Opposition Brief — Inter-Modal Rail Employees Ass'n v. Burlington Northern & Santa Fe Railway Co.

pet a a

Supreme Court, U.S.

FILED

> MAY 2.4 ?0i

No. 99-1704

CEERK

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1999

INTER-MODAL RAIL EMPLOYEES ASSOCIATION, THOMAS

FRANKS, CHARLES JONES, TOMMY MARTIN, HOYT

JARRARD, ROBERT STEIN, AND ROBERT JAQUEZ,

Petitioners,

V.

THE BURLINGTON NORTHERN AND SANTA FE RAILWAY

CO., formerly known as THE ATCHISON, TOPEKA AND SANTA

| FE RAILWAY COMPANY; SANTA FE TERMINAL SERVICES,

INC.; IN-TERMINAL SERVICES, INC.; and MI-JACK

PRODUCTS, INC.,

Respondents.

S

ae

BRIEF IN OPPOSITION TO PETITION FOR WRIT OF

CERTIORARI

Ronald W. Novotny, Esq. Patrick W. Jordan, Esq

Counsel of Record Counsel of Record

Jack R. White Neil O. Andrus

HILL, FARRER & BURRILL, LLP JEFFER, MANGELS,

- One California Plaza, BUTLER & MARMARO, LLP

300 South Grand Avenue, 37" Floor One Sansome Street, 12" Floor

Los Angeles, CA 90071-3147 San Francisco, CA 94104 -4430

(213) 620-0460 (415) 398-8080

Attorneys for Respondents Attorneys for Respondents

THE BURLINGTON NORTHERN IN-TERMINAL SERVICES, INC.

AND SANTA FE RAILWAY CO. and MI-JACK PRODUCTS, INC.

Wright Appellate Services Osi!

(215) 733-9870 @ (R00) 507-9020 @ Fax (215) 733-9872

QUESTIONS PRESENTED

l. Is review necessary to determine whether claims

arising under ERISA §510 should be governed by a federal

three-year limitations period borrowed from ERISA

§§413(a) and 4301(f) in lieu of the most analogous state-law

statute of limitations, notwithstanding the absence of any

authority for this contention and Petitioners’ failure to even

raise it below?

2. Whether certiorari should be granted to determine

whether the court of appeals properly applied a one-year

California statute of limitations for actions based on

wrongful discharge to Petitioners’ §510 claim, in the absence

of any direct and irreconcilable conflict between the Circuit

Courts over what kinds of state-law limitations periods

should apply to such claims?

3. Whether review should be granted to determine

whether Respondents waived their statute of limitations

defense *> Petitioners’ §510 claim, or whether the applicable

limitations period was equitably tolled in this casé?

il

CORPORATE DISCLOSURE STATEMENT

[Supreme Court Rule 29.6]

Respondents The Burlington Northern and Santa Fe

Railway Co. and Santa Fe Terminal Services, Inc. are the

subsidiaries of one parent or publicly-held corporation that

owns more than 10% of their stock, Burlington Northern

Santa Fe Corp.

Mi-Jack Products, Inc. and In-Terminal Services, Inc.

have no parent or publicly-held companies which own more

than 10% of the stock of either company.

ili

LIST OF INTERESTED PARTIES

The parties to this proceeding are correctly identified

in the Petition for Writ of Certiorari.

iv

TABLE OF CONTENTS

CE FE iscinciscnssseernscnticieiiisnnrisoinsiisetiiinisbeniaicistiveia i

Corporate Disclosure Statement.................cccccccsssessssssesceeeees ii

Ak Ok RE TIN i sicsecssiintinsannisncsvintniatatnnncainhansuinvinas ili

URN OE COI atta sia inter tans nvssatinsaiiinniascibinniaabiie 1

Reasons for Denying the Writ..............ccccssscccsessscssessssccsesscees 5

I. PETITIONERS’ ARGUMENT IN FAVOR OF

BORROWING A FEDERAL LIMITATIONS

PERIOD HAS BEEN WAIVED BECAUSE IT

WAS NOT RAISED BELOW AND IS

MERITLESS IN ANY EVENT. ...........cccccccccscosssoees 5

A. Petitioners Have Waived Their Contention That

Any Limitations Periods In ERISA Apply to

Be PIII ssiinicsizsincvnccseesestblahanaipelidlinsaiicaenabascin 5

B. The Lower Federal Courts Have Uniformly

Rejected A Federal Limitations Period For §510

Aa icsdissseustceadcigaideatdsdietaainaiandhaliabiaainacbasaasaidaats 7

II. REVIE\W IS NOT NECESSARY TO

DETERMINE WHETHER THE COURT

PROPERLY APPLIED CALIFORNIA’S ONE-

YEAR STATUTE OF LIMITATIONS FOR

TORTIOUS WRONGFUL DISCHARGE

CLAIMS TO PETITIONERS’ SECTION 510

Vv

A. There Is No Direct And Irreconcilable Conflict

Among The Circuit Courts As to What State

Statute Of Limitations To Apply ERISA

eects OCD iaistincinietctnsitiistaisacdadbiins 11

B. The Ninth Circuit Properly Applied California’s

One Year Statute Of Limitations For Tortious

Wrongful Discharge Claims to Petitioners’

Se SUD I is istsinttiencsctseniibachendiinicdes 17

Ill. CERTIORARI IS COMPLETELY

INAPPROPRIATE TO REVIEW WHETHER

RESPONDENTS WAIVED THEIR STATTUTE

OF LIMITATIONS DEFENSE OR WHETHER

THE LIMITATIONS PERIOD WAS TOLLED..21

COUN i csbicthinstinihiaiiiitalinacia a a ee eee 24

vi

TABLE OF CITATIONS

Cases Cited:

Agency Holding Corp. v. Malley-Duff & Associates, Inc.,

483 U.S. 143, 152, 107 S.Ct. 2759, 97 L.Ed.2d 121 (1987) ..8.

Anhert v.‘Delco Electronics Corp., 982 F.Supp. 1320, 1327

CED. BD. SOF iicsiniicinecicistcntncedeaiibgniaad este elgtatl ecai 14, 19

Baradell v. Board of Social Services, 970 F.Supp. 489, 494

CW ED. Cah. TPIT a cicsicxisscnasecesedaj seaside gehen ae

Barnett v. International Business Machines Corp., 885

F.Supp. 581, 592 GEA. FEY, Br iastinstcndtbsnicinkdinsinecnccoces 12

Barton v. New United Motors Manufacturing Co., 43

Cal.App.4° 1200, 1209, n.6 (1996)...........ccccecseeeees 17, 18, 20

Bollenbacher v. Helena Chemical Co., 934 F.Supp. 1015,

STS CIC ED. BG, TI wikescaccicscesconsicestascaaicniaietulasiestniateepaciiaiares 12

Borden v. Johnson, 196 Ga. App. 288, 289, 395 S.E.2d 628

(Gla. BD. TS xa tisireisnaintintrelicasicraatedaaabaienies Se 15

Burrey v. Pacific Gas & Electric Co., 159 F.3d 388 (9" Cir.

