United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued March 15, 2005 Decided June 3, 2005
No. 04-7040
VLADIMIR SHEKOYAN,
APPELLANT
v.
SIBLEY INTERNATIONAL,
APPELLEE
Appeal from the United States District Court
for the District of Columbia
(No. 00cv02519)
Dawn V. Martin argued the cause for the appellant.
Kathy M. Banke argued the cause for the appellee. Laura J.
Oberbroeckling was on brief.
Before: SENTELLE, HENDERSON and ROGERS, Circuit Judges.
Opinion filed for the court by Circuit Judge HENDERSON.
KAREN LECRAFT HENDERSON, Circuit Judge: Vladimir
Shekoyan, a lawful permanent resident of the United States
2
during all times relevant to this case, filed a suit against his
former employer, Sibley International, alleging employment
discrimination under Title VII of the Civil Rights Act of 1984
(Title VII), 42 U.S.C. §§ 2000e et seq., and retaliation under the
False Claims Act (FCA), 31 U.S.C. §§ 3729–3733. Shekoyan
also asserted state tort and breach of contract claims whose
merits are not before us. The district court dismissed
Shekoyan’s Title VII claim for lack of subject matter
jurisdiction, Shekoyan v. Sibley Int’l Corp., 217 F. Supp. 2d 59
(D.D.C. 2002). The court subsequently granted summary
judgment in favor of Sibley on the FCA claim while dismissing
Shekoyan’s pendent state law claims for lack of supplemental
jurisdiction. Shekoyan v. Sibley Int’l Corp., 309 F. Supp. 2d 9
(D.D.C. 2004). Shekoyan appeals these rulings, as well as two
unpublished orders issued by the district court related to
Shekoyan’s attempt to submit non-standard affidavits in
opposition to Sibley’s motion for summary judgment. Because
the district court correctly interpreted Title VII not to apply to
an alien employed outside the United States and properly
applied the summary judgment standard in finding for Sibley on
Shekoyan’s FCA claim, we affirm the judgment of the district
court.
I.
Vladimir Shekoyan immigrated to the United States from his
native Armenia in 1994 and was granted “lawful permanent
resident” (LPR) status in 1996.1 Shekoyan has a Ph. D. in
Finance and Economics from the University of Moscow and has
worked for Armenia’s Ministry of Economics as well as for the
1
The Immigration and Nationality Act (INA) imposes a five-year
waiting period after acquiring LPR status before an alien may apply
for U.S. citizenship. 8 U.S.C. § 1427(a). Shekoyan applied for
citizenship in 2001 and became a naturalized American citizen in
January 2003.
3
World Bank. Sibley International is a consulting firm
headquartered in Washington, D.C. that “assists foreign
governments in implementing accounting reform.” Def.’s
Statement of Material Facts Not in Dispute, Case No. 00-2519
(Apr. 28, 2003).
This lawsuit stems from Shekoyan’s employment with Sibley
from January 1998 until October 1999. Shekoyan was hired as
a “Training Advisor” on the Georgia Enterprise Accounting
Reform (GEAR) project for which Sibley had been awarded a
contract (called a “task order”) by the U.S. Agency for
International Development (USAID). The parties signed an
employment letter contract that spelled out a 21-month term of
employment with the “hope that this will be the beginning of a
longer association.”2 The contract stated Shekoyan’s place of
employment as “Tbilisi, Republic of Georgia,” and noted his
eligibility for “USAID benefits for long-term personnel living
in Georgia.” Shekoyan claims that Sibley “committed to
maintaining its employment relationship with [him] beyond the
21-month contract” and that he was to “be employed by Sibley
back in Washington, D.C.” This claim is disputed by Donna
Sibley, the president of Sibley International, who stated in her
deposition that Shekoyan’s employment beyond the GEAR
project was never discussed in more definite terms than the
“hope” expressed in the employment contract.
The hoped-for ongoing relationship never came about.
