitioner :
:
v. : No. 604 M.D. 2020
:
Commonwealth of Pennsylvania, :
Respondent :
ORDER
AND NOW, this 14th day of December, 2021, it is ORDERED that the
preliminary objection of the Commonwealth of Pennsylvania asserting sovereign
immunity in the above-captioned matter is SUSTAINED and the petition for review
is DISMISSED.
_____________________________________
MARY HANNAH LEAVITT, President Judge