United States Court of Appeals,
Eleventh Circuit.
No. 95-3006.
Luis E. GARCIA, M.D., Plaintiff-Appellant,
v.
COPENHAVER, BELL & ASSOCIATES, M.D.'S, P.A., Defendant-Third
Party Plaintiff-Appellee,
St. Paul Fire & Marine Insurance Company, Third Party Defendant.
Feb. 3, 1997.
Appeal from the United States District Court for the Middle
District of Florida. (No. 94-387-CIV-T-17A), Thomas B. McCoun, III,
Judge.
Before EDMONDSON, Circuit Judge, FAY, Senior Circuit Judge, and
ALDRICH*, Senior District Judge.
FAY, Senior Circuit Judge:
Appellant, Luis E. Garcia ("Garcia"), filed a complaint
against appellee, Copenhaver, Bell & Associates, M.D.'s, P.A.
("Copenhaver/Bell"), alleging Copenhaver/Bell discriminated against
him on the basis of age in violation of the Age Discrimination in
Employment Act ("ADEA"), 29 U.S.C. §§ 621-634 (1994). At the
conclusion of a jury trial (but before the case was submitted to
the jury), the Magistrate Judge,1 after hearing the evidence
presented from both sides, made the factual determination that
Copenhaver/Bell was not an "employer" as defined by ADEA and
dismissed the case for lack of subject matter jurisdiction pursuant
*
Honorable Ann Aldrich, Senior U.S. District Judge for the
Northern District of Ohio, sitting by designation.
1
The parties consented to proceed to trial before United
States Magistrate Judge Charles R. Wilson. Subsequently, the
case was reassigned to United States Magistrate Judge Tom B.
McCoun III.
to Fed.R.Civ.P. 12(b)(1). Moreover, given the facts of this case,
in determining that Copenhaver/Bell was not an "employer," the
Magistrate Judge also indirectly decided that Garcia was not an
"employee," but an independent contractor. Garcia appeals the
Magistrate Judge's ruling dismissing the case for lack of subject
matter jurisdiction.2 Partly based on the procedural confusion
(see supra note 2), the parties' briefs do not fully address the
true issue before the Court.
The issue that emerges on appeal is whether the factual
determination that defendant is or is not an "employer" is an
element of the cause of action in an ADEA case. For purposes of a
motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(1), Eleventh
Circuit precedent seems to direct the judge, and not a jury, to
decide whether Copenhaver/Bell is an "employer." The importance of
determining whether an "employer" is an element of the claim, is
that it will determine the procedural posture of the Magistrate
Judge's ruling. If we should find that being an "employer" is an
element of an ADEA case, then well established precedent requires
the district court, in ruling on a motion to dismiss, "to find that
jurisdiction exists and deal with the objection as a direct attack
2
Specifically, on appeal, Garcia contends "the district
court erred in directing a verdict for Copenhaver/Bell...." We
assume, because the Magistrate Judge issued its decision at the
end of the trial and because a motion for directed verdict was
pending, Garcia believes the Magistrate Judge entered a directed
verdict in favor of Copenhaver/Bell. Accordingly, Garcia
contends the standard of review in directed verdict cases should
apply and the Magistrate Judge should be reversed. However, for
reasons discussed later in this opinion, Garcia's argument is
procedurally flawed. The Magistrate Judge did not enter a
directed verdict, but rather ruled on Copenhaver/Bell's "notices"
suggesting lack of subject matter jurisdiction filed pursuant to
Rule 12(h)(3) of the Federal Rules of Civil Procedure.
on the merits of the plaintiff's case." Simanonok v. Simanonok,
787 F.2d 1517, 1520 (11th Cir.1986) (quoting Williamson v. Tucker,
645 F.2d 404, 415 (5th Cir.1981), cert. denied, 454 U.S. 897, 102
S.Ct. 396, 70 L.Ed.2d 212 (1981)). The appropriate standard of
review would then be the one applicable to Fed.R.Civ.P. 12(b)(6) or
Fed.R.Civ.P. 56 motions, "both of which place greater restrictions
on the district court's discretion." Williamson, 645 F.2d at 415.
Because in the instant case we hold that whether or not the
defendant is an "employer" as defined in the Act goes to the merits
of an ADEA case, we believe the Magistrate Judge erred in resolving
questions of fact pursuant to Rule 12(b)(1). In finding that being
an "employer" is an element of an ADEA claim, we rely upon
analogous cases within this Circuit, persuasive cases from other
circuits that have found being an "employee" to be an element of
the cause of action, and the unusual factual scenario presented by
this case. In accordance with this holding, the proper procedure
for a district court is to assume jurisdiction and utilize the
standards associated with a 12(b)(6) motion or Rule 56 motion for
summary judgment. Applying these standards to the case at hand,
the motion to dismiss should have been denied on the merits and the
jury allowed to decide the issue of whether Copenhaver/Bell was an
"employer" and consequently whether Garcia was an "employee."
Accordingly, for the reasons discussed below, we reverse the
Magistrate Judge's order dismissing the case for lack of subject
matter jurisdiction and remand the case for a jury trial.
