Cruz v. Bristol-Myers Squibb Co., PR, Inc.

United States Court of Appeals
For the First Circuit

No. 11-1617

CESAR I. CRUZ; JOSE I. LASANTA; MARCELO DIAZ,

Plaintiffs, Appellants,

JANE DOE; JANE DOE 1; JANE DOE 2;
CONJUGAL PARTNERSHIP LASANTA-DOE 1;
CONJUGAL PARTNERSHIP CRUZ-DOE;
CONJUGAL PARTNERSHIP DIAZ-DOE 2,

Plaintiffs,

v.

BRISTOL-MYERS SQUIBB COMPANY, PR, INC.;
BRISTOL-MYERS SQUIBB MFG., INC.;
BMS SEVERANCE PLAN,

Defendants, Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO

[Hon. Francisco A. Besosa, U.S. District Judge]

Before

Lynch, Chief Judge,
Boudin and Lipez, Circuit Judges.

Frank E. Laboy Blanc on brief for appellants.
Lourdes C. Hernández-Venegas, Ana B. Rosado-Frontanés, and
Schuster Aguiló LLP on brief for appellees.

November 7, 2012
 LIPEZ, Circuit Judge. After they were fired from their

jobs, appellants Cesar Cruz, Jose Lasanta, and Marcelo Diaz filed

suit in federal district court against their former employer,

appellee Bristol-Myers Squibb Manufacturing Company ("Bristol-

Myers"), and against the severance plan established by Bristol-

Myers pursuant to the Employee Retirement Income and Security Act

("ERISA"), 29 U.S.C. §§ 1001-1461, appellee BMS Severance Plan.

The district court granted appellees' motion for summary judgment,

and appellants now challenge that ruling, as well as a number of

the district court's other orders. Discerning no error, we affirm.

I.

A. Factual Background

In 2003, Bristol-Myers began winding down operations at

the multi-building site where Cruz had worked as a mechanic since

1993. By letter, Bristol-Myers notified Cruz on July 29, 2003,

that he would receive a cash bonus upon discharge, in addition to

any severance package for which he might be eligible. The letter

explained that the amount of the bonus depended on the timing of

the discharge: if Cruz's employment ended when normal operations in

Building 5 stopped, he would get three months' salary; if he left

when operations in Buildings 2 and 29 stopped, he would get six

months' salary; if he was dismissed when sterile operations in

Building 5 stopped, he would get nine months' salary.

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 As part of the winding-down process, Bristol-Myers

developed a ranking system to determine the order in which

employees occupying the same positions would be terminated. The

ranking system took into account both professional skills and

seniority within the company. In 2007, as operations in Building

2 were coming to a halt, Bristol-Myers decided to terminate two of

its four mechanics. Among the mechanics, Cruz was ranked third in

skills and fourth in seniority. On June 22, 2007, he was informed

that there would be a reduction in force that would result in his

discharge on August 29, 2007. At the time, Cruz was forty-two

years old. The two mechanics who were retained were, respectively,

fifty years old and forty-three years old. No one was hired to

replace Cruz, and he was paid a cash bonus of six months salary.

Prior to Cruz's dismissal, Bristol-Myers had adopted a

severance plan, pursuant to ERISA, to assist employees who were

being downsized. Under the plan, in exchange for signing a general

release of any claims against Bristol-Myers, Cruz would have been

eligible for a severance package of $47,833. Cruz never signed the

release and, as a result, never received a severance package.

B. Procedural History

Appellants' complaint was filed on April 11, 2008,

asserting federal claims under ERISA, the Age Discrimination in

Employment Act ("ADEA"), 29 U.S.C. §§ 621-634, the Americans with

Disabilities Act ("ADA"), 42 U.S.C. §§ 12101-12213, the Worker

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Adjustment and Retraining Notification Act ("WARN"), 29 U.S.C. §§

2101-2109, and the Consolidated Omnibus Budget Reconciliation Act

("COBRA"), 29 U.S.C. §§ 1161-1169, which amended ERISA. The

complaint also asserted a common-law breach of contract claim, as

well as an employment discrimination claim under the Puerto Rico

Anti-Discrimination Act (also known as Law 100), P.R. Laws. Ann.

tit. 29, §§ 146-151, and an unjustified dismissal claim under

Puerto Rico Law 80, P.R. Laws Ann. tit. 29, §§ 185a-m.

