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Bomberger v. Benchmark Builders, Inc.

United States District Court, D. Delaware

April 13, 2017

BENCHMARK BUILDERS, INC., a Delaware corporation, Defendant.


         Plaintiff filed this action against Defendant claiming violations of the Age Discrimination in Employment Act ("ADEA") under 29 U.S.C. § 621 et seq. ("Count I"), the Delaware Discrimination in Employment Act ("DDEA") under 19 Del. C. § 710 et seq. ("Count II"), and the Delaware Common Law Covenant of Good Faith and Fair Dealing ("Count III"). (D.I. 4 at ¶¶ 39-50). Presently before the Court is Defendant's Motion to Dismiss Count II and Count III of Plaintiffs First Amended Complaint. (D.I. 7). The issues have been fully briefed. (D.I. 8, 11, 17). For the reasons set forth below, Defendant's Motion is GRANTED.

         I. BACKGROUND

         This dispute arises out of Plaintiff Steven W. Bomberger's termination of employment from Defendant Benchmark Builders, Inc. in June, 2015. Bomberger was an employee, minority shareholder and former President of Benchmark. (D.I. 4 at ¶ 5). In 1988, Bomberger co-founded Benchmark with Francis Julian, Richard Julian and Gene Julian. (Id. at ¶ 6). Bomberger executed an employment agreement with Benchmark which included a provision for acquiring stock, and which stated, "[t]he redemption price of all stock is the book value of the stock shares." (Id. at ¶¶ 7-8) (alteration in original). In 1994, the four principal shareholders entered into a share repurchase agreement that provided a mechanism for determining the buyback price of stock when any shareholder left the company.[1] (Id. at ¶¶ 10-11).

         The Complaint alleges that in late 2012, Francis and Richard attempted to shift management control to their children (the "Successor Generation") through a proposal "to amend the [share repurchase agreement] so that a Principal Shareholder could transfer stock to his children." (Id. at ¶ 21). This proposal did not benefit Bomberger because he did not have children working for Benchmark. (Id.). Shortly after the amendment, "the Successor Generation began asserting control over Benchmark" and brought in younger employees. (Id. at ¶ 23). At an April 24, 2015 meeting of the Benchmark Board, Bomberger suggested to Francis, Richard, and others within Benchmark that he would resign if they were going to dissolve Benchmark and attempt to freeze him out of the company as they had done to Gene. (Id. at ¶ 26). Those present at the meeting interpreted this as a resignation, and on May 29, 2015, Francis "sent Bomberger a letter that purported to 'confirm [Bomberger's] resignation as President of the Company' and unilaterally set June 30, 2015 as Bomberger's last day of employment with Benchmark." (Id. at ¶ 28) (alteration in original). The letter also stated that Benchmark would repurchase Bomberger's shares at $747.00 per share, which was significantly less than net book value, and "that Bomberger would be replaced by Matthew Egan, " who was fifteen years younger than Bomberger. (Id. at ¶¶ 28-29). Francis subsequently sent an email to Benchmark's staff and trade partners that falsely stated Bomberger was retiring. (Id. at ¶ 48). Bomberger was nine months away from turning fifty-nine, at which time he would have been able to give three years notice of intent to retire pursuant to Article 5 of the share repurchase agreement. (Id. at ¶ 28). A retirement pursuant to Article 5 would have required Benchmark to repurchase Bomberger's 150 shares for their full net book value of $3, 925.15 per share, which was significantly higher than both the original purchase price of $100.00 per share and the $747.00 per share price stated in the May 29, 2015 letter.[2] (Id. at ¶ 32). Thus, by terminating his employment before he turned fifty-nine, Benchmark denied Bomberger more than $476, 000. (Id. at ¶ 33).

         Bomberger submitted an Intake Questionnaire to the Delaware Department of Labor (the "DDOL") on October 8, 2015, which was 118 days after his termination.[3] (Id. at ¶ 36). The document stated, in bold type, "THAT COMPLETION OF THE ENCLOSED FORMS DOES NOT CONSTITUTE FILING A CHARGE OF DISCRIMINATION." (D.I. 4-2 at 2). On October 26, 2015, Bomberger filed a charge of discrimination with the DDOL alleging violations of the DDEA and ADEA. (D.I. 4-4 at 2). The DDOL determined that it did not have jurisdiction and transferred Bomberger's complaint to the EEOC. (D.I. 4 at ¶ 37). On September 27, 2016, "[t]he EEOC issued Bomberger a Notice of Right to Sue, " but Bomberger was never issued a Delaware Right to Sue Notice by the DDOL. (Id. at ¶ 38).