I. BACKGROUND
Garcia is a physician in emergency medicine. In 1991, Garcia
submitted an application to Copenhaver/Bell, an exclusive provider
of emergency room doctors to nine hospitals in Florida.
Copenhaver/Bell matches physicians to hospitals after considering
the physicians' temperaments and the volume of patients and their
acuity. On August 26, 1991, Garcia and Copenhaver/Bell entered
into a "Medical Service Sub-Contract" ("the Contract") pursuant to
which Garcia would provide emergency room services to Mease
Hospital in Dunedin, Florida. The Contract was for one year with
automatic renewal unless terminated by either party.
Paragraph seven of the Contract provides in pertinent part:
[Garcia] shall perform his duties and obligations hereunder as
an independent contractor and not as an employee.
Accordingly, [Copenhaver/Bell] shall not exercise control, or
have the right to control, [Garcia] as to the specific means
or manner in which [Garcia] discharges his duties hereunder
and [Garcia] shall perform his duties at all times in
accordance with the exercise of his independent medical
judgment.... Nothing herein shall be construed to create a
partnership, joint venture, agency or other relationship
between the parties other than an independent contractor
relationship. (Emphasis added).
The Contract contained other limitations on the relationship
between the parties. For instance, the Contract required Garcia to
maintain various certifications and licenses; obligated Garcia and
Copenhaver/Bell respectively to provide at least ninety or sixty
days notice of termination; authorized liquidated damages against
Garcia in the event of his premature termination of the contract;
based Garcia's compensation on an hourly rate; and permitted
Garcia to determine his own schedule in conjunction with the other
physicians at the hospital. Over thirty other physicians entered
into similar contracts with Copenhaver/Bell to perform emergency
work at various Florida facilities.
Garcia was subjected to a six-month probationary period once
he began working at Mease Hospital. On July 14, 1992, Dr. Solomon,
assistant director of the emergency department at Mease Hospital,
informed Garcia that he had successfully completed his probationary
term. On that same day, however, Mr. David Mitchell, an
administrator for Copenhaver/Bell, informed Garcia that
Copenhaver/Bell was forced to replace him due to "hospital
politics." Pursuant to the Contract's termination clause, Garcia
continued to practice at Mease Hospital for an additional sixty
days.
On March 8, 1994, Garcia filed a complaint against
Copenhaver/Bell alleging age discrimination under ADEA. Following
some discovery, Copenhaver/Bell filed a motion for summary judgment
contending there was no disputed issue of material fact and Garcia,
as a matter of law, was an independent contractor. See Daughtrey
v. Honeywell, Inc., 3 F.3d 1488, 1495 n. 13 (11th Cir.1993) ("The
ADEA does not provide relief for discrimination against an
independent contractor."). The Magistrate Judge entered an order
denying Copenhaver/Bell's motion for summary judgment. In denying
the motion, the Magistrate Judge concluded there were questions of
fact as to whether Garcia was an "employee" or an independent
contractor.
Prior to the Magistrate Judge's order denying the motion for
summary judgment, Copenhaver/Bell filed a "Notice of Suggestion of
Lack of Subject Matter Jurisdiction" and then an "Amended Notice of
Suggestion of Lack of Subject Matter Jurisdiction."3 The argument
3
The two "notices" are virtually the same.
advanced in these two pleadings was that Copenhaver/Bell did not
employ twenty or more "employees," and therefore was not an
"employer" as defined in ADEA. The court would then lack subject
matter jurisdiction. The Magistrate Judge did not rule on these
notices before commencement of the trial.
On the first day of trial, the Magistrate Judge discussed
preliminary matters with the parties. One of the issues raised was
whether the court had subject matter jurisdiction over the
proceedings. Counsel for Copenhaver/Bell stated, "the issue of
subject matter jurisdiction. If you want, I can do the motion
right now. I might have to dismiss for lack of jurisdiction. I
understood during a status conference, you would discuss that
during the course of the trial." To which the Magistrate Judge
responded: "Correct. At the appropriate time, we will move on the
motions taken under advisement. With regards to that [subject
matter jurisdiction], what amount of evidence deals with that issue
and does not, for instance, relate to Dr. Garcia's claim,...."
Later on, the Magistrate Judge further commented, "[t]he reason it
occurs to me if we are going to get into a series of witnesses that
will take—purely on that issue [subject matter jurisdiction], it
may be necessary to do that outside the hearing of the jury. But
it may not be necessary because it seems to me to a certain extent
I think there's an overlap." Garcia proceeded to present evidence
in front of the jury.
At the conclusion of Garcia's case, Copenhaver/Bell stated it
had two motions to make. Copenhaver/Bell announced it would
reassert its motion to dismiss for lack of subject matter
jurisdiction and also move for a directed verdict pursuant to
Fed.R.Civ.P. 50(a). The motion for directed verdict was premised
on Proud v. Stone, 945 F.2d 796 (4th Cir.1991). In Proud, the
Fourth Circuit affirmed the district court's dismissal of the case
holding that the plaintiff failed to establish pretext. Id. In
other words, Copenhaver/Bell's motion for directed verdict was
based on Garcia's failure to establish pretext, and not subject
matter jurisdiction. The Magistrate Judge did not rule on the two
motions, but stated he would "make a ruling before the matter is
presented to the jury." Copenhaver/Bell then presented its case.