Because the allegations in the complaint were difficult

to decipher, appellees filed a motion for a more definite

statement. See Fed. R. Civ. P. 12(e). On July 11, 2008,

appellants submitted a new complaint raising identical claims,

which appellees answered. After reviewing the new complaint, the

district court tentatively determined that there was no basis for

appellants to be joined together as plaintiffs in a single lawsuit.

See Fed. R. Civ. P. 20(a)(1). Hence, the district court ordered

appellants to show cause why Diaz and Lasanta should not be severed

from the case, leaving Cruz (as the first named plaintiff) to

proceed alone. Appellants responded that joinder was proper

because their individual rights to relief arose from the same

occurrence - namely, a large-scale reduction in force at the

Bristol-Myers site where they had worked.

On February 25, 2009, before the district court had

conclusively ruled on the propriety of joinder, appellants filed a

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motion seeking to have their suit certified as a collective action

under the ADEA. See 29 U.S.C. § 626(b) (incorporating 29 U.S.C.

§ 216(b)); see also Hoffman-La Roche Inc. v. Sperling, 493 U.S.

165, 170 (1989) ("Congress has stated its policy that ADEA

plaintiffs should have the opportunity to proceed collectively.").

On January 28, 2010, the district court issued an order severing

Diaz and Lasanta and dismissing their claims without prejudice on

the ground that appellants had failed to establish that a question

of law or fact common to all of them would arise in the case. See

Fed. R. Civ. P. 20(a)(1)(B). The district court then declared the

motion seeking certification of appellants' suit as a collective

action to be moot. See Cruz v. Bristol Myers Squibb Co. P.R. Inc.,

264 F.R.D. 22 (D.P.R. 2010).

On February 10, 2010, the district court issued a

scheduling order informing the remaining parties that any amended

pleadings had to be filed by March 9, 2010. After the deadline

passed, Cruz filed a "corrected complaint" on April 26, 2010, which

deleted his ADA, WARN, and COBRA claims. Appellees answered the

corrected complaint on May 4, 2010, and discovery began. On June

13, 2010, Cruz moved to amend the complaint in order to augment his

ADEA and Law 100 claims with information unearthed during

discovery. The district court denied his motion without comment.

On December 13, 2010, after discovery had concluded, Cruz once more

moved to amend the complaint for the purposes of reinforcing his

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existing claims, adding an allegedly indispensable party (an

unidentified successor-in-interest to Bristol-Myers), and rejoining

Diaz as a plaintiff. The motion was denied, again without comment.

On January 11, 2011, appellees moved for summary

judgment, affixing to their motion a statement of uncontested facts

("SUF"), as required by the district court's rules. See D.P.R.

Civ. R. 56(b). On January 23, 2011, Cruz opposed the summary

judgment motion but neglected to submit a counter-statement along

with his opposition admitting, denying, or qualifying each fact in

the SUF. See D.P.R. Civ. R. 56(c). Instead, he submitted a short

narrative outlining his view of the case. Deeming admitted the

facts in appellees' SUF, see D.P.R. Civ. R. 56(e), the district

court granted appellees' motion for summary judgment, see Cruz v.

Bristol Myers Squibb Co. PR, Inc., 777 F. Supp. 2d 321, 340 (D.P.R.

2011). This appeal followed.

II.

A. Party Joinder

We begin our analysis by considering whether the district

court abused its discretion in severing Diaz and Lasanta. See

Coughlin v. Rogers, 130 F.3d 1348, 1351 (9th Cir. 1997) (reviewing

for abuse of discretion). Multiple plaintiffs may join together in

a single action if "they assert any right to relief jointly,

severally, or in the alternative with respect to or arising out of

the same transaction, occurrence, or series of transactions or

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occurrences" and "any question of law or fact common to all

plaintiffs will arise in the action." Fed. R. Civ. P. 20(a)(1)(A)-

(B). If both elements of this test are not satisfied, "a court, in

its discretion, may sever the misjoined parties, so long as no

substantial right will be prejudiced by the severance. In such a

case, the court can generally dismiss all but the first named

plaintiff without prejudice to the institution of new, separate

lawsuits by the dropped plaintiffs . . . ." Coughlin, 130 F.3d at

1350 (citations omitted).