EF crnsisininisecenisvellestnadcuiideswaniamacmpaca mata 3, 4, 16, 18, 20

Byrd v. MacPapers, Inc., 961 F.2d 157, 159 qai™ Cir.

1 | En en Meee wee Reem A Fy Soe ih) oe 15

Chevron Oil Co. v. Huson, 404 U.S. 97, 106-7, 92 S.Ct. 349,

FO Eo a ET ED iicsicinsiescnsinsniisineniielinciainiaiiaailaasditeibiaieabetidlanias

vii

OS... 1s bid acnapaka a cme ismanlaies 15,17

Corkery v. SuperX Drugs Corp., 602 F.Supp. 42, 45 (M.D.

- i FOE ok ne nh a dd eden 12

DelCostello v. International Brotherhood of Teamsters, 460

U.S. 151, 172, 103 S.Ct. 22, 81, 76 L.Ed.2d 476 (1983)...6, 9

DeWitt v. Penn-Del Directory Corp., 872 F.Supp. 126, ie

nh FN cc iceisncis oneectic enc renbsttdnen ateasiciansplsd 7

Felton v. Unisource Corp., 940 F.2d 503, 511-12 (9" Cir.

Firestone Tire & Rubber Co. v. Risjord, 449 U.S. 368,

373, 101 S.Ct. 669, 66 L.Ed.2d 571 (1981)............ Pree 11

Funk v. Sperry Corp., 842 F.2d 1129, 1133 (9" Cir. 1988). 18

Giuffre v. Delta Airlines, Inc.;-746 F. Supp. 238, 241 (D.

DN Ee scistehainspassan ti thake dni harciastantasnis Repintidiainininntaneniie 12

Goodman v. Lukens Steel Co., 482 U.S. 656, 662-4, 107

S.Ct. 2617, 96 L.Ed.2d 572 (1987)............cccccscseee Seer veneer ters 4

Grupo Mexicano v. Alliance Bond, 527 U.S.__, 119 S.Ct.

—__, 144 L.B.2d 319, S3ONR, 3 (1999) ..n..crsccorcrcveccesenescsessees 6

Gutierrez v. Mofid, 39 Cal.3d 892, 898-99 (1985)............+. 23

viii

Hardin v. Straub, 490 U.S. 536, 538-44, 109 S.Ct. 1998, 104

L.Ed.2d 582 (1989) .....csccscsccsserscccccsscsccecsecserenssacsessessecesscenss 23

<

Harper v. Virginia t of Taxation, 509 U.S. 86, 96,

113 S. Ct. 2510, 125 L.Ed.2d 74 (1993) .........csccceseesseeeeeees 18

Hartley v. Ocean Reef Club. Inc., 476 So.2d 1327, 1329 (Fla:

App. 1985)........ccccssssscsesssresstessesesseeseenessssssessessseeeseseeneeenenenes 15

Hawaii Carpenters Trust Funds v. Waiola Carpenter Shop,

Inc., 823 F.2d 289, 298 (9% Cir. 1987).......scsccessessserseeeeesees 20

Healy Tibbitts Construction Co. v. Insurance Company of

North America, 679 F.2d 803, 804 (9° Cir. 1982)............+ 22

Heideman v. PFL, Inc., 904 F.2d 1262, 1267 (8"Cir. 1990)13

Heideman v. PFL, Inc., 710 F.Supp. 711, 720, n. 19 (W.D.

Mo. 1989)... ssinssnisanbesaanddaipuaiaetsancebansiencancstnanaanieacisennteasiatnienss 13

Held v. Manufacturers Hanover Leasing Corp., supra, 912

i ae FI, TOG sicsisevinsscseniciorscsaminnessanrsercacenteisncanaiesanene 7

Held v. Manufacturers Hanover Leasing Corp., supra, 912

F.2d at 1207 (10™ Cir. 1990) oon... ccccccccccenssesscsscsssecenceeesees 13

Hinton v. Pacific Enterprises, 5 F.3d 391, 394 cg" Cir. 1993),

cert. den. 511 U.S. 1083 (1994) .......ceceseseeesessssseeteteesees 20

Holly Farms Corp. v. NLRB, 517 U.S. 392, 400, n. 7, 116

S.Ct. 1396, 134 L.Ed.2d 593 (1996) ........scecsecsssresseeereseeessees 7

Topeka & Santa Fe Railway Co., 520 US. 510, 117 S.Ct.

1513, 137 L.Ed.2d 763 (1997)........cscccsseesseeerssseeserrssensees 3, 11

kilka v. t hnolo ., 757 F.Supp. 175,

177 (D.Comn. 1991) ......ccsscceceeseseseeseenensnsnensnseneneeenenenenenenens 12

Jolly v. Eli Lilly & Co., 44 Cal.3d 1103, 1109-10 (1988)...23

Matsushita Electric Indus. v. Epstein, 516 U.S. 367, 379, n.5,

116 S.Ct. 873, 134 L.Ed.2d 6 (1996)......s.scsscsescsssssssssssceesesees 6

McClure v. Zoecon, Inc., 936 F.2d 777, 778, n. 2 (5" Cir.

DI csc sSisisisenaiccldinciaaienelsceoenneecinanassinainapiansesien 7, 12, 13

Musick v. Goodyear Tire & Rubber Co., Inc., 81 F.3d 135

RTT al Og” Rar 14

North Star Steel Co. v. Thomas, 515 U.S. 29, 34, 115 S.Ct.

S027, 152 LB Dd BF CRG) ceca cesnsnsscrnecconinns 9, 10, 16, 17

Reed v. United Transportation Union, 488 U.S. 319, 324,

109 S.Ct. 621, 102 L.Ed.2d 665 (1989).........0:00 5,9, 10, 17

Rivera v. Anaya, 726 F.2d 564, 566 (9" Cir. 1984) ........... 22

Sandberg v. KPMG Peat Marwick, LLP, 111 F.3d 331, 336

SSA, Wc ecaneenncilaleletetontheadlsdeaijntsnvesiladnte 7,14

xX

Smith v. Piezo Technology Professional Administrators, 427

Ae FEA, Te 0 ei niensdahicieriiscassitctedinlanaeeniiadicicies 15

St. Francis College v. Al-Khazraji, 481 U.S. 604, 608, 107

SHAE, SEER, SS UB POS CSD vavcsiniissncvsntissencrsctniicsarionnons’ 4

Sutter v. First Union National Bank of Virginia, Inc., 932

FD. Tada TOE eR FO YI icinsnsentnesiiinansnsnncinicinnaciians 12

Teumer v. General Motors Corp., 34 F.3d 542, 547, n.1 (7"