Once it concluded its case in chief, Copenhaver/Bell reasserted the
motion for directed verdict and motion to dismiss on the same
grounds raised previously.
Prior to submitting the case to the jury, the Magistrate Judge
issued a ruling from the bench dismissing the case for lack of
subject matter jurisdiction. The Magistrate Judge determined that
the approximately thirty emergency physicians having contracts with
Copenhaver/Bell were independent contractors and therefore could
not be included in the total number of "employees" employed by
Copenhaver/Bell. If the emergency physicians were not "employees,"
Copenhaver/Bell was not an "employer" since it did not employ the
requisite twenty or more employees required by ADEA. 4 The court,
therefore reasoned that it lacked subject matter jurisdiction and
dismissed the case.
Following the trial, the Magistrate Judge issued a written
4
The parties agreed that if the physicians are considered
independent contractors, Copenhaver/Bell does not employ twenty
or more employees and is not an "employer."
order on Copenhaver/Bell's two notice pleadings suggesting lack of
subject matter jurisdiction. In the order, the court stated,
"having proceeded forward with the jury trial in this cause and
having taken evidence on the issue of subject matter jurisdiction,
as framed by the Defendant, and ... for reasons more fully stated
on the trial record, Thursday, June 29, 1995, the court finds that
the Defendant does not employ the necessary twenty (20) or more
employees and thus, the court is without subject matter
jurisdiction under the Age Discrimination [in] Employment Act (29
U.S.C. § 621 et seq.)."
II. DIRECTED VERDICT OR MOTION TO DISMISS?
Before determining the applicable standard the Magistrate
Judge should have employed, we must decide the basis upon which the
Magistrate Judge ruled; i.e., did he treat the notices as motions
to dismiss under 12(b)(1), after hearing the evidence, or did he
grant a motion for directed verdict. On appeal, Garcia contends
the Magistrate Judge granted a directed verdict.
From the record before us and after reading the Magistrate
Judge's order disposing of the "notices," it appears that the
procedural posture set forth in the Magistrate Judge's order is
more accurately described as a ruling on a motion to dismiss,
instead of on a motion for directed verdict. It seems the
Magistrate Judge, during the course of the jury trial,
simultaneously conducted an evidentiary hearing on the issue of
subject matter jurisdiction. After hearing both sides present
evidence on the issue, the Magistrate Judge concluded it was
without jurisdiction to hear the case. In addition,
Copenhaver/Bell's motion for directed verdict was based on Garcia's
absence of establishing pretext, and not on the district court's
lack of jurisdiction. Neither in his ruling from the bench nor in
his written order disposing of the notices does the Magistrate
Judge mention pretext. Rather, the substance of his two related
rulings was subject matter jurisdiction. The language contained in
the written order is clear. The Magistrate Judge dismissed the
case for lack of subject matter jurisdiction. Thus, in essence,
the Magistrate Judge treated Copenhaver/Bell's "notices" as motions
to dismiss for lack of subject matter jurisdiction pursuant to Rule
12(b)(1) of the Federal Rules of Civil Procedure. As such, we will
evaluate the case in light of the standards governing Fed.R.Civ.P.
12(b)(1) motions.
III. STANDARD FOR RULE 12(B)(1)
MOTION TO DISMISS
We begin by observing that it is extremely difficult to
dismiss a claim for lack of subject matter jurisdiction. Simanonok
v. Simanonok, 787 F.2d 1517, 1519 (11th Cir.1986). Attacks on
subject matter jurisdiction under Fed.R.Civ.P. 12(b)(1) come in two
forms: "facial attacks" and "factual attacks." Lawrence v.
Dunbar, 919 F.2d 1525, 1528-29 (11th Cir.1990). Facial attacks on
the complaint "require[ ] the court merely to look and see if [the]
plaintiff has sufficiently alleged a basis of subject matter
jurisdiction, and the allegations in his complaint are taken as
true for the purposes of the motion." Lawrence v. Dunbar, 919 F.2d
1525, 1529 (11th Cir.1990) (quoting Menchaca v. Chrysler Credit
Corp., 613 F.2d 507, 511 (5th Cir.1980), cert. denied, 449 U.S.
953, 101 S.Ct. 358, 66 L.Ed.2d 217 (1980)) (citing Mortensen v.
First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir.1977)). "
"Factual attacks', on the other hand, challenge "the existence of
subject matter jurisdiction in fact, irrespective of the pleadings,
and matters outside the pleadings, such as testimony and
affidavits, are considered.' " Id.