In this case, appellants made no effort to demonstrate

that any common question of law or fact would arise. It appears

that each appellant lost his job under different circumstances and

each has distinct legal claims against appellees. Although the

rules governing party joinder are construed liberally for the sake

of convenience and economy, see Desert Empire Bank v. Ins. Co. of

N. Am., 623 F.2d 1371, 1375-76 (9th Cir. 1980), we discern no abuse

of discretion in the district court's decision to sever Diaz and

Lasanta and dismiss their claims without prejudice.

B. Certification as a Collective Action

For substantially the same reasons, the district court

did not abuse its discretion in declining to certify appellants'

suit as a collective action under the ADEA. See Thiessen v. Gen.

Elec. Capital Corp., 267 F.3d 1095, 1102 (10th Cir. 2001)

(reviewing for abuse of discretion). Employees seeking to bring a

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collective action under the ADEA must establish that they are

similarly situated. See 29 U.S.C. § 626(b) (incorporating 29

U.S.C. § 216(b)); Hipp v. Liberty Nat'l Life Ins. Co., 252 F.3d

1208, 1216-17 (11th Cir. 2001). This requirement is even less

stringent than the test for party joinder, see Grayson v. K Mart

Corp., 79 F.3d 1086, 1095-96 (11th Cir. 1996), but it still has

teeth, see Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233,

1261 (11th Cir. 2008). The modest factual showing that must be

made "cannot be satisfied simply by unsupported assertions," Myers

v. Hertz Corp., 624 F.3d 537, 555 (2d Cir. 2010) (internal

quotation marks omitted), such as those in this case. Appellants'

barebones motion for certification stated only that appellants are

"similarly situated and victims of a single decision, policy or

plan" to reduce Bristol-Myers' workforce. These conclusory

allegations were insufficient to warrant the certification of a

collective action.

C. Amendments to the Complaint

There also was no abuse of discretion in the denial of

Cruz's belated motions to amend his complaint. See Trans-Spec

Truck Serv., Inc. v. Caterpillar, Inc., 524 F.3d 315, 326 (1st Cir.

2008). Cruz argued his motions under Rule 15's liberal amendment

policy, which "provides that . . . '[t]he court should freely give

leave when justice so requires.'” Id. at 327 (quoting Fed. R. Civ.

P. 15(a)(2)). Because the motions to amend came after the deadline

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established by the district court's scheduling order, however, they

could be granted only upon a showing of good cause, see O'Connell

v. Hyatt Hotels of P.R., 357 F.3d 152, 154-55 (1st Cir. 2004); Fed.

R. Civ. P. 16(b)(4). "Rule 16(b)'s 'good cause' standard

emphasizes the diligence of the party seeking the amendment."

O'Connell, 357 F.3d at 155.

Partly due to his misapprehension of the correct legal

standard, Cruz made minimal effort to demonstrate that good cause

justified permitting an amendment. Cruz filed his first motion to

amend three months after the deadline set forth in the district

court's scheduling order. The motion sought to add factual

allegations regarding "a statement . . . made in writing by

plaintiff's immediate supervisor obtained during our efforts to

prepare for the case and to comply with various information

requests put forth by [defendants]." This document was evidently

in plaintiff's possession, raising questions as to why it abruptly

surfaced over two years after he initiated this litigation.

Counsel claimed that their efforts to obtain this evidence were

complicated by Cruz's move to Florida and ill-defined health

problems. These cursory explanations do not demonstrate why this

supposedly crucial piece of information could not have been

uncovered earlier with appropriate diligence.1

1
The timing of Cruz's first motion to amend was puzzling,
since by that point it was unlikely that he would face further
motions to dismiss. The value of adding factual support for his

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 Cruz's second motion to amend came nine months after the

district court's deadline. This motion similarly failed to offer

sufficient explanation for the delay in seeking amendment. Cruz

never identified the allegedly indispensable party he sought to add

as a successor-in-interest to Bristol-Myers, and he failed to

explain why he delayed until after discovery had ended to seek to

rejoin Diaz as a plaintiff, despite having already filed three

versions of his complaint. See O'Connell, 357 F.3d at 155 ("Such

a long and unexplained delay vindicates the district court's

conclusion that plaintiffs were not diligently pursuing this

litigation."); Leary v. Daeschner, 349 F.3d 888, 907 (6th Cir.