Despite a second USAID task order for Sibley to continue the
GEAR project, Shekoyan was terminated as of October 31,
1999—the end date of the original task order. The letter of
termination, dated October 20, 1999 and sent to Shekoyan’s
2
The copy of the letter contract dated January 15, 1998 contained in
the Exhibits to the Joint Appendix is not signed by Shekoyan but the
parties do not dispute that the text of the letter constitutes a valid
employment contract.
4
Washington, D.C. residence, cites “a change in staffing
requirements” as the reason Shekoyan was not rehired.
According to Sibley’s brief, the available positions under the
new task order required a degree in public accounting, which
Shekoyan did not have.
Shekoyan tells a different story. He claims that his working
relationship with his immediate supervisor Jack Reynolds
deteriorated as a result of Reynolds’s discrimination based on
Shekoyan’s national origin. Shekoyan claims that Reynolds
made statements that Shekoyan was not a “real American,”
mocked his accented English and made racist comments about
people from former Soviet states. Shekoyan also alleges
financial misconduct by Sibley staff on the GEAR project,
including use of the offices and equipment paid for by USAID
to run a private audit practice, payment of full time salaries to
individuals who were employed full time by other organizations,
use of resources supplied by USAID to develop unrelated
business for Sibley and diversion of project vehicles and staff
members by Jack Reynolds and his wife for personal tasks.
Shekoyan claims to have alerted his superiors at Sibley in
Washington regarding Reynolds’s harassment and misuse of
project resources—a claim Sibley denies—and that, as a result,
he was fired for insubordination rather than because of any
change in staffing requirements.
Shekoyan filed a lawsuit in federal district court on October
20, 2000 alleging: discrimination on the basis of national origin,
a violation of Title VII, 42 U.S.C. §§ 2000e et seq., and the
District of Columbia Human Rights Act (DCHRA), D.C. Code
§ 2-1402.11; retaliation for his investigation into the misuse of
federal funds by GEAR employees in violation of the FCA, 31
U.S.C. §§ 3729–3733; and other state law torts and breaches of
contract. Sibley moved to dismiss Shekoyan’s Title VII claim
under FED . R. CIV. P. 12(b)(1) on the ground that Title VII
protections do not extend to non-U.S. citizens working abroad
5
and to dismiss his FCA claim under FED. R. CIV. P. 12(b)(6) for
failure to allege facts sufficient to make out a whistleblower
claim. Sibley also moved to dismiss the pendent state law
claims for lack of supplemental jurisdiction. The district court
granted Sibley’s motion to dismiss the Title VII claim, finding
that because “the plaintiff is a permanent resident alien, who
was employed extraterritorially, he is outside the scope of the
protections of Title VII.” Shekoyan v. Sibley Int’l Corp., 217 F.
Supp. 2d 59, 68 (D.D.C. 2002) (Shekoyan I). Accordingly, the
district court held that it lacked subject matter jurisdiction over
the Title VII claim. Id. Turning to Shekoyan’s FCA claim, the
district court found that the complaint, which had been filed pro
se, failed to satisfy FED . R. CIV. P. 9(b), which requires that “[i]n
all averments of fraud or mistake, the circumstances constituting
fraud or mistake shall be stated with particularity.” Shekoyan I,
217 F. Supp. 2d at 73. Nevertheless, the district court granted
Shekoyan leave to amend his complaint because “‘leave to
amend is “almost always” allowed to cure deficiencies in
pleading fraud.’” Id. at 74 (quoting Firestone v. Firestone, 76
F.3d 1205, 1209 (D.C. Cir. 1996) (in turn quoting Luce v.
Edelstein, 802 F.2d 49, 56 (2d Cir. 1988))). Moreover, in
Shekoyan’s opposition to Sibley’s motion to dismiss, he set
forth 22 instances of fraud, leaving the court unable to “‘say
with assurance that … it appears beyond doubt that the plaintiff
can prove no set of facts in support of his claim which would
entitle him to relief.’” Shekoyan I, 217 F. Supp. 2d at 75
(quoting Haines v. Kerner, 404 U.S. 519, 520–21 (1972)
(internal quotation omitted) (omission in Shekoyan I). Because
Shekoyan’s state law claims derived from the same “common
nucleus of operative fact,” United Mine Workers of Am. v.