The present case involves a factual attack, and not a facial
attack. On a factual attack of subject matter jurisdiction, a
court's power to make findings of facts and to weigh the evidence
depends on whether the factual attack on jurisdiction also
implicates the merits of plaintiff's cause of action. Lawrence,
919 F.2d at 1529. If the facts necessary to sustain jurisdiction
do not implicate the merits of plaintiff's cause of action, then:
[T]he trial court may proceed as it never could under
12(b)(6) or Fed.R.Civ.P. 56. Because at issue in a factual
12(b)(1) motion is the trial court's jurisdiction—its very
power to hear the case—there is substantial authority that the
trial court is free to weigh the evidence and satisfy itself
as to the existence of its power to hear the case. In short,
no presumptive truthfulness attaches to plaintiff's
allegations, and the existence of disputed material facts will
not preclude the trial court from evaluating for itself the
merits of jurisdictional claims.
Lawrence, 919 F.2d at 1529 (quoting Mortensen v. First Fed. Sav. &
Loan Ass'n, 549 F.2d 884, 891 (3d Cir.1977)).
On the other hand, if an attack on subject matter
jurisdiction also implicates an element of the cause of action,
then:
[T]he proper course of action for the district court ...
is to find that jurisdiction exists and deal with the
objection as a direct attack on the merits of the plaintiff's
case.... Judicial economy is best promoted when the existence
of a federal right is directly reached and, where no claim is
found to exist, the case is dismissed on the merits. This
refusal to treat indirect attacks on the merits as Rule
12(b)(1) motions provides, moreover, a greater level of
protection to the plaintiff who in truth is facing a challenge
to the validity of his claim: the defendant is forced to
proceed under Rule 12(b)(6) ... or Rule 56 ... both of which
place great restrictions on the district court's
discretion.... [A]s a general rule a claim cannot be
dismissed for lack of subject matter jurisdiction because of
the absence of a federal cause of action. The exceptions to
this rule are narrowly drawn, and are intended to allow
jurisdictional dismissals only in those cases where the
federal claim is clearly immaterial or insubstantial.
Williamson v. Tucker, 645 F.2d 404, 415-16 (5th Cir.1981), cert.
denied, 454 U.S. 897, 102 S.Ct. 396, 70 L.Ed.2d 212 (1981). With
these principles in mind, we will next address whether being an
"employer" implicates an element of a cause of action under ADEA.
In our case, the Magistrate Judge believing that question did not
implicate the merits, weighed the evidence and concluded it was
without subject matter jurisdiction to entertain the case. Should
we find that being an "employer" does not implicate the elements,
then the Magistrate Judge was correct in weighing the evidence and
determining that it was without jurisdiction to hear the case
pursuant to Rule 12(b)(1). If, however, the question of whether or
not the defendant is an "employer" as defined in the Act does
implicate the elements of the plaintiff's claim, then the
Magistrate Judge is forced to proceed under Rule 12(b)(6) or Rule
56, unless Garcia's case is "clearly immaterial or insubstantial."
Id.
IV. ELEMENT OF AN ADEA CLAIM?
A. "Employer"
Copenhaver/Bell asserts that it is not an "employer" as that
term is defined by ADEA, because it does not employ "twenty or more
employees." Rather, Copenhaver/Bell contends that the majority of
its "employees" are independent contractors. Copenhaver/Bell
further argues that determining if it is an "employer" is solely a
jurisdictional question (and not an element of the claim) that
should be decided by the judge pursuant to the standards connected
with a motion under Fed.R.Civ.P. 12(b)(1). In support of this
position, during oral argument before the Court and in supplemental
filings, counsel for Copenhaver/Bell cited several non-binding
cases. Neither party directed this Court to binding precedent
addressing whether establishing the defendant as an "employer" is
a necessary element to prove an ADEA claim. The issue seems to be
one of first impression in this Circuit.5
The Ninth Circuit has stated that "the question of
jurisdiction and the merits of an action will be considered
intertwined where ... "a statute provides the basis for both the
5
The closest case we were able to locate addressing the
issue is Fike v. Gold Kist, Inc., 514 F.Supp. 722 (N.D.Ala.)
aff'd, 664 F.2d 295 (11th Cir.1981). The Eleventh Circuit's
affirmance is referenced in "Decisions without Published
Opinions." Eleventh Circuit Rule 36-2 entitled "Unpublished
Opinions" states in part that "[u]npublished opinions are not
considered binding, precedent." Accordingly, we are not bound by
Fike.
In Fike, female-plaintiffs filed suit against
defendants alleging violations of Title VII when they were
terminated because of their pregnancies. Fike, 514 F.Supp.
at 723. A defendant moved to dismiss the complaints
pursuant to Rule 12(b)(1), arguing that it did not meet the
statutory definition of "employer" because it did not employ
fifteen or more employees. Id. The district court, after
making findings of fact, granted defendant's motion to
dismiss based on lack of subject matter jurisdiction. Id.
at 723-28. Based on this case, it appears the Eleventh
Circuit affirmed a district court's order that found whether
or not a defendant is an "employer" in a Title VII case is
an issue that can be factually resolved by a judge pursuant
to Rule 12(b)(1). However, we also note that at the time of
this decision Title VII cases were tried non-jury.