8 Rar en maim Lome REE ON sm OMEDAR CR SLES CRI EOI 7,0

Van Sant v. American Express Co., 169 F.2d 355, 372

PTOI ssoicessin chek ocacuducihia bh aearaliptaiedabusdiaietah idea albanmidemadaiuaaaiic 21

Varity Corp. v. Howe, 516 U.S. 489, 116 S.Ct. 1065, 134

LRA See OED icisesstindinsnnstldiceinnisiiopeniiiandiaaiaenabaetited 8

Wholesale & Retail Distribution Teamsters v. Santa Fe

Terminal Services, 826 F.Supp. 326, 330 (C.D. Cal. 1993).22

Wilson v. Garcia, 471 U.S. 261, 267-8, 105 S.Ct. 1938, 85

La SOW CNET vieksescsnersikisid eoeasicnstcitaibaar islands 8

Wnight v. Southwestern Bell Tel. Co., 925 F.2d 1288, 1291

Eggs toe, , MRMRIR MOET AR Tat sears Fr RCN) rate mR DOPE 7

Zenith Radio Corp. v. Hazeltine Research, 401 U.S. 321,

B52-5, Fi BAA: THE, FO UTD Fi EAD wisesisstesincsestsicicss 21

Zipes v. Trans World Airlines, Inc., 455 U.S. 385, 398, 102

Bk. VAZT, FE Le Bae re) sisccterssvsisnsicldediiciacs 21

xi

Statutes:

EN Te A Os ccnsenisasidselshinicnshntinsidebcbaslactasieatabeansnhicaneniuisiic wil y &

3, 4, 5, 6, 7, 8, 9, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 22, 23

ERISA §§ 413(a) and 4301 (fp... ceeceeeeceeeeeeeeeees 1.57.8

Be sk Oi cisncstis nak oishcteciiladasiuunhianextanichddanssbiielesaiasanes 2

OO SE Ok SIE sessecinisoucessvcanteystannsnebinbenaniainigeapieibelaabiapeninensiaiaes 2

California Code of Civil Procedure (C.C.P.) § 340(3) ssseseseeees

schuliiahseneeaaldebabibaaatinetisidkdiaaaninnioaiasliadinetas 3, 4, 13, 17, 18, 20

29 U.S.C. $§ TULSCAZ) ated LEST(IZ) ..cescvcsscsercescsescescssesees 5

SC RaI a, AF Te AEN cise esinechasedininaddanonsbenssirelisadaaisiiaieadaawahaeipeanedhion 6

Workers’ Adjustment and Retraining Notification

(“WARN”) Act 29 U.S.C. § 2101, et. Seq. ........scscsscereeees 10

Labor Management Reporting and Disclosure Act

ETS Be BF Sie OF OE RICE cvesnsnnessaicrncescsancesseecensase 10

Ba x PO EE: ARIE TE Ci iitsvenisivescctascsissasnisccnsantcatncesen 14

Scere Ae nnctssiti inne cckssimutinnabioitatipenahibbainabanmanisiineiins 17, 20

Title VII of the U.S. Civil Rights Act of 1964, 42 U.S.C.

NINE <i cshocssntoiactusiirabsuelecanetucnieetiubensiolaebagesbasaudeoan 19

Rules:

Federal Rule of Civil Procedure 12(b)(6)...........sesssessessee- 2, 21

RD Pa xicesinnnccninnaticantessnaoniatinieienenisiipiiaastisabtuiiiadadoiamanae 22

Federal Rule of Civil Procedure 12(h)(2)...............ccccccseeeeees 22

STATEMENT OF THE CASE

This action arose out of a change in the employment

of Petitioners on March 31, 1990. Until that date,

Respondent Santa Fe Terminal Services, Inc. ("SFTSI") was

signatory to an agreement with The Atchison, Topeka and

Santa Fe Railway Co. (the predecessor to Respondent The

Burlington Northern and Santa Fe Railway Co.) to provide

loading and unloading of "intermodal" trailers and containers

on and off of rail flatcars at the Railway's “Hobart yard" rail

terminal in Los Angeles. Petitioners performed that function

for SFTSI as members of two labor organizations, Teamsters

Local Unions 63 and 208. (See Petition, pp. 9-10).

in early 1990, SFTSI was competitively outbid by

Respondent In-Terminal Services, Inc. ("ITS"), for a new

service agreement at the terminal. As a consequence, most

of Petitioners’ members transferred their employment from

SFTSI to ITS effective April 1, 1990. Petitioners allege that

after they were hired by ITS, they suffered a reduction in

contributions to, and benefits from, their Teamster-sponsored

multi-employer pension and health and welfare plans as a

result of this change in their employer and the negotiation of

a new collective bargaining agreement between ITS and

Locals 63 and 208. (See Appellant’s Excerpts of Record on

‘Respondent Santa Fe Railway strongly disputes Petitioners’ assertions

that they “received their pay checks" from the Railway and enjoyed

“Railroad employee status with FELA coverage and RRB [Railroad

Retirement Board] benefits." (See Petition, p. 7). Respondent further

disputes Petitioners’ assertion that they were discharged from their

employment with the Railway, because none of them were ever Railway

employees. (See Petition, pp. 3 and 8-9).

Appeal, hereinafter "E.R.," at p. 14, 9 31).

This action was commenced on July 17, 1992, more

than two years after the change in Petitioners' employment.

Petitioner's original Complaint alleged three claims for relief,

for (1) interference with their rights in violation of § 510 of

ERISA, 29 U.S.C. § 1140, (2) personal injuries under the

Federal Employers' Liability Act ("FELA"), 45 U.S.C. § 51,

et seq., and (3) wrongful discharge in violation of public

policy. (See Appellees' Supplemental Excerpts of Record on

Appeal, hereinafter "S.E.R.," pp. 1-9). The action was -

brought by the "Inter-Modal Rail Employees Association"

(IMREA) as the assignee of the claims brought by

Petitioners or, in the alternative, as a class action on their

behalf.

In April 1993, the district court granted Respondents'

motion to dismiss the Complaint pursuant to Federal Rule of

Civil Procedure 12(b)(6), based primarily on the ground that

Petitioners had not stated an actionable claim for violation of

§ 510 of ERISA and could not maintain a class action under

FELA.” The Ninth Circuit Court of Appeals subsequently

upheld the dismissal of Petitioners' § 510 claim to the extent

it was based on the alleged interference with their health and

welfare and railroad retirement benefits, but held that the

district court erred in dismissing their claim for interference

with their rights to pension benefits under the statute. Inter-

’The court also dismissed Petitioners’ third cause of action for wrongful

discharge in violation of public policy because it was not filed within one

year as required by Cal. Code of Civ. Proc. § 340(3) -- the same statute

of limitations that the court ultimately applied to their ERISA claim.