2003) (affirming denial of leave to amend where "[p]laintiffs gave

the district court no excuse for their considerable delay").

"A scheduling order is not a frivolous piece of paper,

idly entered, which can be cavalierly disregarded by counsel

without peril.” Johnson v. Mammoth Recreations, Inc., 975 F.2d

604, 610 (9th Cir. 1992) (internal quotation marks omitted).

Cruz's failure to show his diligence in seeking an amendment doomed

this motion as well.

claims was therefore limited. Moreover, Cruz could not hope to
evade summary judgment by relying only on his complaint. See Ruiz-
Rosa v. Rullán, 485 F.3d 150, 156 (1st Cir. 2007) ("Allegations
made in a plaintiff's complaint, standing alone, are not enough to
oppose a properly supported motion for summary judgment.").

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D. Summary Judgment

We review the grant of a motion for summary judgment de

novo. See Vicor Corp. v. Vigilant Ins. Co., 674 F.3d 1, 20 (1st

Cir. 2012). Because Cruz did not properly controvert appellees'

SUF, the district court deemed the facts therein admitted, as was

its prerogative. See D.P.R. Civ. R. 56(e); Ríos-Jiménez v.

Principi, 520 F.3d 31, 38-39 (1st Cir. 2008). We therefore confine

our analysis to those facts, see Ríos-Jiménez, 520 F.3d at 39, as

summarized above and described in greater detail in the district

court's decision, see Cruz, 777 F. Supp. 2d at 331-34.

1. The ADEA Claim

Under the ADEA, it is unlawful for an employer to

discharge an employee because of the employee's age. See 29 U.S.C.

§ 623(a)(1); Bonefont-Igaravidez v. Int'l Shipping Corp., 659 F.3d

120, 123 (1st Cir. 2011). To prevail on an ADEA claim, an employee

must establish by a preponderance of the evidence that age was the

but-for cause of his or her termination. See Gross v. FBL Fin.

Servs., Inc., 557 U.S. 167, 176 (2009); Vélez v. Thermo King de

P.R., Inc., 585 F.3d 441, 446 (1st Cir. 2009). "Where, as here,

the employee lacks direct evidence, we utilize the burden-shifting

framework developed by the Supreme Court to facilitate the process

of proving discrimination." Bonefont-Igaravidez, 659 F.3d at 123

(citing McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802-05

(1973)); see also Vélez, 585 F.3d at 446-47 & n.2. In the context

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of a reduction in force, the first step of this framework requires

the employee to make out a prima facie case of discrimination by

showing that (1) he or she was at least forty years old at the time

of discharge; (2) he or she was qualified for his or her position;

(3) he or she was fired; and (4) his or her employer either did not

treat age neutrally or retained younger employees in the same

position. See Woodman v. Haemonetics Corp., 51 F.3d 1087, 1091

(1st Cir. 1995). The burden then shifts to the employer to

articulate a legitimate, nondiscriminatory reason for the

employee's termination, see id., which the employee may rebut by

showing that the proffered reason is "merely a pretext for

impermissible age discrimination," id. at 1092.

In this case, there is no dispute that Cruz satisfied the

first three requirements of a prima facie discrimination case.

However, there is no evidence that Bristol-Myers either failed to

treat age neutrally in deciding to discharge Cruz or retained

younger employees in his position. The record plainly shows that

Cruz was laid off pursuant to a ranking system that considered only

his professional skills and seniority, and the two mechanics who

were retained were both older than Cruz. Hence, no prima facie

case was established. See Goncalves v. Plymouth Cnty. Sheriff's

Dep't, 659 F.3d 101, 105-07 (1st Cir. 2011).

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 2. The Law 100 and Law 80 Claims

The Law 100 claim fails for similar reasons. Under Law

100, "a plaintiff has the initial burden to establish a prima facie

case by (1) demonstrating that he was actually or constructively

discharged, and (2) alleging that the decision was discriminatory."

Velázquez-Fernández v. NCE Foods, Inc., 476 F.3d 6, 11 (1st Cir.