subject matter jurisdiction of the federal court and the
plaintiff's substantive claim for relief.' " Sun Valley Gasoline,
Inc. v. Ernst Enterprises, Inc., 711 F.2d 138, 139-40 (9th
Cir.1983) (quoting Timberlane Lumber Co. v. Bank of America, 549
F.2d 597, 602 (9th Cir.1976)). Thus, initially we will turn to
ADEA to see if the statute provides the basis for both subject
matter jurisdiction and the plaintiff's substantive claim for
relief.6
Congress passed ADEA in 1967 to protect older workers against
discrimination in the workplace. E.E.O.C. v. Chrysler Corp., 759
F.2d 1523, 1524 (11th Cir.1985). More specifically, the portion of
the statute that provides the substantive relief states in part:
(a) Employer practices
It shall be unlawful for an employer—
(1) to fail or refuse to hire or to discharge any
individual or otherwise discriminate against any individual
with respect to his compensation, terms, conditions, or
privileges of employment, because of such individual's age;
29 U.S.C. § 623(a)(1). In its definitions' section, ADEA defines
"employer" in part as "a person engaged in an industry affecting
commerce who has twenty or more employees for each working day in
each of twenty or more calendar weeks in the current or preceding
6
The parties do not dispute that ADEA's "employer" and
"employee" provide a basis for subject matter jurisdiction.
Indeed, we agree with the parties that "employer" and "employee"
provide a basis for subject matter jurisdiction. For example, if
from the face of plaintiff's complaint it is apparent that
defendant-employer does not employ more than twenty employees,
then a court could dismiss an ADEA claim for lack of subject
matter jurisdiction, as ADEA only applies to employers who employ
"twenty or more employees." Accordingly, because the parties
agree "employer" is jurisdictional, we only need to consider if
ADEA's "employer" and "employee" also provide a basis for
plaintiff's substantive claim for relief.
calendar year:...." 29 U.S.C. § 630(b), and "employee" as "an
individual employed by any employer...." 29 U.S.C. § 630(f). The
section provides no further guidance as to the scope of the
"employee" term. Daughtrey v. Honeywell, Inc., 3 F.3d 1488, 1495
(11th Cir.1993).
From the plain language of the statute, it appears the
elements of an ADEA claim under § 623(a)(1) can be summarized as
follow, a plaintiff must prove: 1) an employer, 2) failed or
refused to hire or to discharge, 3) any individual, 4) with respect
to his compensation, terms, conditions, or privileges of
employment, 5) because of such individual's age. Stated simply, it
seems a plaintiff can only recover if he is able to prove an
"employer" discriminated against him/her on the basis of age. In
order to determine if a defendant qualifies as an "employer" and,
consequently, whether ADEA will even apply, we must turn to ADEA's
definitions' section.
In other words, it seems the section of ADEA that provides the
substantive relief, § 623, is intertwined and dependent on the
section of ADEA that defines the scope of the act, § 630. An
analysis of the two sections is circular as the two sections are
dependent on one another. For a plaintiff to recover under the
act, plaintiff must prove as part of his claim that an "employer"
discriminated against him/her. To prove that a defendant is an
"employer," a plaintiff must satisfy the definition of "employer"
set forth in § 630(b).
In reaching this analysis, we draw comparisons to securities
cases, in which this Court has "specifically held that the
definition of the term "security' in the context of a suit based on
the federal securities laws may reach the merits of the case and
thereby limit the court's discretion to dismiss for lack of subject
matter jurisdiction." Williamson v. Tucker, 645 F.2d 404, 416 (5th
Cir.1981), cert. denied, 454 U.S. 897, 102 S.Ct. 396, 70 L.Ed.2d
212 (1981); See also Bell v. Health-Mor, Inc., 549 F.2d 342 (5th
Cir.1977); Hilgeman v. National Ins. Co. of America, 547 F.2d 298
(5th Cir.1977).
For example, in Williamson, plaintiffs, investors in "joint
venture interests," filed suit pursuant to the Securities Act of
1933 and the Securities Exchange Act of 1934 ("the Acts"), alleging
that the "joint venture interests" were securities within the
meaning of the Acts. The district court dismissed the case for
lack of subject matter jurisdiction finding that the "joint venture
interests" were not securities. The Fifth Circuit reversed. In
doing so, it stated, "[i]n this case it is clear that the
jurisdictional issue reaches the merits of the plaintiffs' case;
if the joint venture interests and notes are not securities, there
is not only no federal jurisdiction to hear the case but also no
federal cause of action on the stated facts." Williamson, 645 F.2d
at 416. Since the Court found the issues intertwined, the district
court's dismissal for lack of subject matter jurisdiction was
proper only if plaintiffs' claim was immaterial or insubstantial.
Id.
In order to determine if the "joint venture interests" were
securities covered by the Acts, the parties and the district court
looked to the Acts' definitions of "security" and the Supreme
Court's analysis of securities in Securities & Exchange Commission
v. W.J. Howey Co., 328 U.S. 293, 66 S.Ct. 1100, 90 L.Ed. 1244
(1946). Similarly, in this case, in order to determine if
"employers" and "employees" are covered by ADEA, we look to ADEA's
definitions of the terms and case law interpreting the terms. As
the Court found in Williamson, "if [Copenhaver/Bell is not an
"employer,'] there is not only no federal jurisdiction to hear the
case but also no federal cause of action on the stated facts."
