Opinion
03-CV-5015(JMR/FLN).
August 25, 2004
ORDER
Defendant moves to dismiss this case pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, claiming plaintiff's suit is barred by the relevant statutes of limitations and that plaintiff has failed to state a claim upon which relief may be granted. The Court finds both grounds for dismissal well founded. This action is accordingly dismissed.
I. Background
On April 2, 1999, plaintiff's employment at Hy-Vee, a grocery store chain, ended after nearly five years. Plaintiff next worked at Wal-Mart in Mankato, Minnesota, eventually becoming a manager. He stayed there until early 2000, when he learned of an opening as a Customer Sales Representative for defendant. Plaintiff applied for this position and was interviewed twice.
The interviews led to negotiations over salary and benefits, including plaintiff's request to work out of Mankato instead of Sioux Falls, South Dakota. Defendant agreed to allow plaintiff to work out of Mankato, and also agreed to allow plaintiff to spend a day doing the job to see if he liked it.
Plaintiff liked the job and accepted Kraft's offer of at-will employment contingent on a background check and drug test. Plaintiff quit his job at Wal-Mart in anticipation of his new job. Thereafter, he received a letter from Kraft confirming his employment as a Customer Sales Representative.
Among his job duties, plaintiff was to service the Hy-Vee chain of grocery stores from which he had been fired. Shortly before plaintiff was to begin his employment at Kraft, defendant discovered that Hy-Vee would not allow plaintiff to set foot in any of their stores. As a result, defendant withdrew its offer of employment on September 11, 2000.
Plaintiff filed this suit nearly three years later, on August 18, 2003. He amended his complaint on February 5, 2004, claiming damages under both contract and promissory estoppel theories. Defendant now brings this motion to dismiss.
II. Discussion
a. Statute of Limitations
Defendant argues that Minn. Stat. § 541.07(5), Minnesota's two-year statute of limitations, applies to both of plaintiff's claims. In response, plaintiff asks the Court to apply Minnesota's six-year statute of limitations set forth at Minn. Stat. § 541.05. For the reasons set forth herein, the Court finds the two-year period applies to both claims. Plaintiffs claims are thereby time-barred.
1. Breach of Contract Claim
Minnesota has adopted a general six-year limitations period for breach of contract. See Minn. Stat. § 541.05, subd. 1(1) (2002). But "Minnesota courts consistently hold that `all damages arising out of the employment relationship are subject to [§ 541.07(5)]'" and its two-year limitations period. Kulinski v. Medtronic Bio-Medicus, Inc., 112 F.3d 368, 371 (8th Cir. 1997) (alteration in original) (quoting Stowman v. Carlson Cos., 430 N.W.2d 490, 493 (Minn.Ct.App. 1988) and citing case after case). Because this matter arises from an employment relationship gone bad, the two-year period clearly applies. All events underlying this claim occurred more than two years before this suit was commenced, so the claim must be dismissed.
Plaintiff attempts to distinguish this case from those applying the two-year employment limitations period by denying that he seeks lost wages or benefits. Instead, he casts his claim as one for the "opportunity to reap the benefit of the `bargained-for' employment agreement he negotiated with defendant." (Opp'n at 5-6.) This knowing sophistry amounts to a distinction without a difference.
As plaintiff well knows, and as the Court recognizes, the bargained-for "benefits" of employment are money. Benefits in the form of money from an employer to an employee are called "wages." And the two-year period applies whether plaintiff alleges the loss of wages already earned or the loss of an opportunity to earn them. Portlance v. Golden Valley State Bank, 405 N.W.2d 240, 243 (Minn. 1987) ("Nice distinctions between wages and lost income do not change the nature of the claim."); Kulinski, 112 F.3d at 371.
Plaintiff next argues that "no principled distinction" can be drawn between the facts of this case and those in McDaniel v. United Hardware Distr. Co., 469 N.W.2d 84 (Minn. 1991). Plaintiff is wrong.
In McDaniel, the Minnesota Supreme Court applied the six-year limitations period for a "liability created by statute" under Minn. Stat. § 541.05, subd. 1(2). Id. at 87-88. Contrary to plaintiff's assertion, the Court discerns at least two principled distinctions between McDaniel and this case. First, plaintiff offers no statute creating liability here; this is simply a common law breach of contract claim. Second, the plaintiff inMcDaniel sought relief under Minn. Stat. § 176.82, which bars — and grants a remedy for — an employer's retaliation against an employee who makes a worker's compensation claim. Id. There is no basis for such a claim here. McDaniel is utterly irrelevant.See Kulinski, 112 F.3d at 371 n. 1.
Finally, plaintiff argues that if § 541.07(5) applies, the Court should opt for its special three-year period for "willful" failure to pay wages. Minnesota courts define "willful" as "the intentional and deliberate breach of an obligation to pay agreed upon wages." Levin v. C.O.M.B. Co., 441 N.W.2d 801, 805 (Minn. 1989). Because plaintiff was never was allowed to work, he never earned any wages. There being no wages earned, defendant had no obligation to pay any. Its "failure" to do so cannot be willful. The three-year period does not apply.