(See S.E.R. 21, 35)

3

Modai Rail Employees Association v. The Atchison, Topeka

& Santa Fe Railway Co., 80 F.3d 348, 351-2 (9th Cir. 1996).

On certiorari, this Court held that a claim could be

maintained under § 510 for interference with Petitioners’

non-vested "health and welfare" benefits, and remanded the

case for further proceedings. Inter-Modal Rail Employees

Association v. The Atchison, Topeka & Santa Fe Railway

Co., 520 U.S. 510, 117 S.Ct. 1513, 137 L.Ed.2d 763 (1997).

After remand, Petitioners filed a First Amended

Complaint alleging a violation of § 510 of ERISA and

personal injuries under FELA.’ On November 23, 1998, the

district court granted Respondents’ motion for summary

judgment on the § 510 claim on the ground that it was barred

by the one-year limitations period contained in California

Code of Civil Procedure (C.C.P.) § 340(3). The court

specifically concluded that the “primary interest" which was

invaded by the Respondents' alleged wrongful conduct was

Petitioners’ personal interests in not being wrongfully

terminated from their employment by SFTSI, and that the

one-year statute for tortious wrongful discharge claims was

applicable under the Ninth Circuit's decision in Burrey v.

Pacific Gas & Electric Co., 159 F.3d 388 (9th Cir. 1998)

decided earlier that year. (App. III, 22a). Petitioners

thereafter filed a motion for reconsideration of the district

court's decision, which was denied. (E.R. 418-26; App. I,

4a-10a).

In its unpublished memorandum decision of January

21, 2000, the Ninth Circuit affirmed summary judgment for

*The district court subsequently dismissed the claims of the "Inter-Modal

Rail Employees Association" for lack of standing, thus rendering the

Association's inclusion as one of the parties to this petition improper.

(See E.R., 30-31).

Respondents on Petitioners’ § 510 ERISA claim on the

ground that it was not timely filed within the one-year

limitations period applicable to § 510 claims in California.

The Court of Appeals held that the Burrey case was properly

given full retroactive effect to this action, and that the one-

year statute of limitations contained in C.C.P. § 340(3) was

properly applied to Petitioners' claim because the "essential

nature of the action" was to remedy a violation of "personal

rights" implicated by § 510. (See Appendix I, 6a-10a).* The

Ninth Circuit also categorically rejected Petitioners’

contentions that Respondents waived their statute of

limitations defense, and that the applicable limitations period

was equitably tolled in these circumstances. (Id. at 6a, 8a).

No petition for rehearing or suggestion for rehearing en banc

was filed.

‘In holding that Burrey was properly applied to the case at hand, the

Court distinguished Chevron Oil Co. v. Huson, 404 U.S. 97, 106-7, 92

S.Ct. 349, 30 L.Ed.2d 296 (1971) on the ground that Burrey did not

overrule any "clearly established precedent" on which Petitioners were

entitled to rely. (See Appendix I, 7a, n. 5, citing St. Francis College v.

Al-Khazraji, 481 U.S. 604, 608, 107 S.Ct. 2022, 95 L.Ed.2d 582 (1987)

and Goodman v. Lukens Steel Co., 482 U.S. 656, 662-4, 107 S.Ct. 2617,

96 L.Ed.2d 572 (1987).

REASONS FOR DENYING THE WRIT

I.

PETITIONERS' ARGUMENT IN FAVOR

OF BORROWING A FEDERAL

LIMITATIONS PERIOD HAS BEEN

WAIVED BECAUSE IT WAS NOT

RAISED BELOW AND IS MERITLESS IN

ANY EVENT

A. Petitioners Have Waived Their

Contention That Any

Limitations Periods In ERISA Apply

to § 510 Actions

The principal argument presented in the certiorari

petition is that a uniform federal limitations period should be

borrowed from elsewhere in ERISA. Petitioners specifically

contend that this Court should grant review and adopt a

uniform three-year limitations period to § 510 claims based

on §§ 413(a) or 4301(f)(2) of ERISA, 29 U.S.C. §§

1113(a)(2) and 1451(f)(2). (Petition, p. 23). However,

Petitioners did not propose the application of either of these

federal statutes to their § 510 claim in the proceedings

below, nor did they argue that a federal law limitations

period applied to that claim pursuant to the "narrow

exception" to borrowing state limitations periods in these

circumstances. See Appellees' Joint Answering Brief, p. 13,

n. 2 [citing Reed v. United Transportation Union, 488 U.S.

319, 324, 109 S.Ct. 621, 102 L.Ed.2d 665 (1989) and

DelCostello v. International Brotherhood of Teamsters, 460

U.S. 151, 172, 103 S.Ct. 2281, 76 L.Ed.2d 476 (1983)]. ~

Rather, Petitioners consistently argued, both in the district

court and the appellate court, only that a three or four-year

limitations period should be borrowed from state law for

application to their § 510 claim in these circumstances,

thereby fully conceding the propriety of borrowing a state

limitations period.’ (See Appellants Opening Brief, p. 19

(arguing that the duty of the federal courts under Reed was to _

"formulate an analogy to the various California causes of

action that would avoid the importation into ERISA" of the

one-year limitations period applied in this case); Appellants

Opening Brief, p. 34 (correctly noting that since ERISA §

510 does not contain its own statute of limitations, litigants

such as Petitioners “must look to the most analogous statute

of limitations under state law"); S.E.R. 148 (in which

Petitioners' counsel expressly acknowledged that § 510 is a

“public policy type tort claim which borrows the statute of

limitations from whatever analogous state laws exist in the

various jurisdictions").

Because Petitioners failed to raise their federal

limitations argument below, they have accordingly waived it

and the Court should decline to consider it. See Grupo

Mexicano v. Alliance Bond, 527 U.S. _, 119 S.Ct. _,

144 L.Ed. 2d 319, 330, n. 3 (1999); Matsushita Electric

*Petitioners no longer contend that the four-year limitations period

contained in C.C.P. § 337(1) applied to their claim, nor could they

reasonably do so given the utter lack of merit of that contention and the

Ninth Circuit's outright rejection of it. (See Appellees' Joint Answering

Brief, pp. 23-29; App. I, 9a).

Indus. v. Epstein, 516 U.S. 367, 379, n. 5, 116 S.Ct. 873, 134

L.Ed.2d 6 (1996); Holly Farms Corp. v. NLRB, 517 U.S.

392, 400, n. 7, 116 S.Ct. 1396, 134 L.Ed.2d 593 (1996).

B. The Lower Federal Courts Have

Uniformly Rejected A Federal

Limitations Period For § 510 Claims

Apart from Petitioners' failure to raise their federal

limitations period argument at any prior point in these

proceedings, this argument has never been accepted by any

federal court, anywhere. Every federal court which has

considered the proposition that a federal statute of

limitations, including §§ 413(a) or 4301 of ERISA, should be

applied to § 510 claims has unhesitatingly rejected it.