Gibbs, 383 U.S. 715, 725 (1966), as his FCA claim, the district
court chose to exercise supplemental jurisdiction and denied
Sibley’s motion to dismiss those claims. Shekoyan I, 217 F.
Supp. 2d at 75–76.
6
Shekoyan filed his first amended complaint on September 2,
2002 with the assistance of counsel. Sibley filed an answer
denying all wrongdoing and a counterclaim for the value of
certain equipment it alleged Shekoyan took from the GEAR
project site. Following discovery, on April 28, 2003, Sibley
moved for summary judgment on Shekoyan’s FCA claim. As
part of the filing in opposition, Shekoyan’s lawyer signed and
submitted an unnotarized “affidavit” that recounts the purported
substance of her telephone interviews with former Sibley
employees, including Sibley’s former Chief Financial Officer,
David Bose. Shekoyan’s filing also included an unsigned draft
declaration by Gary Vanderhoof, a former Vice President and
Project Advisor at Sibley, corroborating Shekoyan’s version of
events on the GEAR project. Sibley challenged the accuracy of
the affidavit and draft declaration and moved to strike both. In
support, Sibley submitted signed, notarized affidavits by Bose
and Vanderhoof stating that Shekoyan’s lawyer had
misrepresented their conversations and that they could not
substantiate any harassment claims. Sibley also pointed to the
transcript of the telephone conversation between Shekoyan’s
lawyer and Bose, which in several places had Bose denying any
knowledge of harassment before Shekoyan’s return to the
United States. Shekoyan countered with a Rule 11 motion for
sanctions against Sibley’s lawyers. The district court denied
Shekoyan’s Rule 11 motion and granted Sibley’s motion to
strike in part, striking from the record the unnotarized affidavit
of Shekoyan’s lawyer and the unsigned Vanderhoof declaration.
While the dispute over Shekoyan’s submissions in opposition
to Sibley’s motion for summary judgment was playing out, on
January 30, 2004, Shekoyan moved to file his own motion for
summary judgment out of time. In an unpublished order dated
February 3, 2004, the district court denied the request, noting
that all dispositive motions were required—per court order—to
be filed by April 28, 2003. On March 19, 2004, the district
7
court granted Sibley’s motion for summary judgment and
dismissed Shekoyan’s remaining state law claims and Sibley’s
remaining counterclaims. Shekoyan v. Sibley Int’l Corp., 309 F.
Supp. 2d 9, 22 (D.D.C. 2004) (Shekoyan II). The district court
found that Shekoyan failed to raise “a genuine issue as to any
material fact,” FED. R. CIV. P. 56(c), because he could show
neither that he was engaged in “protected activity” nor that he
had suffered an adverse employment action as a result thereof.
Shekoyan II, 309 F. Supp. 2d at 14, 20. Having disposed of the
last of Shekoyan’s federal claims, the district court declined to
exercise jurisdiction over the remaining District of Columbia
claims, noting that 28 U.S.C. § 1367(d) provides for the tolling
of a state’s statute of limitations when a federal court exercises
supplemental jurisdiction over state claims and concluding,
therefore, that dismissing the claims “will not adversely impact
plaintiff’s ability to pursue his District of Columbia claims in
the local court system.” Shekoyan II, 309 F. Supp. 2d at 22.
Shekoyan timely filed his notice of appeal on April 6, 2004.
Pursuant to the district court’s order in Shekoyan II, Shekoyan
filed his state and common law claims in the District of
Columbia Superior Court. Shekoyan v. Sibley Int’l Corp., C.A.
No. XX-XXXXXXX (D.C. Sup. Ct. 2004). Those proceedings are
stayed pending the outcome of this appeal.
II.
A. The Title VII Claim
Title VII of the Civil Rights Act of 1964 prohibits
discrimination in employment based on, inter alia, race or
national origin. Title VII provides that “[i]t shall be an unlawful
employment practice for an employer … to fail or refuse to hire
or to discharge any individual, or otherwise to discriminate
against any individual … because of such individual’s race,
color, religion, sex, or national origin.” 42 U.S.C. § 2000e-2(a).
