Schierholt v. Nationwide Mutual Insurance Co.

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION

Deborah J. Schierholt,

Plaintiff, Case No. 2:22-cv-3061

V. Judge Michael H. Watson

Nationwide Mutual Insurance Co., Magistrate Judge Jolson

Defendant.

OPINION AND ORDER

Nationwide Mutual Insurance Co. (“Defendant”) moves for judgment on the

pleadings on Deborah J. Schierholt’s (“Plaintiff’) Complaint. ECF No. 7. For the

following reasons, the motion is GRANTED.

I. FACTS'

Plaintiff, age 62 at the time of filing the Complaint, began working for

Defendant in 2009 as an executive assistant. Compl. 8, ECF No. 1. Plaintiff

most recently worked in Defendant’s Project Delivery Services Department. /d.

In August 2020, Plaintiffs department was eliminated in a reduction-in-force. /d.

Plaintiff's last day of employment was scheduled to be October 30, 2020. See

Agreement 1, ECF No. 7-1.

Prior to the end of her employment, Plaintiff applied for an executive

assistant position in another department (the “Position”). Compl. 11, ECF No.

1 The Court accepts Plaintiffs’ factual allegations as true for the purposes of Defendant's

motion. See Fritz v. Charter Twp. of Comstock, 592 F.3d 718, 722 (6th Cir. 2010).

1. Based on her resume, experience, and letters of recommendation, Plaintiff

was one of the most qualified applicants for the Position. /d. 14. On October

13, 2020, Plaintiff learned that she was not selected for the Position. PI. Aff. 1 8,

ECF No. 7-2.

On October 14, 2020, Plaintiff signed a severance agreement (the

“Agreement”). Agreement, ECF No. 7-1. Therein, Plaintiff waived all claims—

including claims under the Age Discrimination in Employment Act (“ADEA”)—that

arose before the execution of the Agreement. /d. On October 22, 2020, Plaintiff

learned that Defendant selected Kelly Lewis (“Lewis”) for the Position; Lewis was

age 35 at the time, had only one year of prior employment with Defendant, and

had no prior experience as an executive assistant. Compl. 16, ECF No. 1.

ll. © STANDARD OF REVIEW

“For purposes of a motion for judgment on the pleadings, all well-pleaded

material allegations of the pleadings of the opposing party must be taken as true,

and the motion may be granted only if the moving party is nevertheless clearly

entitled to judgment.” Fritz, 592 F.3d at 722 (quoting JPMorgan Chase Bank v.

Winget, 510 F.3d 577, 581 (6th Cir. 2007)). A claim survives a motion to dismiss

under Rule 12(b)(6) if it “contain[s] sufficient factual matter, accepted as true, to

‘state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S.

662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).

“The plausibility standard is not akin to a ‘probability requirement,’ but it asks for

more than a sheer possibility that a defendant has acted unlawfully.” /d. (quoting

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Twombly, 550 U.S. at 556). This standard “calls for enough fact to raise a

reasonable expectation that discovery will reveal evidence of [unlawful conduct].”

Twombly, 550 U.S. at 556. A pleading’s “[flactual allegations must be enough to

raise a right to relief above the speculative level . . . on the assumption that all

the allegations in the [pleading] are true (even if doubtful in fact)[.]” /d. at 555

(internal citations omitted). At the motion to dismiss stage, a district court must

“construe the complaint in the light most favorable to the plaintiff, accept its

allegations as true, and draw all reasonable inferences in favor of the plaintiff.”

Wamer v. Univ. of Toledo, 27 F.4th 461, 466 (6th Cir. 2022) (internal quotation

marks and citations omitted). However, the non-moving party must provide

“more than labels and conclusions, and a formulaic recitation of the elements of a

cause of action will not do.” Twombly, 550 U.S. at 555.

lil. ANALYSIS

Plaintiff asserts her claim under the ADEA. Compl. ff] 24-25, ECF No. 1.

However, through the Agreement, Plaintiff waived any ADEA claims that arose

before the execution of the Agreement. Agreement, ECF No. 7-1. The issues,

then, are whether Plaintiff's claim “arose” before she signed the Agreement and,

if so, whether the Agreement is enforceable.

First, the Court addresses a preliminary matter. In a prior Opinion and

Order, the Court observed a discrepancy between the date Plaintiff learned she

did not get the Position as alleged in the Complaint (October 22, 2020) and as

averred in an affidavit attached to Defendant’s motion (October 13, 2020). ECF

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No. 29. Because that discrepancy might have been dispositive, the Court

notified the parties that it would treat the motion for judgment on the pleadings as

one for summary judgment and directed the parties to conduct limited discovery

on the timing of events. /d. Plaintiff responded to the Court’s Opinion and Order

and explained that she agreed that the date on which she learned she did not get

the Position was October 13, 2020. ECF No. 30. As such, the Court will

consider October 13, 2023 as the date on which Plaintiff learned she did not get

the Position.