Williamson, 645 F.2d at 416.
Although Williamson is helpful in arriving at the conclusion
that whether or not one is an "employer" is an element of an ADEA
claim, we are not sure our discussion can end here. As stated
earlier, the significance in determining whether being an
"employer" is an element of an ADEA claim is deciding which
standard a judge should apply—Rule 12(b)(1) or Rule 12(b)(6).
Under Rule 12(b)(6), a plaintiff is more likely to withstand a
motion to dismiss and the case is more likely to be decided on the
merits by the fact finder. Thus, the ultimate conclusion reached
by our holding that whether or not one is an "employer" is an
element of an ADEA claim, is the belief that the jury, rather than
the judge, should decide the disputed question. In support of this
belief, we draw analogies from Title VII cases and criminal cases
within the Eleventh Circuit.7
In interpreting ADEA's definition of "employer," Title VII
7
See also Marine Coatings of Alabama, Inc. v. United States,
792 F.2d 1565, 1566-67 (11th Cir.1986), rev'd on other grounds,
932 F.2d 1370 (11th Cir.1991) (Admiralty case where this Circuit
found that the government's jurisdictional attack under the
statute was also an attack on the merits.).
cases are helpful. In addition, most of the cases interpreting the
definition of "employer" are found in Title VII cases. The only
notable difference between the two statutes' definitions of
"employer" is the number of "employees" each statute requires.
Title VII requires fifteen or more employees, while ADEA requires
twenty or more. At a minimum, Title VII cases interpreting the
definition of "employer" are helpful. As the First Circuit has
stated:
As the substantive provisions of the ADEA were derived in
haeca verba from Title VII, (citation omitted), as was the
statutory definition of "employer," (which relates to the
scope of the law's substantive provisions), we may look to the
constructions of the term in the Title VII (and thus the NLRA)
context for guidance. (citations omitted).
Rivas v. Federacion de Asociaciones Pecuarias de Puerto Rico, 929
F.2d 814, 820 n. 15 (1st Cir.1991). Because there is no real
difference (other than numerical) between the definitions in the
two statutes, we turn to Title VII cases for guidance.
In Virgo v. Riviera Beach Associates, Ltd, 30 F.3d 1350 (11th
Cir.1994), plaintiff filed suit against several defendants alleging
sexual harassment in violation of Title VII and several pendent
state law claims. At the time the alleged harassment took place,
Title VII did not permit trials by jury. 8 Accordingly, the judge
acted as the fact finder and found that one of the defendants was
subject to Title VII liability, despite its contention it did not
jointly employ fifteen or more employees with another defendant.
8
The Civil Rights Act of 1991, which became effective
November 21, 1991, liberalized Title VII by creating a right to
trial by jury. Goodgame v. American Cast Iron Pipe Co., 75 F.3d
1516, 1518 (11th Cir.), reh'g denied and reh'g en banc denied, 86
F.3d 1172 (1996).
The Eleventh Circuit agreed with the district court's findings of
fact and affirmed.
A similar issue has arisen in criminal cases in which this
Court has held that where the jurisdictional element is a material
element of the crime, the jurisdictional issue should be decided by
the jury and not the judge. United States v. Medina, 90 F.3d 459,
463-64 (11th Cir.1996); United States v. Ayarza-Garcia, 819 F.2d
1043, 1048 (11th Cir.), cert. denied, 484 U.S. 969, 108 S.Ct. 465,
98 L.Ed.2d 404 (1987). For example in Medina, defendants allege
the district court erred by deciding as a matter of law that its
vessel was subject to the jurisdiction of the United States. On
appeal, defendants argued that jurisdiction under 46 U.S.C. §
1903(a) was also an element of the offense and should be decided by
a jury. The Eleventh Circuit agreed and vacated the district
court's order. The Court held that where the jurisdictional
requirement is also a substantive element of the crime, the
jurisdictional issue should be determined at trial by the fact
finder. Medina, 90 F.3d at 463-64.
We believe these cases are persuasive in holding that the
question of whether or not a defendant is an "employer" is a
substantive element of an ADEA claim and intertwined with the
question of jurisdiction. That being the case, the resolution of
the question must be made by the fact finder deciding the merits of
the claim.
Finally, the most convincing argument that the question of
"employer" status is an element of an ADEA claim is the factual
situation of the instant case, where both the "employer" and
"employee" issues are synonymous. In order to determine whether
Copenhaver/Bell is an "employer," pursuant to ADEA, the Magistrate
Judge also indirectly decided that Garcia was not an "employee" but
an independent contractor. When the Magistrate Judge ruled the
other subcontracted emergency physicians were independent
contractors and Copenhaver/Bell therefore did not employ "twenty or
more employees," the Magistrate Judge also implicitly found that
Garcia was not an "employee," but an independent contractor.9
Should we determine that being an "employee" in this case is an
element of an ADEA claim, the Magistrate Judge would seem to be
precluded from resolving questions of fact on the "employer" issue.
