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Sterling v. Bernhardt

United States District Court, E.D. Louisiana

March 18, 2019


         SECTION "F"



         Before the Court is the defendants' motion to dismiss and/or alternatively for summary judgment. For the reasons that follow, the motion is GRANTED.


         This lawsuit challenges the U.S. Department of the Interior's employment practices, including allegations that an employee was tasked with duties beyond his pay grade, but received delayed reclassification (or no corresponding increase in pay and no back pay) due to his race, and that he suffered retaliation in the form of additional work and delayed reclassification after complaining about the unlawful employment practices.

         Following a 21-year career in the oil and gas industry, Kevin Sterling, an African American male, began working as a GS-1801-11 Inspector for the Bureau of Safety and Environmental Enforcement (BSEE), Gulf of Mexico Region, in 2008.[1] In May 2011, Sterling was promoted to a Safety and Environmental Management Specialist, as a GS-0301-12. While working in that capacity under Glynn Breaux, Sterling was cross-trained to work on Civil Penalty cases (CPs), which is how BSEE assesses oil and gas operators for safety or environmental violations.

         Civil Penalty cases start with an Incident of Non-Compliance, which is a referral from a district level BSEE Inspector in the field. The Incident of Non-Compliance and supporting documentation are reviewed at the regional level in the Office of Safety Management (OSM) to determine the extent of the violation and the amount of penalty to be assessed. Beginning in November 2012, Sterling served as the panel chair for an Accident Investigation Panel charged with investigating an accident involving Black Elk Energy Offshore Operations, LLC.

         Safety and Environmental Management work decreased in late 2013, causing an uptick in Civil Penalty review work. In early 2014, Breaux began cross-training Safety and Environmental Specialists in Civil Penalty work, which was previously only performed by the GS-0881 Petroleum Engineers or GS-1801 Inspectors in the Office of Safety Management. As of January 8, 2014, Sterling testified that he was cross-trained as a Civil Penalty reviewing officer; he helped with backlogged cases. By April 2014, Sterling was recognized as the fourth Civil Penalty reviewing officer; however, he continued to be compensated as a 0301 series employee, while the other Civil Penalty Review officers, who were engineers, were 0881 series employees.

         In August 2014, BSEE began paying workers in the 1801 series a 35% enhanced retention special pay rate. A few months later, the Director for the BSEE Gulf of Mexico Region, Lars Herbst, initiated an effort to reclassify workers in the 0301 Series, [2] like Sterling, to the 1801 Series. However, this initiative was delayed while BSEE studied and underwent a reorganization in 2015.

         That his position description failed to reflect the Civil Penalty review work he was actually performing prompted Sterling in September 2015 to request that his then-supervisor Jason Mathews[3] initiate a Desk Audit so that Sterling could be reclassified into an 1801 Series position. Rather than initiating a Desk Audit, Mathews determined that it would be more effective to draft a new position description for Sterling.[4] But Mathews' first attempt to write a new position description was not accepted by Vanessa Matthews, the Human Resources Manager for BSEE, Gulf of Mexico Region. Ms. Matthews determined that the draft position description too closely resembled the one held by the Petroleum Engineers; Sterling did not have an engineering degree.[5] Mr. Mathews was told to write a new position description. Meanwhile, by November 2015, Sterling initiated his first informal EEOC complaint, alleging desk audit denial; he officially filed the EEOC complaint on December 21, 2015. Sterling alleges that he was denied timely reclassification and appropriate compensation because of his race.[6]

         At the same time Sterling made his informal EEO complaint regarding desk audit denial, in November 2015, BSEE underwent a national reorganization. Stephen Kovacs, the new Office of Enforcement supervisor, became Sterling's supervisor and was tasked with rewriting Sterling's position description. Sterling inquired about the status of his new position description in mid-February 2016. Kovacs asked his supervisor, Mike Prendergast, for assistance. By this time, Vanessa Matthews had retired; Kovacs worked on drafting the new position description for Sterling with Derek Childress, a classification specialist out of BSEE's Virginia headquarters. With input from Sterling, Childress and Kovacs collaborated on Sterling's new position description. In early May 2016, Kovacs submitted the final version, which was reviewed by a contractor for Childress.[7] On July 10, 2016, Sterling's new position description became effective; he was officially reassigned from a Series 0301 position to an Enforcement Coordinator for Civil Penalties, GS-1801-13. From then on, Sterling was paid according to the special pay rate table. However, he was not eligible for back pay.[8]

         Just two weeks before he was reclassified as an Enforcement Coordinator for Civil Penalties, on June 27, 2016, Sterling initiated another EEO complaint in which he alleged that, shortly after he filed his first formal discrimination complaint, he was subject to reprisal. Sterling cited three instances of retaliation: (1) a Civil Penalty case, W&T (Nabors) in which he assessed a nearly $1 million fine, had been remanded at the request of the agency's Solicitor General in March 2016; (2) two of his Civil Penalty cases were selected by the Solicitor's office for inclusion in a study (CP Pilot Program) to determine whether the agency's time guidelines for processing CPs should be adjusted; and (3) Sterling still had not been given a new position description that accurately reflected his duties. The second EEO complaint was officially filed on August 8, 2016.[9]