An “employee” is defined by Title VII, in circular fashion, as
8
“an individual employed by an employer.” Id. § 2000e(f). The
parties do not dispute that Shekoyan was “employed” by Sibley
International nor do they dispute that Sibley meets the statutory
definition of an “employer.” See id. § 2000e(b).
Shekoyan contends that the district court erred in two ways in
dismissing his Title VII claim for lack of subject matter
jurisdiction: first, by holding that Title VII does not extend to a
non-U.S. citizen employed overseas; and second, by holding
that, for Title VII purposes, Shekoyan’s place of employment
was the Republic of Georgia rather than the United States.
Shekoyan I, 217 F. Supp. 2d at 67–68. We review de novo a
district court’s dismissal of a claim under FED. R. CIV. P.
12(b)(1). Macharia v. United States, 334 F.3d 61, 64 (D.C. Cir.
2003).
The United States Supreme Court took up the issue of Title
VII’s extraterritorial application in Equal Employment
Opportunity Comm’n v. Arabian Am. Oil Co., 499 U.S. 244
(1991) (ARAMCO). In ARAMCO, the Court held that the
protections of Title VII do not extend to citizens employed by
U.S. companies overseas. It relied on the “longstanding
principle of American law ‘that legislation of Congress, unless
a contrary intent appears, is meant to apply only within the
territorial jurisdiction of the United States.’” Id. at 248 (quoting
Foley Bros., Inc. v. Filardo, 336 U.S. 281, 285 (1949)). It
explained that because the Court “assume[s] that Congress
legislates against the backdrop of the presumption against
extraterritoriality,” it will not read extraterritorial jurisdiction
into a statute “unless there is the affirmative intention of the
Congress clearly expressed.” Id. (internal quotation marks
omitted). If the statutory language is “ambiguous” or “does not
speak directly to the question presented,” the Court will not infer
9
extraterritorial jurisdiction. Id. at 250.3 The Court thus
concluded that “Congress’ awareness of the need to make a clear
statement that a statue applies overseas” combined with its use
of “more limited, boilerplate … language” manifested that the
Congress never “intended Title VII to apply abroad.” Id. at 252,
258-59.
In response to ARAMCO, the Congress amended Title VII to
extend its protections to U.S. citizens working overseas. The
statute now reads: “With respect to employment in a foreign
3
Shekoyan argues that the presumption against extraterritoriality
should not apply here because “the interests of the U.S. are clearly
affected by the assertion of Title VII jurisdiction over Sibley.” Pet’r
Br. at 22. In support he cites Envt'l Def. Fund, Inc. v. Massey, 986
F.2d 528 (D.C. Cir. 1993), which involved the extraterritorial
application of the National Environmental Policy Act, 42 U.S.C. §§
4321 et seq., to a federal agency, the National Science Foundation for
failing to prepare an Environmental Impact Statement (EIS) before
incinerating food waste in Antartica. 986 F.2d at 529. In Massey, we
first noted that the presumption against extraterritoriality “is generally
not applied where the failure to extend the scope of the statute to a
foreign setting will result in adverse effects within the United States.”
Id. at 531. The court named U.S. antitrust law, 15 U.S.C. §§ 1 et seq.,
and trademark law, 15 U.S.C. §§ 1051 et seq., as examples of statutes
enforced extraterritorially in order to avoid “negative economic
consequences” domestically. Massey, 986 F.2d at 531. Shekoyan lists
lost tax revenues to the federal government as well as the cost of
unemployment benefits paid to him as sufficient adverse consequences
to negate the presumption of territoriality. But Massey was not
decided on the “adverse consequences” exception. Rather, the court
found that “[b]ecause the decisionmaking processes of federal
agencies take place almost exclusively in this country and involve the
workings of the United States government, they are uniquely
domestic.” Id. at 532 (citation omitted). Moreover, the Massey court
expressly noted that the presumption against extraterritoriality did
apply to Title VII. Id. at 533 (citing ARAMCO, 499 U.S. at 255).