Stated differently, if the Magistrate Judge were precluded
from conducting an evidentiary hearing to determine that Garcia is
an "employee," then it would seem that the Magistrate Judge also
would be equally precluded from concluding that Copenhaver/Bell is
an "employer." To allow the Magistrate Judge to decide the
9
Given the particular facts in this case, the "employer" and
"employee" issues are intertwined. This is so, because ADEA's
definitions of "employer" and "employee" overlap. ADEA's
definition of "employer" contains the following provision "twenty
or more employees." (emphasis added). Thus, in some instances,
in order to determine whether an "employer" employs "twenty or
more employees," one must look at ADEA's definition of
"employee." Conversely, the issues will not be intertwined in a
case where it is undisputed that defendant-employer employs
"twenty or more employees," thus satisfying the jurisdictional
"employer" requirement under ADEA.
For instance, in a case where there is a dispute as to
whether a certain individual plaintiff, hired by the
defendant-employer is an "employee" rather than an
independent contractor and thus able to assert a claim under
ADEA, but no dispute as to the status of the
defendant-employer, the issues will not be intertwined. See
Daughtrey v. Honeywell, Inc., 3 F.3d 1488, 1495 n. 13 (11th
Cir.1993) ("The ADEA does not provide relief for
discrimination against an independent contractor.").
"employer" issue, is to allow the judge (and not the jury) to also
indirectly decide the "employee" issue. Of course, this argument
is only applicable if we determine that "employee" is an element of
an ADEA claim.
B. "Employee"
We begin by noting that other circuits cases have found that
whether a plaintiff is an "employee" is both jurisdictional and an
element of a claim. The Tenth Circuit has found that whether a
plaintiff qualifies as an "employee" under ADEA is both a
jurisdictional question and an element of the claim. Wheeler v.
Hurdman, 825 F.2d 257, 259 (10th Cir.), cert. denied, 484 U.S. 986,
108 S.Ct. 503, 98 L.Ed.2d 501 (1987) ("We find that the
determination of whether [plaintiff] qualifies as an employee under
the federal discrimination statutes is both a jurisdictional
question and an aspect of the substantive claim in her
discrimination action.").
Once again, Title VII cases are helpful in making the
determination of whether an "employee" is an element of a cause of
action. Both Title VII and ADEA's definitions of "employee" are
virtually identical. In a Title VII case, the Fifth Circuit found
that the determination of "employee" status was intertwined with
the merits of the Title VII claim. Clark v. Tarrant County, Texas,
798 F.2d 736, 742 (5th Cir.), reh'g denied, 802 F.2d 455 (1986).
In Clark, plaintiffs, female probation officers, sued the
county and the probation department alleging sex discrimination in
pay and promotion. The probation department moved to dismiss for
lack of subject matter jurisdiction, claiming plaintiffs were
personal staff of county officials and thus lacked standing.10 The
district court agreed and dismissed the case for lack of subject
matter jurisdiction. The Fifth Circuit reversed the dismissal.
The Court of Appeals found that the application of the personal
staff exemption and the question of employee status provided the
basis for both jurisdiction and a cause of action under Title VII
and thus must be resolved by the fact finder for the merits
disposition.
In a case somewhat similar to Clark, the Eleventh Circuit
found that an assistant state attorney position was not an
"employee" covered by ADEA and dismissed the case. E.E.O.C. v.
Reno, 758 F.2d 581 (11th Cir.1985). In Reno, plaintiff filed suit
against defendant Janet Reno, the then state attorney for Dade
County, alleging age discrimination under ADEA when Reno refused to
hire him. Defendant, relying on Florida state statutes, moved to
dismiss the complaint arguing plaintiff was exempted from the Act's
coverage by virtue of the personal staff exemption provided in
ADEA's definition of "employee." The district court dismissed the
case, concluding "that defendant Reno does not employ any
"employees' within the meaning of the Act, and that therefore the
court lacked jurisdiction to hear the case." Id. at 583. The
Eleventh Circuit affirmed the district court's dismissal of the
case.
The basis of the district court's dismissal was a motion to
10
Title VII's definition of "employee" does not include
individuals who are the personal staff of a person elected to
public office. See 42 U.S.C. § 2000e(f). ADEA contains the same
exemption. 29 U.S.C. § 630(f).
dismiss. Id. at 583 n. 6. More specifically, in the language
cited from the district court's order, it appears the dismissal was
based on lack of subject matter jurisdiction pursuant to Rule
12(b)(1). This 12(b)(1) dismissal is a "facial" dismissal. That
is, the district judge did not resolve questions of fact, but ruled
as a matter of law, that plaintiff was not an "employee" covered by
ADEA.