See Held v ufacturers Hanover in .» 912 F.2d

1197, 1200; 1209-10 (10" Cir. 1990); McClure v. Zoecon,

Inc., 936 F.2d 777, 778, n.2 (Sth Cir. 1991); Sandberg v.

KPMG Peat Marwick, LLP, 111 F.3d 331, 336 (2d Cir.

1997)(holding that the “available state-law limitations

periods satisfy the federal government's interest in ensuring

that an employer fulfill its obligations under ERISA");

Teumer v. General Motors Corp., 34 F.3d 542, 547, n.1 (7th

Cir. 1994)(finding no particularly appropriate federal

analogue that would "prompt us to part from the usual

practice [of borrowing the most applicable state law statute

of limitations] in this case"). Some courts have in fact

expressly rejected application of the limitations period

contained in § 413 to § 510 claims. See Teumer, supra, 34

F.3d at 546; Wright v. Southwestern Bell Tel. Co., 925 F.2d

1288, 1291 (10th Cir. 1991); DeWitt v. Penn-Del Directory

Corp., 872 F.Supp. 126, 136 (D. Del. 1994).

There is good reason for this uniform rejection of

efforts to borrow limitations periods from other parts of

ERISA, because (as Petitioners concede in their Petition) §

413(a) expressly applies only to actions under Title I,

Subtitle B, Part 4 of ERISA for breaches of fiduciary duty,

and § 4301 expressly governs only actions against

multiemployer plans under Subtitle E of Title IV of the

statute (See Petition, p. 4).° Since no circuit court has ever

adopted or even suggested adopting either of the suggested

federal analogues to § 510 claims, there is clearly no conflict

among the circuits regarding the propriety of doing so. Nor

is there any other basis in Supreme Court Rule 10 that would

support the grant of certiorari on this issue.

Indeed, this argument runs counter to well

established principles of federal law. When Congress fails to

provide a statute of limitations for claims arising under

federal statutes, a court must generally apply the limitations

period of the state-law cause of action most analogous to the

federal claim. Wilson v. Garcia, 471 U.S. 261, 267-8, 105

S.Ct. 1938, 85 L.Ed.2d 254 (1985). This requires the court

to "characterize the essence" of the plaintiff's federal claim

(Id. at 267-70), and apply the statute which "substantively

most resembles the federal action." Agency Holding Corp.

v. Malley-Duff & Associates, Inc., 483 U.S. 143, 152, 107

S.Ct. 2759, 97 L.Ed.2d 121 (1987). Petitioners thus

acknowledge that when a federal statutory claim does not

*Moreover, this Court did not acknowledge that § 510 claims are “quite

similar" to breach of fiduciary claims in its decision of Varity Corp. v

Howe, 516 U.S. 489, 116 S.Ct. 1065, 134 L.Ed.2d 130 (1996), as

Petitioners assert; in fact, this Court did not even address § 510 claims in

its opinion in that case. (See Petition, p. 22, n. 15).

9

provide its own limitations period, a court generally applies

the “state statute which is ‘most closely analogous" to the

federal Act in need." See Petition, p. 10, citing North Star

Steel Co. v. Thomas, 515 U.S. 29, 34, 115 S.Ct. 1927, 132

L.Ed.2d 27 (1995). Only when the state limitations rule is

“at odds for the purpose of operation of federal substantive

law," has the Court recognized a "closely circumscribed

exception" from the general rule that statutes of limitation

are to be borrowed from state law. Reed, supra, 488 U.S. at

324. Accordingly, resort to state law remains the norm for

“borrowing purposes" except

[w]hen a rule from elsewhere

in federal law clearly provides

a closer analogy than available

state statutes, and when the

federal policies at stake and the

practicalities of litigation make

that rule a significantly more

appropriate vehicle for

interstitial law making.

DelCostello, supra, 460 U.S. at 171-2; Reed, supra, 488 U.S.

at 323-4.

Petitioners have failed to show that the requirements

for application of this narrowly circumscribed exception to

the general rule of borrowing state limitation periods apply

in this case. They have not even begun to explain why any

of the suggested provisions of ERISA would constitute a

“closer analogy" to § 510 actions than state statutes of

limitation applicable to wrongful discharge causes of action

which, as shown infra, have been invoked in virtually all

states in which such claims exist. Petitioners accordingly

attempt to achieve here judicially what Congress did not do

10

legislatively, and urge the Court to adopt a limitations period

in derogation of the usual procedure for finding the most

appropriate limitations period in these circumstances. Stated

differently, they ask this Court to address an argument that

calls for a radical departure from existing law, when it was

not raised below and has never been accepted or even

considered by the by Ninth Circuit in this case or by any

other federal court.’ For each of these reasons, the Court

should deny the petition.

"In contrast, in both North Star and Reed, supra, the Court resolved splits

in the circuit courts over whether statutes of limitations applicable to

various federal statutory claims should be borrowed from state or federal

law. See North Star, supra, 515 U.S. at 33 (resolving conflict between

circuits in borrowing state-law or National Labor Relations Act (NLRA)

limitations periods to actions brought under the Workers’ Adjustment and

Retraining Notification ("WARN") Act, 29 U.S.C. § 2101, et. seq.; Reed,

supra, 488 U.S. at 323, n.3 (resolving conflict between circuits as to

whether the NLRA or state-law limitations periods applied to claims

brought by union members under the free speech and assembly

provisions of the Labor Management Reporting and Disclosure Act

("LMRDA"), 29 U.S.C. § 411(a)(2). Significantly, the Supreme Court

decided in both cases that state-law limitations periods applied to claims

brought under these federal statutes.

11

Il.

REVIEW IS NOT NECESSARY TO

DETERMINE WHETHER THE COURT

PROPERLY APPLIED CALIFORNIA'S

ONE-YEAR STATUTE OF LIMITATIONS

FOR TORTIOUS WRONGFUL

DISCHARGE CLAIMS TO PETITIONERS'

SECTION 510 ACTION

A. There Is No Direct And Irreconcilable

Conflict Among The Circuit Courts

As To What State Statute Of

Limitations To Apply ERISA Section

510 Claims.

Petitioners next contend that this Court must grant

certiorari because the courts of appeal "differ widely" in their

selections of statutes of limitation. (Petition, p. 15).

However, this is not a "conflict" within the meaning of Rule

10. Rather, a conflict must ordinarily be "square and

irreconcilable" and implicate a matter of federal importance

in order for review to be granted. Supreme Court Rule

10(a); Stein, et al., Supreme Court Practice, 7th Ed. 1993, §

414, p. 168, citing Firestone Tire & Rubber Co. v. Risjord,

449 U.S. 368, 373, 101 S.Ct. 669, 66 L.Ed.2d 571 (1981).°

*Thus, for example, the Court previously granted review in this

action to resolve a direct conflict between the circuit courts over whether

§ 510 actions may be based on the interference with "non-vested" as

opposed to “vested" benefits. See Inter-Modal, supra, 137 L.Ed.2d at

768.