2. Promissory Estoppel Claim
The two-year statute of limitations also applies to plaintiff's promissory estoppel claim, as this, too, is a claim "arising out of the employment relationship." Kulinski, 112 F.3d at 371;see also Lake v. Honeywell, Inc., 1997 WL 458463 at *6 (D. Minn. May 27, 1997) (Doty, J.) (applying the two-year period to a promissory estoppel claim); Warner v. Armco Inc., 1993 WL 771048 at *3 (D. Minn. Feb 7, 1993) (Alsop, J.) (same); 17Minnesota Practice, Employment Law Practice § 11.4(c) (2d ed. 2003) ("The statute of limitations for a claim based upon promissory estoppel is two years."). As plaintiff's claim is being made outside the two-year period, it must be dismissed.
Plaintiff also argues that the three-year period for willful failure to pay wages should apply to the promissory estoppel claim. The reasoning that precludes its application to the breach of contract claim applies equally well to the promissory estoppel claim, so this argument is unavailing.
b. Merits
Even if this claim were not barred by the statutes of limitations, it would fail on its merits. The Court recognizes that, for purposes of a motion to dismiss, it must accept the complaint's factual allegations as true. See McSherry v. Trans World Airlines, Inc., 81 F.3d 739, 740 (8th Cir. 1996). A motion to dismiss may be granted "only if no set of facts would entitle the plaintiff to relief." Id. Even conceding this elevated standard, dismissal is appropriate here.
1. Contract Claim
The withdrawal of an offer for at-will employment cannot form the basis for a breach of contract claim under Minnesota law.See, e.g., Friedman v. BRW, Inc., 40 F.3d 293, 296 (8th Cir. 1994) (applying Minnesota law); Gunderson v. Alliance of Computer Profs., Inc., 628 N.W.2d 173, 183-84 (Minn.Ct.App. 2001). Plaintiff acknowledges that defendant offered him at-will employment. (E.g. Opp'n at 10.) But plaintiff cites Grouse v. Group Health Plan, Inc., 306 N.W.2d 114 (Minn. 1981), for the proposition that defendant breached its contract with plaintiff by reneging on its offer, "even though it had the right to terminate plaintiff once he started working." (Opp'n at 10.)
Once again, plaintiff is incorrect. Grouse concerns an equitable claim for promissory estoppel; it explicitly disavows the existence of any contract. Grouse, 306 N.W.2d at 116. The present case is precisely to the contrary: plaintiff claims a breach of contract. Therefore, the general rule applies, and plaintiff fails to state a claim for breach of contract by referring to Grouse.
2. Promissory Estoppel Claim
Plaintiff has failed to state a claim for promissory estoppel. To maintain such a claim, plaintiff must show that: (1) defendant made a clear and definite promise; (2) defendant expected, or reasonably should have expected, the promise to induce detrimental reliance by plaintiff; (3) the promise did in fact induce such reliance; and (4) the promise must be enforced to avoid injustice. See Ruud v. Great Plains Supply, Inc., 526 N.W.2d 369, 372 (Minn. 1995); Cohen v. Cowles Media Co., 479 N.W.2d 387, 391 (Minn. 1992). Plaintiff cannot show even a clear and definite promise, so the claim fails.
"In the employment context, a cause of action for promissory estoppel requires proof of a clear and definite promise of long-term employment terminable only for cause." Friedman, 40 F.3d at 297. In other words, an offer of at-will employment cannot constitute the requisite "clear and definite" promise. Plaintiff does not contend there was such a promise here, but he again cites Grouse. In Grouse, the Minnesota Supreme Court permitted a promissory estoppel claim despite its being based on the withdrawal of an offer for at-will employment. Grouse, 306 N.W.2d at 115-16. This fact does not, however, resolve the matter.
This is because the Eighth Circuit Court of Appeals has specifically held that Grouse does not affect the analysis of whether a promise is clear and definite: "Grouse does not analyze the `clear and definite promise' component of a promissory estoppel claim. It focuses instead on the detrimental reliance element, which in this case we need not and do not reach." Fox v. T-H Continental Ltd., 78 F.3d 409, 415 (8th Cir. 1996). As in Fox, this Court need not reach the detrimental reliance element here, because there was no "clear and definite promise of long-term employment terminable only for cause." Friedman, 40 F.3d at 297. Therefore, plaintiff fails to state a claim for promissory estoppel.
III. Conclusion
For the foregoing reasons, the Court finds that both of plaintiff's claims are time-barred and without merit. Accordingly, IT IS ORDERED that:
1. Defendant's motion to dismiss [Docket No. 15] is granted.
2. Plaintiff's claims are dismissed with prejudice.
LET JUDGMENT BE ENTERED ACCORDINGLY.