V. ANALYSIS
Having determined that the motion to dismiss for lack of
subject matter jurisdiction involved a "factual" attack and the
determination of whether Copenhaver/Bell is an "employer" under
ADEA provides the basis for both subject matter jurisdiction and
the substantive claim for relief, the summary judgment standard
must be applied, unless plaintiff's claim was clearly immaterial or
insubstantial.11
11
Whether or not a district court will utilize the 12(b)(6)
standard or Rule 56 standard will depend on whether the district
court considered matters outside the pleadings. Under 12(b)(6),
whether a plaintiff failed to state a claim upon which relief can
be granted must be ascertained from the face of the complaint.
Once the court considers matters outside the complaint, the
12(b)(6) motion to dismiss converts into a motion for summary
judgment. Fed.R.Civ.P. 12(b)(6). In this case, the Magistrate
Judge considered matters outside the pleadings, converting the
motion to dismiss into one for summary judgment.
Additionally, before a district court may convert a
motion to dismiss into a motion for summary judgment, it
must notify the parties and allow the parties ten days to
submit any relevant evidence and arguments in support or
opposition to the merits. Marine Coatings of Alabama, Inc.
v. United States, 792 F.2d 1565, 1568 (11th Cir.1986), rev'd
on other grounds, 932 F.2d 1370 (11th Cir.1991). However,
as the panel noted in Marine Coatings, this Circuit has
recognized an exception to the ten days notice requirement
when the "parties are aware of the court's intent to
consider matters outside the record and have presented all
the materials and arguments they would have if proper notice
We do not believe, and Copenhaver/Bell does not contend, that
Garcia's claim is clearly immaterial, made solely for the purpose
of establishing jurisdiction, nor is it insubstantial or frivolous.
Therefore, if genuine issues of material fact exist, the motion to
dismiss should have been denied and the question presented to the
jury. The Magistrate Judge had decided that genuine issues of
material facts did exist when it denied Copenhaver/Bell's motion
for summary judgment. Thus, it was improper for the Magistrate
Judge to grant the motion to dismiss.
From the record before the Court, it appears there is a
genuine issue of fact as to whether Garcia is an independent
contractor or an "employee" and conversely then whether
Copenhaver/Bell is an "employer." Courts have adopted three tests
in distinguishing between an "employee" and an independent
contractor: (1) the common-law agency test first set forth in
Community for Creative Non-Violence v. Reid, 490 U.S. 730, 109
S.Ct. 2166, 104 L.Ed.2d 811 (1989) and reaffirmed by the Supreme
Court in Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 112
S.Ct. 1344, 117 L.Ed.2d 581 (1992); (2) an economic realities
test;12 and (3) a combination of the agency and economic realities
tests ("hybrid test"). Cobb v. Sun Papers, Inc., 673 F.2d 337,
had been given...." Id. (citing Property Management &
Investments, Inc. v. Lewis, 752 F.2d 599, 605 (11th
Cir.1985)).
In this case, it cannot be seriously contested that
despite a lack of notice, the parties did not make all
available arguments and submit all the evidence they would
have if they had received proper notice.
12
See e.g., Dole v. Elliott Travel & Tours Inc., 942 F.2d
962, 965 (6th Cir.1991).
340-41 (11th Cir.), cert. denied, 459 U.S. 874, 103 S.Ct. 163, 74
L.Ed.2d 135 (1982). This Court, in non-ADEA cases, has relied on
both the hybrid and agency tests. Id. (Title VII case utilizing
hybrid test.); Daughtrey v. Honeywell, Inc., 3 F.3d 1488 (11th
Cir.1993) (Under ERISA claim, Court utilized common-law agency
test.).
In Daughtrey v. Honeywell, Inc., 3 F.3d 1488 (11th Cir.1993)
this Court found it unnecessary to decide which test to apply to a
claim under ADEA, because the Court found the central issue to both
the hybrid test and the agency test is the "hiring party's right to
control the manner and means by which the work is accomplished."
Daughtrey, 3 F.3d at 1495-96. Similarly, for purposes of the ADEA
case before us, we do not need to decide which test to employ.
Under either test, there are disputed facts concerning the amount
of control Copenhaver/Bell exerted over Garcia. For example,
Garcia testified that the medical directors oversaw the medical
care he provided, scheduled his shifts and paid him on an hourly
basis. Construing these facts in favor of Garcia, as we must under
Rule 56, we cannot rule as a matter of law that Garcia is an
independent contractor. Therefore, the proper ruling is to deny
Copenhaver/Bell's motion to dismiss for lack of subject matter
jurisdiction and allow the jury to decide if Garcia is an
"employee" and if Copenhaver/Bell is an "employer."
VI. CONCLUSION
For the foregoing reasons, we hold on the facts of this case
that whether or not the defendant is an "employer" is an element of
an ADEA claim. In dismissing for lack of jurisdiction, the
Magistrate Judge incorrectly resolved questions of fact in a
12(b)(1) motion. The proper procedure would have been to utilize
the standards associated with a 12(b)(6) motion or Rule 56 motion
for summary judgment. Applying the summary judgment standard to
the case before us, we REVERSE the Magistrate Judge's order
dismissing Garcia's complaint for lack of subject matter
jurisdiction and REMAND the case for a jury trial.