12

Contrary to Petitioners’ assertions, the application of

different statutes of limitations in different states poses no

conflict requiring certiorari to resolve, but rather constitutes

a natural by-product of the general rule that the courts

borrow the limitations period applicable to the most

analogous state-law cause of action for § 510 claims.

Petitioners first ignore the fact that almost all courts

have construed § 510 claims as analogous to wrongful

discharge or employment discrimination claims. See

McClure v. Zoecon, Inc., supra, 936 F.2d at 778, and cases

cited therein. Thus, in 1994, the Seventh Circuit borrowed

the Illinois limitations period governing retaliatory discharge

claims under § 510 actions [See Teumer v. General Motors

Corp., supra, 34 F.3d at 550], and other federal courts have

almost uniformly followed suit in characterizing claims

under § 510. See Jaskilka v. Carpenter Technology Corp.,

757 F.Supp. 175, 177 (D. Conn. 1991) (holding that a

complaint alleging discharge for the purpose of depriving an

employee of retirement benefits under ERISA bears a “close

resemblance to a cause of action for wrongful discharge in

violation of a clear mandate of public policy under

Connecticut law"); Corkery v. SuperX Drugs Corp., 602

F.Supp. 42, 45 (M.D. Fla. 1985) (Section 510 action held

analogous to an employment termination case); Bollenbacher

v. Helena Chemical Co., 934 F.Supp. 1015, 1030 (N.D. Ind.

1996) (applying Indiana's statute of limitations for retaliatory

discharge claims to § 510 actions); Giuffre v. Delta Airlines

Inc., 746 F.Supp. 238, 241 (D. Mass. 1990) (retaliatory

discharge claim held analogous to § 510 claim under

Massachusetts law).”

°See also Barnett v. International Business Machines Corp., 885

13

After reviewing the numerous cases which applied

limitation periods for wrongful discharge claims to § 510

actions, the Fifth Circuit in McClure acknowledged the

Eighth Circuit's decision in Heideman v. PFL, Inc., 904 F.2d

1262, 1267 (8th Cir. 1990), which held that a contract

analogue was appropriate -- but noted that the Heideman

court adopted that limitations period "without analysis" and

“without allocating more than one sentence to the issue of

which limitation statute properly applied." Ibid., 936 F.2d at

779. The circuit court in Heideman in fact merely upheld the

application of a six-year statute of limitations adopted from

Tennessee law by the district court, which had merely (and,

once again, without any analysis) held that such a limitations

period applied to § 510 claim because it was also applicable

to claims brought for the denial of benefits under 29 U.S.C. §

1132. See Heideman v. PFL, Inc., 710 F.Supp. 711, 720, n.

19 (W.D. Mo. 1989).

By affirming the application of California's one-year

limitations period for wrongful discharge claims in violation

of public policy contained in C.C.P. § 340(3) in this instance,

the Ninth Circuit therefore acted in accord with most of the

other circuit and district courts which have addressed the

issue. Moreover, to the extent that certain circuit courts have

applied limitations periods applicable to other kinds of

claims to § 510 actions, such rulings can be reconciled by the

obvious fact that causes of actions vary from state to state, as

F.Supp. 581, 592 (S.D. N.Y. 1995)(citing McClure); Sutter v. First Union

National Bank of Virginia, Inc., 932 F.Supp. 753, 757 (E.D. Va. 1996)

(holding that Virginia's common law cause of action for wrongful

discharge was most analogous to an action under § 510); Baradell v.

_ Board of Social Services, 970 F.Supp. 489, 494 (W.D. Va. 1997).

os

do statutes of limitations. See Musick v. Goodyear Tire &

Rubber Co., Inc., 81 F.3d 136, 139 (11th Cir. 1996). The

courts have in fact recognized that there is no way to

eliminate disparities among various limitations periods to

applicable § 510 actions arising in different states, given the

fact that this is the natural and inherent result of Congress’

choice not to specify a limitations period for such claims.

See Anhert v. Delco Electronics Corp., 982 F.Supp. 1320,

1327 (S.D. Ind. 1997).

Petitioners purport to identify only one situation in

which courts have reached different results under the law of

the same state. Petitioners claim that the Second Circuit's

decision in Sandberg v. KPMG Peat Marwick, LLP, supra,

111 F.3d at 335 conflicts in this sense with the earlier

decision of the Tenth Circuit in Held v. Manufacturers

Hanover Leasing Corp., supra, 912 F.2d at 1207 (10th Cir.

1990) (Petition at 16). However, careful examination of the

Second Circuit's opinion indicates otherwise. The Second

Circuit expressly noted that New York does not have a cause

of action for "wrongful discharge," and therefore could not

use this analogue for § 510 claims. It therefore borrowed the

limitations period from a New York workers' compensation

statute (N.Y. Work. Comp. Law § 120). Significantly, the

Second Circuit expressly considered the Tenth Circuit's

decision in Held — which applied New York's six-year

limitations period for breach of contract actions — but pointed

out that the workers' compensation statute had not been

adopted until 1994, and therefore was not available to the

Held court. See Sandberg, supra, 111 F.3d at 336. This kind

of evolving response to a changing statutory scheme simply

does not constitute a "conflict" within the meaning of Rule

10.

15

The only other Circuit Court of Appeals decisions

cited by Petitioners which did not apply a tortious wrongful

discharge analogue to § 510 actions were issued by the

Eleventh Circuit in Clark v. Coates & Clark, Inc., 865 F.2d

1237, 1241 (11th Cir. 1989) (applying two-year limitation

period for enforcement of statutory rights under Geergia

law) and Byrd v. MacPapers, Inc., 961 F.2d 157, 159 (11th

Cir. 1992) (applying limitations period for retaliatory

discharge for filing workers' compensation claim under

Florida law) (See Petition, p. 16, n.6). However, neither

Georgia nor Florida recognize common law causes of action

for retaliatory wrongful discharge. See Borden v. Johnson,

196 Ga. App. 288, 289, 395 S.E.2d 628 (Ga. App. 1990)

(rejecting any “public policy" exception to Georgia's at-will

employment rule absent codification in statute); Hartley v.

Ocean Reef Club, Inc., 476 So.2d 1327, 1329 (Fla. App.

1985) and Smith v. Piezo Technology Professional

Administrators, 427 So.2d 182, 184 (Fla. 1983) (confirming

that no common law tort of retaliatory discharge exists in

Florida, and that the legislature had prescribed a wrongful

discharge cause of action in that state only for employees

who are fired for bringing workers' compensation claims).