2007) (internal quotation marks omitted). After the plaintiff

makes this "rather undemanding" showing, the burden of persuasion

then shifts to the employer to show that it had just cause for the

employee's termination. Id.; see also Baralt v. Nationwide Mut.

Ins. Co., 251 F.3d 10, 16 & n.8 (1st Cir. 2001) (explaining that

making out prima facie case under Law 100 requires less than what

plaintiff must bring forward to satisfy prima facie showing under

ADEA). If the employer can establish just cause, then, "as under

the ADEA, the burden of persuasion returns to the employee to show

that the employer's decision was motivated by age discrimination."

Velázquez-Fernandez, 476 F.3d at 11 (internal quotation marks

omitted). "Ultimately . . . the employee is faced with the same

burden of persuasion as an employee bringing suit under the ADEA."

Id.

As the Puerto Rico Supreme Court has explained, because

Law 100 does not define what constitutes just cause, guidance is

drawn from Law 80. See Báez García v. Cooper Labs., Inc., 20 P.R.

Offic. Trans. 153, 164 (P.R. 1987); see also Baltodano v. Merck,

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Sharp & Dohme (I.A.) Corp., 637 F.3d 38, 41-42 (1st Cir. 2011)

("Law 80 and Law 100 employ identical standards for just cause.").

According to Law 80, a dismissal is for just cause if it results

from the "[f]ull, temporar[y] or partial closing of the operations

of the establishment." P.R. Laws Ann. tit. 29 § 185b(d).

Hence, even assuming that Cruz made the "minimal showing"

required to make out a prima facie case under Law 100, Baralt, 251

F.3d at 16, Bristol-Myers has shown that there was just cause for

his dismissal, since the company was engaged in a large-scale

reduction in force. Defendant has adduced evidence showing that

Cruz's layoff took place as a result of a neutrally-applied ranking

system that took into account both his seniority and skill level.

Cruz has not rebutted this showing by demonstrating that his

termination was, in fact, motivated by age discrimination. Indeed,

any inference of discrimination is severely undermined by the fact

that the two employees who were retained after the layoff were

older than Cruz.

Likewise, the Law 80 claim fails. Law 80 requires an

employer to make severance payments to an employee who is

discharged without just cause. See P.R. Laws. Ann. tit. 29, §

185a; see also Baltodano, 637 F.3d at 41-42. It, too, employs a

burden-shifting scheme. See id. at 42. Once an employee has

established that he or she was discharged, it is up to the employer

to show that the discharge was for just cause. See id. The

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employee then must rebut this showing. See id. As we have already

said, Bristol-Myers showed that there was just cause for Cruz's

dismissal, and Cruz has not rebutted this showing.

3. The ERISA and Breach of Contract Claims

The final two claims - the ERISA claim and the breach of

contract claim - fail for entirely different reasons. The ERISA

claim alleges that Cruz was denied the severance package due to him

under the severance plan. This claim is barred because, as Cruz

concedes, he neglected to exhaust his administrative remedies prior

to filing suit, as required under ERISA. See Madera v. Marsh USA,

Inc., 426 F.3d 56, 61-62 (1st Cir. 2005). Cruz attempts to

circumvent this bar by arguing that the severance plan was not a

bona fide ERISA plan and, therefore, that the exhaustion

requirement is inapposite. However, this argument is woefully

undeveloped. It is not supported by reference to either legal

authority or evidence in the record. As a result, we deem it

waived. See McDonough v. Donahoe, 673 F.3d 41, 49 n.14 (1st Cir.

2012).

The breach of contract claim alleges that the July 29,

2003 letter informing Cruz that he would receive a cash bonus upon

discharge constituted a contract that Bristol-Myers breached by

paying him less than the agreed amount. Even if the letter was a

contract, there is no evidence that Bristol-Myers failed to

perform. The letter described a three-tiered bonus structure, with

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the bonus amount determined by the timing of Cruz's departure. The

letter clearly stated that, if Cruz was dismissed when operations

in Buildings 2 and 29 stopped, he would receive six months' salary.

That is precisely what happened.

III.

In sum, there was no error in the management of this case

or the grant of appellees' motion for summary judgment. The

judgment of the district court is affirmed.

So ordered.

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