10
country,” the term “employee” “includes an individual who is a
citizen of the United States,” 42 U.S.C. § 2000e-1(f). The
Congress also retained section 2000e-1(a), which specifies that
Title VII does not apply “to an employer with respect to the
employment of aliens outside any State.” Id. § 2000e-1(a).
Shekoyan argues that his LPR status makes him a U.S. national,
thereby placing him in statutory limbo between a protected
citizen and an excluded alien. Pet’r Br. at 11. Shekoyan relies
on the Immigration and Nationality Act, 8 U.S.C. § 1101, which
defines “alien” to include “any person not a citizen or national
of the United States,” id. § 1101(a)(3), to support his
interpretation that a national should not fall within Title VII’s
“alien” exclusion for overseas employees. Yet even assuming,
arguendo, that a lawful permanent resident qualifies as a U.S.
national—a matter the parties dispute—Shekoyan faces a
significant problem: Title VII does more than merely exclude an
alien employed overseas from protection; it affirmatively grants
protection only to “a citizen of the United States.” 42 U.S.C. §
2000e(f). Especially in light of the presumption against
extraterritoriality, the Congress’s express language extending
the extraterritorial reach of Title VII only to American citizens
controls. “‘[W]hen the statute’s language is plain, the sole
function of the courts … is to enforce it according to its terms.’”
United States ex rel. Totten v. Bombardier Corp., 380 F.3d 488,
494 (D.C. Cir. 2004) (quoting Lamie v. United States Tr., 540
U.S. 526 (2004) (alteration in Bombadier) (omission added)).
The Congress is under no obligation to extend the protection
of its laws extraterritorially to every individual to whom it could
do so and courts have read Title VII’s extraterritorial jurisdiction
provision narrowly. See, e.g., Iwata v. Stryker Corp., 59 F.
Supp. 2d 600, 603 (N.D. Tex. 1999) (Title VII has “limited
extraterritorial reach”); Russell v. Midwest-Werner & Pfleiderer,
Inc., 955 F. Supp. 114, 115 (D. Kan. 1997) (“Title VII applies
only to American citizens employed abroad….”). Courts have
11
also read similar provisions in analogous statutes narrowly. See,
e.g., Reyes-Gaona v. N.C. Growers Ass’n, 250 F.3d 861, 865
(4th Cir. 2001) (interpreting Age Discrimination in Employment
Act to have “limited extra-territorial application”); Hu v.
Skadden, Arps, Slate, Meagher & Flom LLP, 76 F. Supp.2d 476,
477 (S.D.N.Y. 1999) (extraterritorial application of ADEA
“clearly limited”); O’Laughlin v. The Pritchard Corp., 972 F.
Supp. 1352, 1364 (D. Kan. 1997) (finding that “intent of
Congress” was to make “ADEA inapplicable to non-citizens of
the United States working abroad”). Moreover, the Congress
has explicitly chosen to extend extraterritorial coverage to an
LPR in other statutes. See, e.g., Arms Control Export Act, 22
U.S.C. § 2778(b) (coverage includes “every person” who
engages in brokering activities with respect to defense articles;
limited by International Traffic in Arms Regulation, 22 C.F.R.
§ 129.3(a), to apply only to a “U.S. person,”which includes an
LPR. 22 C.F.R. § 120.15). Accordingly, we hold that Title VII
does not extend extraterritorially to any person who is not an
American citizen.
Shekoyan’s alternative argument, that he was not employed
“in a foreign country” within the meaning of Title VII, 42
U.S.C. § 2000e(f), is based on the facts that he was hired and
trained in the United States, that many decisions related to his
employment were made in the United States and that his letter
of termination was sent to his Washington, D.C. residence.
Because the employment letter contract between Sibley and
Shekoyan stated Shekoyan’s place of employment as “Tbilisi,
Republic of Georgia” and classified him as “long-term personnel
living in Georgia” and because Shekoyan resided and worked
in Georgia throughout his employment with Sibley, however, we
agree with the district court that Shekoyan was engaged in
“employment in a foreign country.”