The Clark and Byrd courts' borrowing of Georgia's and

Florida's statutes of limitations for enforcement of a statutory

claim and for retaliation for filing a workers’ compensation

action to the § 510 claims in those cases can therefore easily

be reconciled and explained by the limited kinds of causes of

action available in those states, and the absence of any

tortious wrongful discharge analogue to apply to § 510

claims.'°

*°For this reason, this case is a poor vehicle for instructing federal courts

16

This Court in fact largely disposed of Petitioners’

contention in North Star Steel Co. v. Thomas, supra, 515

U.S. at 36, in which it was urged that a uniform federal

statute of limitations should be applied to actions brought

under the WARN Act. The Court there readily

acknowledged that

the practice of adopting state statutes of

limitations for federal causes of action can

result in different limitations periods in

different States for the same federal action,

and .. . that some plaintiffs will canvass

the variations and shop around for a forum.

But these are just the costs of the rule

itself, and nothing about [the federal

statute in issue] makes them exorbitant.

Petitioners have accordingly failed to demonstrate

that 2 sufficiently direct, significant, and irreconcilable

conflict presently exists among the circuit courts with respect

to what state statute of limitations to borrow for § 510

claims. More significantly, they have failed to demonstrate

how the Ninth Circuit's decisions in this case and in Burrey

are in conflict with any other circuit court decision on the

important question of how the statute of limitations should be

on how to handle situations such as those confronted by the Second and

Eleventh Circuits, in which the pertinent state law did not recognize a

cause of action for wrongful discharge. In direct contrast to the cases

from those circuits, this case does involve a state scheme in which there

is an analogous wrongful discharge cause of action and associated

limitations period. Thus, determining whether or not such a limitations

period was properly applied in this instance would not assist the appellate a

courts with jurisdiction over states which do not have such causes of 4

action, on which limitations periods should apply to § 510 claims.

17

determined for claims brought under § 510. Nor is there any

conflict with this Court's past decisions; rather, the Ninth

Circuit did exactly what it was supposed to do under the

well-settled rules articulated in Reed and North Star for

borrowing the most analogous state law limitations period to

the "federal Act in need." The petition must accordingly be

denied on this basis as well.

B. The Ninth Circuit Properly Applied

California's One-Year Statute Of

Limitations For Tortious Wrongful

Discharge Claims To Petitioners’

Section 510 Claim

As previously noted, the Ninth Circuit applied a one-

year statute of limitations under C.C.P. § 340(3) to

Petitioners’ § 510 action, as opposed to the three-year

limitations period for causes of action based on liability

created by statute contained in C.C.P. § 338(a).'' Initially,

the issue of which statute of limitations should be selected

for application to § 510 claims in an individual state does not

"Petitioners cite Barton v. New United Motors Manufacturing

Co., 43 Cal. App.4th 1200, 1209, n.6 (1996) in support of their contention

that § 338(a) should be applied to their § 510 claim because it is a

“statutory claim that did not exist at common law.” But this misses the

point: applicable statutes of limitations in these circumstances are almost ~

always borrowed from the most analogous state-law cause of action,

because otherwise federal claims such as § 510 actions would always be

governed by the limitations period for violations of various state

statutes. See Clark v. Coats & Clark, Inc., supra, 865 F.2d at 1241 (court

finds the “most analogous state law claim when adopting a_ limitations

period to a federal law”).

18

raise an issue of national importance, and is therefore an

insufficient ground for granting review by this Court under

Rule 10. Nevertheless, the Ninth Circuit properly applied

the one-year statute of limitations period in this instance.

Petitioners principally contend that the Ninth Circuit

erred in borrowing a state statute of limitations first clarified

by an appellate court decision in 1996 to their § 510 claim

filed four years earlier.'? This argument, based on the

particular history of an individual case, is even more narrow

than the question of what limitations period should typically

be borrowed from California law for application to § 510

actions, and therefore provides a patently insufficient ground

for review. Moreover, this contention ignores the well-

settled proposition that "a rule of law, once announced and

applied to the parties in a controversy, must be given full

retroactive effect by all courts adjudicating federal law."

[See App. I at 6a-7a, citing Harper v. Virginia Department of

Taxation, 509 U.S. 86, 96, 113 S.Ct. 2510, 125 L.Ed.2d 74

(1993)]. The Ninth Circuit thus properly relied upon its

1998 decision in Burrey, which borrowed the one-year

limitations period adopted by the California Court of Appeal

in 1996 for tortious wrongful discharge claims in California.

In doing so, the Ninth Circuit in no way “did

violence" to ERISA's “broad remedial purposes." (See

Petition, p. 12). Congress and the courts have traditionally

"Petitioners refer to the California Court of Appeal's decision in Barton,

supra, 43 Cal.App.4th 1200. They con‘inue to ignore the fact, however,

that the Ninth Circuit found that the one-year statute of limitations under

C.C.P. § 340(3) applied to claims for wrongful discharge in violation of

public policy in a decision issued eight years earlier. See Funk v. Sperry

Corp., 842 F.2d 1129, 1133 (9th Cir. 1988).

19

applied shorter statute of limitations periods to labor-based

claims which arise out of major consequences such as the

loss of employment, since such consequences are "known to

the employee from the moment the action occurs" and thus

provide an immediate basis for an “adequate pre-filing

inquiry" that Petitioners contend they should have had time

to make. See Anhert, supra, 982 F.Supp. at 1326; see also

Title VII of the U.S. Civil Rights Act of 1964, 42 U.S.C. §

2000e-5(e)(1) (providing that employment discrimination

claims are generally required to be filed within 180 days).

Indeed, Petitioners readily acknowledge the fact that

the lower federal courts have routinely and consistently

applied limitations periods of two years or less to § 510

actions, which would have barred their claim here. See

Petition, n. 6 (citing cases applying two-year limitation

periods under Alabama and Georgia law to § 510 actions); n.

7 (citing authority applying Texas’ two-year wrongful

discharge employment discrimination limitation to § 510

claim and Louisiana's one-year limitation period for

wrongful discharge actions); Anhert v. Delco Electronics

Corp., supra, 92 F.Supp. at 1326, and cases cited therein.

Their contention that borrowing a limitations period of less

than three years somehow contravenes ERISA's "remedial

purposes" is therefore squarely at odds with the substantial

body of case law applying shorter limitations periods to §

510 claims.