         Civil Penalty cases such as the Nabors case start with a district office drafting a Notice of Non-Compliance, which undergoes a multilevel review in the district office before the assessment of a civil penalty supported by evidence.[10] The Civil Penalty case is then forwarded to the regional office (Office of Enforcement) and is assigned to a Civil Penalty Review Officer such as Sterling.[11] The Nabors case was assigned to Sterling originally; he was charged with evaluating the evidence for the Notice of Non-Compliance and then drafting a Notice of Proposed Civil Penalty. Sterling issued a final decision or “Notice of Proposed Civil Penalty” to W&T (Nabors) assessing a $990, 000 civil penalty for violation of BSEE regulations. W&T (Nabors) appealed the Civil Penalty to the Interior Board of Land Appeals. BSEE consulted with the Solicitor's Office in Washington, D.C., and elected to remand the case, rather than proceed with the Civil Penalty as originally issued. The Civil Penalty was remanded to the Agency and thus returned to Sterling so that the final decision could be rescinded and reissued after review and further analysis; the reason given for remand was to give BSEE a chance to make a stronger case.[12]

         This was the first time that a Civil Penalty case had been remanded. Neither Sterling nor his supervisor, Kovacs, were given any guidance on the remand. Like Sterling, Kovacs thought that the case should not have been remanded: indeed, the case was remanded even after Sterling and Kovacs told headquarters that the “new evidence, ” which was submitted by Nabors in support of its appeal of the Civil Penalty, was comprised of false affidavits. The remand was a BSEE headquarters decision (through David Fish[13]and Mary Aubry[14]).

         Sterling and Kovacs had several telephone conferences about the W&T (Nabors) civil penalty case. Sterling contended in his EEO complaint and testified in his deposition relative to the second EEO complaint that he believes the remand was retaliatory because “no other cases have been remanded couldn't even give a good reason on why they remanded.” Sterling also suggests that the timing of the remand on the heels of his prior EEO complaint coupled with the fact that the decision to remand the case was made in spite of falsified affidavits executed by W&T (Nabors) supports his retaliation theory.

         Shortly after Sterling received an email confirming the remand of the Nabors case, he received an email notifying him that two of his cases had been assigned to the Civil Penalty Pilot Program.[15] The Civil Penalty Pilot Program was a BSEE Headquarters initiated study whose purpose was to streamline the Civil Penalty Process; it was initiated to track the timeline from the issuance of an Incident of Non-Compliance to the issuance of a Civil Penalty and determine how long the process took and whether the timeline established by Headquarters was realistic or needed to be revised. The Pilot Program intended to determine whether the process to review and assess each case could be accomplished within 60 to 90 days, instead of the 90 day benchmark. The pilot program was started in the summer of 2015 by Dianne Shawley in BSEE Headquarters in Sterling, Virginia.

         The CP Pilot Program lasted until May 18, 2016 and was considered a success in meeting its goals and, as a result, the CP roadmap was to be revised to more accurately reflect the processes in the field. The Civil Penalty Referral and Assessment guide calls for Civil Penalty Review Officers to complete their review and assessment within 60 to 90 days. It also indicated the need for additional future staffing and called for the creation of a District or Program Office Case File Developer, a newly established function to assist with referrals of Civil Penalty cases. Sterling thought the Civil Penalty Pilot Program was a great idea because he believed that his colleagues were not meeting the 90-day prescribed timeline for completing the penalty case review assessment.

         The CP Pilot Program consisted of numerous telephone conference calls, sometimes weekly, among various agency employees (including Sterling on two occasions) in the field and in headquarters; the participants discussed the status of the cases being tracked. Sterling was invited to participate in a telephone conference on March 29, 2016 along with other employees about the Civil Penalty Pilot Program. During the conference, the two test cases that were previously selected by BSEE Headquarters for inclusion in the Pilot Program were discussed.[16] Both cases, Walter and Hercules, which involved the same incident, happened to be Sterling's due to the order in which they arrived in the Enforcement Section.[17] Sterling had two other cases assigned to the CP Pilot Program.

         Both of Sterling's administrative EEO complaints were investigated; Sterling forewent an EEO hearing and final agency decision. Sterling sued Sally Jewell in her then-official capacity as Secretary of the Department of the Interior; he also named as defendants the Department of the Interior and the Bureau of Safety and Environmental Enforcement. Sterling later filed an amended complaint replacing Jewell with Ryan Zinke as the Secretary of the Department of the Interior, but he continued to name as additional defendants the Department of the Interior and the Bureau of Safety and Environmental Enforcement.[18] He alleges that the defendants engaged in unlawful employment practices including disparate treatment, based on his race, which prevented him from receiving earned pay increases and promotion opportunities, and that the defendants retaliated against him after he filed an EEO complaint, in violation of Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e, et seq. and the Louisiana Employment Discrimination Law. The defendants now move for summary judgment or dismissal of the plaintiff's claims.