A. When did Plaintiff’s claim arise?

The ADEA provides that it shall be unlawful for an employer “to fail or

refuse to hire or to discharge any individual . . . because of such individual’s

age.” 29 U.S.C. § 623(a)(1). The ADEA protects individuals forty years of age or

older. 29 U.S.C. § 631(a).

Plaintiff argues that her ADEA claim arose when she learned that a

younger person was hired for the Position, not when Plaintiff learned she did not

get the Position. Resp., ECF No. 8. Plaintiff argues that she could not have

known there was any basis for thinking Defendant acted in a discriminatory

manner until she learned that a younger person was hired. /d. Therefore,

according to Plaintiff, her ADEA claim “arose” after she signed the Agreement.

Id.

Any argument that Plaintiffs ADEA claim arose on the date she learned a

younger candidate got the position fails. An ADEA claim “accrues when [the

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plaintiff] learns of the actual injury (i.e., an adverse employment action), not when

[the plaintiff] suspects a legal wrong.” Russell v. Metro. Nashville Pub. Sch., No.

3-11-0536, 2012 WL 3241664, at *2, n. 3 (M.D. Tenn. Aug. 7, 2012); see also

Giambrone v. Spalding & Eventio Co., 966 F.2d 1452 (Table) (6th Cir. 1992) (“[A]

plaintiff's cause of action accrues under the ADEA when he is notified of

impending termination[.]” (citing cases)); Taylor v. Battelle Columbus Lab’ys, 680

F. Supp. 1165, 1170 (S.D. Ohio 1988) (“It is now well settled that a cause of

action under the ADEA accrues when the employee receives a notice of

termination . . . .” (cleaned up)).

Applied here, Plaintiffs claim accrued on October 13, 2023, the day she

learned she did not get the Position. Plaintiff signed the Agreement on October

14, 2020. Agreement, ECF No. 7-1. Accordingly, Plaintiffs claim arose before

the Agreement, and, therefore, Plaintiff waived her ADEA claim with the

Agreement.

Relatedly, Plaintiff also argues that the date her claim arose should be

tolled by the equitable doctrine of fraudulent concealment. The fraudulent

concealment doctrine tolls a limitations period “where a defendant impermissibly

conceals its wrongdoing from the plaintiff.” Lutz v. Chesapeake Appalachia, LLC,

807 F. App’x 528, 530 (6th Cir. 2020) (citing Doe v. Archdiocese of Cincinnati,

849 N.E.2d 268, 278-79 (Ohio 2006)). To toll the statute of limitations based on

fraudulent concealment, a plaintiff must show “(1) a factual misrepresentation,

(2) that the misrepresentation is misleading, (3) that the misrepresentation

Case No. 2:22-cv-3061 Page 5 of 10

induced actual reliance that was reasonable and in good faith, and (4) that it

caused detriment to the relying party.” Lutz, 807 F. App’x, at 530-31 (citing

cases).

Here, equitable tolling based on fraudulent concealment is unwarranted.

Plaintiff fails to allege any “affirmative acts of concealment,” which is a

“prerequisite for equitable tolling.” Hamilton Cty. Bd. of Comm’rs. v. National

Football League, 491 F.3d 310, 318 (6th Cir. 2007). Examples of such

affirmative acts include “hiding evidence or promising not to plead the statute of

limitations.” Bridgeport Music Inc. v. Diamond Time Ltd., 371 F.3d 883, 891 (6th

Cir. 2004). “[MJere silence or unwillingness to divulge wrongful activities is not

sufficient.” Helmbright v. City of Martins Ferry, Ohio, 61 F.3d 903 (Table) (6th

Cir. July 26, 1995).

Here, Plaintiff does not allege that Defendant took any affirmative action to

conceal that it hired a younger candidate for the Position. Instead, Plaintiff

alleges only that she did not, and could not, have known that Defendant hired a

younger person for the Position before signing the Agreement and that

Defendant knew that Plaintiff did not, and could not, know the same. Compl.

18-19, ECF No. 1. In other words, Plaintiff alleges only that Defendant was

“merely silent” or “unwilling to divulge wrongful activities.” Helmbright, 61 F.3d

903 (Table). That is insufficient to plead fraudulent concealment; therefore,

tolling the accrual date is inappropriate here.

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In sum, Plaintiffs ADEA claim arose before she signed the Agreement,

and equitable tolling is inapplicable here.

B. Is the Agreement enforceable?

Plaintiff argues that even if her claim arose before signing the Agreement,

she was fraudulently induced into signing it, and, therefore, it is not an

enforceable release of her claim. Resp., ECF No. 8.