Moreover, to the extent that it is even relevant, the

Ninth Circuit in Felton v, Unisource Corp., 940 F.2d 503,

511-12 (9th Cir. 1991), did not hold that a one-year statute of

limitations would "interfere with the policy that underlies

ERISA," as Petitioners contend. Rather, in adopting the two-

year statute of limitations applicable to wrongful discharge

20

claims under Arizona law, the Felton court merely noted in

dictum that this conclusion was supported by its own earlier

decision involving a different ERISA claim, in which it said

that importing too short a period of limitations under state

law would “interfere with the strong federal policy that

underlies ERISA." Id. at 513, citing Hawaii Carpenters Trust

Funds v. Waiola Carpenter Shop, Inc., 823 F.2d 289, 298

(9th Cir. 1987).'? Felton was therefore entirely consistent

with the Ninth Circuit's later decisions in Hinton v. Pacific

Enterprises, 5 F.3d 391, 394 (9th Cir. 1993), cert. den. 511

U.S. 1083 (1994) and Burrey, supra, both of which held that

the limitations period for § 510 actions in California is the

one-year statute of limitations contained in C.C.P. § 340(3)

for tortious wrongful discharge claims. Finally, to the extent

that Petitioners contend otherwise, this presents only an

intra-circuit conflict which has now been effectively resolved

by Burrey, and is an insufficient ground for review.

"Felton also expressly rejected the argument that Arizona's statute of

limitations for actions based on violations of statutes should apply to

ERISA § 510 claims. The court reasoned that to find that a § 510 claim

is most analogous to a statutory claim, merely because ERISA is a

statute, reflects "circular reasoning." Ibid., 940 F.2d at 512. The Barton

court later agreed, reasoning that the cause of action for wrongful

termination in violation of public policy is itself a "common law,

judicially recognized cause of action, not a liability created by statute."

Ibid., 43 Cal.App.4th at 1209, n.6. For this reason, Section 338(a) was

therefore clearly not the appropriate limitations period to apply to

Petitioners’ § 510 claim.

21

Il.

CERTIORARI IS COMPLETELY

INAPPROPRIATE TO REVIEW

WHETHER RESPONDENTS WAIVED

THEIR STATUTE OF LIMITATIONS

DEFENSE OR WHETHER THE

LIMITATIONS PERIOD WAS TOLLED

Lastly, Petitioners contend that Respondents waived

their statute of limitations defense by failing to raise it in

their initial Rule 12(b)(6) motion filed in 1993. They also

contend that the appropriate limitations period was somehow

“equitably tolled" due to their ignorance of the limitations

period prior to 1996. Both of these contentions are patently

without merit and far too specific to the procedural

circumstances of this case to warrant Supreme Court review.

Because the statute of limitations defense here was raised in

the answer and asserted in a motion to dismiss before trial,

this case is easily distinguishable from the cases cited by

Petitioners. See, e.g., Zipes v. Trans World Airlines, Inc.,

455 US. 385, 398, 102 S.Ct. 1127, 71 L.Ed.2d 234 (1982)

(ninety-day limitation period for filing EEOC charge under

Title VII held not jurisdictional and waived when not

asserted until after settlement); Zenith Radio Corp. v.

Hazeltine Research, 401 U.S. 321, 332-3, 91 S.Ct. 795, 28

L.Ed.2d 77 (1971) (failure to raise defense until after trial);

Van Sant v. American Express Co., 169 F.2d 355, 372

(1948) (failure to raise a statute of limitations defense at first

trial before remand).

It is in fact well settled that a party may raise a

defense of failure to state a claim upon which relief can be

22

granted in any pleading permitted or ordered under Rule

7(a), or by motion for judgment on the pleadings, or at the

trial on the merits. Fed. Rule of Civ. Proc. 12(h)(2). As the

district court itself noted in a related action between the

Santa Fe Respondents and Petitioners’ labor unions, a

defendant preserves an affirmative defense if it includes it in

its answer to the plaintiffs' pleading. Wholesale & Retail

Distribution Teamsters v. Santa Fe Terminal Services, 826

F.Supp. 326, 330 (C.D. Cal. 1993). Indeed, a defendant may

even raise an affirmative defense for the first time on

summary judgment, absent prejudice to the plaintiff. See

Rivera v. Anaya, 726 F.2d 564, 566 (9th Cir. 1984); Healy

Tibbitts Construction Co. v. Insurance Company of North

America, 679 F.2d 803, 804 (9th Cir. 1982).

Although the statute of limitations defense to the §

510 claim was not among the grounds that Respondents

initially raised in their motion to dismiss filed in 1993, it was

expressly included in the affirmative defenses pleaded in

their Answers to the Second Amended Complaint filed in

1998. The defense was also specifically asserted on two

occasions prior to that time in separate motions to dismiss

plaintiffs' pleading following the remand of this action to the

district court in 1997, and was raised again on summary

judgment. Respondents therefore clearly did not waive this

defense under established law, and the appellate court

properly rejected this argument. (See Appendix I, p. 6a).

Nor could Respondents’ failure to raise the statue of

limitations defense in 1992, or Petitioners' claimed ignorance

of the limitations period, have operated as any kind of

“equitable tolling." (See Petition, p. 27). Where a state

limitations period is applied to an action arising under a

federal statute, the state's tolling provisions should be given

23

effect unless they conflict with the federal statute's goal.

Hardin v. Straub, 490 U.S. 536, 538-44, 109 S.Ct. 1998, 104

L.Ed.2d 582 (1989). As the Ninth Circuit noted, in

California the application of equitable tolling principles

requires some wrongdoing on the part of the defendant.

(App. I, 8a). None was present here.

Moreover, under California law, equitable tolling

does not excuse a plaintiff who is merely ignorant of the

applicable limitations period, as opposed to the facts

underlying the claim. Gutierrez v. Mofid, 39 Cal.3d 892,

898-99 (1985). It is awareness of facts, not of their legal

significance, which starts the running of the statute of

limitations. Jolly v. Eli Lilly & Co., 44 Cal.3d 1103, 1109-

10 (1988). Hence, Petitioners’ claim that they were unaware

of the limitations period applicable to § 510 actions is plainly

insufficient to warrant an extended filing period. In any

event, this question of the application of state law on

equitable tolling to the specific facts and procedural

circumstances of this case does not warrant Supreme Court

review.

Jd

CONCLUSION

For all of the foregoing reasons, the petition must be

denied in all respects.

Dated: _May 24, 2000

Respectfully submitted,

Ronald W. Novotny

Counsel of Record

Jack R. White

HILL, FARRER & BURRILL LLP

300 South Grand Avenue

37th Floor

Los Angeles, CA 90071-3147

(213) 620-0460

Attorneys for Respondents

THE BURLINGTON NORTHERN

AND SANTA FE RAILWAY

COMPANY and SANTA FE

TERMINAL SERVICES, INC.

25

Patrick W. Jordan

Counsel of Record

Neil O. Andrus

JEFFER, MANGELS, BUTLER & MARMARO LLP

One Sansome Street, 12th Floor

San Francisco, CA 94104-4430

(415) 398-8080

Attorneys for Respondents

IN-TERMINAL SERVICES, INC. and MI-JACK

PRODUCTS, INC.