         The subject matter jurisdiction of federal courts is limited. Kokkonen v. Guardina Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Indeed, "[i]t is to be presumed that a cause lies outside this limited jurisdiction," the Supreme Court has observed, "and the burden of establishing the contrary rests upon the party asserting jurisdiction." Id. (citations omitted); King v. U.S. Dep't of Veterans Affairs, 728 F.3d 410, 416 (5th Cir. 2013); Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001). Motions filed under Rule 12(b)(1) of the Federal Rules of Civil Procedure allow a party to challenge the Court's subject matter jurisdiction. Fed.R.Civ.P. 12(b)(1). A lawsuit must be dismissed if it appears that the Court lacks subject matter jurisdiction. Fed.R.Civ.P. 12(b)(1), (h)(3).

         The Court may find a plausible set of facts to support subject matter jurisdiction by considering any of the following: “(1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts.” Barrera-Montenegro v. United States, 74 F.3d 657, 659 (5th Cir. 1996).


         In addition to the jurisdictional challenge, the defendants also seek dismissal of the plaintiff's claims for failure to state a claim under Rule 12(b)(6). The standard of review applicable to motions to dismiss under Rule 12(b)(1) is similar to that applicable to motions to dismiss under Rule 12(b)(6). See Williams v. Wynne, 533 F.3d 360, 364-65 n.2 (5th Cir. 2008)(observing that the Rule 12(b)(1) and Rule 12(b)(6) standards are similar, but noting that applying the Rule 12(b)(1) standard permits the Court to consider a broader range of materials in resolving the motion). Rule 12(b)(6) of the Federal Rules of Civil Procedure allows a party to move for dismissal of a complaint for failure to state a claim upon which relief can be granted. Such a motion is rarely granted because it is viewed with disfavor. See Lowrey v. Tex. A & M Univ. Sys., 117 F.3d 242, 247 (5th Cir. 1997) (quoting Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982)).

         Under Rule 8(a)(2) of the Federal Rules of Civil Procedure, a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009)(citing Fed.R.Civ.P. 8). "[T]he pleading standard Rule 8 announces does not require 'detailed factual allegations,' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Id. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

         In considering a Rule 12(b)(6) motion, the Court “accept[s] all well-pleaded facts as true and view[s] all facts in the light most favorable to the plaintiff.” See Thompson v. City of Waco, Texas, 764 F.3d 500, 502 (5th Cir. 2014) (citing Doe ex rel. Magee v. Covington Cnty. Sch. Dist. ex rel. Keys, 675 F.3d 849, 854 (5th Cir. 2012)(en banc)). But, in deciding whether dismissal is warranted, the Court will not accept conclusory allegations in the complaint as true. Id. at 502-03 (citing Iqbal, 556 U.S. at 678).

         To survive dismissal, “‘a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'” Gonzalez v. Kay, 577 F.3d 600, 603 (5th Cir. 2009)(quoting Iqbal, 556 U.S. at 678)(internal quotation marks omitted). “Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact).” Twombly, 550 U.S. at 555 (citations and footnote omitted). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (“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.”). This is a “context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Id. at 679. “Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement to relief.” Id. at 678 (internal quotations omitted) (citing Twombly, 550 U.S. at 557). “[A] plaintiff's obligation to provide the ‘grounds' of his ‘entitle[ment] to relief'”, thus, “requires 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 (alteration in original) (citation omitted).


         Federal Rule of Civil Procedure 56 instructs that summary judgment is proper if the record discloses no genuine dispute as to any material fact such that the moving party is entitled to judgment as a matter of law. No. genuine dispute of fact exists if the record taken as a whole could not lead a rational trier of fact to find for the non-moving party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). A genuine dispute of fact exists only "if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

         The Court emphasizes that the mere argued existence of a factual dispute does not defeat an otherwise properly supported motion. See id. Therefore, "[i]f the evidence is merely colorable, or is not significantly probative," summary judgment is appropriate. Id. at 249-50 (citations omitted). Summary judgment is also proper if the party opposing the motion fails to establish an essential element of his case. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). In this regard, the non-moving party must do more than simply deny the allegations raised by the moving party. See Donaghey v. Ocean Drilling & Exploration Co., 974 F.2d 646, 649 (5th Cir. 1992). Rather, he must come forward with competent evidence, such as affidavits or depositions, to buttress his claims. Id. Hearsay evidence and unsworn documents that cannot be presented in a form that would be admissible in evidence at trial do not qualify as competent opposing evidence. Martin v. John W. Stone Oil Distrib., Inc., 819 F.2d 547, 549 (5th Cir. 1987); Fed.R.Civ.P. 56(c)(2). "[T]he nonmoving party cannot defeat summary judgment with conclusory allegations, unsubstantiated assertions, or only a scintilla of evidence." Hathaway v. Bazany, 507 F.3d 312, 319 (5th Cir. 2007)(internal quotation marks and citation omitted). In deciding whether a fact issue exists, courts must view the facts and draw reasonable inferences in the light most favorable to the nonmoving party. Scott v. Harris, 550 U.S. 372, 378 ...

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