12
B. The FCA Claim
The False Claims Act, 31 U.S.C. §§ 3729-3733, imposes a
civil penalty and treble damages on any individual who, inter
alia, “knowingly presents, or causes to be presented, to an
officer or employee of the United States Government … a false
or fraudulent claim for payment or approval.” Id. § 3729(a).
The FCA permits a private party—a “relator”—to initiate a qui
tam action on behalf of the government. Id. § 3730(b). The
government has the option of taking over the suit or leaving it to
the relator to prosecute. Id. In either case, the relator is entitled
to a percentage of any recovery resulting from a successful suit.
Id. § 3730(d)(1)-(2).
The FCA also contains a “whistleblower” protection provision
which can give rise to a retaliation claim. The statute provides
that:
[a]ny employee who is discharged, demoted, suspended,
threatened, harassed, or in any other manner discriminated
against in the terms and conditions of employment by his or
her employer because of lawful acts done by the employee
… in furtherance of an action under this section … shall be
entitled to all relief necessary to make the employee whole.
Id. § 3730(h). To assert such a retaliation claim, the employee
must show: (1) that he engaged in protected activity (“acts done
… in furtherance of an action under this section”); and (2) that
he experienced discrimination “because of” his protected
activity. Id. To establish the second element, the employee
must demonstrate that the employer had knowledge of the
employee’s protected activity and that the retaliation was
motivated by the protected activity. See United States ex rel.
Yesudian v. Howard Univ., 153 F.3d 731, 736 (D.C. Cir. 1998)
(citing S. REP . NO. 99-345).
Shekoyan argues on appeal that the record raises a genuine
13
issue of material fact regarding whether he engaged in
“protected activity” under the FCA and therefore the district
court erred in granting summary judgment to Sibley. Under
FED . R. CIV. P. 56, summary judgment is appropriate only if
there is no genuine issue of material fact and the moving party
is entitled to judgment as a matter of law. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 247–48 (1986). We review a grant
of summary judgment de novo, applying the same standards as
the district court, Tao v. Freeh, 27 F.3d 635, 638 (D.C. Cir.
1994), drawing all inferences from the evidence in favor of the
non-movant. Reeves v. Sanderson Plumbing Prods., 530 U.S.
133, 150 (2000).
We have held that the language of the FCA “manifests
Congress’ intent to protect employees while they are collecting
information about a possible fraud, before they have put all the
pieces of the puzzle together.” Yesudian, 153 F.3d at 740
(emphasis in original). Thus, while the employee “must be
investigating matters which are calculated, or reasonably could
lead, to a viable FCA action,” United States ex rel. Hopper v.
Anton, 91 F.3d 1291, 1269 (9th Cir. 1996); see also Neal v.
Honeywell Inc., 33 F.3d 860, 864 (7th Cir. 1994), it is not
necessary for a plaintiff “to ‘know’ that the investigation …
could lead to a False Claims Act suit.” Yesudian, 153 F.3d at
741. Nevertheless, “[m]ere dissatisfaction with one’s treatment
on the job is not … enough. Nor is an employee’s investigation
of nothing more than his employer’s non-compliance with
federal or state regulations.” Id. at 740. An employee does not
engage in protected conduct if he “merely inform[s] a supervisor
of the problem.” Zahodnick v. IBM Corp., 135 F.3d 911, 914
(4th Cir. 1997).
Determining whether an employee has engaged in protected
conduct under the FCA is a “fact specific inquiry.” Hutchins v.
Wilentz, Goldman & Spitzer, 253 F.3d 176, 187 (3d Cir. 2001).
Shekoyan has alleged several acts that could constitute fraud,
14
including payment of full-time salaries to persons receiving full-
time salaries from other employers and use of project resources
for personal benefit—such as project vehicles and GEAR-
financed private residences. Shekoyan reported his concerns to
one of his supervisors and asked whether he should raise them
with USAID; he was told to let Sibley investigate first. The
district court found, however, that the basis of Shekoyan’s
complaints “was because the plaintiff was apparently denied the
use of such vehicles and not that the conduct was fraudulent.”