As an initial matter, the state common law doctrine of fraudulent

inducement likely does not apply to ADEA claims. See Oubre v. Entergy

Operations, Inc., 522 U.S. 422, 427 (1998). As the Supreme Court has

explained, the Older Workers Benefit Protection Act (“OWBPA’) “sets up its own

regime for assessing the effect of ADEA waivers, separate and apart from

contract law.” /d. Thus, the “OWBPA governs the effect under federal law of

waivers or releases on ADEA claims and incorporates no exceptions or

qualifications,” and forecloses state common law arguments about the validity of

the release, “notwithstanding how general contract principles would apply to non-

ADEA claims.” /d.

Consider, then, the OWBPA’s requirements. The OWBPA sets out the

following requirements for a valid release of an ADEA claim:

(1) The release must be written in a manner calculated to be

understood by the employee signing the release, or the average

individual eligible to participate;

(2) the release must specifically refer to the ADEA;

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(3) the release must not purport to encompass claims that may arise

after the date of signing;

(4) the employer must provide consideration for the ADEA claim

above and beyond that to which the employee would otherwise

already be entitled;

(5) the employee must be advised in writing to consult with an

attorney;

(6) the employee must be given at least 21 or 45 days to consider

signing, depending on whether the incentive is offered to a group;

(7) the release must allow the employee to rescind the agreement up

to 7 days after signing; and

(8) if the release is offered in connection with an exit incentive or group

termination program, the employer must provide information relating

to the job titles and ages of those eligible (or selected) for the program,

and the corresponding information relating to employees in the same

job titles who were not eligible (or not selected) for the program.

Howlett v. Holiday Inns, Inc., 120 F.3d 598, 600 (6th Cir. 1997) (paraphrasing 29

U.S.C. § 626(f)).

Plaintiff makes no argument that the Agreement fails to meet any of these

statutory requirements. From the Court’s review of the Agreement, the Court

concludes that the Agreement complies with the OWBPA requirements and,

therefore, is a valid release.

Even if the fraudulent inducement doctrine applied to an ADEA claim, it

would not invalidate the Agreement here. The only allegations in the Complaint

that seem to relate to Plaintiff's fraudulent inducement claim are: (1) that Plaintiff

could not have discovered that a younger candidate was chosen for the Position

before Plaintiff signed the Release; and (2) that Defendant knew Plaintiff could

Case No. 2:22-cv-3061 Page 8 of 10

not have learned the same. Compl. J] 18-19, ECF No. 1. It seems, then, that

Plaintiff argues fraudulent omission, rather than a fraudulent affirmative

statement.

When a plaintiff “alleges fraud by concealment or omission, the plaintiff

must also allege an underlying duty to speak for the nondisclosure to be

actionable.” Brown v. Whirlpool Corp., 996 F. Supp. 2d 623, 646 (N.D. Ohio

2014) (cleaned up). The general rule is that parties to a contract do not have a

duty to disclose, absent special circumstances including: “(1) when a fiduciary

relationship exists between the parties, (2) where a special trust or confidence is

understood between the parties, and (3) where disclosure of facts is necessary to

dispel misleading impressions that are or might have been created by partial

revelation of the facts.” Equal Just. Found. v. Deutsche Bank Tr. Co. Americas,

No. C2-04-228, 2006 WL 2795211, at *6 (S.D. Ohio Sept. 27, 2006) (internal

quotation marks and citations omitted).

Here, Plaintiff does not allege that her situation fits any of these

exceptions. First, Plaintiff does not allege that the parties had anything more

than an “ordinary relationship of employer and employee” that might give rise to

such a duty. Swartz v. Oracle Corp., 787 F. Supp. 2d 686, 693 (N.D. Ohio 2011)

(citing Ohio law) (explaining that an “ordinary” employer-employee relationship

did not create a fiduciary relationship). Next, Plaintiff has not alleged that any

further disclosures were “necessary to dispel misleading impressions that are or

might have been created by partial revelation of the facts.” Equal Just. Found.,

Case No. 2:22-cv-3061 Page 9 of 10

2006 WL 2795211, at *6 (internal quotation marks and citations omitted). Thus,

Plaintiff has not alleged that Defendant owed her any duty to disclose whom

Defendant hired for the Position and, by extension, Plaintiff has not alleged that

Defendant fraudulently induced her into signing the Agreement.

In sum, the Agreement is valid and enforceable.

IV. CONCLUSION

For these reasons, Defendant’s motion is GRANTED; Plaintiffs claim is

DISMISSED WITHOUT PREJUDICE. The Clerk shall enter judgment for

Defendant and close the case.

IT IS SO ORDERED. ~ ff / if

/"~\

MICHAEL H. WATSON, JUDGE

UNITED STATES DISTRICT COURT

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