         Rule 8 requires a complainant to provide "a short and plain statement of the claim showing that the pleader is entitled to relief" Fed.R.Civ.P. 8(a)(2). Rule 12(b)(6) allows the accused party to bring a motion to dismiss the claim for failing to meet this standard. A Rule 12(b)(6) motion may be granted only if, accepting the well-pleaded allegations in the complaint as true and viewing them in the light most favorable to the complainant, a court concludes that those allegations "could not raise a claim of entitlement to relief." Bell Ail. Corp. v. Twombly, 550 U.S. 544, 558 (2007).

         "Though 'detailed factual allegations' are not required, a complaint must do more than simply provide 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action."'Davis v. Abington Mem'lHosp., 765 F.3d 236, 241 (3d Cir. 2014) (quoting Twombly, 550 U.S. at 555). I am "not required to credit bald assertions or legal conclusions improperly alleged in the complaint." In re Rockefeller Ctr. Props., Inc. Sec. Litig., 311 F.3d 198, 216 (3d Cir. 2002). A complaint may not be dismissed, however, "for imperfect statement of the legal theory supporting the claim asserted." Johnson v. City of Shelby, 135 S.Ct. 346, 346 (2014).

         A complainant must plead facts sufficient to show that a claim has "substantive plausibility." Id. at 347. That plausibility must be found on the face of the complaint. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). "A claim has facial plausibility when the [complainant] pleads factual content that allows the court to draw the reasonable inference that the [accused] is liable for the misconduct alleged." Id. Deciding whether a claim is plausible will be a "context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679.


         A. Violation of the DDEA (Count II)

         Benchmark's Motion to Dismiss Count II of the Complaint is granted because Bomberger did not timely file a charge of discrimination with the DDOL as required by the DDEA.[4] The intake questionnaire submitted by Bomberger 118 days after his termination does not constitute a charge of discrimination. This Court, consistent with the Supreme Court in Fed, Express Corp. v. Holowecki, 552 U.S. 389 (2008), has previously held that an intake questionnaire is not charge of discrimination when the questionnaire cannot "be construed as a request to take action" and explicitly states that completion of the form does not constitute a charge. See Hayes v. Delaware State University, 726 F.Supp.2d 441, 453 (D. Del. 2010) (holding intake questionnaire filed with DDOL that specifically stated it "does not constitute the filing of a charge" was not a charge despite similarities in content between the two documents). The intake questionnaire in this case, similar to the intake questionnaire in Hayes, stated in in bold type, "THAT COMPLETION OF THE ENCLOSED FORMS DOES NOT CONSTITUTE FILING A CHARGE OF DISCRIMINATION." (D.I. 4-2 at 2). The DDOL did not consider the questionnaire to be a charge, and it cannot be construed as a request to take action because it does not contain any specific requests for relief. Because the intake questionnaire makes clear it is not a charge of discrimination, and Bomberger only submitted an actual charge more than 120 days after his termination, his claim is time-barred by the statute.

         Bomberger argues that even if the intake questionnaire does not constitute a charge of discrimination, the amendment to the DDEA extending the filing deadline for a charge to 300 days should apply retroactively to save his claim. (D.I. 11 at 16-18). I refuse to apply the amendment retroactively because Benchmark's substantive rights will be affected. Statutory amendments generally apply prospectively "unless the legislature expressly states, to the contrary, that the amendments shall be retrospective ... [or the amendment] relates to practice, procedure or remedies and does not affect substantive or vested rights." Fountain v. State, 139 A.3d 837, 841 (Del. 2016) (quoting Hubbard v. Hibbard Brown & Co., 633 A.2d 345, 354 (Del. 1993)). Retroactive application is not appropriate if "a person's rights and obligations will be affected." Konstantopoulous v. Westvaco Corp., No. 90-146-CMW, 1992 U.S. Dist. LEXIS 9466, at *19 (D. Del. June 19, 1992). In this case, the amendment to the DDEA extending the filing deadline to 300 days does not state that it applies retroactively. The amendment is not necessarily procedural because retroactive application would subject Benchmark to a claim which would not otherwise exist, thereby affecting its rights and obligations. Therefore, the amendment cannot be applied retroactively and Plaintiffs claim is time-barred.

         B. Violation of the Delaware Common Law Covenant of Good Faith ...

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