Shekoyan II, 309 F. Supp. 2d at 18. Particularly significant is
Shekoyan’s own deposition testimony, to wit: “I have never
concluded that there was corruption. I thought that there are
some issues that need to be kind of addressed or corrected or
fixed or I don’t know, worked out, but I did not conclude that
there was a [sic] corruption.” Shekoyan’s own statement
manifests that he did no more than “inform[] a supervisor of [a]
problem,” Zahodnick, 135 F.3d at 914, and thus did not engage
in “protected activity” under the FCA.
C. The Pendent Claims
Shekoyan contends that the district court erred when, after
disposing of all of the federal claims upon which the court had
exercised supplemental jurisdiction, it dismissed his pendent
claims under District of Columbia law. Whether to retain
jurisdiction over pendent state and common law claims after the
dismissal of the federal claims is “a matter left to the sound
discretion of the district court” that we review for abuse of
discretion only. Edmondson & Gallagher v. Alban Towers
Tenants Ass’n, 48 F.3d 1260, 1265–66 (D.C. Cir. 1995).
“[P]endent jurisdiction is a doctrine of discretion, not a
plaintiff’s right.” United Mine Workers Ass’n v. Gibbs, 383
U.S. 715, 726 (1966). A district court may choose to retain
jurisdiction over, or dismiss, pendent state law claims after
15
federal claims are dismissed. 28 U.S.C. § 1367(c)(3).4
Edmondson & Gallagher, 48 F.3d at 1265–66. “[I]n the usual
case in which all federal-law claims are dismissed before trial,
the balance of factors to be considered under the pendent
jurisdiction doctrine—judicial economy, convenience, fairness,
and comity—will point toward declining to exercise jurisdiction
over the remaining state-law claims.” Carnegie-Mellon Univ.
v. Cohill, 484 U.S. 343, 350 n.7 (1988).
Shekoyan argues that this is not “the usual case,” id., because
the litigation proceeded for four years in the district court prior
to the dismissal of the last of his federal claims and because the
district judge was familiar with District of Columbia law, having
served previously for 18 years as a D.C. Superior Court judge.
Yet judicial economy is not the only relevant factor and the
district court properly considered comity as well as fairness to
the plaintiff in concluding that its rejection of his non-federal
claims would “not adversely impact plaintiff’s ability to pursue
4
The statute provides that a district court
may decline to exercise supplemental jurisdiction … if:
(1) the claim raises a novel or complex question of
State law,
(2) the claim substantially predominates over the claim
or claims over which the district court has original
jurisdiction,
(3) the district court has dismissed all claims over
which it has original jurisdiction, or
(4) in exceptional circumstances, there are other
compelling reasons for declining jurisdiction.
28 U.S.C. § 1367(c). In exercising its discretionary authority to retain
or dismiss pendent claims, the district court is to be “guided by
consideration of the factors enumerated in 28 U.S.C. § 1367(c).”
Edmondson & Gallagher, 48 F.3d at 1266.
16
[those] claims in the local court system.” Shekoyan II, 309 F.
Supp. 2d at 22. We find no abuse of discretion in the district
court’s dismissal of Shekoyan’s pendent claims.
D. Contested Procedural Orders
Shekoyan also contests two procedural orders issued by the
district court during the course of the litigation. The first is the
district court’s refusal to permit Shekoyan to file a motion for
summary judgment after the deadline for filing dispositive
motions. Order, Case No. 00-2519 (February 3, 2004)
(summary judgment order). The second is the district court’s
denial of Shekoyan’s motion for Rule 11 sanctions against
Sibley’s lawyers. Order, Case No. 00-2519 (February 17, 2004)
(Rule 11 Order). We review both orders for abuse of discretion.
See Atchinson v. District of Columbia, 73 F.3d 418, 424 (D.C.
Cir. 1996) (reviewing denial of motion to amend complaint for
abuse of discretion); Cooter & Gell v. Hartmax Corp., 496 U.S.
384, 405 (1990) (“[A]n appellate court should apply an abuse-
of-discretion standard in reviewing all aspects of a district
court’s Rule 11 determination.”). In the Rule 11 context, we
note that a district court “would necessarily abuse its discretion
if it based its ruling on an erroneous view of the law or on a
clearly erroneous assessment of the evidence.” Id.
Rule 16 of the Federal Rules of Civil Procedure instructs the
district court to “enter a scheduling order that limits the time …
to file motions [and] to complete discovery.” FED. R. CIV. P.
16(b). On December 6, 2002 the district court issued a
scheduling order that required all dispositive motions to be filed
by March 28, 2003. Order, Case No. 00-2519 (December 6,
2002) (Scheduling Order I). This deadline was later extended to
April 28, 2003. Order, Case No. 00-2519 (February 24, 2003)
(Scheduling Order II). Shekoyan filed his “Motion to File
Motion for Summary Judgment Out of Time” on January 30,
2004—more than nine months after the deadline set by
17
Scheduling Order II. Shekoyan’s explanation for the delayed
filing is that he had finally obtained an eyewitness declaration
corroborating his allegations of discrimination at Sibley. Yet
Shekoyan had earlier filed a motion to supplement his
opposition to Sibley’s motion for summary judgment with the
newly obtained declaration, which allowed the district court to
consider the material in evaluating whether summary judgment
was warranted. See Summary Judgment Order. Moreover,
corroboration of Shekoyan’s version of the facts was irrelevant
to the summary judgment analysis. At the summary judgment
stage, all inferences from the evidence are to be drawn in favor
of the non-movant. Reeves, 530 U.S. at 150. Thus, the district
court was already under an obligation to accept as true
Shekoyan’s allegations of discrimination in ruling on Sibley’s
motion for summary judgment. We therefore conclude that the
district court did not abuse its discretion in denying Shekoyan’s
motion.
Rule 11 of the Federal Rules of Civil Procedure provides for
sanctions for filing a paper with the court “for any improper
purpose,” including harassment, delay or increasing the costs of
an opponent in litigation. FED. R. CIV. P. 11(b)(1). Likewise, all
legal and factual allegations made by a litigant before the court
must be made in good faith. Id. Shekoyan filed his motion for
Rule 11 sanctions in response to Sibley’s motion to strike from
the record the disputed unsigned and unnotarized affidavits
submitted by Shekoyan’s lawyer. Rule 11 Order at 11.
Shekoyan accused Sibley’s lawyers of bad faith in filing the
motion to strike, eliciting perjured testimony and manipulating
witnesses, and violating the district court’s Local Rule 7(m),
which requires counsel to confer with opposing counsel before
filing non-dispositive motions. See Rule 11 Order at 11–12;
LCvR 7(m). In particular, Shekoyan claimed to have an audio
recording of his lawyer’s conversation with David Bose that
verified the content of the draft declaration and established
18
Sibley’s witness manipulation. The district court found that the
motion to strike was justified but that Sibley had violated Local
Rule 7(m) by failing to discuss the motion with Shekoyan.
Despite being “troubled” by the competing claims of inaccuracy
with respect to the Bose and Vanderhoof declarations, the court
refused to “sift through” the audio recording in order to
determine which party’s account was accurate. Rule 11 Order
at 12–13. Instead, it ruled that Shekoyan could use the
recording to impeach Sibley’s witnesses at trial. Id. at 13. The
Supreme Court has instructed that: “[t]he district court is best
acquainted with the local bar’s litigation practices and thus best
situated to determine when a sanction is warranted to serve Rule
11’s goal[s].” Cooter & Gell, 496 U.S. at 404. We ordinarily
find that “decisions concerning Rule 11 sanctions are better left
to the discretion of the district court which has a bird’s eye view
of the actual positions taken by the litigants,” Corley v.
Rosewood Care Ctr., Inc., 388 F.3d 990, 1013 (7th Cir. 2004)
(citing Brandt v. Schal Assocs., Inc., 960 F.2d 640, 645 (7th Cir.
1992)), and will not second guess the factual determinations
integral to the district court’s decision not to impose Rule 11
sanctions.
For the foregoing reasons, the decision of the district court is
affirmed.
So ordered.